Saturday, September 22, 2007

Robert Friedman Red Mafiya Jewish Mafia or Russian mafia 6/6

no way related to YBM or its subsidiary, Arigon," an obscurely written press release stated.
In truth, both Canadian regulators and Bogatin himself were aware that British intelligence had spent three years investigating Mogilevich's racketeering empire, traveling across the globe to gain knowledge of its structure, accord­ing to British intelligence documents and sources on the Alberta Stock Exchange. The Canadian authorities were told that YBM and Pratecs were not only controlled by Mogilevich, but that the probable intention of obtaining Pratecs a listing on the exchange was to have a vehicle to launder dirty money, manipulate stock shares, and bilk legitimate investors.
By the summer of 1995, British intelligence was ready to strike against Mogilevich and his network of companies in Great Britain, which they suspected as fronts for drug trafficking, stolen goods, and money laundering. In an action code-named Operation Sword, British police raided Arigon's offices in London, as well as the offices of its attor­ney, Adrian Churchward, who was arrested and interro­gated. Documents found in Churchward's office showed that over a three-year period the lawyer had used clients' accounts to launder more than $50 million in criminal pro­ceeds on behalf of Mogilevich. The funds, laundered through the Royal Bank of Scotland with the help of a solic­itor, "originated from a variety of dubious sources in the former Soviet Union," says a British intelligence report, which describes the money as "largely the proceeds of Russian organized crime in Eastern Europe from the Mogilevich and Solntsevskaya organization."
The High Court of Justice in London issued orders freezing the assets of Arigon and several of its shareholders, including Churchward and his wife, Galina, Mogilevich's onetime paramour. She had an eleven-year-old son with
Mogilevich who was being educated at a private school at Kent.
But the criminal cases against Mogilevich, Churchward, and others had to be dropped after Russian prosecutors deliberately refused to turn over evidence, according to British intelligence. Mogilevich didn't escape unscathed, however, for he was banned from entering the U.K. His British businesses were shut down, his solicitor's reputation was ruined, Churchward was disbarred, and the Royal Bank of Scotland was subjected to a high-level internal inquiry by the Special Investigation Unit of the Bank of England.
The British affair was not the only incident that nearly thwarted Bogatin's attempt to gain a foothold in Alberta. In May 31, 1995, Czech police stormed a summit meeting of Eurasian mob chieftains at the U Holubu restaurant in Prague, which Mogilevich had bought in 1991 to use as a prime money laundering center, according to FBI and Israeli intelligence reports. The gangsters were meeting on the occasion of Sergei Mikhailov's birthday to discuss carv­ing up criminal jurisdictions and to iron out turf disputes between Mogilevich and Mikhailov's Solntseuskaya organi­zation. After years of cooperation, the men had come to despise each other. Mikhailov had tried to shake down Mogilevich for $3.5 million. There had been shouting matches, and then bombing attacks.
On the eve of the conclave, an unidentified Russian delivered an anonymous letter to the chief of police in Budapest, stating that Mogilevich was to be assassinated at the celebration. "Mogilevich knew he was dealing with some very, very treacherous people," said former FBI agent Robert Levinson. "They'd kill him in an instant."
After receiving the tip, the Czech prosecutor dis­patched hundreds of cops to the restaurant, where they arrested, photographed, and fingerprinted two hundred
partying mobsters. Their diaries, journals, and other docu­ments were confiscated for photocopying. Anticipating a bloody shoot-out, the Czechs had parked two large refrig­eration vans outside the restaurant to store the bodies. But the mobsters surrendered quietly, and following their release from custody they returned to their homes in Ger­many, Hungary, Russia, and Israel.
Mogilevich himself was conspicuously absent from the celebration. "Mogilevich may have [sent in the] tip himself as a protective measure, or, having arrived late, noted the police presence and fled," stated a classified FBI report. Whatever the case, five individuals were declared persona non grata by the Czech Republic following the police raid, including Mogilevich, Viktor Averin, and Sergei Mikhailov.
Although Canadian intelligence had been aware of both the Czech and British incidents, stock market regulators had only to inspect the rogues gallery that made up YBM's initial shareholders list to guess at its true nature. According to the author's analysis of the disclosure documents, Mogilevich and his confederates owned up to 90 percent of the shares. Among the major stockholders were the Brainy Don him­self, his fifty-two-year-old Ukrainian-born ex-wife, Tatiana, and their twenty-eight-year-old daughter Mila, a blue-eyed blonde, who lived on Wilshire Boulevard in Los Angeles, as well as Mogilevich's ex-mistress Galina Grigorieva.*

*Another key stockholder was Mogilevich associate Alexei Viktorovich Alexandrov, aka "the Plumber " His nickname stemmed from his deft han­dling of "leaks" and planting disinformation for Mogilevich's organization He was also Mogilevich's contact with the Hungarian National Police, and the source of derogatory information on Mogilevich's competitors Based in Prague, the Plumber was also responsible for procuring Russian women for Mogilevich's sex market Like many of Mogilevich's colleagues, he is well educated, holding degrees in economics and engineering, as a classified FBI document reveals The FBI also reports that he has an address in Los Ange­les Alexandrov, a director of Arigon Ltd, was one of the five who were declared persona non grata after the incident at the U Holubu nightclub
Despite the events of the previous months, on July 25, 1995, Pratecs publicly announced that it had received a clean bill of health. Canadian regulators in Alberta later acknowledged that, without any actual court convictions, they lacked the hard proof necessary to keep the company off the exchange. And so "after a six-week halt in Pratecs' shares," wrote the Vancouver Sun, "the Alberta Stock Exchange allowed Pratecs to merge with YBM, a move that allowed the company to transform itself from a shell whose only asset was its stock exchange listing into a manufactur­ing firm with plants in Hungary, Kentucky and ultimately a listing on the Toronto Stock Exchange in 1996."
Touted by Bay Street underwriters, YBM quickly became the darling of the Toronto Stock Exchange, eventu­ally being included in the prestigious TSE 300 Index, the Standard & Poor's 500 Index of Canada. The company's glossy brochures boasted about big international deals and amazing new technologies. Almost overnight, it became nearly a billion-dollar-cap company. To enhance its image, YBM soon dropped many of the Russians from the board of directors, and added, among others, the powerhouse lawyer David Peterson, the former premier of Ontario.
While YBM's stock thrived, the Bay Street financial world continued to ignore the warning signs in the com­pany's operations. A November 1995 confidential report by Britain's National Crime Squad concluded that Mogilevich had been transferring funds from Britain to Hungary, and from there to the United States and then on to Canada through YBM. Circulated throughout the top rungs of reg­ulatory and financial circles by word of mouth, the report also asserted that Mogilevich was using the Canadian stock exchange listing "primarily to legitimise the criminal organ­isation by the floating on the stock exchange of a corpora­tion which consists of the UK and USA companies whose
existing assets and stocks have been artificially inflated by the introduction of the proceeds of crime," including drug and arms trafficking and prostitution.
A spokesman for one of YBM's major underwriters, First Marathon, later admitted that it had heard rumors about the company's ties to the Russian mob, but its con­cerns were allayed after auditors Deloitte & Touche initially reported the business to be financially sound. Unlike the bulls on Bay Street, the FBI was more skeptical. YBM— whose home office remained in Newtown—listed a paltry projected gross sales of $8,573 on its 1993 U.S. tax returns. In 1995, at the time of the acquisition of YBM by Pratecs, it claimed net sales of $32.5 million, net income of $3.3 million, and stockholder equity of $17.5 million. Surveil­lance of a YBM facility in Pennsylvania by the FBI revealed that it occupied a small section of a former school building. The space, the bureau concluded, was not capable of sup­porting either the 165 employees or the $20 million in sales YBM claimed in its glossy published report.
Although by August 1996 YBM's board was aware that the firm was being investigated by the U.S. Attorney's Office in Philadelphia, as minutes of a confidential YBM board meeting confirm, the company never informed its investors of the fact. During that same period, Bogatin was even promoting the company to the New York Stock Exchange, and the company was waiting approval for a list­ing on Nasdaq.
Investors also had no way of knowing that YBM's pres­tigious auditor, Deloitte & Touche, had issued a highly crit­ical report, declaring that it had found irregularities and possible criminal fraud in the company's 1997 annual report. It noted that "one or more illegal acts may have occurred which may have a material impact on [YBM's] 1997 financial statements." Among other problems, audi-
tors discovered that $15.7 million in magnet sales to the Middle East and North America had been fabricated. Deloitte & Touche resigned when YBM failed to follow its recommendation to hire an outside forensic auditor to con­duct a sweeping reevaluation of the company's books and business methods. Several of YBM's directors, meanwhile, sold millions of dollars of their shares in YBM stock after they received the report from Deloitte & Touche, but well before it was made publicly available.
The beginning of the end finally came on May 13, 1998, when at 10:15 A.M., U.S. Attorney Robert Courtney, head of the Organized Crime Task Force in Philadelphia, led some five dozen agents in a joint FBI, IRS, INS, Customs, and State Department raid on YBM's offices in Newtown. Fax machines, computer hard drives, Rolodexes, bank statements, and shipping invoices were seized and loaded onto trucks. Citing the company's alleged ties to Russian organized crime, the law enforcement agencies asserted that YBM was a vast money laundering machine for Mogile-vich. Just twenty-three minutes after the raid, trading in YBM's stock on the TSE 300 Index was suspended by Canadian authorities, but not before a quarter of its value had been wiped out.
In the months that followed the raid, a succession of bizarre revelations besmirched what was left of the com­pany's tattered reputation. The Financial Times of London reported that a "revolutionary" scientific process YBM claimed it had invented for desulfurizing oil, and which accounted for 20 percent of its revenues in 1997, didn't even exist, according to the top earth scientists interviewed by the prestigious newspaper.
On September 22, 1998, irate institutional investors finally staged a coup after court documents filed in Alberta revealed that more than $20 million in cash was missing
from YBM's accounts. Five directors, including Fisherman, were fired. On November 23, Bogatin received a "target letter" from the Justice Department stating it had gathered sufficient evidence to indict him for money laundering. He resigned two days later.
The new board's forensic investigators discovered what international police had strongly suspected all along—that Mogilevich had been directly involved in the affairs of YBM, siphoning money from the accounts of its sub­sidiaries, as well as using the company as a vast money laun­dering machine — with money passing through various front companies and banks in Moscow, the Cayman Islands, Lithuania, Hungary, and a Chemical Bank branch in Buf­falo, New York. YBM received $270,000 from Benex, a shell company allegedly controlled by an associate of Mogilevich. Investigators later claimed that Mogilevich, using Benex, had laundered huge sums through the Bank of New York. When YBM's newly installed board sent Pinker-ton men to visit the company's plant in Budapest, they were turned away by brutish guards brandishing Berettas and Uzis. The board couldn't even get a key to one of the foreign plants. In all, not only were tens of millions of dol­lars of reported YBM sales bogus, but customers and even entire product lines turned out to have been fabricated.
