Lev Parnas’ Curious Loan, a Swiss Lawyer and Krysha

Photo by Pascal Debrunner on Unsplash

Lev Parnas’ Curious Loan, a Swiss Lawyer, and Krysha

What do a Ukrainian oligarch, a Russian vor, and a one-time boss of Putin have in common?

If you answered a clever Swiss attorney who currently resides in Dubai but practices in Switzerland you win a bottle of Trump vodka. Should you have responded Ralph Oswald Isenegger — ding-ding — you score a bottle of Stoli’s! So pour yourself a couple of fingers to assist you in swallowing some additional salient elements of Ralph’s resume and all of its curious ramifications.

Isenegger is the guy who recently wrote to Manhattan Federal District Court Judge Oetken in the SDNY Lev Parnas case regarding the $1M transferred to Lev Parnas’s wife Svetlana’s account, in $200k tranches during the month of September(2019) from a Russian bank — “this was a personal business transaction between myself and Lev & Svetlana Parnas.” “The funds were entirely mine, and I was not acting in this matter at the request of or on behalf of any of my clients or indeed anyone else.”

Well, the Kyiv Post begged to differ. They reported that Lev Parnas, a Ukrainian-American and an associate of U.S. President Donald Trump’s personal attorney Rudy Giuliani, received the $1M from Ukrainian oligarch Dmytro Firtash, who is currently fighting extradition from Austria to the U.S. with regard to a pending Bribery indictment in Chicago.

SDNY prosecutors claim that Parnas concealed the fact that the million-dollar payment was from Firtash, while Lev’s American lawyer Joseph Bondy, claimed the money was a loan. Bondy is the guy who did his best VP Pence potted plant imitation during the Rachel Maddow televised interview of Parnas. He has also represented multiple defendants with Organized Crime connections. Judge Oetken expressed skepticism with regard to the loan characterization but did not lock Parnas up so apparently, Parnas was free to schlep down to Congress with his docs and testimony should his appearance be requested by those looking to impeach the President.

Isenegger tried to recall the “loan” after all the adverse publicity claiming that his client Firtash no longer supports Parnas. “I believe he(Parnas) has burned that bridge, to the extent there was a bridge.” Recall if you would the allegations that Firtash fronted for Semion Mogilevich “the brainy don” while heading up RosUkrenergo(RUE) the intermediary between Russian gas behemoth Gazprom and the Ukraine national gas company Naftogaz. Who would burn that bridge if in fact there was a bridge? Perhaps the befuddled barrister was referencing roof(Krysha/protection) instead of a bridge!

Speaking of krysha, Isenegger has compiled a bunch over the course of his Swiss lawyering career. While Firtash may have laundered his own reputation somewhat from the days of spinning up offshore shell companies with Mogilevich related individuals/entities to conceal corrupt gas deals in Ukraine, he is not the first Russian Organized Crime(ROC) related figure Isenegger has represented, nor the biggest.

That would be Sergei (Mikhas) Mikhailov “leader of the Solntsevaskya criminal syndicate” as identified by the Russian Interior Ministry in a fax to Swiss authorities in 1996. Mikhailov was being prosecuted in Switzerland for organized crime activities back then and was held in prison for two years before the trial started. Prior to the start of the trial the lead witness for the Swiss — Vadim Rozenbaum — was shot and killed in his home in the Netherlands. Subsequently, the Russian authorities were unable for some reason to provide the Swiss with much more evidence to present to the court tying Mikhas to organized crime than the above-referenced fax.

The Swiss jury acquitted Mikhas for a lack of evidence. Mikhailov sued the Swiss for compensation for the two years he was held in jail and won over $500k. Ralph Isenegger was Mikhailov’s very successful legal representative in getting Mikhas off the Swiss hook. But some troubling evidence did come out in the trial.

Financial evidence discovered during the Mikhailov investigation reflected a business partnership between Mikhailov and Boris Birshtein. Surfacing was the fact that Mikhas and Boris were partners in an international metals trading company called Seabeco as well as another company called MAB International registered in Belgium. Both companies had developed a reputation for money laundering. When investigators further pulled on some financial threads they followed a money path to Ukraine and an individual by the name Oleksandr Volkov — a Seabeco representative who became a top advisor and campaign manager to Ukraine President Leonid Kuchma. Volkov’s role in that campaign was analogous to that later played by Paul Manafort for Yanukovich who was a Kuchma acolyte early on.

Charles Clover, writing for the Financial Times in 1999 nailed down a fascinating money trail with his diligent reporting much of which is recounted here and above. It seems that the Swiss discovered a wire transfer to a Volkov account in Belgium from a trading company called Fearnley — owned by an associate of Mikhailov. The Swiss then made a legal assistance request to Belgium in 1997 which resulted in a Belgian judge freezing Volkov’s bank accounts that contained $3M.

