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TRUMP’S LUXURY CONDO: A CONGOLESE STATE AFFAIR

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How the Congolese Presidential fam­i­ly used taint­ed mon­ey to buy a Trump apart­ment in New York City.

The daugh­ter of the klep­to­crat­ic ruler of Republic of Congo used mil­lions of dol­lars of appar­ent­ly stolen state funds to buy a lux­u­ry apart­ment at the Trump International Hotel & Tower in New York City, Global Witness’ new inves­ti­ga­tion reveals. Despite the risks asso­ci­at­ed with the trans­ac­tion, the Trump Organization bro­kered and prof­it­ed from the apart­ment deal.

Download the pol­i­cy brief­ing (PDF, 124KB)

Meet the Republic of Congo’s Sassou-Nguesso fam­i­ly – rulers of one of the longest-last­ing author­i­tar­i­an regimes on the plan­et. In pow­er for much of the past four decades, the Sassou-Nguesso fam­i­ly own prop­er­ties worth mil­lions around the world and have been accused of using their posi­tions of pow­er to enrich them­selves – an accu­sa­tion some have also direct­ed at the cur­rent first fam­i­ly of the United States of America.

But that’s not all that links the Trumps to the Sassou-Nguessos. Global Witness’ new inves­ti­ga­tion reveals that the daugh­ter of Congo’s President appears to have helped her­self to almost 20 mil­lion dol­lars in pub­lic funds and laun­dered part of the cash through U.S. prop­er­ty – specif­i­cal­ly, a lux­u­ri­ous Trump apart­ment in Manhattan worth more than 7 mil­lion dol­lars. This is yet fur­ther evi­dence that some of the world’s most noto­ri­ous politi­cians and busi­ness­peo­ple choose to stash their cash in Trump prop­er­ty.

At the heart of the appar­ent mon­ey-laun­der­ing scheme is Claudia Sassou-Nguesso (left) — daugh­ter of the Congolese President and pres­i­den­tial head of com­mu­ni­ca­tions. © GUY GERVAIS KITINA/AFP/Getty Images

The U.S. President boasts that he has made a for­tune from his name, with a will­ing client base in many cor­ners of the globe. Huge let­ters spell out “Trump” on build­ings across the world, though what was once con­sid­ered by some to be a mark­er of brash lux­u­ry is today a light­ning rod for protests and inves­ti­ga­tions.

Yet, Trump-affil­i­at­ed prop­er­ties, hotels and con­dos have been a source of rev­enue for the Trump Organization and ulti­mate­ly Trump him­self, whether from sales, licens­ing, rental or man­age­ment fees. Questions swirl around the source of the vast sums of mon­ey invest­ed in Trump prop­er­ties, with the New Yorker recent­ly describ­ing sev­er­al of Trump’s prop­er­ty deals as show­ing signs of “pos­si­ble mon­ey-laun­der­ing, tax eva­sion, sanc­tions vio­la­tions, and oth­er finan­cial crimes.”

One of the most promi­nent Trump build­ings is the tow­er­ing apart­ment and hotel block loom­ing over Manhattan’s Central Park: the Trump International Hotel & Tower at 1 Central Park West (Trump International). Trump him­self has described it as his “flag­ship” hotel. Since the late 1990s, peo­ple have bought over 150 pri­vate apart­ments in the build­ing, and Trump’s com­pa­ny has sold 176 units that are rent­ed as hotel rooms. Once sold, these apart­ments and units con­tin­ue to pay fees to com­pa­nies Trump led until he became U.S. President.

What fol­lows is the sto­ry of apart­ment 32G in Trump International, and how Claudia Sassou-Nguesso, daugh­ter of Congo’s President, used appar­ent­ly stolen pub­lic funds to pur­chase it in the sum­mer of 2014. The tale involves a noto­ri­ous Portuguese mid­dle­man, a world-renowned American law firm, a com­plex net­work of secre­tive com­pa­nies in mul­ti­ple juris­dic­tions, and a now-defunct bank, and rais­es seri­ous ques­tions about the role Trump Organization played in a sus­pect­ed mon­ey laun­der­ing scheme.

A LUXURY PAD IN THE HEART OF MANHATTAN

In 2017, Portuguese jour­nal­ist Micael Pereirastart­ed to ask ques­tions about the own­er of an apart­ment in the Trump International. The reporter had infor­ma­tion indi­cat­ing that unit 32G had been pur­chased in July 2014 by José Veiga, a busi­ness­man and for­mer direc­tor of the major Portuguese soc­cer club Benfica. By the mid-2010s, how­ev­er, Veiga was also becom­ing known as a per­son­al busi­ness fix­er for the Congolese President.

