Recently unsealed federal court records reveal that former Trump Organization senior advisor Felix Sater landed an illegal, sweetheart deal on sentencing from the Eastern District of New York’s federal judges and prosecutors in 2009.
It is still unclear why his cooperation agreement was extended for many years by the feds, even after they knew that Sater was violating the terms of his cooperation by committing further acts of fraud.
What is entirely clear, is that Felix Sater’s sentencing violated multiple federal laws that require notice to victims and cash restitution for their losses.
Federal prosecutors and the sentencing judge, I. Leo Glasser, illegally allowed him to keep the proceeds of a multiple mafia-linked, major financial felony racketeering scheme, with full knowledge of the situation.
That’s because his federal probation officer was instructed not to ask Sater the whereabouts of his ill-gotten gains, or about skimming millions from Bayrock’s victims, who thought they were buying the Trump brand and had no idea, it was being peddled by a financial felon.
However, we do know for certain that Felix Sater knew he owed restitution to his victims because he agreed to pay them back in writing as part of his plea deal, as this newly unsealed, redacted passage of court record about his pre-sentencing report for major white collar crime highlights.
“We know that Sater is another Whitey Bulger of financial crimes already,” Yale global justice fellow and New York attorney James S. Henry told me, “he really has been profiting from all of these crimes, right up to the minute.”
One of Felix Sater’s co-conspirators in a massive Wall Street pump-and-dump scheme —a man named Gennady Klotsman — who blew the whistle on Sater’s felony conviction to the New York Times in 2007, a co-equal in Sater’s stock pump-and-dump scheme run from the Trump Offices at 40 Wall Street (and amazingly also a witness to his first felony, a brutal, unprovoked beating).
Gennady Klotsman also testified as a cooperating witness against 19 other mobsters but got the worst end of the deal. For his role in Sater’s crimes, Gennady Klotsman was sentenced to pay $40 million in victim restitution in addition to 6 years in jail many years prior, just as Sater should’ve been sentenced in 2009 under the ‘joint and several liability’ provisions of the federal racketeering law, by which each member of a criminal racket is considered equally liable for damages.
Just as a judge has no power to go against the black letter of the law, such as mandatory minimum sentencing laws or laws compelling mandatory restitution by criminals to their victims.
In Felix Sater’s case, Judge Glasser was obligated to comply with the Mandatory Victims Restitution Act (MVRA) and with the 2004 Crime Victims Rights Act, which mandates that courts give crime victims proper notice and the right to be heard at sentencing. Glasser should’ve sentenced Sater to a $40 million dollar restitution order.
Instead, the judge kept Sater’s secret conviction on a secret court docket in a virtually secret sentencing that happened 11 years after the fact, and it was all kept under seal by the full force of the federal government, acting outside the laws Congress wrote.
Attorney General Loretta Lynch was the Eastern District of New York’s US Attorney during the fight to keep Sater’s records sealed, who was forced to personally answer about Sater’s unusual sentencing to Senator Orrin Hatch (R-UT) in sworn testimony (page 142) during her 2013 confirmation hearings. Ultimately, Lynch deflected the questions about Sater’s unusual sentencing, even in writing, claiming national security interests.
Amazingly, Felix Sater’s father Michael Sater aka Michael Sheferovsky also obtained a sweet plea deal with the federal government, which he entered into just a couple of years after his son’s cooperation agreement was signed. Sater’s father is a known Russian mafia associate of Semion Mogilevich but seems to have had a smaller portfolio of crimes than the son. He too didn’t have to pay restitution because the court agreed when the prosecutors argued that his victims were either dead or also criminals while ignoring the MVRA’s requirement to pay restitution to the rightful heirs of the deceased.
Federal Judge I. Leo Glasser’s sentencing of Felix Sater to a small fine and no restitution very plainly violated the Constitutional separation of powers between Congress, with the Judiciary acting in concert with the Executive Branch’s Department of Justice and FBI agencies to evade the law.
If the FBI wanted to pay Felix Sater millions for his cooperation, they should’ve used their budget to compensate his victims, or asked Congress for an appropriation to do so.
Instead, Felix Sater’s victims funded a secret government program built on his activities, which we, the public, know virtually nothing about, except that the secrecy enabled him to go from a $60 million dollar fraud, on to something much, much larger with Donald Trump as a knowing co-conspirator from 2008 onward.