A Belgian prosecutor than launched an investigation and found $15M had transited Volkov’s Belgian accounts from 1993–1997 and that Volkov controlled bank accounts in the UK, Germany, Monaco, Luxembourg, Switzerland, and the U.S. More significantly, it was discovered that $5M of the transfers to Volkov starting in September 1994 and ending in January 1996 came from companies owned by Boris Birshtein or by associates of Birshtein.

Upon further breaking down the $5M transfer, it was discovered that Seabeco had transferred $2M while Birshtein associates transferred $3M. According to Volodymyr Malinkovitch — a key adviser to Kuchma — campaign finance for Kuchma’s successful 1994 Presidential bid came from Seabeco after Volkov joined the campaign in February 1994.

Former KGB Chief Vladimir Kryuchkov said Seabeco “was created in order to apply KGB money.” And so it did. The Russian Interdepartmental Commission on Combatting Crime & Corruption(MVK) characterized Seabeco as an “Octopus, entangling the Russian economy.” Additionally, it appears that the octopus(Seabeco) strangling the economy of “Mother Russia” had stretched out a tentacle to Ukraine, and percolating just below the public surface was organized crime — it’s money and it’s Swiss lawyer.

But organized crime in Russia needed direction and some discipline in the wild, wild west of nascent Russian predatory capitalism. The Solntsevo OG alluded to above as being headed by Sergei Mikhailov, was referenced in a February 2012 U.S. cable obtained by WikiLeaks, where an expert is cited saying that both the Russian Interior Ministry and the FSB have “close links” to the crime syndicate but that FSB provides the real cover for Solntsevo. “FSB is the real Krysha for Solntsevo.”

It was the FSB preceded by its better-known acronym KGB, that seeded Seabeco with the necessary financing to facilitate the movement of Russian government gold reserves and other assets to safety often outside of the environs of the old Soviet Union and notably into the safety and secrecy of Swiss Banks as well as offshore jurisdictions. International financial expertise was highly valued and Boris Birshtein with his Canadien, Israeli, Eastern European, and Central Asian connections and operating under the protection(krysha) of Russian Minister of Security Services Viktor Barannikov, was held in high esteem at the time. So were the smarts and direction of a certain ex FSB agent by the name of Vladimir Putin.

Putin worked as a KGB foreign intelligence officer from 1975–1991 before taking a Deputy position under Mayor Anatoly Sobchak in St. Petersburg. When Sobchak failed to get re-elected in 1996 Putin moved to Moscow and Boris Yeltsin appointed him Deputy Chief of the Presidential Property Management Department(PPMD) and Putin held this position until March 1997. During his tenure at PPMD, Wikipedia notes that Putin was responsible for the foreign property of the state and organized the transfer of the former assets of the Soviet Union and Communist Party to the Russian Federation.

Putin’s boss at the PPMD was the formidable and powerful Pavel Borodin.

In July 1998, Yeltsin appointed Putin as Director of the Federal Security Service(FSB), the primary intelligence and security organization of the Russian Federation and the successor to the KGB. On December 31, 1999, the fast-rising Putin became Acting President of the Russian Federation. Putin’s first Presidential decree granted Boris Yeltsin and his family immunity from prosecution in what had become known as the Mabetex affair or Yeltsin-gate. But the role of others involved in the infamous corruption case e.g. Pavel Borodin was subject to legal scrutiny until the case was dropped about a year later on December 13, 2000, for “lack of evidence,” despite thousands of pages of evidence being provided the Prosecutor General by the Swiss.

Among other notable legal cases dropped by the Prosecutor General of Russia during Putin’s early era in office include a certain corruption case involving “illegal metals trading” by the previous Deputy Mayor of St. Petersburg — Vladimir Putin.

The Mabetex scandal involved millions of dollars of bribes and kickbacks being paid pertaining to contracts to refurbish the Kremlin awarded by Yeltsin and the PPMD to the Swiss firm Mabetex. While the Russian authorities under Putin’s direction had quietly dropped their case the Swiss proceeded to prosecute Borodin and others. Borodin was represented by the aforementioned Ralph Isenegger before the Swiss court. Witnesses and documentary evidence promised by the Russian authorities never made it to the Swiss court and Borodin received a slap on the wrist money laundering conviction with a fine of $177k and he was allowed to return to Russia.

Putin then appointed Borodin to a largely ceremonial position pertaining to reunification efforts with Belarus therein repaying Borodin for his earlier hiring and endowing Borodin with Presidential level krysha.

Speaking of which, does Lev Parnas currently retain any krysha? If so, from whom?

SDNY? DOJ? Dmytro Firtash? Organized Crime? FSB?

Or do all roads lead to Putin?

Ask Ralph Oswald Isenegger — he has dealt with all of the above.

Martin Sheil

email: martinsheil@protonmail.com