Congo has qui­et­ly risen to become sub-Saharan Africa’s fourth biggest oil pro­duc­er, earn­ing huge rev­enues from its off­shore black gold. However, the coun­try is beset by cor­rup­tion and mis­man­age­ment, and despite its oil wealth it con­sis­tent­ly per­forms bad­ly in devel­op­ment indices.

Denis Sassou-Nguesso, the fourth longest serv­ing author­i­tar­i­an leader in the world, rules Congo. Corruption, usu­al­ly around oil deals but also in infra­struc­ture projects and oth­er pro­cure­ment con­tracts, has fuelled lav­ish spend­ing sprees by President Sassou-Nguesso’s fam­i­ly.  Since 2010, fol­low­ing a crim­i­nal com­plaint filed by French non-gov­ern­men­tal orga­ni­za­tions (NGOs), French pros­e­cu­tors have pur­sued the family’s assets on the basis that they had been acquired through mis­ap­pro­pri­a­tion of pub­lic funds and mon­ey laun­der­ing. The case is known as the Affaire des Biens Mal Acquis (Ill-Gotten Gains) and is ongo­ing.

As part of the probe, French inves­ti­ga­tors found that President Sassou-Nguesso and his fam­i­ly had spent $67.6 mil­lion (€60 mil­lion) on lux­u­ry goods and real estate assets in France. Stories of extrav­a­gance abound: the President report­ed­ly spent over a mil­lion dol­lars on shirts and suits from lux­u­ry Parisian bou­tiques, while France’s Libération news­pa­per quot­ed a for­mer aide to the pres­i­den­tial staff say­ing that the President’s son “changes shirts three or four times a day and boasts that he nev­er wash­es them and uses them as Kleenexes”.

In a 2017 report, the Swiss NGO Public Eye showed how, from 2011, Veiga had act­ed as a rep­re­sen­ta­tive for the Brazilian com­pa­ny Asperbras in Congo. In this role, Veiga lever­aged his close rela­tion­ship with the Sassou-Nguessos to close hyper-inflat­ed con­tracts with the Congolese gov­ern­ment, accord­ing to Public Eye. All told, Asperbras got deals in Congo worth some $1.5 bil­lion. Veiga’s arrange­ment with Asperbras report­ed­ly gave him a three per­cent cut of the total val­ue of the deals.

Given the Congolese government’s rep­u­ta­tion for cor­rup­tion, Portuguese author­i­ties had ques­tions about Veiga’s affairs in the coun­try and arrest­ed him in ear­ly 2016, cit­ing his alleged involve­ment in mon­ey laun­der­ing and inter­na­tion­al cor­rup­tion in Congo. He was released five months lat­er and the inves­ti­ga­tion is ongo­ing. No charges have been brought so far.

In this con­text, it is no sur­prise that the Portuguese media became inter­est­ed when Veiga’s name was linked with the apart­ment in the Trump International. Pereira, the jour­nal­ist look­ing at the sto­ry in 2017, con­tact­ed Veiga for com­ment. Veiga was hap­py to claim the apart­ment was his.

The apart­ment in ques­tion is owned by a com­pa­ny, of which I am the share­hold­er. The acqui­si­tion made by this com­pa­ny was financed by my own means, in a busi­ness that has noth­ing to do with third par­ties, name­ly the fam­i­ly of the President of Congo- José Veiga, respond­ing to Portuguese jour­nal­ist Micael Pereira in 2017

This is a lie.

Global Witness’ new inves­ti­ga­tion reveals that a com­pa­ny belong­ing to Claudia Sassou-Nguesso, a Congolese mem­ber of par­lia­ment, the pres­i­den­tial head of com­mu­ni­ca­tions and the daugh­ter of Congo’s President Denis Sassou-Nguesso, pro­vid­ed the funds for the pur­chase of the apart­ment using mil­lions of dol­lars of Congolese pub­lic mon­ey. Public offi­cials’ salaries in Congo are high­ly unlike­ly to fund the pur­chase of this kind of lux­u­ry prop­er­ty. There are strong grounds to sus­pect the funds were stolen from the Congolese trea­sury. Veiga was mere­ly the front­man for Claudia Sassou-Nguesso in the deal. 

A MONEY-LAUNDERING SCHEME?

In 2007, President Lula, for­mer Brazilian leader, attend­ed a sem­i­nar in Congo aimed at pro­mot­ing invest­ment oppor­tu­ni­ties in both coun­tries, along­side Brazilian busi­ness rep­re­sen­ta­tives. At the meet­ing, the two pres­i­dents did a deal: Congo’s debt would be can­celled in exchange for infra­struc­ture con­tracts for Brazilian com­pa­nies.