New York federal judges throw the First Amendment to the wind
A group of New York federal judges abandoned ample case law, precedents and the public’s First Amendment right to view court dockets in the Sater case. In their zeal to hide records which can be obtained elsewhere, they accidentally revealed their own cover-up.
The last relevant redaction highlights applied by Judge Chen to Sater’s case show the federal court system’s urgent efforts to stymie the First Amendment rights of attorneys Richard Lerner and Fred Oberlander, who uncovered the web of secrecy surrounding Donald Trump’s business partner.
In effect, Sater was permitted to ‘make crime pay’ by the FBI, Department of Justice and a federal judge who violated the black letter of the law believes “Richard Roe” — that is, Fred Oberlander — the party who first sought to unseal these records. “Justice Brandeis said that sunshine is the best disinfectant of all,” says Oberlander, “and today the sun is shining a little brighter on the activities of Felix Sater and his enablers.”
“It’s a bedrock principle of law that once something is made public,” attorney Richard Lerner told me, summarizing the case law from his 10,000-word article in Law360.com by LexisNexus about court secrecy, “it can’t be sealed later, and kept secret by a court.”
This means that Judge Chen shouldn’t have attempted to redact the material used in this filing, but Felix Sater’s attorney Robert S. Wolf celebrated her censorship activities. Wolf told me by email:
“The 2nd Circuit Court of Appeals upheld Judge Pamela Chen’s earlier decision which was adverse to the media outlets and journalists and continued to keep everything sealed that the government and Mr. Sater requested to remain sealed including his Pre-Sentence Report.”
Federal judges even ordered Oberlander and Lerner not to tell Congress about the secret proceedings with Sater — an unheard of abrogation of their First Amendment rights — which has kept judicial and prosecutorial lawbreaking from the only other branch of government capable of checking the first two.
“Throughout the case against Felix Sater — at the request of his attorneys and federal prosecutors — judges have rubber-stamped their demands inexplicably,” says attorney Richard Lerner, who gave up a lucrative law partnership to pursue this case, and whose efforts led to the initial unsealing of Sater’s record by the Supreme Court. “The Second Circuit and Eastern District federal judges ordered public information to be buried forever, and for me to never discuss his organized crime racket.”
“If I speak out,” says Lerner, “the judges have threatened to jail me.”
Oberlander is still similarly threatened by the heavy hand of the Eastern District of New York’s apparently unlawful demands for secrecy in court, but he continues to fight for full transparency.
“No matter what remains to be unsealed in the future,” says Oberlander who was gagged by federal judges when he attempted to tell Sater’s story to The Daily Beast. He says:
“The American public always wins when truth triumphs over deceit and openness triumphs over secrecy.”
Felix Sater’s spectacularly unusual secret criminal proceeding raises the specter of an obstruction of justice racket operating in the New York federal court system.
Felix Sater’s big media blitz
Interestingly, Sater went on a media blitz recently, giving interviews to MSNBC’s Chris Hayes, on CNN with Chris Cuomo and to ABC News’ George Stephanopoulos where he crucially confirmed to interviewers that his relationship with Donald Trump stretches back to 1999.
The convicted fraudster’s media blitz contained two screaming falsehoods, about Sater’s motivations to cooperate with the FBI, and about his past violent felony conviction; and the value of his supposed contributions to national security is not obvious, but was much hyped by the journalists who had access to Trump’s former business partner.
It was a useful exercise for the twice-convicted felon who spun a half-baked story about the Trump Tower Moscow emails with lawyer Michael Cohen proclaiming that Putin would help Trump get elected, and about his subsequent back channel Ukraine “peace deal.”
Sater carefully avoided discussing the Trump SoHo project in the three television interviews — apologizing directly to his uncompensated victims from the 1990s — while claiming he was presenting the ‘full story’ of his work for national security.
Instead, he used the rest of his ’45 minutes of fame’ on national cable television to lobby public opinion on the issue of his secretive role advising the Trump campaign, which only emerged last year after emails leaked about building a Trump Tower in Moscow.
Contrary to the published reporting, Felix Sater, in fact, was richly rewarded for his help to the federal government; secondly, his confirmed contributions to US national security included no strategic victories.
Even though Sater demonstrably got away with millions of dollars from a Wall Street pump and dump scam, Buzzfeed News reported:
“[Sater] said he was not paid for his work — which two Justice Department officials confirmed — but did it to help his country and for the ‘thrill.’”
Disseminating a big lie about selfless public service was one of Felix Sater’s central public relations goals. His thrill was obviously stealing, and getting to keep the money.
