Hacking

Wikileaks- Julian Assange released classified information and damaging emails

LinkedIn, DropboxFormspring (Anthony Weiner’s sexting),voter registration-themed spear-phishing campaign, the DNC Hack 2016

China Has Abandoned a Cybersecurity Truce With the U.S., Report Says Bloomberg By 

2016 Presidential Campaign Hacking Fast Facts CNN

It’s become clear that Putin intends to sway elections in the Western world. The US, France and UK have been hacked and the US election was influenced by the combined efforts of hackers, American voices of the Alt-Right and the trolls from the US and abroad. Actual interference into voter rolls and machine vote tallies is being investigated…but not by the agency designed to investigate. Trump’s shutting that down…and instead suggesting a Cyber Security Taskforce with Putin himself at the G20 summit.  Many speculate that Putin’s trying to win the war without firing a bullet, so to speak… taking over one free country at a time and encouraging authoritarian, far-right regimes which restrict women’s rights and freedoms of all kinds.


Here’s exactly how Russia can hack the 2018 elections Vice News July 10, 2017


Spearfishing  —     Russia’s attempt to hack US election officials, explained Vox

Foreign governments hacking US elections is a real threat. We need to be ready. “According to the NSA, the Russian government began its hacking efforts by attempting to infiltrate an American election technology vendor that the Intercept says is a Florida-based company called VR Systems. The attackers used a “spear phishing” technique, sending personalized emails to several employees of the company to try to trick the employees into entering their passwords into a fake Google login form. Next, the attackers posed as employees of the voting technology company to attack election officials in jurisdictions that used the company’s products. Using real documentation stolen from VR Systems, the hackers created malicious Microsoft Word documents that compromise a victim’s computer when they are opened. The documentation was for EVid, software that manages the voter checkin process at a polling place. We don’t know how many of those 122 election officials clicked on the malicious link and had their computers compromised. We don’t know if Russian spies did anything malicious once they gained access. The attackers sent out malicious emails to 122 election officials around the country” —Vox News

DNC HACK Spring 2016    

February 16, 2018: Mueller Issues indictment against 13 Russian Nationals with working for the Russian Internet Research Agency to foment discord in the US. CNN  These people impersonated Americans and held rallies for and against Trump issues, resulting in the count for Identity Theft.

2016 Presidential Campaign Hacking Fast Facts CNN

Timeline:
June 14, 2016 – The Washington Post reports hackers working for the Russian government accessed the Democratic National Committee’s computer system, stealing oppositional research on Donald Trump and viewing staffers’ emails and chat exchanges. The Kremlin, however, denies that the government was linked to the hack, and a US official tells CNN that investigators have not yet concluded that the cyberattack was directed by the Russian government.

Track what the Russian Bots are doing in Real Time here! 

 


Steele Dossier

Quoting the Steele Dossier about planting malware in cheap Russian IT games: “In terms of the FSB’s recruitment of capable cyber operatives to carry out its, ideally deniable, offensive cyber operations, a Russian IT specialist with direct knowledge reported in June 2016 that this was often done using coercion and blackmail. In terms of ‘foreign’ agents, the FSB was approaching US citizens of Russian (Jewish) origin on business trips to Russia. In one case a US citizen of Russian ethnicity had been visiting Moscow to attract investors in his new information technology program.

The FSB clearly knew this and had offered to provide seed capital to this person in return for them being able to access and modify his IP, with a view to targeting priority foreign targets by planting a Trojan virus in the software. The US visitor was told this was common practice. The FSB also had implied significant operational success as a result of installing cheap Russian IT games containing their own malware unwittingly by targets on their PCs and other platforms.

In a more advanced and successful FSB operation, an IT operator inside a leading Russian SOE, who previously had been employed on conventional (defensive) IT work there, had been under instruction for the last year to conduct an offensive cyber operation against a foreign director of the company. Although the latter was apparently an infrequent visitor to Russia, the FSB now successfully had penetrated his personal IT and through this had managed to access various important institutions in the West through the back door.

6. The senior Russian government figure cited above also reported that non-state sponsored cyber crime was becoming an increasing problem inside Russia for the government and authorities there. The Central Bank of Russia claimed that in 2015 alone there had been more than 20 attempts at serious cyber embezzlement of money from corresponding accounts held there, comprising several billions Roubles. More generally, s/he understood there were circa 15 major organised crime groups in the country involved in cyber crime, all of which continued to operate largely outside state and FSB control. These included the so-called ‘Anunak’, ‘Buktrap‘ and ‘Metelorganisations.