Finally, in late December 1998, the board announced that it expected YBM would be indicted and that it had no viable criminal defense. YBM was placed into receivership by an Alberta court. The government accused the company of fraudulently inflating the value of its securities by creat­ing the appearance of record sales and revenues, while fail­ing to disclose that it was run by a Hungarian-based mob boss. On June 7, 1999, YBM pleaded guilty to one count of mail fraud and one count of securities fraud. It was fined $3 million and agreed to make restitution to the thousands of
defrauded shareholders. The company admitted that its principals played a shell game for regulators and investors, setting up paper companies to hide its actual control. The U.S. Attorney's Office has allegedly filed three sealed indictments against company insiders, one of which has the Brainy Don's name on it. Belatedly perhaps, in November 1999, ten of YBM's former board members, including David Peterson, were charged by Canada's leading securi­ties commission with violating the Ontario Securities Act for allegedly failing to disclose to investors that the com­pany was being investigated by U.S. authorities for its ties to Russian organized crime. They deny the charges.
In the end, more than half a billion dollars in YBM's market capitalization simply vanished. Perhaps billions more was made by mobsters manipulating the stock's price, buying and selling blocks of shares on inside information. During its dramatic run on the Toronto Stock Exchange, YBM raised over $100 million in hard Western currency, and laundered hundreds of millions of dollars more. The casualties included many average investors, as well as groups like the Ontario Teacher's Pension Fund, which was left holding $32 million of worthless shares. "It's now clear that YBM's only successful business [was] the laundering of criminal proceeds," said shareholders in one of many class action suits filed against YBM's former board of directors, Deloitte & Touche, and several law firms.
"This is the most significant and serious case of stock fraud that I've investigated in eighteen years," said Adrian du Plessis, a respected analyst for StockWatch in Vancouver, and a private forensic stock investigator. "It represents a level of corruption of the marketplace that is unprecedented in its nature."
The sensational size, sophistication, and sheer boldness of the YBM scam, however, should not obscure a fact that has continued to disturb many in law enforcement: namely,
that it was hardly a unique event. "This is just one case,' says former FBI official James Moody, "but there are others just like it throughout the world."
How accurate that assessment was was strikingly demon­strated when, two years after the YBM scandal broke, Mogilevich found himself in the middle of the biggest money laundering case in U.S. history. It had been discovered that, through a series of front companies spanning Russia, Europe, and the United States, he and others, primarily Russian busi­nessmen evading local taxes, had laundered billions through the esteemed Bank of New York. The massive scale of the operation, combined with the fact that it had occurred on U.S. soil, was a startling embarrassment to U.S. law enforce­ment and the government. (While the bank has not been charged with any wrongdoing, some investigators believe that the money laundering could not have taken place unless senior bank officials were bought off or otherwise involved. Indeed, in February 2000, Lucy Edwards, a former vice pres­ident of the bank's Eastern European division, and her hus­band, Peter Berlin, pleaded guilty to money laundering charges. Indictments of other bank officials are expected.)
Actually, Mogilevich had been making a mockery of law enforcement for a very long time. Although as early as the mid-1990s he had been publicly identified in congressional hearings as one of the top Russian mobsters in the world, prompting the U.S. State Department to bar him from obtaining a visa, the prohibition never stopped him from continually entering America under aliases on temporary traveler's visas issued in Tel Aviv. Between December 1, 1995, and December 7, 1995, for instance, Mogilevich trav­eled to Toronto, Philadelphia, Miami, and back to Philadel­phia. Well after the YBM affair had become headline news, the brazen don boasted to a Hungarian magazine that he traveled to Los Angeles in late 1998 to surprise his
granddaughter on her birthday. In January 2000, Mogilevich slipped into Boston to conduct business, say top European and U.S. law enforcement officials.
Although he is also barred from entering seven Euro­pean countries, Mogilevich travels extensively around the world in order to manage his business affairs. He has almost as many passports as he has aliases, which have included Semion Mogilevich, Senior Mogilevich, Semion Mogei-legtin, Semion Mobllerltsh, Seva Magelansky. Other mem­bers of his organization travel just as freely, often using forged passports of superior quality. Some of them are couriers who transfer large sums of cash from country to country, according to Israeli intelligence files.
Mogilevich still controls a variety of criminal activities from one American coast to the other. And while he has been careful not to defile his own hands with the blood of his gangland victims, he has not refrained from associating with known killers while in America, prime among them Elson and Ivankov, whom he regularly visited on one of his numerous fraudulent passports.
The Bank of New York scandal was not without its repercussions for Mogilevich, however. Perhaps most seri­ously, the man who had relied on his underlings to take responsibility for his crimes had lost his anonymity, one of his most valuable assets. In addition, the FBI—which iron­ically had built an international training academy just a short cab ride from Mogilevich's Budapest headquarters in 1994—put intense pressure on the Hungarians to crack down on his operations there, and his homes and offices were raided by the Hungarian tax police. His presence in Budapest was costing too much blood, in any case; there had been more than 170 mob-related bombings in Budapest between 1994 and 1999, many of them directed at or initiated by Mogilevich.
Although Mogilevich has apparently abandoned Budapest as his base of operations, his global empire is still largely intact, and the Brainy Don spends much of his time flying between Moscow and Tel Aviv on his private jet. Mogilevich claims to feel secure in the Jewish homeland notwithstanding his feelings about his clamorous country­men. When asked in September 1999 by a Hungarian reporter to respond to charges that he was a major Russian crime czar, he laughed, dismissing the accusation as the mad "ravings of the FBI." That same month, he successfully won a libel case brought against a Hungarian television sta­tion that broadcast a report about his criminal activities. When asked why he didn't likewise sue the American media for similar stories, he replied that he wasn't really a rich man, and that, in any case, he joked darkly, he had just paid a hit man $100,000 to kill American reporter Robert I. Friedman.
Later that month, he complained to ABC News, "I have no business now. Who would do business with me?" he asked dejectedly as his underlings provided security, their faces hidden from the cameras. "I've lost my spark. Maybe I should tear my shirt off and prove my innocence, but I don't even care anymore. . . . There is a saying in Russia, 'if you tell a rabbit over and over that he is a pig, he'll oink.' Everybody says I'm a criminal. I'm used to it. And the pub­lic is, too."
When questioned how the charges that he was a crimi­nal had surfaced, he attributed them to a plot by the jour­nalist Friedman and the American Justice Department. A few days after the TV interview, say reliable sources, he was trying to obtain a permanent residence permit in Spain so that he could operate his "humble grain business" from that country's beautiful Costa del Sol and Barcelona.

When the international press, bankers, and law enforcement officials professed outrage at the announcement that Red Mafiya boss Semion Mogilevich was allegedly behind the laundering of as much as $7 billion through accounts at the Bank of New York, it recalled the scene in Casablanca when the corrupt but worldly wise Vichy prefect masterfully played by Claude Rains told Humphrey Bogart's Rick that he was "Shocked, just shocked!" that gambling was going on in Rick's cabaret. In fact, intelligence officials and government leaders had known since the early 1990s the true state of affairs in the former Soviet Union. The CIA alone claims to have published more than a hundred reports since 1998 for the American foreign policy establishment documenting crime and corruption in Russia—a society where everything from submarines for the likes of Tarzan to fissionable material for
Mogilevich was for sale. The agency reported that the Rus­sian mob and its cronies in government and big business have looted the country into a condition resembling medieval beggary: the economy has declined every year since 1991. More than 40 percent of the country's peasants are living in abject poverty, suffering through Russia's third Great Depression this century. In the unforgiving fields, peasants are killing each other over potatoes. Social indices have plummeted. Workers' minuscule paychecks come late or not at all. Horrific terrorist bombings, apparently the responsibility of rebellious Islamic republics, about which the authorities can seem to do nothing, are causing a further erosion of the public's trust of the government.
At the same time on Moscow streets are more Mer­cedes per capita than any place on earth, and the number one concern of the city's nouveau riche is how to avoid paying taxes and hide their fortunes offshore. They revel away nights in gaudy sex clubs and expensive restaurants, gorging themselves on South American jumbo shrimp washed down with vodka and cocaine. Disputes are settled with bursts of submachine gunfire. It is a classic fin de siecle society erected on a seemingly limitless supply of dirty money.
No post-Soviet institution has been immune from cor­ruption, and even investigators have been investigated, often for good reason. Vladislav Selivanov, head of the Inte­rior Ministry's Organized Crime Division, admitted in a July 1998 press conference that a probe of the Federal Security Service, the successor to the old Soviet KGB, resulted in several criminal prosecutions and the disman­tling of the service's organized crime unit on the grounds that it had ties to the Russian mob. A few months later, dur­ing a bizarre news conference in Moscow, a group of mid-ranking FSB agents wearing sunglasses and ski masks
declared that their once-vaunted agency harbored thugs, extortionists, and Mafiya hit men.
To make matters worse, the country's few political reformers have been sacked or killed. The Duma is a den of thieves, as was Yeltsin's inner circle. The same has even been alleged of Yeltsin and his family, who have purportedly taken a million dollars' worth of kickbacks from a Swiss contractor that renovated the Kremlin. But corruption and influence-peddling are a national plague in Russia as old as the czars. No one in Russia can purchase anything of value without a cash-laden handshake.
Astonishingly, both the Bush and the Clinton adminis­trations have unwittingly helped foster the Russian mob and the untrammeled corruption of post-Soviet Union Russia. When the CIA was asked in 1992 by Kroll and Asso­ciates, working on behalf of the Russian government, to help locate $20 billion that was hidden offshore by the KGB and the mob, the Bush national security policy team declined to cooperate. The Bush group rationalized, accord­ing to Fritz Ermath, a top CIA Soviet policy analyst writing in The National Interest, "that capital flight is capital flight. It doesn't matter who has the money or how it was acquired even if by theft; so long as it is private, it will return to do good things if there was a market."
Of course, that never happened, yet it did not prevent the Clinton administration from handing billions in aid to Russia without any accountability. With the vigorous sup­port of the United States another $20 billion of Interna­tional Monetary Fund loans has been deposited directly into Russia's Central Bank since 1992. However well inten-tioned, the Clinton adminstration simply has no way to deliver "economic aid that will give benefits directly to the people," as Brent Scowcroft, Bush's national security adviser, has asserted. The chastened Russian Central Bank,
admitting that it lacked any mechanism to monitor aid money once it was deposited, initiated an investigation to determine if the funds were stolen, and if so, whether they were part of the monies passed by Mogilevich and others through the Bank of New York.