The reality is that Felix Sater very much knew that he was working the system for a sweet deal, as he candidly explained to a Russian magazine, Snob.ru just days after the 2016 election. Here are a few of his translated quotes from that story:
“If you continue to cooperate with law enforcement agencies, the state delays your verdict.”
“Of course, I helped to help myself. Of course, I wanted the verdict to be easy. Who wants to go to jail?“
“But I’ll say: they told me back in 2000 that there was no deadline.”
Federal prosecutors and law enforcement have not made public the reasons for their termination of Felix Sater’s cooperating witness agreement in 2009 as opposed to 2004 when his pre-sentencing report was first written.
News reports in December indicate Sater is trying to sell his story to Hollywood.
“You want gangsters?” Sater told the assembled paparazzi in December 2017, “I’ll give you the biggest gangster since Bugsy [Siegel].” (video below)
A few days later when Felix Sater delivered his written testimony to Congress — it was controversially given to the House Intel Committee without Democrats present. He and his lawyer delivered a copy of that testimony to Buzzfeed News, but, they clearly elected to withhold from those outlets a few important details from the now unsealed court documents.
What did America get for giving Felix Sater a license to make crime pay?
Buzzfeed News confirmed four deliverables to US authorities from Sater. Not one has not led to a known, major strategic success for United States foreign policy. Buzzfeed’s list is in italics, an analysis in bold:
— “He obtained five of the personal satellite telephone numbers for Osama bin Laden,” but Bin Laden got away and still bombed the World Trade Towers
— “He persuaded a source in Russia’s foreign military intelligence to hand over the name and photographs of a North Korean military operative,” but North Korea still got nukes.
— “Sater provided US intelligence with details about possible assassination threats,” but there’s no assessment if he really stopped an assassination plot in Afghanistan. Is it really news that someone in a country we’ve invaded wants to kill a top official from our country?
— “He went undercover in Cyprus and Istanbul to catch Russian and Ukrainian cybercriminals,” but plainly, Sater’s work in Cyprus and Ukraine didn’t lead to an end of money laundering, though it may have enabled some tactical victory.
Perhaps Felix Sater really did produce high-value intelligence to the US government, but nobody knows the true story, except that whatever the convicted financial felon and fraudster did do, induced federal prosecutors and judges to break the law to help him out.
Both of Felix Sater’s most recent Trump deals involved attorney Michael Cohen, his childhood friend from Brooklyn, who has deep ties to Ukraine. He described the now-infamous back-channel peace deal on television as a nuclear development deal which would’ve hurt the Kremlin, which is, of course, totally unverifiable at present.
And Felix Sater didn’t bother to give Buzzfeed a copy of his “peace” proposal.
Nobody knows exactly what happened with the latest failed Trump Tower Moscow — with a shady company controlled by a Cypriot attorney — even after Sater offered the flimsy excuse to CNN’s Cuomo that his email to Cohen about Putin was “just a real estate deal in Moscow.” But he touted the ability to attract Putin’s help during the presidential election campaign on CNN:
“I don’t know Putin, I’ve never met him… If the project was moving forward; believe me, I’d start working the phones. I’d start calling business people. I’d start finding people that knew Putin. I’d start finding people that could get Donald involved in this project.”
This all belies the point that Donald Trump didn’t need Sater’s help to find Putin-linked real estate business people, like Igor Krutoy, who began visiting him at Trump Tower New York as far back as 2011.
Felix Sater told his interviewers that he had no involvement with the Trump campaign, neglecting to mention his regular donations to Donald Trump, Trump’s joint fundraising committee and to the Republican National Committee, or his July 21st, 2016 in-person visit to Trump Tower.
Admittedly, nobody knows the entire extent of embattled lawyer Michael Cohen’s — Sater’s childhood friend — involvement with the Trump campaign, though we know he was a surrogate, fixer and hush money conduit.
What we do know is that none of Felix Sater‘s remarks about his dealings with Trump’s lawyer Michael Cohen regarding a secret Ukrainian peace deal, or the Trump Tower Moscow project were delivered with factual evidence to the major news outlets who covered his story in March.
And the real story of Trump’s advisor’s amazing ability to make crime pay, and to get away with multiple, national level interstate financial crimes, wasn’t told, nor did any news outlet report on a single strategically important outcome from his cooperation with the Feds.
Video interview with Felix Sater in Hollywood, California before he steps into a White Rolls Royce and departs:
Read the first part of this story here.