– Further evidence of extensive conspiracy between campaign team and Kremlin, sanctioned at highest levels and involving Russian diplomatic staff based in the US

– TRUMP associate admits Kremlin behind recent appearance of DNC e-mails on WikiLeaks, as means of maintaining plausible deniability

– Agreed exchange of information established in both directions.

Team using moles within DNC and hackers in the US as well as outside in Russia. PUTIN motivated by fear and hatred of Hillary CLINTON. Russians receiving intel from team on Russian oligarchs and their families in US

Mechanism for transmitting this intelligence involves ‘pension’ disbursements to Russian emigres living in US as cover, using consular officials in New York, DC and Miami

– Suggestion from source close to TRUMP and MANAFORT that Republican campaign team happy to have Russia as media bogeyman to mask more extensive corrupt business ties to China and other emerging countries


Top-Secret NSA Report Details Russian Hacking Effort Days Before 2016 Election   June 5, 2017 The Intercept: “Russian General Staff Main Intelligence Directorate actors … executed cyber espionage operations against a named U.S. company in August 2016, evidently to obtain information on elections-related software and hardware solutions. … The actors likely used data obtained from that operation to … launch a voter registration-themed spear-phishing campaign targeting U.S. local government organizations.”

Federal contractor Reality Leigh Winner arrested for sending classified NSA intelligence to news outlet “A 25-year-old federal contractor is facing charges she leaked a classified National Security Agency document to a news outlet in May.The charges against Reality Leigh Winner came about an hour after the publication of a story based on an NSA document detailing Russian attempts to hack American voting systems in 2016.” Washington Examiner


Trump’s Server, Revisited “Sorting through the new evidence, and competing theories, about the Trump server that appeared to be communicating with a Russian bank. By   Slate  November 2, 2016  “In a detailed post critiquing my piece, cybersecurity expert Rob Graham wrote, “The evidence available on the Internet is that Trump neither (directly) controls the domain trump-email.com, nor has access to the server.” This echoes the point raised by Vox, the Intercept, and others that the server was not operated by the Trump Organization directly. Rather, it was run and managed by Cendyn, a vendor that organizes email marketing campaigns for hotels and resorts…I entered the internet protocal address for mail1.trump-email.com to check if it ever showed up in Spamhaus and DNSBL.info. There were no traces of the IP address ever delivering spam…There’s a much smaller spike during the Democratic convention and no apparent increase before or during the Republican convention,” he noted. “In short, this chart seems to be totally unrelated to the political calendar.” He wonders why the largest spike occurs in August, after the party conventions. This happened to be a moment of potential interest in Russia, since those weeks were the denouement of the Paul Manafort era in the Trump campaign, with the exposure of logs showing he received $12.7 million in off-the-book payments from the Putin-backed Party of Regions. But Lee’s fundamental response is understandable: The chart shows possible correlations, not proven causation. There were reports that the Trump campaign had ordered the Republican Party to rewrite its platform position on Ukraine, maneuvering the GOP toward a policy preferred by Russia, though the Trump campaign denied having a hand in the change. Then Trump announced in an interview with the New York Times his unwillingness to spring to the defense of NATO allies in the face of a Russian invasion. Trump even invited Russian hackers to go hunting for Clinton’s emails, then passed the comment off as a joke. (I wrote about Trump’s relationship with Russia in early July.) After Tea Leaves posted his analysis on Reddit, a security blogger who goes by Krypt3ia expressed initial doubts—but his analysis was tarnished by several incorrect assumptions, and as he examined the matter, his skepticism of Tea Leaves softened somewhat. I asked nine computer scientists—some who agreed to speak on the record, some who asked for anonymity—if the DNS logs that Tea Leaves and his collaborators discovered could be forged or manipulated. They considered it nearly impossible.

* * *

Tea Leaves and his colleagues plotted the data from the logs on a timeline. What it illustrated was suggestive: The conversation between the Trump and Alfa servers appeared to follow the contours of political happenings in the United States. “At election-related moments, the traffic peaked,” according to Camp. There were considerably more DNS lookups, for instance, during the two conventions.

In September, the scientists tried to get the public to pay attention to their data. One of them posted a link to the logs in a Reddit thread. Around the same time, the New York Times’ Eric Lichtblau and Steven Lee Myers began chasing the story.* (They are still pursuing it.) Lichtblau met with a Washington representative of Alfa Bank on Sept. 21, and the bank denied having any connection to Trump. (Lichtblau told me that Times policy prevents him from commenting on his reporting.)  Slate

The spike in August was at the same time the Mercer camp and their SuperPac money publicly joined Trump, with Kellyanne Conway replacing Paul Manafort as Campaign Director and Steve Bannon getting more heavily involved in the Campaign.