Until the Bank of New York fiasco, the top rungs of the U.S. foreign policy establishment refused to acknowledge the Russian government's staggering corruption. In 1995, the CIA sent Vice President Al Gore, who had developed a "special" relationship with then Russian prime minister Viktor Chernomyrdin, a thick dossier containing conclusive evidence of his widespread corruption. Gore's friend had become a multibillionaire after he took over Gazprom, the giant natural gas monopoly, with holdings in banking, media, and other properties. The CIA said it cost $1 million merely to gain entry into Chernomyrdin's office to discuss a business deal. It was also alleged, though Chernomyrdin denied it, that he was among the oligarchs who had been stealing the country's resources after the fall of commu­nism.
Gore angrily returned the report, scribbling a barnyard epithet across the file, according to the New York Times, and declared that he did not want to see further damning reports about Russian officials. It is unlikely, then, that he read the classified FBI file claiming that two colonels in the Russian Presidential Security Service had traveled to Hun­gary in 1995 to pay Mogilevich for information on the upcoming Russian political campaign, which was then allegedly passed on to Chernomyrdin. "The corruptive influence of the Mogilevich organization apparently extends to the Russian security system," asserts the FBI report.
"The bottom line is that Clinton and Gore had lots of warning about Russian corruption under Yeltsin's banner of
reform," wrote political columnist David Ignatious in the Washington Post. "And the question continues to be: Why didn't the administration do more to stop it?"
The most charitable explanation, which now seems tragically ironic, is that they truly believed they were help­ing the ex-Soviet Union make a meaningful transition to democracy and a free market economy.
"The American political establishment didn't want to hear about Russia's corruption," says Jack Blum. "They believe they're looking at nascent capitalism, and they are flat-ass crazy. A bunch of thugs run the country. They have stolen everything that isn't bolted down, moved it offshore, and then globalized their criminal business."
It was only a matter of time before the Russian mob tried to buy its way into the American political system that has contributed to it so generously, if inadvertently. In New York, for instance, they almost succeeded. The invitations had been mailed, the menu prepared, and everything had been arranged down to the last detail for a $300 per couple, black-tie fund-raiser for then Governor Mario Cuomo on October 10, 1994, at Rasputin—the garish nightclub then owned by Monya Elson and the Zilber brothers. But on the eve of the event, the Cuomo campaign canceled. Officially, the explanation was a scheduling conflict; discreetly and quite unofficially, federal investigators had warned the Cuomo campaign that Rasputin was a bastion of the Rus­sian Mafiya.
A few months before the Cuomo fund-raiser occurred, there was a similar misjudgment, and one that represented a serious lapse in national security. Grigori Loutchansky, a Latvian-born convicted felon and president of the Austrian-based NORDEX, a multinational trading company, had been implicated in everything from major money launder-
ing to smuggling nuclear components. House Speaker Newt Gingrich once said that U.S. government officials believed Loutchansky had shipped Scud missile warheads to Iraq from North Korea. The ubiquitous Loutchansky was also a former business associate of both Chernomyrdin and Semion Mogilevich, according to the CIA and other West­ern intelligence officials. Yet somehow this enormously wealthy underworld rogue was invited to a private Demo­cratic National Committee fund-raising dinner for Clinton in 1993. During coffee, Clinton turned to the mobster to ask a favor: would he pass a message along to the Ukrainian government requesting it to reduce its nuclear stockpile? Clinton then posed for a photograph with the grinning hood, which Loutchansky later liberally passed out among his cronies, greatly enhancing his stature among corrupt government officials and the criminal underworld. When the photo of the men shaking hands was eventually pub­lished in a Russian newspaper, the CIA analyzed it to see if it was a fake. When they discovered it was genuine, agency officials were aghast. "Loutchansky had one thing in mind: legitimization," a congressional investigator probing Russian organized crime explained. "He wanted U.S. citizenship and he wanted to buy a U.S. bank."
In July 1995, the DNC invited the mobster to a $25,000-a-plate fund-raising dinner for Clinton at the Hay Adams Hotel in Washington. At the last minute, the secu­rity services provided information on Loutchansky and the State Department denied him a visa, which he had obtained in Israel. He was subsequently banned from enter­ing the United States, Canada, Hong Kong, and England.
The mobsters were not easily dissuaded, however. In September 1995, not long after the Loutchansky ban, his partner at NORDEX, Ukrainian mob boss Vadim Rabi-novich, attended a Clinton-Gore fund-raiser at the Shera-
ton Bel Harbor Hotel in Miami. Rabinovich came as a guest of Bennett S. LeBow, the chairman of Brooke Group Ltd., parent of Liggett, a cigarette manufacturing company. (LeBow refused to comment.)
Rabinovich, who by his own account once served an eight-year jail term in Ukraine for theft of state goods, should not have even been in the United States, let alone attending a gala for the president, for he was on a State Department Watch List that bans aliens from entering the United States to commit crimes. Nevertheless, he, too, cleverly managed an all-important photo op, squeezing in between a smiling Clinton and Gore. That picture, too, appeared in the Eastern European press, greatly adding to the mobster's reputation.
The Republicans have not been immune to the Russian mob's advances, either. In March 1994, Vahtang Ubiriya, one of Mogilevich's top criminal lieutenants, was pho­tographed by the FBI at a tony Republican party fund-raiser in Dallas, says a confidential FBI report. Ubiriya, a high-ranking official in the Ukrainian railway administration, has a prior conviction for bribery in that country. A friend of Mogilevich for some twenty-five years, he has been involved with him in extortion, fraud, and illegal currency operations there.
This was not Mogilevich's only attempt to manipulate the U.S. political system. After the INS and the State Department denied visas to YBM employees arriving from Budapest and Ukraine, Jacob Bogatin contacted the FBI office in Philadelphia for an explanation. Rebuffed, Bogatin—who had donated $2,250 to the National Repub­lican Committee and an additional $500 to the National Republican Congressional Committee, a soft money account, between April 1996 and April 1998—called upon Pennsylvania Republican congressman Jim Greenwood for
help obtaining the visas. "I remember when they came to visit me and they brought all those brochures, and I remem­ber how impressed I was that such a high-tech enterprise was there in the Newtown industrial park,' Congressman Greenwood recalled. "And I remember thinking, 'Gee, I wonder how they had escaped my attention.' Normally when there is a particularly interesting high-tech industry in your district you become aware of it and often take a tour."
Greenwood's staffers petitioned the State Department on Bogatin's behalf, requesting a reason for the denial of the visas. After it was "nonresponsive, I then made personal calls to the State Department to get to the bottom of it, and I was essentially told that what I ought to do is talk to the FBI," said Greenwood. "We arranged for FBI represen­tatives to come to my office in Washington." Greenwood recalled that the agents told him in confidence that Russian godfather Semion Mogilevich was running YBM and that it was under investigation for money laundering among other crimes. They also said that Bogatin "had to know" what was going on. "It took a hell of a lot of gall if Bogatin was aware of this and [yet he] sat with a U.S. congressman, demand­ing that our government [allow] their employees back into the country," Greenwood angrily declared.
By the dawn of the new millennium Russian mobsters were lavishing millions of dollars in contributions on Demo­cratic and Republican politicians. In New York City, com­modities mogul and alleged wiseguy Semyon (Sam) Kislin has been one of mayor Rudy Giuliani's top campaign sup­porters. Kislin, various relatives, and his companies, raised or donated a total of $64,950 to Giuliani's mayoral cam­paigns in 1993 and 1997. A Ukrainian immigrant well known among the Russian Jewish community in South Brooklyn, Kislin has also made generous donations to
Democratic Senator Charles Schumer as well as other state politicians.
According to a confidential December 1994 FBI report and underworld sources, Kislin is a member of the Ivankov organization. These sources say that Kislin's New York commodities firm has been involved in laundering millions of dollars, and co-sponsored a U.S. visa for a man named Anton Malevsky, who is a contract killer and head of one of Russia's most bloodthirsty Mafiya families.
Kislin's donations to charities and politicians bore fruit in 1996 when he was appointed to be a member of New York City's Economic Board of Development Corporation. On December 2, 1999, Giuliani reappointed Kislin to the board, stating in a letter that his "service is deeply appreci­ated." Kislin has denied any ties to the Russian mob, insist­ing at a December 1999 press conference that "I have done nothing evil."
Although the Russian Mafiya's invasion of American politics is still in its infancy, it already poses a huge threat to U.S. national security interests abroad. The mob dominates Russia, and has Eastern Europe in a bear hug. It is also turn­ing Western Europe into its financial satrapy, and the Caribbean and Latin America have quickly become sandy playpens for coke and weapons deals with Colombian drug lords. There are few nations where the Russian mob does not hold some influence, making efforts to combat it ever more difficult.
A striking example is Switzerland, where the Mafiya has been drawn by the country's world-renowned, highly secretive banking system. "There are three stages of Russian Mafiya penetration," Jean Ziegler, a university professor in Switzerland has explained. "When the Soviet Union broke up, Switzerland was the laundering place for immense for-
tunes. Then Mafiya leaders started sending their children to expensive private schools here. Now we are in the third stage, where some of the Mafiya dons are transferring their operational headquarters to Switzerland—and that is very dangerous." More than six hundred Russian dons have moved to Switzerland, and, according to Swiss court docu­ments, more than $60 billion of Russian mob money has been laundered through its banks.
In one of Switzerland's first strikes against a major Rus­sian gangster, Sergei Mikhailov was arrested in October 1996 in Geneva for money laundering and for his leader­ship of the Solntsevskaya crime family. Headquartered in Moscow, the Solntsevskaya mob openly operated out of a stylish commercial office building at Leninsky Prospekt, where it controlled much of the city's gambling, casino, and banking business, as well as prostitution, drugs, the city's used car trade, and the Vnukovo airport, the city's principal cargo terminal. It also owned real estate from Malaysia to Monaco, setting up a labyrinth of fictitious international firms and offshore accounts to launder money received from the sale of narcotics, arms, and extortion. At the time he was apprehended, Mikhailov was living in a quaint chateau outside Geneva, where he drove around in a blue Rolls-Royce, maintained a $15,000-a-month clothing bud­get, and doted on his wife and two children. He traveled on a Costa Rican diplomatic passport and had been appointed that country's honorary consul to Moscow.
Inside Mikhailov's lavish home, police found sophisti­cated Israeli military devices that allowed him to eavesdrop on secret Swiss police radio communications and to tap telephones. They also discovered a trove of documents list­ing front companies he allegedly used to launder money from drugs and arms sales. Investigators learned that Mikhailov had invested millions of his laundered dollars in
America: he had bought a Brighton Beach disco called Nightflight, which he owned with Ivankov. He acquired another club in Los Angeles. He also purchased a car deal­ership in Houston with a local who agreed to send red Jeep Cherokees to him in Geneva so he could give them as gifts to friends. The Texan had no idea of the danger to which he was exposing himself when he began to pocket Mikhailov's money, and though the furious gangster sent a hit man to Houston, the killer was captured by the police.