Officials from Asperbras, a com­pa­ny found­ed in the small Brazilian coun­try­side town of Penápolis, saw this as a prime oppor­tu­ni­ty to begin oper­a­tions in Congo. Until then, the company’s spe­cial­i­ty had been the man­u­fac­ture of PVC pipes and con­nec­tors for agri­cul­tur­al irri­ga­tion in Brazil. The Brazil-Congo deal would allow Asperbras to expand its hori­zons and areas of exper­tise, but it need­ed a local agent to help it do busi­ness with the Congolese gov­ern­ment. Asperbras turned to Veiga.

Asperbras told Global Witness that Veiga “was the best avail­able option” because he was flu­ent in French, had con­tacts in the coun­try and knowl­edge to devel­op Asperbras’ activ­i­ties in Congo. The com­pa­ny said that its rela­tion­ship with Veiga was for bro­ker­age ser­vices and that he act­ed as a busi­ness inter­me­di­ary in Congo. He “was nev­er a share­hold­er, direc­tor or rep­re­sen­ta­tive of Asperbras”.

Thanks to Veiga, in just a few years, Asperbras won a diverse range of con­tracts with the Congolese state: geo­log­i­cal map­ping, con­struc­tion of an indus­tri­al park, dig­ging 4,000 hydraulic bore­holes and build­ing 12 hos­pi­tals. The com­pa­ny claimed the lat­ter to be “the largest pub­lic health project in the African con­ti­nent”.

The work of Asperbras is chang­ing the lives of mil­lions of Congolese cit­i­zens for the bet­ter- Asperbras pro­mo­tion­al video

However, the prices Asperbras was charg­ing in Congo were inflat­ed, accord­ing to the French news­pa­per Le Canard Enchaîné. The news­pa­per found the geo­log­i­cal sur­vey con­tract signed between Asperbras and the French state-owned enti­ty Bureau de Recherches Géologiques et Minières (BRGM) cost up to ten times more than sim­i­lar work BRGM had pre­vi­ous­ly done. The company’s bore­hole con­tract was up to sev­en times more expen­sive than com­pa­ra­ble con­tracts, as alleged by the news­pa­per.

These sorts of appar­ent­ly hyper-inflat­ed deals with the state should set alarm bells ring­ing as they can sig­nal cor­rup­tion: pub­lic pro­cure­ment is rife with cor­rup­tion around the world as fixed con­tract­ing can lead to excess pub­lic funds being shared between cor­rupt offi­cials and con­trac­tors involved in reach­ing any deal.

In response to writ­ten ques­tions from Global Witness, Asperbras said it could not com­ment on what BRGM charged for its ser­vices as the two com­pa­nies were inde­pen­dent. Asperbras argued that it was mis­lead­ing to com­pare projects between coun­tries since in Congo the work was on a larg­er scale, hav­ing been car­ried out through­out the coun­try. Asperbras com­plete­ly refut­ed any claim of over-priced con­tracts and irreg­u­lar­i­ties in the Congolese pub­lic pro­cure­ment process.

Money to pay for at least one of Asperbras’ con­tracts flowed out of Congo’s trea­sury and into an Asperbras sub­sidiary. A por­tion of those funds would even­tu­al­ly find their way to Claudia Sassou-Nguesso’s com­pa­ny and was used, ulti­mate­ly, to pur­chase the apart­ment in the Trump International.

Bank state­ments and busi­ness con­tracts reviewed by Global Witness show in detail the cir­cuitous route tak­en by the funds from Congo to Delaware, the British Virgin Islands and Cyprus. The real estate acqui­si­tion was even­tu­al­ly made using a New York-based shell com­pa­ny, set up just before the pur­chase. 

First came the pay­ment from the Congolese trea­sury to Asperbras. Bank records for Asperbras LLC (the Asperbras sub­sidiary in Delaware) show that on November 28, 2013 it received $675 mil­lion (€491.1 mil­lion) from Dgt Services Virement Congo Brazzaville. The sender was a depart­ment with­in the Congolese Ministry of Finance and Budget respon­si­ble for man­ag­ing the trea­sury.

President of Republic of Congo, Denis Sassou-Nguesso, father of Claudia, is one of the longest-serv­ing author­i­tar­i­an rulers in the world. © JEWEL SAMAD/AFP/Getty Images

The Congolese trea­sury paid the mon­ey into Asperbras LLC’s account at Banco Espirito Santo, a bank that is now defunct fol­low­ing a peri­od of “ruinous mis­man­age­ment” that cor­re­sponds with the dates of these trans­ac­tions. Global Witness does not sug­gest that the bank was par­ty to any alleged mon­ey laun­der­ing scheme. Bank doc­u­ments show that Asperbras LLC had only a cou­ple of thou­sand dol­lars in that account until the mas­sive pay­ment from Congo arrived.