4/3/17 Keith Olberman on Trump’s panic over the Russian election hack, which may be about Cambridge Analytica getting the official voter information rolls from about 20 States. Cambridge Analytica has been run by Steve Bannon and owned by Trump’s savior donors, Robert and Rebekah Mercer. Mikhael Kalugin identified as the Steele Dossier Russian spy under surveillance at the US Embassy, and the key player in the election scheme, suddenly pulled back to Moscow.

Trump gave a speech in New York City on June 22, which was written to be delivered on June 9, the same day as the Campaign was anticipating receiving Kompromat, or a Blackmail File, on Clinton’s campaign. The press conference was delayed until the 22nd because of the Pulse nightclub shooting in Orlando. The same day as this speech was delivered, the Trump Tower – Alfa Bank Pings began. Full Transcript and Video on Politico.  “Because it’s not just the political system that’s rigged. It’s the whole economy. It’s rigged by big donors who want to keep down wages. It’s rigged by big businesses who want to leave our country, fire our workers, and sell their products back into the U.S. with absolutely no consequences for them. It’s rigged by bureaucrats who are trapping kids in failing schools. It’s rigged against you, the American people. Hillary Clinton has perfected the politics of personal profit and theft. She ran the State Department like her own personal hedge fund – doing favors for oppressive regimes, and many others, in exchange for cash. Then there are the 33,000 emails she deleted. While we may not know what is in those deleted emails, our enemies probably do. So they probably now have a blackmail file over someone who wants to be President of the United States. This fact alone disqualifies her from the Presidency. We can’t hand over our government to someone whose deepest, darkest secrets may be in the hands of our enemies.”


June 22, 2016: “10 days after Trump’s Reddit gets a big spike in members, less than 2 weeks post-Jr.’s meeting, Trump Tower -Alfa Bank pings begin. Seth Abramson 

Link to Dr. Jean Camp’s Graph


June 12, 2016 “72 hours after Don Jr met with a Russian agent at Trump Tower, the top Trump fan-site had its largest-ever membership spike by FAR.” Seth Abramson


Alleged hacker held in Prague at center of ‘intense’ US-Russia tug of war  The Guardian

Yevgeniy Nikulin faces extradition requests from both countries amid lingering disquiet over Moscow’s alleged interference in the US presidential election

Yevgeniy Nikulin was charged with offences relating to the hacking of computer networks belonging to LinkedIn, Dropbox and Formspring.
 Yevgeniy Nikulin was charged with offences relating to the hacking of computer networks belonging to LinkedIn, Dropbox and Formspring. Photograph: YouTube    

“An alleged computer hacker being held in the Czech Republic is at the centre of an international legal tussle between the United States and Russia amid lingering disquiet over Moscow’s alleged interference in the recent US presidential election.

Yevgeniy Nikulin, 29, faces extradition requests from both countries after being detained by Czech police on an Interpol arrest warrant issued by US authorities.

Nikulin, a Russian citizen, was arrested in a restaurant in Prague on 5 October shortly after arriving in the city during a holiday with his girlfriend.

He faces a maximum 30 years in prison and up to $1m in fines if convicted on charges including computer intrusion, aggravated identity theft, conspiracy, damaging computers and trafficking in illegal access devices.

There is no acknowledged link between Nikulin’s alleged offences and the hacking of Hillary Clinton’s presidential campaign, but his arrest came just three days before the Obama administration formally accused Russia of stealing emails from the Democratic National Committee and disclosing them through WikiLeaks.

Formspring, one of the sites he allegedly hacked, was the platform used for sexting by Anthony Weiner, the former New York mayoral candidate and husband of Huma Abedin, Clinton’s closest aide. The discovery of emails linked to Clinton on Weiner’s laptop damaged her campaign in its final two weeks after the FBI director, James Comey, revealed their existence.

Meanwhile, Russia has responded to the American extradition request against Nikulin by tabling one of its own, demanding that he be returned to face allegations dating back to 2009 that he hacked another person’s bank account and stole 111,000 roubles (£1,465).

“He was never formally accused at that time. I think the reason is that he was recruited [by the Russian security services],” said Ondrej Kundra, political editor with the Czech weekly magazine Respekt, which has reported that the Russian services offer alleged offenders immunity from prosecution in exchange for collaboration.

One theory is Nikulin – even if not personally involved in the election hacking – may know other hackers who were.
 One theory is Nikulin – even if not personally involved in the election hacking – may know other hackers who were. Photograph: Police of the Czech Republic

“There’s intense lobbying in this case. People from the US and Russian side are talking to the Czech authorities because both really want Nikulin in their countries.”