Investigators learned that apart from the tranquil Geneva suburbs, Mikhailov's favorite hangout was Miami. After his men committed murders in Europe and Russia, they would check into the Fontainebleau Hotel "where they would stay by the beach and wait for the heat to cool off," according to retired FBI agent Robert Levinson. But before hitting the soft white sand, the mobsters liked to stop at a nearby Sports Authority, where they bought snazzy jogging outfits to preen for South Beach's glamorous models.
Although Mikhailov insisted, typically, that he was a simple businessman, he is a career criminal with an excel­lent strategic mind. Born on February 7, 1958, in Moscow, the onetime waiter was first convicted in the Soviet Union in 1984 of theft and perjury, according to a classified Rus­sian document. He was later investigated for murdering a casino owner and a banker. In 1989 he was arrested for extortion, but the victim found it judicious to recant.
The Swiss authorities were confident that they had an excellent case against the mobster, but on the eve of Mikhailov's Swiss trial, a Dutch father and son who had engaged in some questionable business dealings with Mikhailov in Moscow were executed gangland-style. The father was stabbed in the eye and bled to death; his son was gunned down. Soon afterward, Moscow's chief of police
sought political asylum in Switzerland, claiming he was threatened by Mikhailov's men. The press was targeted, too. Veteran Russian mob reporter Alain Lallemand of he Soir in Brussels was threatened after he wrote a series about Mikhailov that apparently displeased the mobster. Lalle­mand was warned by several intelligence services that Mikhailov had scheduled his assassination, and the reporter and his family went underground for a month. The police captured an ex-Belgian gendarme in Brussels who was about to carry out the contract.
Despite these intimidation tactics, the trial went for­ward, with a total of ninety witnesses being issued protec­tive vests and placed under close guard. The key witness against Mikhailov was Robert Levinson, the ex-FBI agent based in Miami who specialized in the Russian Mafiya. Some foreign intelligence agents, however, were dismayed when they saw his briefing book, which seemed to primar­ily consist of warmed-over FBI gossip. Why hadn't the bureau dispatched active agents with more current material that would hold up as evidence? asked Pierre Delilez. "They are always telling the European intelligence agencies to share. They share nothing." Lallemand, however, insists that the FBI's material was excellent, though the best of it never made it into evidence.
Meanwhile, Mikhailov had succeeded in securing a high-profile paid expert witness for his defense: former U.S. Attorney General Ramsey Clark. Clark has become something of a heretic for having taken on a series of unpopular cases like representing a German SS guard who the U.S. government said massacred Jews during World War II and then illegally gained citizenship.
Clark was first approached by a young Russian lawyer representing Mikhailov, who thought an American with his prestigious legal pedigree would be of great help to his
client. Clark politely declined, but Mikhailov's men perse­vered over the next several months. A group even came to his downtown Manhattan office and asked him to slam the FBI with a "slap suit" that would keep their evidence out of Swiss court. Clark informed them that they didn't have a legal theory that would stand up in an American courtroom.
Finally, Mikhailov's lawyers convinced Clark to look at Levinson's FBI briefing book and some documents that they had obtained in discovery. After reading the material, Clark changed his mind. The FBI reports reminded him of the kind of malicious, untested gossip the bureau had used when it wanted to bring down civil rights leaders. "It was American criminal imperialism," he stated.
Even though the burden of proof was on Mikhailov— under Swiss law, he had to prove that he was not the head of a mob family—Clark skillfully helped dismantle Levin-son's testimony, not only showing its inconsistencies, but arguing effectively that the bulk of it was built on rumor, hearsay, and derived from unverifiable anonymous sources. Levinson could neither read nor write Russian, Clark declared, but more importantly, the ex-FBI man's intelli­gence files—or information culled from them—would almost certainly never be allowed into evidence in a U.S. court of law.
Yet Clark's defense alone could not have vindicated the mobster. At least as damaging to the Swiss authorities' case was the fact that several Russian prosecutors working with the Swiss were suddenly and inexplicably fired, after which the Russian government reneged on its previous promises to send crucial documents to Geneva.
Mikhailov, who had been held in a Swiss prison for two years, was acquitted in December 1998. "My heart is full of gratitude," he announced at an airport press conference. "I love you." He was then quietly deported to Moscow aboard
an Aeroflot jet. The acquittal was a devastating blow to both Swiss and international law enforcement who had been battling the Russian mob, and it was followed by the usual round of fingerpointing. "The next time we try a major Russian mob boss, we are going to need a watertight case," said Pierre Delilez, who believes that the FBI inten­tionally fumbled the case, perhaps in order to be able to use Mikhailov as an intelligence agent. James Moody, mean­while, blamed Levinson for a poor performance. In truth, it was Mikhailov's power, money, and international connec­tions that had succeeded in winning his release and enabling him to continue his glorious criminal career.
The Swiss, meanwhile, are still struggling with the intractable problem of the Russian mob. Ziegler says the only way to derail their inexorable advance is to ban Russ­ian banks from operating in Switzerland, since most of them are controlled by gangsters. Some Swiss banks have already adopted a blanket policy of not accepting any Russ­ian clients. On September 3, 1999, Swiss authorities announced that they had frozen fifty-nine bank accounts, and asked Swiss banks to provide information on the two dozen Russians who held them. Yet in a country where it is not illegal to bribe a public official, the Swiss skirmish against the Russian mob smacks of the Marx Brothers going to war against a mythical kingdom in Duck Soup.
Of all the nations where the Russian mob has estab­lished a presence, none has been more deeply compromised than the State of Israel, America's staunchest ally in the volatile Middle East. More than 800,000 Russian Jews have made aliyah or settled in Israel since the first massive wave of immigration in the 1970s. The Russians took advantage of Israel's most sacred law—the Right of Return, which guarantees Jews the right to return to their ancestral home-
land, where they would receive citizenship and live as free men and women outside the odious yoke of anti-Semitism. "The Russians are a blessing,' said Israel's top political columnist Nachum Barnea, who stands in public awe of their brilliant intellectual gifts in a variety of fields.
But just as in Brighton Beach, Russian immigration to Israel has brought a more unwelcome element—the vor v zakonye and their criminal minions. Ten percent of Israel's five million Jews are now Russian, and 10 percent of the Russian population "is criminal," according to NYPD notes of a briefing in Manhattan by Israeli police intelligence offi­cial Brigadier General Dan Ohad.
"There is not a major Russian organized crime figure who we are tracking who does not also carry an Israeli pass­port," says senior State Department official Jonathan Winer. He put the number at seventy-five, among whom are Mogilevich, Loutchansky, Rabinovich, and Kobzon.
Many of the mobsters who have Israeli citizenship, such as Eduard Ivankov and Sergei Mikhailov, are not even Jew­ish. In the mid-1990s, an Israeli police sting—code-named Operation Romance—netted, among others, a high-ranking Interior Ministry official who was taking payoffs from Mikhailov and convicted KGB spy Shabtai Kalmanovitch to issue passports to dozens of Russian gangsters, according to Brigadier General Hezi Leder, the Israeli police attache in Washington, and classified FBI documents. (Kalmanovitch, after serving time in an Israeli prison for treason, became one of Moscow's most notorious mobsters and frequently returns to Israel.)
Russia's criminal aristocracy covets Israeli citizenship "because they know Israel is a safe haven for them," said Leder. "We do not extradite citizens."
"The Russians then use the safe haven to travel around the world and rape and pillage," added Moody.
The country has also remained attractive to gangsters because "Israel is good for money laundering," explained Leder. Under Israeli law, banks can accept large cash deposits with no questions asked. In one instance, a corrupt ex-deputy prime minister of Ukraine smuggled $300 mil­lion of illicit cash into Israel in several suitcases, and deposited it into a bank, as Israeli Minister of National Security Moshe Shahal told a gathering of intelligence heads in June 1996. "I've watched Russian mobsters exchange suitcases full of cash out in the open at the Dan Hotel's swimming pool," laughed an American underworld crime figure. "Israel is a country that encourages people to come and invest money," said Leder. "There is no mecha­nism to check the origin of the money."
Israeli police officials estimate that Russian mobsters have poured more than $4 billion of dirty money into Israel's economy, though some estimates range as high as $20 billion. They have purchased factories, insurance com­panies, and a bank. They tried to buy the now defunct, pro-Labor Party Davar daily newspaper, and the pro-Likud Maariv, the nation's second largest newspaper. They have even put together a koopa, or a pool of money, for bribes and other forms of mutual support. One of Leder's greatest fears is that the Russians will compromise Israel's security by buying companies that work for the military-industrial complex. The mobsters, in fact, attempted to purchase a gas and oil company that maintains strategic reserves for Israel's military. "They could go to the stock market and buy a company that's running communications in the mili­tary sector," he complains.
Insinuating themselves throughout the country, Russian dons have bought large parcels of impoverished develop­ment towns, taking over everything from local charities to the town hall. For instance, Gregory Lerner, a major Rus-
sian crime boss who arrived in Israel with huge amounts of money, allegedly owns everything from fashionable restau­rants to parts of several port city waterfronts.
"Do you know what Gregory Lerner did in Ashkelon?" Leder asked me during an interview in New York. "His mother was three times in the hospital there. He bought new medical equipment and dedicated it to his mother! It's the way the mobsters wash their name." They do so, he explains, in order to build up grassroots support and openly influence politicians—or even run for elective office. Leder worries that one day three or four Russian gangsters who have bought their legitimacy will win Knesset seats, take over a key committee, and be in an ideal position to stop an important piece of anti-crime legislation, such as a pro­posed bill to criminalize money laundering.
One of Leder's worst fears came true when Russian gangsters handpicked several candidates to run for local and national offices, according to the minutes of a classi­fied Israeli cabinet meeting held by the Committee of the Controller in June 1996. And in May 1997, Israeli police launched a probe into allegations that Lerner attempted to bribe former Prime Minister Shimon Peres, among other Knesset members and cabinet ministers. The inves­tigation was inconclusive, however, and no charges were filed.*
One politician already ensnared in the web of organized crime is Russian-born Natan Sharansky, the head of the
* Succumbing to persistent pressure from the Russian government, the Israeli police finally arrested Lerner in May 1997 as he was about to board a flight to the United States. He was charged with attempted bribery, defrauding four Russian banks of $106 million, and attempting to set up a bank in Israel to launder money for the Russian Mafiya. Lerner pleaded guilty to bank fraud and bribing government officials on March 22, 1998, after having fiercely maintained for months that he was a victim of an Israeli government plot to discredit Russian emigre entrepreneurs.