Asperbras LLC now need­ed a pre­text to move some of those funds on to oth­er com­pa­nies. On December 11, 2013, less than two weeks after the pay­ment of more than half a bil­lion dol­lars was received by Asperbras LLC from the Congolese trea­sury, a sec­ond Asperbras sub­sidiary, the British Virgin Island-based Energy & Mining Asp. Inc., sub­con­tract­ed a Cypriot com­pa­ny called Sebrit Limited to car­ry out part of the geo­log­i­cal map­ping project. Sebrit had been incor­po­rat­ed only two days before the con­tract was signed.

Energy & Mining, the sec­ond Asperbras sub­sidiary, agreed to pay  $19.5 mil­lion to Sebrit: $6.8 mil­lion upon com­ple­tion of a “Geophysical Report” and $12.7 mil­lion for Sebrit to “search for new busi­ness to the client [Energy & Mining]”, accord­ing to the con­tract reviewed by Global Witness.

On December 13, 2013, two days after the con­tract was signed, Asperbras LLC trans­ferred $31 mil­lion (€22.7 mil­lion) to Energy & Mining and then, three weeks lat­er on January 6, 2014, Energy & Mining paid $19.5million (€14.3 mil­lion) to Sebrit. This was the first and only amount cred­it­ed to Sebrit’s bank account accord­ing to a Portuguese police report reviewed by Global Witness.

Sebrit was an opaque Cypriot com­pa­ny that did not appear to have the cap­i­tal or exper­tise to car­ry out the pub­lic works it was con­tract­ed to do. It had been oper­at­ing for only two days before it signed the deal with Energy & Mining, had no web­site, no pres­ence on LinkedIn or sim­i­lar sites, with not a sin­gle iden­ti­fi­able employ­ee; it does not appear to have been a com­pa­ny car­ry­ing out any gen­uine busi­ness, let alone one that would have any exper­tise in geo­log­i­cal map­ping. In fact, French com­pa­ny BRGM, men­tioned above, seems to have car­ried out the geo­log­i­cal map­ping project. Given its appar­ent lack of real busi­ness, Sebrit was in all like­li­hood sim­ply a vehi­cle for extract­ing and laun­der­ing Congolese pub­lic funds, and was lat­er dis­solved in July 2018.

Asperbras explained that BRGM car­ried out only part of the geo­log­i­cal map­ping project. It did not men­tion the nature of its trans­ac­tions with Veiga’s com­pa­nies, includ­ing Sebrit. Asperbras said it could not respond to ques­tions into its Congo deals as they are under inves­ti­ga­tion in Portugal.

SEBRIT’S SECRETS

During this peri­od, Sebrit was part of a struc­ture of three dif­fer­ent Cyprus-reg­is­tered com­pa­nies. Sebrit’s shares were owned by one of these com­pa­nies, called Voxxi, which was in turn ful­ly owned by the third Cypriot com­pa­ny, Leezu.

Veiga was named as the sole direc­tor for each of the com­pa­nies, and list­ed as the only share­hold­er of Leezu, the com­pa­ny at the top of the struc­ture. At first glance, then, Veiga appears to have been the own­er of this set of com­pa­nies – at least accord­ing to pub­licly avail­able cor­po­rate doc­u­ments.

This is per­haps the biggest cor­rup­tion red flag so far with regards to Sebrit’s geo­log­i­cal map­ping con­tract: Veiga was on both sides of this deal with the Congolese gov­ern­ment. First, he was rep­re­sent­ing the con­tract­ing com­pa­ny, Asperbras, in Congo; sec­ond; he was also the appar­ent direc­tor and own­er of the sub­con­trac­tor, Sebrit. This is a glar­ing con­flict of inter­est and a com­mon trait in cor­rupt con­tract­ing arrange­ments.

Veiga was not the only per­son behind these Cypriot com­pa­nies, how­ev­er. Global Witness has uncov­ered nota­rized con­tracts from the Congolese cap­i­tal Brazzaville reveal­ing that while Veiga was the list­ed direc­tor of the com­pa­nies, he was actu­al­ly just a front.

An obscure con­tract­ing arrange­ment hid the iden­ti­ty of the true own­er and ben­e­fi­cia­ry of the net­work: Claudia Sassou-Nguesso, daugh­ter of Congo’s President.