Fuelling speculation is the existence of sealed US court documents, tabled six days after the original indictment against Nikulin on 20 October but whose contents have not been revealed.

“A number of documents were filed under seal, which means you cannot talk about them,” a US justice department spokesman told the Guardian.

Adam Kopecky, Nikulin’s Czech lawyer, said his client denied both the US and Russian charges and suggested he had become a political pawn. “My client and myself think it’s a political affair,” Kopecky said.

“Given the international situation, when one superpower accuses a citizen of the other of hacking their computers and then the other superpower accuses the same citizen of another crime, it’s kind of strange.”

Nikulin has suffered health problems since his arrest, his lawyer said.

Kopecky lodged an official complaint after prison authorities put his client under high-level supervision that included monitoring his communications with the lawyer.

“He is unhappy about being detained for a long time in a foreign country and about the accusations against him. He wants to return to Russia – but as a free man,” Kopecky said.

The case is currently in the hands of Prague’s chief prosecutor, who is expected to issue a decision on the twin extradition requests at the end of this month or early in February, a spokeswoman for the city’s municipal court said.

Russia’s embassy in Prague declined to comment but cited a previous foreign ministry statement in which a spokeswoman compared the affair to other incidents and called it “another proof that the US law enforcement agencies are hunting for Russian citizens across the world”.

A 32-year-old Russian computer programmer named only as Lisov was arrested by Spanish police at Barcelona airport this month on another US arrest warrant. Police in Spain said he was suspected of leading a financial fraud network and having designed and used software to steal account details from banks and individuals.

Another Russian citizen, Roman Valerevich Seleznev, was convicted last year of 38 hacking-related charges by a US court after he was arrested and extradited from Guam in 2014. Russia said Seleznev’s arrest amounted to “kidnapping”.” The Guardian


 

Hospitals Gain Control After Ransom Hack, More Attacks May Come   

Bloomberg    

“Ransom Hackers Who Hit Hospitals Dealt Setback; May Return,” by Bloomberg’s Jordan Robertson: “The cyber-attack that spread rapidly around the globe was stifled when a security researcher disabled a key mechanism used by the worm to spread, but experts said the hackers were likely to return as many computers remain at risk. Hackers can still gain easy access to personal computers that lack a security update issued in March by Microsoft Corp. to fix the vulnerability in its Windows operating system. … More than 75,000 computers in 99 countries were compromised in Friday’s attack, with a heavy concentration of infections in Russia and Ukraine.”


July 7, 2017: Russia Steps Up Spying Efforts After Election  Former DNI James Clapper: I think Russia’s goal here is to “prep the battlefield” for the 2018 election CNN 

Russia has actual spy college, wherein people get trained in a variety of legitimate careers and then placed in strategic companies and organizations for espionage. They acually employ hackers, as the investigations have shown.


THE DNC EMAIL HACK

Hacked from March 2015-June 2016


THE PODESTA EMAILS

Hacked in March 2016 and released October 2016

Trump Tenants

Trump Tower 725 Fifth Avenue

Paul Manafort, Strategic Consultant in Ukraine, Trump’s Campaign manager, Consultant to Turkey

“The Trump Organization said the building was refinanced for $100 million in August 2012, allowing Trump to take a cash distribution of over $73 million. Trump also has the leasehold at the Niketown building at 6 East 57th Street..which abuts Trump tower” The Real Deal

Bayrock, the Trump Tower development company being investigated for money laundering with Felix Sater as Managing Director and  developer of Trump Soho.

“FBI agents subpoenaed Trump in 1980 to ask about his dealing with John Cody, a Teamsters official described by law enforcement as a very close associate of the Gambino crime family…But a female friend of Cody’s, a woman with no job who attributed her lavish lifestyle to the kindness of friends, bought three Trump Tower apartments right beneath the triplex where Donald lived with his wife Ivana. Cody stayed there on occasion and invested $500,000 in the units. Trump, Barrett reported, helped the woman get a $3 million mortgage without filling out a loan application or showing financials.” Politico

Joseph Weichselbaum, an embezzler who ran Trump’s personal helicopter service and ferried his most valued clientele. Weichselbaum, who in 1979 had been caught embezzling and had to repay the stolen money, pleaded guilty to two felonies. Donald Trump vouched for Weichselbaum before his sentencing, writing that the drug trafficker is “a credit to the community” who was “conscientious, forthright, and diligent.” And while Weichselbaum’s confederates got as many as 20 years, Weichselbaum himself got only three, serving 18 months before he was released from the urban prison that the Bureau of Prisons maintains in New York City. In seeking early release, Weichselbaum said Trump had a job waiting for him. Weichselbaum then moved into Trump Tower, his girlfriend having recently bought two adjoining apartments there for $2.4 million. The cash purchase left no public record of whether any money actually changed hands or, if it did, where it came from. I asked Trump at the time for documents relating to the sale; he did not respond.” Politico