Russian Yisrael Ba-Aliya and minister of the interior in the government of Prime Minister Ehud Barak. Because of his resistance to the Soviet regime and his strong and open identification with Judaism, he suffered a long, bru­tal confinement in the Gulag before international pres­sure led to his release. In Israel, the charismatic dissident was lionized by the Jewish people, and he became a power broker for the large and growing Russian emigre" community, whom he helped integrate into a rigid society that sometimes seemed jealous of the talented new Rus­sians.
However, Sharansky has publicly admitted that his party has accepted campaign contributions from NORDEX president Grigori Loutchansky. Officials from the U.S. Congress, the State Department, and the CIA pleaded with Sharansky to sever his ties to Loutchansky. "We told Sharansky to stop taking money from Loutchansky," says Winer. "We told him about [Loutchansky's] MO: bribery, influence peddling, that he was a bridge between foreign governments and traditional organized crime."
Sharansky simply refused, arguing that he needed the money to resettle the tidal wave of Russian emigres. "When we warned Sharansky," says the congressional investigator, "to stop taking money from Loutchansky, he said, 'But where am I going to put them,'" referring to the huge influx of Russian Jewish refugees. '"How am I going to feed them? Find them jobs?'" He figures Loutchansky is just another source of income.
"Sharansky is very shrewd," the congressional investiga­tor continued. "He knows better. It was a cynical [deci­sion]. He did take money. Then he asked, 'Why shouldn't I?' The CIA warned him that Loutchansky was trying to buy influence through him and his party for [the] Russian Organized Crime/Russian government combine. We told
Sharansky that Loutchansky is a major crook." (Sharansky declined to comment.)
Ignoring all the warnings, Sharansky introduced Loutchansky to Benjamin Netanyahu prior to Israel's 1996 national elections. The Israeli press reported that Netanyahu received $1.5 million in campaign contribu­tions from Loutchansky, a charge the prime minister hotly denied. "The Likud is corrupt, and Bibi [Netanyahu] is disgusting," says Winer. "He's had meetings with Loutchansky and Kobzon—criminals promoting their own interests."
Kobzon's influence in Israel may exceed that of even Loutchansky and Mogilevich. "Kobzon has big [political] connections in Israel," says Leder. For instance, in January 1996, Kobzon was detained upon his arrival at Israel's Ben Gurion International Airport "because of his ties to the Russian Mafiya," Labor Party Knesset member Moshe Sha­hal said in his cramped Knesset office in Jerusalem. Shahal, at the time the country's security minister, intended to send the mobster back to Russia, but then the phones started ringing in the chambers of high government min­istries. Kobzon's friends in Israel petitioned the minister of the interior, the minister of transportation, and Foreign Minister Shimon Peres, who finally ordered the airport police to free Kobzon and let him enter the country. Peres, who was being pressed by the Russian ambassador, told Shahal that he relented to avoid a messy incident with the Russian government. (The following year, Kobzon flew to Israel in his private jet to pick up Marat Balagula's eldest daughter, who lives in Netanya, to bring her back to Moscow to celebrate his sixtieth birthday.)
With two decades of unimpeded growth, the Russian Mafiya has succeeded in turning Israel into its very own "mini-state," in which it operates with virtual impunity.
Although many in international law enforcement believe that Israel is by now so compromised that its future as a nation is imperiled, its government, inexplicably, has done almost nothing to combat the problem. In June 1996 Leder, then chief of Israeli police intelligence, prepared a three-page classified intelligence assessment that concluded: "Russian organized groups [had] become a strategic threat" to Israel's existence. He documented how they were infil­trating the nation's business, financial, and political com­munities. Shahal used the report to brief Prime Minister Yitzhak Rabin, Shin Bet, Israel's FBI, and Mossad, and pro­vided his own recommendations on how to uproot the Russian mob. Before Rabin had a chance to act on the plan, he was assassinated by a right-wing Jewish religious zealot in Tel Aviv following a peace rally. Shimon Peres subse­quently set up an intra-agency intelligence committee on the Russian mob after reading Leder's report, but did little else. Leder's report was shelved by Netanyahu, according to Shahal.
"Israel is going to have to do something," says James Moody. "They could lose their whole country. The mob is a bigger threat than the Arabs."
Leder agrees: "We know how to deal with terrorist orga­nizations. We know how to deal with external threats. This is a social threat. We as a society don't know how to handle it. It's an enemy among us."
Why should Americans be concerned about the global explosion of Russian organized crime and the concomitant corruption in Russia? The simple answer is that the nuclear-capable behemoth is on the verge of a political and eco­nomic meltdown. "The Russian [people] are deeply humiliated," Brent Scowcroft, Bush's national security adviser, has said. "They have lost their superpower status
and they are turning against the U.S. and against the West." In historical terms, the closest analogy to the financial situ­ation in Russia is the Versailles Treaty at the end of World War I, when the Western allies demanded reparations from the Germans. Huge amounts of capital were forced out of Germany, so impoverishing the nation that it helped set the stage for Hitler. "That is the only parallel we have of a vast change in a society, accompanied by massive decapitaliza-tion—and look at the consequences," said Jack Blum, who is consulting with the House Banking Committee in its investigation of Russian money laundering. "Russia is three times our size and has nuclear weapons. Why should we care? Excuse me. Common sense says you have to care mightily."
It should also by now be abundantly clear that the Rus­sian Mafiya is made up of multipurpose, entrepreneurial master criminals. "Once funded, once flush, with the bil­lions of dollars they ripped off, these boys are in business doing every shape, manner, and form of crime globally," Blum continued. "So it was Russians who were doing the gasoline daisy chains in New York, New Jersey, and Long Island, in which billions of dollars in excise tax was ripped off; it's Russians who are screwing around with Colom­bians, figuring out how to deliver weapons to them. Should Americans not care about that? That's going on right here.
"If nothing else, Americans should worry that they'll drive up the price of real estate in the Hamptons," Blum said with a sarcastic laugh.
"The Hamptons are filling up with Russians," Mike Morrison, a criminal investigator with the IRS told me. "When we ask them where they got the money to purchase their house or business, they produce a document from Uncle Vanya in St. Petersburg who says it's a gift. There is nothing we can do."
Meanwhile, Russian mobsters move easily in and out of the United States on visas "that they get in Israel to dance through our clearance process," says Blum. Or they obtain visas as employees of shell corporations like YBM, or as friends of NHL hockey players, or as "film consultants," as Ivankov did. "So should we worry about that?" asks Blum. "Of coursel"
America's vast wealth will always be an irresistible tar­get for the Russian Mafiya, and their most sophisticated scams are likely to cause the most damage: their devious financial machinations on Wall Street, their money launder­ing, their infiltration of prestigious institutions like the NHL. Should we worry about that? In a few years, predicts James Moody, the Russian mob will be bigger than La Cosa Nostra in America. And perhaps GE, and Microsoft, too.
It's a warm summer day. Bobby Sommer looks like a shell-shocked grunt in a World War II movie. A detec­tive in the 61st Precinct in Brighton Beach, he is clearly on the verge of surrendering to a force that has him out­gunned, outfinanced, and outwitted. A Russian crime group bought the building directly across the street from his sta­tion house, and the gangsters have been photographing detectives as they saunter in with their snitches. It took the police about a year to wise up. Sommer is sometimes fol­lowed by Russian thugs at the end of a shift. "I'm tailing them, and they are tailing me," says the fifty-something cop, who wears cheap leather boots and a worn expression. Sommer's gray metal desk is cluttered with case files. More than half are Russian mob-related. Arrayed across the criminal debris are glossy photos of dismembered Russian crime victims. "If you cut off the head, and the arms and
feet are missing, too, you can't get a positive identification on the torso. It's brilliant," he says dejectedly.
"You can't work a homicide in Brighton Beach," Som-mer continues, gloom settling in his face like the pall of smoke after a heavy battle. "The Russians don't talk. Some­one could get whacked in a club in front of a hundred din­ers, and nobody would see anything. So they will kill with impunity."
Russian organized crime incubated in Brighton Beach for twenty years before the city and federal government tried to stop it, he says angrily. By then, it had merged with even more powerful organized crime syndicates that pros­pered in Russia after perestroika. Sommer says he barely has a budget to pay for snitches. How is he supposed to stop a Byzantine global crime menace?
"Why are we being victimized by noncitizens who can run to Israel or Russia and can't be extradited? The Russian gangsters have told me that they've come here to suck our country dry. My uncle died on the beaches of Normandy defending this country. How did the Russian mob become so entrenched? They are into Social Security, Medicare, and Medicaid fraud. Why is it that every ambulance service in Brooklyn is run by the Russian mob? Why are so many of their doctors practicing without a license? They have invaded Wall Street from boiler-room operations to broker­age houses. Nothing is too small for them to steal. Even the guys with the multimillion-dollar Medicare scam still have to have their food stamps. The first generation are all thieves. Maybe the second generation will become a little more American."
A few blocks away, in one of the tidy Art Deco apart­ment buildings that line the seaward side of Brighton Beach Avenue in Brooklyn, a big Russian is sprawled on his back on
a leather workout bench. A masseur kneads his lumpy body. The living room, where he spends hours every day, is deco­rated like the interior of a coffin, with wallpaper painted to resemble gathered gray satin. He watches a thirty-two-inch color TV in a mirror.
"The police steal the drugs and kill everybody," he says, while a Russian-language movie blares in the background. "I've seen it before."
The Russian has an enormous chest and huge belly, but his legs are spindles. The masseur helps him sit up. Two large craters are sunk deep into his fleshy white back. They were made by dumdum bullets that shattered his spine.
The Russian was once an imposing figure, standing over six foot four—a man who favored floor-length black leather jackets with ermine collars. He was wearing his favorite jacket, a .45 concealed inside, when an assassin on a motor­cycle shot him on a Brooklyn street corner in full view of a busload of schoolchildren several years ago. A onetime heroin and arms trafficker, he says that an ex-business part­ner commissioned the hit to settle a score. Before the ambush, he had been one of the top gangsters in Brighton Beach. Even after the shooting, he was working, running an extortion ring at Kennedy Airport from his wheelchair. He "taxes" Russians $1,000 to retrieve their shipped goods from Aeroflot.
Lifted onto his bed by his son and the masseur, the Russian sighs, appearing more like a young Buddy Hackett than a notorious criminal. "Look what they did to me," he says softly. "Look how everybody has to step over me. They ruined my life."
Yet talking about the Russian Mafiya reinvigorates him. "The Russians are stronger than the Italians," he says assuredly. He doesn't mean tougher—yet. He means wealthier. "Saudi Arabia is small potatoes," he boasts. "The
U.S. goes into Moscow with $100 million of aid, and the mob walks out with $105 million. They have so much money it would take years to count it with a computer."