Before he became involved in Congo, José Veiga (left) was a direc­tor of Portuguese foot­ball club Benfica. Here he is pic­tured at a press con­fer­ence for the club in 2005. © FRANCISCO LEONG/AFP/Getty Images

Key to this arrange­ment are two types of con­tract: a Cession d’actions (Share Transfer Agreement) and a Convention de portage d’actions (Carrying Agreement). Global Witness has reviewed two sets of these con­tracts, for both Leezu and Voxxi. The doc­u­ments indi­cate that they were drawn up in Brazzaville and nota­rized by the ‘Office Notarial Galiba’, a Congolese notary.

The share trans­fer agree­ments pro­vide for 100 per­cent of the shares in both Voxxi and Leezu to be trans­ferred from Veiga to Claudia Sassou-Nguesso. These con­tracts are both dat­ed July 16, 2013. As a result, Claudia Sassou-Nguesso became the own­er of the shares and assets of the com­pa­nies and their sub­sidiaries, includ­ing Sebrit.

The car­ry­ing agree­ments, reg­is­tered by the same Congolese notary on the same date, show Claudia Sassou-Nguesso grant­i­ng Veiga autho­riza­tion to man­age both Voxxi and Leezu on her behalf. Veiga is required to remit all gains to her. The con­tracts spec­i­fy that Veiga would not receive any remu­ner­a­tion for man­ag­ing the com­pa­nies – this seems an unusu­al­ly gen­er­ous con­ces­sion and is anoth­er indi­ca­tor of a poten­tial­ly cor­rupt arrange­ment.

These con­tracts meant that, from July 2013, Claudia Sassou-Nguesso was the hid­den own­er of Sebrit, which by January 2014 had received almost $20 mil­lion of Congolese pub­lic funds via an appar­ent sham con­tract for pub­lic works.

Asperbras said it did not know of any finan­cial trans­ac­tion car­ried out by Veiga on behalf of any “Politically Exposed Person” (PEP) in Congo. Claudia Sassou-Nguesso would qual­i­fy as a PEP.

Global Witness sent writ­ten ques­tions to Claudia Sassou-Nguesso, José Veiga’s lawyer, an email address for the pub­lic works min­istry in Brazzaville, and the Congolese gov­ern­ment spokesper­son, ask­ing for com­ment on the details and alle­ga­tions laid out in this arti­cle. No sub­stan­tive respons­es to the alle­ga­tions put to them for com­ment were received from any of these par­ties with­in the dead­line pro­vid­ed. 

LIVING THE HIGH LIFE

Documents and sources con­sult­ed by Global Witness indi­cate that – after receiv­ing its pay­ment from Asperbras sub­sidiary Energy & Mining – Sebrit, with Claudia Sassou-Nguesso’s own­er­ship obscured, made a cash pay­ment for apart­ment 32G in the Trump International.

The osten­ta­tious apart­ment cost $7.1 mil­lion. It has an open view of Central Park from an impos­ing sky­scraper equipped with “concierge and valet ser­vices, gym, spa and pool”. Residents can also order food from a Michelin-star restau­rant locat­ed in the hotel.

American law firm K&L Gates LLP, ranked in the top 20 law firms world­wide, was hired to enable the prop­er­ty acqui­si­tion. To arrange the pur­chase, K&L Gates incor­po­rat­ed a com­pa­ny called Ecree LLC, reg­is­tered in New York on May 30, 2014 – only two months pri­or to the apartment’s pur­chase. Neither Veiga’s nor Claudia Sassou-Nguesso’s names are on cor­po­rate doc­u­ments for Ecree obtained by Global Witness. Instead, the direc­tor of Ecree is a lawyer at K&L Gates and the reg­is­tered address for Ecree is that of the K&L Gates office in New Jersey.

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Global Witness@Global_Witness

#Trump com­pa­nies accept­ed appar­ent­ly stolen Congolese state funds from the #CongoBrazzaville Presidential fam­i­ly to pur­chase a lux­u­ry apart­ment in Trump Hotel & Tower in Manhattan.
The Trump Organization bro­kered and prof­it­ed from the apart­ment deal: https://bit.ly/2D4HCk4 716:01 PM — Apr 10, 201984 peo­ple are talk­ing about thisTwitter Ads info and pri­va­cyEcree finalised the pur­chase of the apart­ment from a pri­vate sell­er on July 31, 2014, accord­ing to the pur­chase deed. Documents reviewed by Global Witness show that Trump International Realty, a Trump Organization com­pa­ny, act­ed as the bro­ker in the sale.