Trump World Tower

Kellyanne Conway (Bloomberg)

Michael Cohen, Trump’s personal attorney (Bloomberg)

Behind Trump’s Russia Romance, There’s a Tower Full of Oligarchs Bloomberg  “At Trump World Tower, [Sam] Kislin provided a mortgage to Vasily Salygin, a future official of the Ukrainian Party of Regions linked to Russian President Vladimir Putin, to buy an 83rd-floor apartment. Salygin’s time in office overlapped with Paul Manafort’s tenure as an adviser to the party. The push to sell units in Trump World Tower to Russians expanded in 2002, when Sotheby’s International Realty teamed up with Kirsanova Realty, a Russian company. One reception at Moscow’s swank Hotel Baltschug Kempinski pitched the tower alongside Trump’s West Side condos and his building on Columbus Circle.

Eduard Nektalov, an Uzbekistan-born diamond dealer, purchased a 79th-floor unit directly below [Kellyanne] Conway’s for $1.6 million in July 2003. He was being investigated by federal agents for a money-laundering scheme, which involved smelting gold to make it appear like everyday objects that were then hauled to drug cartels in Colombia. Nektalov sold his unit a month after he bought it for a $500,000 profit. Less than a year later, Nektalov, rumored to have been cooperating with authorities, was gunned down on Manhattan’s Sixth Avenue.”Bloomberg

Sales agent Stotts helped rent out apartments owned by those who invested in World Tower. Her very first job was filling [Michael] Cohen’s apartment after he moved to 502 Park Ave., another Trump building. Three months after the New York Post reported that Cohen and his Ukrainian in-laws had bought units in World Tower, Trump hired him.”Bloomberg

Trump 502 Park Avenue, New York

“Trump does still own 23 apartments at Trump Park Avenue, which he rents for rates as high as $100,000 per month, and 19 units at Trump Parc.”The Real Deal

Michael Cohen

Angela Chen “has ties to important members of the Chinese ruling elite and to an organization considered a front group for Chinese military intelligence. Chen, who also goes by the names Xiao Yan Chen and Chen Yu, purchased the four-bedroom condo in the Trump Park Avenue building in New York City on February 21 (2017 for $15.8 million). As Mother Jones first reported, Chen runs a business consulting firm, Global Alliance Associates, which specializes in linking US businesses seeking deals in China with the country’s top power brokers. “As counselors in consummating the right relationships—quite simply—we provide access,” Chen’s firm boasts on its website. But Chen has another job: She chairs the US arm of a nonprofit called the China Arts Foundation, which was founded in 2006 and has links with Chinese elites and the country’s military intelligence service. The China Arts Foundation was created by Deng Rong, the youngest daughter of Deng Xiaoping, the iconic revolutionary figure and Chinese leader.” Mother Jones

“It all started in 1994, when Trump was facing foreclosure on the Riverside South residential high-rises he’d developed on Manhattan’s far West Side. He sold a majority interest in the buildings to a consortium of Hong Kong investors, who then made a deal to swap the properties with Extell Development and the Carlyle Group in exchange for 1290 Sixth Avenue and 555 California Street” The Real Deal

“New York Residential Property with Trump Name, The majority are co-ops and condos that have long since sold out.: Trump Palace on East 69th Street, Trump Parc at 106 Central Park South, Trump Parc East at 100 Central Park South, Trump Plaza on 61st Street and Trump International Hotel & Tower at 1 Central Park West”The Real Deal

Trump Soho, New York-Now The Dominick Hotel 

The Trump SoHo Hotel Has a New Name Fortune By HALLIE DETRICK December 21, 2017 “As of midnight on Thursday, the business now operates as The Dominick Hotel. The property will be run by an affiliate of CIM Group, which has owned the hotel since 2014. The hotel-cum-condominium building was seemingly doomed from the start, hitting the market just as the Great Recession settled in; dogged by bankruptcy, rumored criminal activity and even russia meddling among investors; and only able to sell one-third of its units by the time CIM Group bought it in a foreclosure auction. The Manhattan District Attorney’s office even began building a case against Ivanka Trump and Donald Trump Jr. for misrepresenting the success of the building to potential buyers. But don’t shed a tear for the Trump family, there are still plenty of buildings in New York that bear the family name.”