The big Russian brags about the way the mob's tentacles have spread around the world in a few short years. "For Russians, enough is never enough. If a Russian makes $20 million, he wants $40 million. They never know when to stop. There is a saying in Russia: 'The house is burning and the clock is ticking.' It means you have to keep making money every minute.
"Even Russian racketeers and crooks want their children to be doctors and lawyers. But some of the kids have learned that they can make more money by being crooks," he says somberly. "Young Russian kids with MBAs are get­ting jobs on Wall Street. They are setting up all kinds of scams. They'll hurt a lot of people. There'll be a lot of sui­cides.
"In this country, it's so easy to make money," the Russ­ian says. "I love this country. I would die for it."
ABC-TV, 200, 261 Abehs, Leonid, 137-138 Adams, Cindy, 92 Adeev, V B , 204-205, 213, 214 Agron, Evsei, 20, 23-42, 45, 79, 82 Alberta Stock Exchange, 250-252, 254 Albright, Madeleine, 183n Alexandrov, Alexei Viktonovich (the
Plumber), 253n All-Russian Exchange Bank, 204,
212-214, 234 Almeida, Juan, 152-153, 155-159,
163, 165-166, 168 Aloi, Benny, 94 American Express, 224-225 American League, 200 Andropov, Yuri, 76 Anmchanco, Richard, 221-222 Antigua, 216-217 Arbat International, 243, 250 Arigon Ltd , 243-245, 249-251, 253n Armstrong, Martin, 230n Army Co-op, 245 art fraud, 244 Atiolkin, Viktor, 116 Atkom, 126 Aubut, Marcel, 187 Audit Chamber (Russia), 233 Austria, 126, 210, 216, 247 Avenn, Viktor, 128, 243, 253 Azatian, Moucheg (Misha), 134 Azimov, Tofik, 126
Babushka (Miami restaurant), 161, 162,
Bagdasaryan, Rafik (Svo), 105-106, 209 Bakatansky, Peter, 221 Balagula, Aksana, 52, 133 Balagula, Alexandra, 44, 45, 66 Balagula, Jakov, 43 Balagula, Leon, 45 Balagula, Marat, 16-18, 41-48, 51-67,
83, 121,224,281 Balagula, Zinaida, 43 Balchug, 245
Balmonchnykh, Maxim, 201 Banco Safra, 223 BankChara, 134-135, 138
banking, xvin, 122-123, 203-235, 239
See also money laundering Bank of Credit and Commerce, 209 Bank of England, 216, 252 Bank of New York, xix, 117, 131-132,
168, 240, 257, 259, 260, 263, 266 Banque Franchise De L'orean, 245 Barnea, Nachum, 277 Barnett, Mike, 177, 178 Belgium, 247 Benex, 257
Berger, Roger, xix, 79-80, 94 Berkovich, Lazar, 248n Berkovich, Oleg, 248n Berkovich, Vladimir, 248 Berlin, Peter, 259 Bettman, Gary, 199 Biahk (poet), 6 Bibb, Harold, 62-64 Biggs, Tonia, 35 bioterronsm, xvin-xix Birbragher, Fernando, 152-153, 156-157 Black, Roy, 166
Black and White Clubs (Hungary), 242 Bhnkin, Larissa, 34 Bhtzer, Wolf, 58
Blum, Jack, 209, 234, 267, 283, 284 BND (German intelligence agency),
Bogatin, David, 25On Bogatin, Jacob, 249-252, 254, 257, 269-270 Bojangles (fast-food chain), 34 Bophuthatswana, 59 Bopp, Michael, 196-197 Bor, Alexander (Timoka), 153 Bratsky Krug (Circle of Brothers), 117,
Bremdel, Eric, 76-77, 82 Brezhnev, Leonid, xiv, 12, 115 Brighton Beach (Brooklyn, N Y), xn,
xiv, 15-21,218 See also
Organizatsiya Brokhin, Tanya, 75, 77 Brokhin, Yuri, 18-20,75-83 Brown, Pam, 162-163, 167 Bulgaria, 82
Bure, Pavel, 179, 193-196, 198-199 Byrne, John, 48, 49

Cafe Arabat (Brooklyn), 102 Cahen, Alferd, 247-248 Cah cartel, 122, 153 California, xix, 219, 231 Camorra crime family, 242-243 Campanella, Joel, 35, 78, 79, 81,
83-84, 201
Canada, 111, 127-128, 192, 217, 218 Mogilevich s activities, 249-254,
256-258 Shva's operations, 128, 133,
186-188, 190-191 Capone, Al, 4, 29 Cardenelh, Louis, 14-15, 107, 117 Cardin, Pierre, 183 Carey, Hugh, 50 Carey, Martin, 50 Carmel Mizrachi (kosher distillery),
Casso, Anthony (Gas Pipe), 55 Castellano, Paul, 34 Castro, Fidel, xix, 13 Cayman Islands, 257 Cefarello, Ralph, 107 Central Intelligence Agency (CIA), xm,
55-56, 156n, 263-266, 268,
280-281 and Russian banking and money
laundering, 210, 214-216, 230 Channel Islands, 243 Chechen Mafiya, 114, 117 Chemical Bank, 257 Chernenko, Konstantin, 111 Chernomyrdin, Viktor, 266, 268 Chubais, Anatoly, 233 Churchward, Adrian, 251-252 Churchward, Gahna, 251-252 CIA See Central Intelligence Agency cigarette bootlegging, 8In, 162 Clark, Ramsey, 274-275 Clinton, Bill, 208, 266, 268, 269 Clouns International, 60 Colombian drug cartels, 122, 152-153,
271 money laundering, 209, 210, 217,
225, 241 weapons trafficking, xu, 143,
155-158, 163-164, 166-168, 283 Colombo crime family, 50, 54 Committee to Protect Journalists, xvi,
Committee to Reelect the President, 31 Comptroller of the Currency, U S ,
221, 228-229 contract assassins, 238, 248 Cosa Nostra See Mafia Costa Rica, xviu Cotter, Patrick J , 85 Courtney, Robert, 256 Cozzolma, Robert, 227
C-24 squad, 89
Cunningham, Dennis, 196-197, 199
Cuomo, Mario, 50, 267
Customs Bureau, U S , 95, 156n, 189,
225, 226, 227, 245, 256 Czech Republic, 237, 243, 249,
Dayne, Taylor, 17
DEA See Drug Enforcement Agency
DeFalco, Salvatore, 243
Dehlez, Pierre, 246, 247-248, 274, 276
Deloitte and Touche, 255-256, 258
Democratic National Committee, 268
Denver (Colo ), xix, 122, 188-190,
Dershowitz, Alan, 62 Details magazine, 198 Detroit Red Wmgs, 179-180, 184, 198 Digep General Machine Works, 245 DiPietro, James, 30, 79, 120 DiPietro, Sylvia, 92 Disney Company, 200 Dona, Ronald, 135 Dougherty, Edward, 91-92 Drubin, Barry, 74-75, 77-83 Drug Enforcement Agency, 95, 101, 131
money laundering cases, 225, 226-227
Roizes and, 147, 160-162, 168
Tarzan (Fainberg) and, xu, 143, 152,
156, 157, 163-167 drug trafficking, xvm, 20-21, 35, 57, 100-101, 225, 243
Ivankov's activities, 122, 124-125, 129
Tarzan's (Fainberg) operations, 143, 151-153, 167-168
See also Colombian drug cartels Dubinin, Sergei, 233 Dunes Hotel (Las Vegas), 32-33 du Plessis, Adrian, 258
Eaton, Brent, 151, 153, 164-165, 167
Economic Board of Development Corporation (NYC), 271
Economist, The (magazine), 81n
Edwards, Lucy, 259
Ehrenfeld, Rachel, 227
Eisenberg, Robert, 48, 49
El Canbe Country Club (Brooklyn), 24, 36,41
Elson, Abraham, 11
Elson, Marina, 4, 106-107
Elson, Monya, 3-21, 27, 75, 97-100,
149, 162, 267
Mogilevich and, 160, 238, 242, 260 Nayfeldwars, 100-108, 120, 209
Energy Department, US, 156n
England, 60, 210, 216

Mogilevich's operations, 238, 242,
248-252, 254 Epke, John, 178, 198 Ermath, Fritz, 265
Escobar, Pablo, 153, 156, 157, 158, 163 ESPN (cable channel), 200 European Union Bank (EUB), 216-218,
234 extortion, xvm, 24-25, 36, 128,
136-138, 154 of hockey players, 176, 177-179,
196-197 Ezra, Joe, 51-52, 62
Fama (Tarzan Famberg's common-law
wife), 155 Fainberg, Alex, 152 Fainberg, Ludwig (Tarzan), xu, 122,
141-169, 195, 263
Fainberg, Maria Raichel, 146, 147, 149 Fasano, Robert, 61-62 Fat Felix See Komorov, Felix Federal Bureau of Investigation (FBI),
61,71, 153, 189 and author death threats, xi-xni, xv-
xvi, xx
Bank of New York case, 131-132 Brokhin murder investigation, 77,
Denver mob operations, 188-190 Dunes Hotel investigation, 32-33 hockey-Ma/iya ties, 175-179,
181-182, 185-186, 188, 194-195, 197-198 Ivankovand, 122, 123, 126, 127,
132-133, 134, 136, 139, 235, 271 Mikhailov case, 274, 275, 276 Mogilevich's activities, 238, 241, 244, 245, 246, 248, 249, 252, 253, 255, 256, 260, 266, 269, 270 money laundering operations, 217,
222-223, 233
Puerto Rico mob meeting, 130-131 Russian anU-Mafiya efforts and,
86-88, 94-95
Russian arms trafficking, 156n Russian mobsters' manipulation of,
Russian mob threat downplay, 84-90 See also Russian Organized Crime
Squad Federal Reserve, 207, 215-218, 221,
228, 230, 232
Federal Security Services, 264-265 Federal Witness Protection Program,
xvi, 138
Fedorov, Sergei, 177 Fernandez, Diana, 150 Fetisov, Slava, 130, 179-186, 198, 199 Fickenauer, James, 95
Financial Crimes Enforcement Network
(FINCEN), 210 financial markets, xix, 34, 46, 239,
249-259, 284 Financial Times (London newspaper),