Global Witness has not seen doc­u­ments that demon­strate con­clu­sive­ly that Ecree was owned or con­trolled by Sebrit. However, Sebrit pro­vid­ed the mon­ey for the var­i­ous costs asso­ci­at­ed with the pur­chase. Documents reviewed by Global Witness describe trans­fers between January 6, 2014 and June 23, 2015 from Sebrit to K&L Gates, the Trump International Management Corporation, and a lawyer rep­re­sent­ing the sell­er of 32G.

Global Witness does not allege that K&L Gates broke any laws in its role in the pur­chase of apart­ment 32G. There are no legal require­ments in the U.S. for law firms to do due dili­gence on their clients, so the firm may argue they were enti­tled to take on this busi­ness. However, K&L Gates should seek at all times to avoid enabling sus­pect trans­ac­tions, and Global Witness believes that the firm should have iden­ti­fied warn­ing signs forc­ing it to seri­ous­ly con­sid­er the risks of act­ing for Sebrit or its own­ers, or accept­ing funds from the com­pa­ny. Where the own­er­ship of Sebrit was obscured, this ought to have put K&L Gates on notice to make fur­ther enquiries.

Global Witness sought com­ment from K&L Gates about its role in the pur­chase of the apart­ment but the law firm did not respond to writ­ten ques­tions.

Asperbras said it does not know any­thing about deals closed by Veiga or his com­pa­nies, or whether Veiga and his com­pa­nies were involved in the pur­chase of an apart­ment at Trump International. 

WHAT DID THE TRUMP COMPANIES KNOW?

In the course of the cor­rup­tion inves­ti­ga­tion into Veiga’s busi­ness in Congo, Portuguese author­i­ties seized a series of ref­er­ence let­ters from July 2014 – a few weeks before the final­iza­tion of the pur­chase of the apart­ment – and addressed to mem­bers of Trump International’s board. In one of the let­ters Veiga express­es his sup­port for a pur­chase appli­ca­tion for the apart­ment by Lauren Lemboumba, daugh­ter of Claudia Sassou-Nguesso. Despite Lemboumba being only 17 years old at the time, Veiga said that they had known each oth­er for years, describ­ing her as one of his “close friends”.

When ques­tioned in 2017 by Pereira, the Portuguese jour­nal­ist, Veiga claimed that he had ini­tial­ly named Claudia Sassou-Nguesso on forms before chang­ing her name to that of her daugh­ter. However, Veiga did not acknowl­edge that Lemboumba or Claudia Sassou-Nguesso had made pur­chase appli­ca­tions. Instead, he said that the apart­ment belonged to a com­pa­ny of which he was the share­hold­er. According to Veiga, the apart­ment was bought with his own means, in a deal com­plete­ly unre­lat­ed to the Congolese Presidential fam­i­ly.

Veiga said that his ref­er­ence let­ters were intend­ed to grant autho­riza­tion for Claudia Sassou-Nguesso and her daugh­ter to stay in the apart­ment. He explained: “Complying with the con­do­mini­um rules, I informed who would stay in my apart­ment for a cer­tain peri­od of time. I start­ed by indi­cat­ing the name of the moth­er, but since the daugh­ter was the one who would actu­al­ly […] live in my apart­ment, I changed the name”.

This con­tra­dicts Veiga’s ref­er­ence let­ter reviewed by Global Witness, which clear­ly rec­om­mends that Lemboumba be able to pur­chase a Trump apart­ment. Veiga’s let­ter to the Trump International board reads: “This let­ter is sent to you on behalf of my good friend, Lauren Anne Marie Ikia Lemboumba, who have [sic] applied to pur­chase an apart­ment in Trump International Hotel & Tower Condominium.”

Trump International Hotel & Tower, New York, which Trump him­self has described as his “flag­ship” hotel. © James D. Morgan/Getty Images

The board of the Trump International Hotel & Tower Condominium should have been extreme­ly alarmed if it received a pur­chase appli­ca­tion show­ing Claudia Sassou-Nguesso’s or her daughter’s name. As both a senior gov­ern­ment offi­cial and a mem­ber of Congo’s Presidential fam­i­ly, Claudia Sassou-Nguesso should have been imme­di­ate­ly iden­ti­fied as a PEP.

Although there are not any manda­to­ry require­ments for back­ground checks to be car­ried out by lawyers or the real estate sec­tor in the U.S., as a con­se­quence of iden­ti­fy­ing a PEP, Global Witness believes enhanced checks should have been car­ried out on Claudia Sassou-Nguesso and her daugh­ter and the source of funds for the apart­ment and main­te­nance fees. Given the French inves­ti­ga­tion into the Sassou-Nguesso fam­i­ly, this should have imme­di­ate­ly raised con­cerns that Trump com­pa­nies could be receiv­ing pos­si­ble stolen state funds and there­by be facil­i­tat­ing mon­ey laun­der­ing.

