A Tax Fraud Filed Against Felix Sater Dismissed


A Manhattan court has dismissed Felix Sater’s, a Russian businessperson, and President Donald trump former associate, civil fraud case of $250 million. Sater, the founder of Bayrock real estate, was prosecuted as qui tam. In a qui tam case, the filing of a lawsuit may be done by a whistleblower on behalf of the state and the intervention of the attorney general is not a requirement.

The whistleblower, in this case, was Fred Oberlander, the lawyer who represented Jody Kriss in a case of money-laundering against Sater’s company. An attorney that was present on Wednesday during the case hearing told the business insider that Fred had acknowledged the fact that he had filed the claim based on evidence removed by a judge against Kriss’s original complainant. According to the attorney, the case did not favor Oberlander since had used information that a federal judge had ordered to be removed because the judge found it confidential. Robert Wolf, Sater’s lawyer, later confirmed that indeed the judge dismissed the case.

The attorney general last year refused to be involved in the case. He had sent a letter to the Supreme Court of New York in February 2016 explaining of a “fake and misleading media release” Oberlander had given against him. According to the release, Oberlander claimed that he had given the go-ahead to the case while according to the attorney, the state had failed to intervene. The office of the attorney general accepted to monitor the case to protect both the rights and interest of the country. According to the wolf, Sater’s lawyer, the case was not dismissed based on the procedure but merits grounds. He said that the layers involved in the case had referred to the director of justice for criminal contempt which according to wolf was misconduct. Richard Lerner, another attorney that was involved in the case against Sater, told one of the reporters that he had the plan of tossing the case.

The case against Sater in 2010 by Jody Chris, a former director of finance at Bayrock, claimed that the company engaged in many crimes which included bank fraud, tax evasion, bribery and money laundering among many other crimes. Kris accused the founders of the company, Sater, and Tevfik Arif, of taking millions of money from him through money laundering and fraud among other misconduct. A New York judge in December ordered that the legal case be considered as racketeering case.

According to Kriss, the founders of the company in 2003 agreed to negotiate with the Trump Organization to market some products but did not tell Trump of the Sater’s crimes in the past. Trump in 2007 said that he would not have partnered with Bayrock to develop Trump SoHo if he knew the Sater’s criminal history and that if they found themselves sharing a room with Sater, he would not recognize him. The statements were ironic because Trump’s office was two floors above Bayrock’s. A person who knew about the case told business insider that in the past, Trump and Sater had a meeting every week. Sater claimed that he had met Trump occasionally, contradicting the previous report by trump. He also claimed that Trump appreciated his loyalty and his connection with Russia.