First Interstate Bank, 189 First Marathon, 255 Fisherman, Igor, 249, 250, 257 France, 210, 247-248 Franzese, Michael, 50, 51, 54 Freeh, Louis, xvn, 94 Furnan, Christopher (Christie Tick),
Galizia, Joe, 43
Gambino crime family, 90, 147, 159
gambling, 197-198, 200
gasoline bootlegging, 46-56, 71-73, 90-94, 224, 283
Gavin, William A , 89
Gazprom, 266
Gelber, Dan, 212
Genovese crime family, 147, 239, 250n Agron and, 28-30, 31 Balagula and, 53-54, 57, 59-60 Zilber brothers and, 70-73, 91, 120
Georgia (republic), 156n, 243
German Federal Police, 84, 159
Germany, 23, 84, 210, 246-247, 283
Getty Oil, 48-49
Gigante, Vincent, 138
Gilman, Benjamin, 61
Gingrich, Newt, 268
Ginzberg, Vladimir, 120, 151, 162
Giuliani, Rudolph, 32, 183, 270, 271
Glugech, Valen (Globus), 124-125
Goetz, Bernhard, 62
Goldberg, Boris, 34-38
Goldstein, Artie, 93
Golembiovsky, Igor, 188
Gorbachev, Mikhail, 44, 116, 213
Gore, Al, 266, 269
Gotti, John, 53, 72, 85
Gotti, John, Jr , xvm
Gravano, Sammy (the Bull), 4
Green, Pinky, 32
Greenwald, Ronald, 28, 30-32, 58-62
Greenwood, Jim, 269-270
Gregory, Richard, 159
Gngoneva, Galina, 253
Gnnenko, Peter, 77, 80-81
Gnshin, Vladimir, 116
Gromov, Alex, 208, 210
Guarnacchia, Francesco, 57n
Guccione, Bob, 35
Hamadei, Mohammed Ah, 64 Hanna, Glenn, 192 Harden, Blame, xx

Health, Education, and Welfare
Department, U S , 32 Hehtaxi, 166 Hesse, Rayburn, 231-232 hockey, Russian mob influence on, xix,
173-201,284 Hoffa, Jimmy, 32-33 Hoover, J Edgar, 86 Houston (Tex), 122,273 HSBC Holdings PLC, 230n Hungarian National Police, 253n Hungary, 203-205, 213, 242, 244-246,
249, 257, 260 Hynes, Joe, 81n
Ignatious, David, 267 Immigration and Naturalization Service, 121, 131, 217, 233-235, 256, 269 Inkombank, 230-231 Institutional Investor (magazine), 223,
insurance fraud, xix, 26 Intercross International, 190, 191n Internal Revenue Service, 46-47, 71,
131, 189,256 International Brotherhood of Teamsters,
33, 185
International Home Cinema Inc ,191 International Monetary Fund, 233, 265 Interpol, 60, 64, 238 Ionzzo, Lawrence, 49-50 Iran, 116, 156n, 195,245 Iraq, 268
IRS See Internal Revenue Service Israel, 13, 14, 44, 123-124, 143
Kalmanovitch's activities, 58, 59, 61,
123-124 mob influence in, 123-124, 167,
276-282 Mogilevich and, 238, 239, 241-242,
244, 245, 247, 252, 260 Italian Mafia See Mafia (Italian) Ivan (ex-Brighton Beach resident),
Ivan (Russian mobster), 82-83 Ivankov, Eduard, 123, 126, 277 Ivankov, Vyacheslav Kinllovich author death threats and, xv-xvi,
xx-xxi, 312 hockey players and, 181-183, 186,
187-188, 198
Mogilevich and, 242, 243, 260 Petrossov and, 189-190, 192, 193 in Russia, 108-111, 113-117 in United States, 119-139, 141, 153, 235, 271, 273, 284
Jackson, Henry (Scoop), 13 Jacmo (drug dealer), 36 Jermyn, Ray, 43, 53, 54, 55-56
jewel theft and smuggling, xix, 19-20,
57, 90, 100, 122 Josephson, Marvin, 28 Justice Department, U S , 84, 95, 208,
235, 257, 261
Kalmanovitch, Shabtai, 58-61, 98, 277 Kamensky, Valen, 179, 187, 188, 190,
192, 193, 198, 199 Kamikaze Club (Moscow), 158 Kantor, Oleg, 211-212 Kaplan, Robert, 127-128 Kasparov, Garry, 180 Katnc, Anatoly, 247 Keenan, John, 168
Kerr, Raymond C , 89, 139, 182, 185 KGB
espionage, 58, 64-65, 82 looting of Soviet assets, 111-112,
150, 209
money laundering by, 213, 234, 265 Soviet jail emptying, xiv, 13, 23 Khodorovsky, Mikhail, 214-215, 216,
Kikahshvih, Anzor, 130 Bureties, 194-196, 198-199 Tarzan (Fainberg) and, 154, 157, 163,
King, Reg, 179
Kishn, Semyon (Sam), 270-271 Kissinger, Henry, 13 Kobzon, Joseph, 70, 115-116,
128-131, 183n, 194, 199, 277, 281 Kommersant (Moscow newspaper),
214, 233
Komorov, Felix, xn, 123, 183-186, 191 Konamkhine, Alexander, 203-206,
212-218, 233-235 Korkov, Gennadiy (the Mongol), 109,
Kozlov, Andrei, 232 Kroll and Associates, 265 Kruglov, Sergei (the Beard), 104, 106 Kulikov, Anatoly, 214 Kvantrishvilli, Amiran, 181 Kvantnshvilli, Otan, 114-115, 116, 125, 130
Lallemand, Alain, xi, 274
Lansky, Meyer, xix, 38, 151
Laskin, Efim, 57, 64, 146
Las Vegas (Nev), 32-33, 185
Lautenberg, Frank, 116
Leach, Jim, 218
LeBow, Bennett S , 269
Leder, Hezi, 277, 278, 279, 281, 282
Lehman, William, 151
Lerner, Gregory, 278-279
Lev, Leonard, 121, 122, 133, 137, 138

Levinson, Robert, 196, 246, 252, 273,
274, 275, 276 Liat (company), 59 Liebowitz, Leo, 48-49 liquor smuggling, 244 Listyev, Vladimir, 188n Lithuania, 257
Long Island Motor Fuel Task Force, 49 Lopez, Byron, 166 Los Angeles (Calif), xix, 219 Loutchansky, Gngori, 267-268, 277,
280-281 Lubrani, Un, 60
Lyubertskaya crime family, 135, 136, 240 Lucchese crime family, 53, 54, 55 Luchins, David, 76-77 Luciano, Lucky, 29, 38 Lynn, Amber, 142 Lyubarsky, Vyacheslav, 18
M&S International, 100
Mafia (Italian), xvu, 85, 86, 185-186,
Balagula and, 46, 53-55, 57, 59-60 Camorra family, 242-243 Colombo family, 50, 54 Gambino family, 90, 147, 159 gasoline bootlegging, 53-54, 71-73,
90-94 Genovese family See Genovese crime
Las Vegas interests, 32-33 Lucchese family, 53, 54, 55 money laundering, 209, 210 Roizes and, 168
Mafiya (Russian), 287-288
arms dealing See weapons trafficking author death threats, xi-xm, xv-xvi,
xx-xxi, 261
banking activities, xvm, 203-235 global network, 14-15, 57, 120, 127-128, 133-134, 263-284 hockey influence, 174-201 post-Soviet rise of, 112-113 scope of operations, xvn-xix U S politics and, 50, 267-271 See also Orgamzatsiya, Red Mafiya
Magharian brothers, 226, 227
Magnex 2000, 245, 249, 250
Magnex Ltd, 248n
Malakhov, Vladimir, 177
Malevsky, Anton, 271
Mangano, Venero (Benny Eggs), 29
Mangope, Lucas, 59
Maverick's Steak House (Colo ), 190
Mazursky, Paul, 17
McCall, Michael, xi-xn, xv-xvi
McCormick, Robert H , 212, 229-230
McGovern, George, 31
McKenna, Jeremiah, 50
McMahon, Joseph, 164-166
McShane, Michael, 165
Medellin drug cartel, 158
Medicaid/Medicare fraud, xix, 26, 286
Melmkov, Viktor, 210-211
Menatep Bank, 214-216, 218, 232-233
Merrill Lynch, 60, 61
Metro-Dade Police Department, 164
Metropole (N Y nightclub), 79
Miami (Florida), xn, xix, 122, 141-143,
149-155, 159-168,218,273 Miami Beach Police Department,
149-150 Mikhailov, Sergei, 128, 243, 244, 245,
250n, 252, 253, 272-276, 277 Misha (St Petersburg, Russia, crime
lord), 164
Mogilevich, Mila, 253 Mogllevich, Sermon (the Brainy Don),
xni, 117, 124, 160, 213, 237-264,
266, 268-270, 277, 281 Mogilevich, Tatiana, 253 Mogilny, Alexander, 177, 178-179 Momoh, Joseph, 57, 58 money laundering, 82, 153, 203-235,
284 Bank of New York case, xix, 117,
131-132, 168, 240, 257, 259, 260,
263, 266
Denver operations, 188-189 hockey player involvement, 181-182 in Israel, 278 Ivankov's operations, 122, 126, 127,
271 Konamkhine case, 203-206,
212-218, 233-235 Mogilevich's activities, 238, 241,
243, 249, 251, 256-260 Republic National Bank and, 207,
219, 220-230, 232 Swiss banks and, 271-272, 276 Moody, James, 85-89, 95, 115, 132,
190, 197, 198-199, 259, 276, 277,
282, 284 Morelli, Anthony (Fat Tony), 72, 73,
91-92, 94 Morris, Stanley, 211 Morrison, Mike, 283 Moschella, William, 24, 77, 80 Moscow on the Hudson (film), 17 Mossad, 58, 282 Moymhan, Daniel Patrick, 76-77 Murkoff, Benjamin, 216 MVD See Russian Ministry of Internal
Namath, Joe, 200 Nasdaq, 255
National (Brooklyn restaurant), 17, 82, 97

National Association of Securities
Dealers, 135
National Football League, 200 National Hockey League, xix, 174, 175,
177-180, 184-186, 190, 196-201,
National Republican Committee, 269 National Republican Congressional
Committee, 269 NATO, 245
Nayfeld, Benjamin, 24, 25, 36, 46, 62 Nayfeld, Boris (Biba), 24, 25-26, 36,
38, 41, 46, 100-108, 160, 209 Nelh (singer), 161, 162 Netanyahu, Benjamin, 281, 282 Newsday, 58n, 226 New York City, xix, 271 See also
Brighton Beach New York Daily News, 193 New Yorker (magazine), 17, 58n New York Police Department, 74, 84,
189, 277 Brokhin murder investigation, 74-75,
cops on mob payroll, 73, 79-80 New York Post, 92 New York State Banking Department,
219, 220-221, 223, 229-230 New York State Organized Crime Task