Included in the apart­ment pur­chase doc­u­ments is a form signed by Veiga, as rep­re­sen­ta­tive of yet anoth­er front com­pa­ny for Claudia Sassou-Nguesso, giv­ing the Trump Corporation, which is owned by Trump, autho­riza­tion to car­ry out back­ground checks on the pur­chas­er. The board super­vis­ing apart­ments in Trump International, on which Donald Jr sits, was also autho­rized to con­duct these checks. It is unclear whether this due dili­gence was car­ried out, or how effec­tive it was.

In any case, the pur­chase went ahead. Global Witness does not have evi­dence as to who owns Ecree, the com­pa­ny pur­chas­ing the apart­ment. But the apart­ment was paid for by a com­pa­ny owned by Claudia Sassou-Nguesso, and the deal done by her busi­ness part­ner, Veiga, rep­re­sent­ing anoth­er com­pa­ny she owns. It appears there­fore that Claudia Sassou-Nguesso owns the Trump apart­ment, paid with sus­pect­ed stolen state funds.

By February 2016, at a time when Trump com­pa­nies were receiv­ing month­ly “com­mon charges” (main­te­nance fees) pay­ments for unit 32G, Veiga had been arrest­ed for sus­pect­ed cor­rup­tion and mon­ey laun­der­ing in Congo. Despite back­ground checks not being required by law, Global Witness believes this should have raised alarms for the Trump Organization com­pa­nies and prompt­ed a review of pri­or due dili­gence.

These facts call into ques­tion the qual­i­ty of the back­ground checks car­ried out by the Trump com­pa­nies and the deci­sion-mak­ing made based on them. A real estate bro­ker or prop­er­ty man­ag­er should rea­son­ably be con­cerned if a client, pur­chas­ing a mul­ti-mil­lion dol­lar lux­u­ry prop­er­ty, was iden­ti­fied as a PEP from a noto­ri­ous­ly cor­rupt gov­ern­ment or was, in Veiga’s case, lat­er arrest­ed for cor­rup­tion.

The ques­tion now is: did the back­ground checks fail to raise the alarm, or did the Trump com­pa­nies choose to look the oth­er way?

TRUMP COMPANIES PROFIT FROM SEEMINGLY IGNORING RED FLAGS

As part of the pur­chase agree­ment, Ecree is oblig­ed to pay month­ly main­te­nance fees for unit 32G. The agree­ment, which names both the Trump International Management Corporation and the Trump International Hotel & Tower Condominium, pro­vides for month­ly pay­ments of $2,832.14. It is like­ly that these charges will have risen since then, but tak­ing $2,832.14 per month as a base­line, Ecree LLC should by now have paid at least $164,264.12 in main­te­nance fees. Trump head­ed these com­pa­nies until he became U.S. President in January 2017.

According to Pereira’s sto­ry, Sebrit made main­te­nance fees pay­ments to the Trump International Management Corporation on behalf of unit 32G: $16,000 was paid on September 10, 2014 and fur­ther $35,000 was paid on May 15, 2015. It is not known whether Sebrit con­tin­ued to pay main­te­nance fees for 32G after May 2015. However, the apart­ment has not been sold since 2014, when Sebrit – Claudia Sassou-Nguesso’s com­pa­ny – paid for it.

Altogether, at least five Trump-owned or Trump-led com­pa­nies were involved in the sale of unit 32G. Three Trump Organization com­pa­nies, belong­ing to Trump, played key roles: as the own­er of 1 Central Park West, as the bro­ker in the sale, and as one of the com­pa­nies man­dat­ed to car­ry out back­ground checks on the pur­chas­er of the apart­ment. Trump is still the own­er of these com­pa­nies, though they are cur­rent­ly part of the port­fo­lio of inter­ests held in trust by his sons. However, while his sons con­trol the com­pa­nies’ day-to-day oper­a­tions through the trust he cre­at­ed, Trump can still receive income from them. He can revoke his sons’ author­i­ty and retake the assets in the trust at any time.

Donald Trump open­ing the Trump International Hotel and Tower, New York, 1997. © James Hughes/NY Daily News via Getty Images

Then there is the ques­tion of the two com­pa­nies that receive main­te­nance fees from unit 32G. Trump’s finan­cial dis­clo­sures indi­cate that he does not own these com­pa­nies, so he the­o­ret­i­cal­ly cut ties with them when he resigned his posi­tions before becom­ing U.S. President. Yet Trump’s var­i­ous incomes are still murky, as Investopedia explained in October 2018: “As Trump has not released his tax returns to the pub­lic, there are many aspects of his finances which remain unclear to those out­side of the Trump Organization.” Indeed, in 2018 two attor­ney gen­er­als sub­poe­naed the Trump Organization in an effort to under­stand whether and how Trump has prof­it­ed from the pres­i­den­cy, part­ly via his real estate. Further dis­clo­sures are required to ful­ly clar­i­fy whether or not Trump has prof­it­ed from unit 32G at 1 Central Park West since he became U.S. President.