Trump Palace 200 E 69th St, New York, NY 10021

Igor Zorin, who owned three apartments in Trump Palace: $1,57 million, $2,32 million and $2,22 million, is another high-level Russian government official holding a series of strategically important positions related to propaganda.A deputy head of the Federal Communications Agency at the time of his Miami real estate operations, Zorin previously served as the director of the Main Center for Special Communications, a federal state unitary enterprise that acted as a courier service in charge of the delivery of secret dispatches, narcotic drugs, weapons and cash. In 2009, Zorin left this position due to a scandal: he was accused of the theft of nineteen million rubles. In 2010, Zorin was awarded the Medal of the Order “For Services to the Fatherland of the II Degree” by the Decree of the President of the Russian Federation “On awarding state awards of the Russian Federation” №650 dated May 27, 2010 “for the work achievement and many years of conscientious work.” The awards were presented by the head of the ministry Igor Shchegolev.” Zarina Zabrisky

Trump Parc

Trump owns 19 units The Real Deal

Trump International Hotel & Tower, Ft. Lauderdale

“In 2011, for instance, buyers at three separate Trump-branded properties, including the Trump International Hotel and Tower Fort Lauderdale, sued the mogul for allegedly misleading them into believing he was the developer and later pulling his name from the projects once they went belly-up. The Trump Organizations denies those claims. Some of those lawsuits, however, are still ongoing.Trump Soho, NY.”The Real Deal

“At projects such as the Trump Soho hotel/condominium at 246 Spring Street (developed by a partnership between the Bayrock Group and New York City developer Tamir Sapir) Trump is paid for the use of his name, but does not invest any of his own capital. Trump sometimes manages these projects, as he did in the case of Trump Soho, and always takes a licensing fee of $5 to $10 million, according to news reports. In some cases, he also takes a portion of potential future sales at the building.” The Real Deal

Sunny Isles Beach, FL

“Simultaneous with when the [Trump World] tower was going up, developer Gil Dezer and his father, Michael, were building a Trump-backed condo project in Sunny Isles Beach, Fla. “Russians love the Trump brand,” he says, adding that Russians and Russian Americans bought some 200 of 2,000 units in Trump buildings he built. They flooded into Trump projects from 2001 to 2007, helping Trump weather the real estate collapse, he says.” Bloomberg

San Francisco 1290 Sixth Avenue and 555 California

“Trump acquired the last two significant pieces of his commercial real estate holdings, 1290 Sixth Avenue and San Francisco’s 555 California Street, in an unusual way: through a property swap.”The Real Deal

40 Wall Street, NY

A gorgeous green, copper-topped vintage skyscraper in the heart of Wall Street.

Inside Trump’s Most Valuable Tower: Felons, Dictators and Girl Scouts Bloomberg   June 22, 2016

“Trump has a $160 million mortgage attached to the property.” The Real Deal

“They want that Wall Street address,” Donald Trump Jr., who’s in charge of leasing for the Trump Organization, which manages the building, told Commercial Property Executive in 2010. “We’re basically catty-corner from the stock market.”A cheap way to get a 40 Wall St. address is to grab space on the 28th floor, which is broken up into small offices. The firms listed in the lobby directory for that floor include Your Trading Room, a foreign-exchange operation ordered shut by an Australian court in 2012; Asian AIM Incubator Co., which Malaysian regulators put on a list of possible scams; Stilas International Law, whose founder was banned from practicing law in Virginia; and Ero Capital Corp., run by a man convicted of credit-card fraud.Even one of the four Cushman & Wakefield brokers who handle leasing for the skyscraper is a felon. Jeffrey Lichtenberg admitted accepting a bribe in 1999 after an investigation of bid-rigging in the construction business. He declined to comment.The tower also houses a Girl Scouts office and an elementary school with its own entrance.

Eleven new tenants were cited in that interview. Since then, the heads of four of them have been charged with fraud.