Force, 80
New York Stock Exchange, 255 New York Times, xm, xx-xxi, 64, 71,
8In, 132, 215, 230n, 266 NHL See National Hockey League Nightflight (Brooklyn disco), 273 Nikiforov, Viktor (Kalina), 125 Nixon, Richard, 13, 31-32 Noriega, Manuel, 153 Novoye Russkoye Slovo (newspaper),
nuclear weapons, xvm-xix, 156n NYPD See New York Police
Odessa (Black Sea port), 7, 16, 109
Odessa (Brooklyn restaurant), 16-18, 41,46, 55, 121, 149
Office of Technology Assessment, U S , 231
Ohad, Dan, 277
Olga (hair salon owner), 25-26
Ontario Teacher's Pension Fund, 258
Operation Odessa, 159-160
Operation Red Daisy, 73, 87, 90-94, 95
Operation Romance, 277
Operation Sword, 251
Orgamzatsiya, 15, 209, 285-287 Agron as don, 20, 23-42, 45, 79, 82 Balagula s operations, 16-18, 41-48, 51-67, 83, 121, 224, 281
Elson-Nayfeld wars, 100-108, 120,
Goldberg gang, 34-38 Ivankov's activities, 114-139,
181-183, 186, 187-190, 192, 193,
198, 235, 242, 243, 260, 271, 273,
284 law enforcement agencies and,
55-56, 79-80, 83-85 Tarzan s (Fainberg) activities, xii, 122,
141-169, 195, 263 Zilber brothers as dons, 70-73,
90-91,99, 119-120,267
Pacino, Al, 183
Pagano, Daniel, 72, 73
Pagano, Joseph, 72
Paine Webber, 184
Palmer, Richard, 112, 163
Palm Terrace (L A restaurant), 248
Panama, 121, 210
Pantanella, Renato, 57n
Papp, Katalin, 242
Papsouev, Vitah, 218
Paradise Club (Brooklyn), 133
Parker, Buddy, 223
Passic, Greg, 226, 227
Paul (piano player), 161-162
Peabody, Charles, 224
People's Courts, 9, 18, 108
Peres, Shimon, 279, 281, 282
Peterson, David, 254, 258
PetroEnergy International, 189
Petrossov, Vatchagan, 122, 188-193
pickpockets, 12
Platenum Energy, 54
Plehve, Vyacheslav von, 6
plutonium, 156n
Poland, 100-101, 250n
police corruption
Hungary, 246
New York, 73, 79-80
Russia, 113-114,246 Pollard, Jonathan, 58 Pooya, Rafigh, 191n Porky's (Miami strip club), 122,
141-142, 150, 151, 154, 165 Potts, Larry, 88 Power Test, 48-49 Pratecs Technologies Inc , 250-251,
254, 255
Promstroybank, 230 prostitution, 238, 242, 253n Prudential Securities, 135 Puzyretsky, Emile, 18, 24-25, 97, 99
Rabin, Yitzhak, 58, 282 Rabinovich, Vadim, 268-269, 277 Racer, Sam, 46-47, 64-65 Ragsdale, Tina, 77-78

Raichel, Maria See Famberg, Maria
Raichel, Naum (Psyk), 146 Raichel, Sermon {Psyk), 146-147 Rainbow Amusements, 35 Rasputin (Brooklyn nightclub), 30, 70,
71, 79, 91, 95, 99, 120, 138, 267 Red Brigades, 57, 146 Red Mafiya, xm, 213, 237-261, 263,
Rehbock, Richard, 92-94 Remnick, David, 7 Reno, Janet, 88 Republic National Bank, 207, 219,
220-230, 232 Rezmkov, Vladimir, 54-55, 83,
Rich, Marc, 32, 51, 58 Rivera, Charlie, 35, 36, 37 R J Reynolds Tobacco Co , 190 Roberts, Clare, 216
Rocky (Porky s day manager), 141, 142 Rodio, James, 49 Rohr, Klaus C , 88 Roizes, Grecia (the Cannibal), 147,
160-162, 168 Rose, Charles, 64, 65 Rose, Pete, 200 Rosenberg, Philip, 247 Rowe, Jerry, 218, 219 Royal Bank of Scotland, 251, 252 Royal Canadian Mounted Police, 111,
127, 128, 133, 159, 187-188, 190,
Rushailo, V B, 191n Russia, 6-10, 249, 282-283
anti Mafiya efforts, 86-88, 94-95 banking system, 208-212 See also
Russian Central Bank corruption, 7, 8-9, 44, 126, 263-267 journalist killings, xvi-xvu, 188n looting of government, 111-112,
150, 209, 264 organized crime influence, xix, 7-9,
112-117, 120, 124, 133-134, 156 police corruption, 113-114, 246 underground economy, 7-8, 43-44 See also KGB, Mafiya, vor v zakonye Russian and Turkish Baths (N YC ), 38 Russian Association of Bankers, 211 Russian Central Bank, 208, 211, 231,
232-233, 265-266 Russian Mafiya See Mafiya (Russian) Russian Ministry of Internal Affairs,
123n, 159 Russian Organized Crime Squad, xi,
xvn, 88-89, 131-132 Russian Presidential Security Service,
266 Russian World Art Gallery (N YC ), 183
S&S Hot Bagel Shop (NYC), 101
Sachs, Jeffrey, 208
Sadko (N Y restaurant), 80
Sadykov, Roustam, 135
Safra, Edmond, 223-227, 230n
St Petersburg (Colorado restaurant),
San Francisco (Calif), xix Santora, Frank, 148 Sasha (Adeev s enforcer), 204, 205 Sasha (extortionist), 178 Schumer, Charles, 129, 271 Sciortino, Frankie (the Bug), 54, 92-94 Scotty, Gavin, 184-185 Scowcroft, Brent, 265, 282-283 Secret Service, U S , 61, 62-63 Seidle, William {Stanyk), 150-151,
153, 156
Sehvanov, Vladislav, 264 Semionov, Anatoly, 125 Shahal, Moshe, 278, 281, 282 Shakarchi, Mahomoud (father),
Shakarchi, Mohammed (son), 226 Shakarchi Trading, 226-227 Shapiro, Jay, 138-139 Sharansky, Natan, 279-281 Shenker, Morris, 32-33 Shevchencko, Natalia, 62, 66 Shin Bet, 282 Shuster, David (Napoleon), 34, 36,
87-88, 90-91, 92, 94 Siegel, Bugsy, 38 Sierra Leone, xvin, 57-58, 59, 63-64,
Sigalov, Joseph (Mr Tomato), 127-128 Simis, Konstantin, 8 Skolmck, Alexander (Cabbagehead), 17 Slavic Inc, 181-183 Slepimn, Alexander (the Colonel),
103-104, 149 Shva, Vyacheslav, 128, 133 186-188,
190-191 Slotmck, Barry, 62, 64, 65, 91, 137,
138, 182
Smith, Mike, 177 Smolensky, Alexander, 230 Social Security fraud, 286 Solntsevskaya crime family, 124, 126,
128, 242-245, 251, 252, 272 Solzhemtsyn, Alexander, 139 Sommer, Bobby, 285-286 Sotheby s, 244 Soviet Jewish emigres, xiv, 12-15, 23,
45, 241, 276-277, 280 Spain, 261 sports, Mafiya control of, 174-175 See
also hockey Stahl, Robert, 93-94 Stalin, Joseph, 6, 10

Stasmk, Gregory, 80, 99-100, 102,
132, 133 State Department, U S , xx, 130, 166,
196, 217, 220, 256, 259, 268-270,
277, 280
Stembrenner, George, 200 Stohchny Bank, 230 ' Streetsweeper" incident (1993),
106-108, 120
Summit International, 134-135, 138 Sunday Times (London newspaper), xm Svo, Rafik See Bagdasaryan, Rafik Switzerland, 210, 225, 227, 271-276 Sych, Valentin, 200-201
Taj Mahal (NJ casino), 132-133
Terminello, Louis, 167
Testa, Joe, 55
Texaco, 48
Thailand, 57, 122
Timofeyev, Sergei (Sylvester), 104,
Toronto Stock Exchange, 254, 258 Trade Development Bank, 224, 225 Treasury Department, U S , 208, 210,
221, 228, 232 Trentacosta, Anthony, 93 Trump Organization, 132n TSE 300 Index (stock index), 254, 256 Turkey, 225
Tverdovsky, Alexandra, 176 Tverdovsky, Oleg, 173-179 Twelve-LA (film company), 121 Twenty First Century Association, 115,
130, 194-195
Ubinya, Vahtang, 269
U Holubu (Prague restaurant), 252-253
UJA-Federation, 129
Ukleba, Shlava, 106
Ukraine, 128, 245, 249, 269
uranium, 156n
Urov, Boris, xx
Uruguay, 216
U S Attorney's Office, 255, 256, 258
Valachi, Joseph, 72
Valiquette, Joe, 84
Vancouver Canucks, 193, 194
Vax, Michael, 54
Village Voice (newspaper), xm, 17, 240
Vinmtsky, Mishka See Yaponchick
Vinny (store clerk), 148
Vitale, Anne T, 222
Volkov, Alexander, 135-136, 138 Voloshin, Vladimir, 135-136, 138 Volovmk, Yakov (Billy Bombs), 137,
von Raab, William, 223, 225 vorvzakonye (thieves-in-law), 192,
193, 198, 277 Bratsky Krug, 117, 123 in Russia, 9-10, 23, 110, 111, 113,
117, 134
Wall Street Journal, 215 Wanner, Vladislav, 125 Washington Post, 267 Washington Times, 183n weapons trafficking, xvm, 116, 195,
Mogilevich s activities, 243, 244-245 Tarzan (Fainberg) and, xn, 155-159,
163-164, 166-168 Wemberg, Lilly, 129 Wemberg, Valery, 129-130 Weinberger, Bernard, 32 Wexler, Leonard, 49, 65 Willard Hotel (Washington, D C ), 217 Wilson, Murray, 28-29, 32-33 Winer, Jonathan, 210, 211, 216, 217,
232, 277, 280, 281 Wirtschafts Woche (Austrian magazine),
WNET (television station), 215-216 World Bank, 233
Yakuza (Japan), 242 Yaponchick (Russian bandit), 109 Yasevich, Alexander, 162-163, 166 YBM Magnex International, 249-251,
253-259, 269-270, 284 Yegorov, Mikhail Konstantinovich,
86-87 Yeltsin, Boris, xix, 114, 116, 194, 213,
214, 265, 266 Yugorsky Bank, 211 Yukos Oil, 214
Zapivakmine, Oleg, 106, 107-108
Zarkova, Anna, xvi-xvu
ZDF (German television network),
Zhitmk, Alexei, 177-178 Zhukov, Marshal, 213 Ziegler, Jean, 271-272, 276 Zilber, Vladimir and Alex, 70-73,
90-91, 99, 120, 267


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