Global Witness sent writ­ten ques­tions to the Trump Organization ask­ing for com­ment on the details and alle­ga­tions laid out in this arti­cle. No response to the alle­ga­tions put to it for com­ment were received with­in the dead­line pro­vid­ed. However, as this arti­cle was pub­lished, the New York Times quot­ed a Trump Organization spokesper­son who said that unit 32G had been bought from an unre­lat­ed par­ty and that con­do fees paid for the apart­ment were for main­te­nance costs “and are not fees paid to Trump for prof­it.”

THE BIG PICTURE

From the use of off­shore accounts and secre­cy juris­dic­tions to enabling lawyers and anony­mous com­pa­nies, the pur­chase of apart­ment 32G in the Trump International demon­strates the urgent need to address the ways in which opaque com­pa­nies can move funds around the world at ease, fac­ing no tough ques­tions on prove­nance or legit­i­ma­cy.

Every coun­try should require lawyers who car­ry out trans­ac­tions for their clients and the real estate sec­tor to know who their clients are and the source of their funds as a pre­cau­tion to make sure that sus­pect funds are not being laun­dered into the prop­er­ty mar­ket.

Since 2001, American real estate agents have been required to estab­lish mon­ey laun­der­ing checks, but the Treasury Department has failed to enforce this. This should change, and Treasury should imme­di­ate­ly require com­pa­niesto dis­close their ulti­mate own­ers when pur­chas­ing U.S. real estate.

Global Witness is also call­ing on law enforce­ment in the U.S., France and Portugal to inves­ti­gate the signs of mon­ey laun­der­ing in the pur­chase of the apart­ment and the seem­ing embez­zle­ment of pub­lic funds by the Congolese Presidential fam­i­ly, enabled by Veiga. If appro­pri­ate, law enforce­ment should hold the Trump Organization and Donald Trump account­able for their actions. Congressional com­mit­tees look­ing into such issues should like­wise inves­ti­gate these alle­ga­tions and hold any wrong­do­ers to account.

This scheme also rais­es seri­ous ques­tions that must be answered by Trump com­pa­nies attached to the deal, K&L Gates, the law firm rep­re­sent­ing the sell­er of 32G, and the oth­er banks and real estate agents involved. They should explain why they pro­ceed­ed with these trans­ac­tions despite the appar­ent risks of mon­ey laun­der­ing and cor­rup­tion. At a min­i­mum, now that the source of funds has been revealed, they should stop doing busi­ness with the com­pa­nies linked to Claudia Sassou-Nguesso and José Veiga.

The Trump International Management Corporation and the Trump International Hotel & Tower Condominium must clar­i­fy the source of the pay­ments for con­do­mini­um main­te­nance of apart­ment 32G since May 2015 as well as Donald Trump’s role in these com­pa­nies. This infor­ma­tion is of par­tic­u­lar pub­lic inter­est as there is a risk that these com­pa­nies may be cur­rent­ly enabling mon­ey laun­der­ing of pub­lic funds embez­zled by the Congolese President’s daugh­ter and ben­e­fit­ting in the process.

Claudia Sassou-Nguesso and Veiga used a wide range of tools of the glob­al finan­cial sys­tem in order to siphon, hide and poten­tial­ly laun­der mil­lions of dol­lars that should have been spent invest­ing in a bet­ter future for Congolese cit­i­zens.

The con­se­quences of trans­ac­tions like these can be dev­as­tat­ing, often for peo­ple bat­tling pover­ty and cor­rupt gov­ern­ments in places like Congo, where lead­ers give pub­lic con­tracts to the least scrupu­lous investors and the most oppor­tunis­tic crim­i­nals. The U.S. and Europe have an oblig­a­tion to address their own sys­tems’ loop­holes that enable cor­rup­tion and mon­ey laun­der­ing, allow­ing noto­ri­ous polit­i­cal elites like the Sassou-Nguessos to enjoy the lux­u­ri­ous spoils of appar­ent­ly ill-got­ten gains abroad.

Credit for ban­ner image: © Spencer Platt/Getty Images

Mariana Abreu, Campaigner, Corruption Investigations Team

mabreu@globalwitness.org

+44 (0)7912517147

Original source:

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