No U.S. address has been home to more of the unregistered brokerages that investors complain about, according to the Securities and Exchange Commission’s current public alert list….Trump took it over in 1995 in what may be the best deal of his career. No single property in his portfolio is more valuable than 40 Wall St…prosecutors have filed criminal charges against at least 29 people connected to 12 alleged scams tied to the building. Nine other firms have faced serious regulatory claims. Authorities prevailed in most but not all of the cases. Many were brought against principals, executives and other employees, not the firms themselves. Some are still pending. Here are the allegations, as well as descriptions of other firms in the tower that trade stocks and arrange loans….The tower was built to be the tallest in the world. It lost out, was foreclosed on and for a while was in the secret control of Filipino despots (hiding money for Marcos)….By 1993, the building was a “vertical ghost town” whose windows were dark while the rest of the Financial District glowed, the Associated Press reported. Kinson Properties, an arm of a Hong Kong-based footwear and real estate company, acquired it that year. Trump pounced when Kinson had trouble turning the building around, he wrote. He said he paid $1 million for the right to lease the building through 2059. A deal with lenders saved him from ruin. A few weeks before Trump signed the lease for 40 Wall St., friends threw him a lunch to celebrate his rebound, praising his comeback and even joking about a possible career in politics.Today, in addition to housing legitimate lawyers, architects and nonprofits, it offers a cheap way to grab a Wall Street address. The building’s average annual rent per square foot is $36, mortgage filings show, about $20 cheaper than the area’s average asking price and less than half of Midtown’s rates. At one point in 2010, according to regulators, brokers on the 34th floor were allegedly helping the financier on the 38th with a penny-stock scam; a brokerage on the 17th floor was involved in an unrelated fraud; and a bond-trading firm on the 42nd floor was bribing a Venezuelan official to win business. Trump Mortgage, on the 25th floor, was launched at the height of the housing bubble and closed in 2007. Trump wrote in his 2008 book “Trump Never Give Up” that tenants at 40 Wall St. are “many of the top-notch businesses in the world.”

Viceroy Capital Funding, Convicted: Viceroy, which arranges loans to small businesses, was accused in a lawsuit brought by a borrower of charging a 299 percent annualized interest rate. The case was settled out of court. Jonathan Braun, who runs the business according to a person with knowledge of the matter, is awaiting sentencing for running a marijuana-smuggling ring from his parents’ Staten Island house.

DirectView Holdings, Convicted: CEO Roger Ralston was sentenced to five months in a halfway house in 2001 for bribing government employees to buy video-conferencing equipment.

Wolf Hedge, Convicted: Mark Malik, 34, pretended to have died from a heart attack when investors tried to withdraw money from his fake hedge fund, according to the SEC. He’s currently serving 5-15 years for swindling investors out of more than $800,000.

EJS Capital Management, Convicted: Brokers cold-called investors, pitching a currency-trading strategy, then spent almost all the money they sent in, according to a December civil court ruling. One of the operators, Alex Ekdeshman, 43, is serving a seven-year sentence after pleading guilty to another foreign-exchange fraud last year. (2015)

Barclay Metals, Convicted: The CFTC barred Sean Stropp from the commodities industry for five years in 2013 for this alleged precious-metals scam, which used a 40 Wall St. address. New York prosecutors also charged him that year with fraud. He was convicted and served almost two years in prison.

Rosabianca & Associates, Convicted: Real estate lawyer Luigi Rosabianca catered to foreign clients who sometimes paid with suitcases full of cash, he told New York magazine in 2014. “Real estate is a wonderful way to cleanse money,” he said. A year later, he was disbarred and charged with stealing $4.4 million from six clients, whose victims allegedly include a woman suffering from schizophrenia. Rosabianca pleaded guilty to grand larceny and will be sentenced this month to four to 12 years.

Spyker Consulting, Convicted:  Spyker principal Luis Ferreira was on supervised release from prison for a telemarketing scam when the firm leased space in the building around 2009. He was arrested in 2010 for violating his parole with the new scheme. He fled rather than return to jail, and is now on the FBI’s white-collar most-wanted list.

Essex & York, Convicted: The heads of this brokerage firm and six employees were accused in 2006 of running a $13 million pump-and-dump scheme. They allegedly cold-called investors and convinced them to invest in a temp agency, then sold their own shares when the stock rose. Seven pleaded guilty and one died before his case was resolved.

First Merger Capital, Convicted: The heads of this defunct brokerage took a $350,000 payment from a Chinese kitchen-appliance company and pushed its stock to investors, according to regulators. One of the co-heads filed an appeal this year after the SEC sided with Finra against the two men. Their partner Ronen Zakai, 45, spent most of last year in prison after being convicted of stealing the $705,000 he raised to invest in the Facebook IPO.

Evergreen International Spot Trading, Convicted: The firm’s currency-trading scam came to light when customers asked about their money after the Sept. 11 attacks. Prosecutors called one of the four executives convicted of cheating investors “the Michael Jordan of investment fraud” and said another faked his suicide after wiring money to Azerbaijan.

Direct Access Partners, Convicted: This bond-trading firm went bust after a bribery scheme surfaced in 2013. Prosecutors said executives conspired to make payments to a Venezuelan state bank official. Former CEO Benito Chinea is serving a four-year prison sentence, and four other employees also pleaded guilty to criminal charges.

The David Firm, Convicted: Earl David, a lawyer, was sentenced to prison in 2013 after using phony employment claims in what officials called one of the largest immigration frauds in U.S. history.

Stilas International Law, Sanctioned:  Matthew Bennett Greene was banned from practicing law in Virginia in 2009 after two clients claimed they paid for services he didn’t deliver. In 2013, Connecticut’s banking commissioner fined him for violating securities law related to investments in a B movie that promised investors 1,000 percent returns.

Aegis Capital, Sanctioned: The brokerage was fined $950,000 by Finra last year for helping a financier unload billions of unregistered shares of penny stocks. The firm didn’t admit or deny wrongdoing.

John Carris Investments, Sanctioned:  George Carris, who owned the firm, was expelled last year by the Financial Industry Regulatory Authority for selling shares of his brokerage without disclosing it was short of capital and for manipulating a penny stock. Regulators also alleged he spent company money on tattoos, liquor and motorcycles.

Banc de Binary, Sanctioned: This Cyprus-based firm operated an unlicensed binary-options brokerage in the U.S., soliciting investors with YouTube videos and spam e-mails to bet on whether stocks would rise or fall, according to the SEC, which sued in 2013. The firm and affiliates agreed to pay $11 million this year to settle regulators’ claims without admitting or denying the allegations.

Your Trading Room, Sanctioned: This currency-trading firm advertised that it taught secrets that “will change your life.” An Australian court ordered it liquidated in 2012 after a report that it was run by someone who had been banned by the country’s securities regulator.

GunnAllen Financial, Sanctioned: This Florida-based brokerage closed in 2010 after Finra said it didn’t have sufficient capital. The firm was overwhelmed by legal costs from some brokers’ involvement in two Ponzi schemes. “You cannot let the inmates run the asylum, and that’s where the firm failed,” its former general counsel was quoted as saying at the time.

Trump University, Settlement Approved:  CNN on March 31, 2017  New York’s attorney general is suing the unlicensed school for fraud. Students who signed up for real estate seminars were told they would be taught by experts hand-picked by Trump but were instructed instead by neophytes and bankrupt investors

New York Global Group, Facing Accusations: Benjamin Wey helped Chinese companies raise tens of millions of dollars in the U.S. before he was arrested last year and accused of securities fraud. U.S. Attorney Preet Bharara called him a “master of manipulation.” Wey has pleaded not guilty. He said in a court filing last month that his business was legitimate and the case against him is based on an illegal FBI search of 40 Wall St.

Felix Investments, Facing Accusations: Frank Mazzola, whose office was marked only by an 8.5-by-11-inch piece of paper, tried to raise money from investors by saying a fund he set up to buy Facebook shares had been approved by the social-networking company, according to a 2012 SEC lawsuit. After settling that case for $500,000 in 2014, Mazzola was sued by the agency in March for his ties to another alleged fraud. He said in court filings that he’s fighting the lawsuit.

Saddle River Advisors, Facing Accusations: John Bivona was sued by the SEC in March for fraud related to pre-IPO tech companies,a ponzi-like scheme. Bivona allegedly funneled investor money to relatives including his nephew, Frank Mazzola, also on the 17th floor. The SEC says the family used the money to pay the mortgage on a Jersey Shore vacation home. Both men denied wrongdoing in court filings. Bivona’s lawyer, Jahan Pierre Raissi, didn’t respond to messages seeking comment.

Patriarch Partners, Facing Accusations: Private equity manager Lynn Tilton, who was once in talks to star in a reality show called “Diva of Distressed,” had an office in the building for years. The SEC accused her last year of defrauding investors in three collateralized-loan-obligation funds, a case that’s still pending. A countersuit she filed against the agency was thrown out on appeal.

Forex Trading, Exonerated: The Commodity Futures Trading Commission accused the head of this business, Ross Erskine, of fraud in 2004 and said he had also set up Goros LLC as “a classic boiler room.” Erskine successfully argued that his currency-trading program wasn’t subject to the agency’s regulation. Judge Boyko found evidence of fraud but none that those in question were futures transactions.

A.B. Watley Group, Exonerated:  Day traders at this firm allegedly bribed Merrill Lynch and Citigroup brokers to allow them to listen in on the squawk box audio feed where brokers discussed clients’ trades. A jury found six participants guilty in 2009, but the convictions were reversed in 2012 because prosecutors withheld evidence.” Bloomberg

Trump International Hotel & Tower, Dubai

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