Felix Sater
Credit: MSNBC/YouTube

I need a sabbatical from blogging to write a screenplay. And this won’t even be the opening scene:

It was a bold, but effortless heist.

Three men, posing as gemstone buyers for a wealthy client, walked into the Moscow offices of an Indian-owned diamond dealer. They talked their way into the firm’s vault. After all, they needed to inspect the merchandise. Once the steel hatch was opened, one of the men stepped out to call his client. Shortly afterwards, four men draped in camouflage and wielding assault rifles stormed into the building.

The armed men claimed to be officers of Russia’s Federal Security Service (FSB). They were conducting a raid on illicit gemstone trading, they said. Those present were told to drop to the ground. And the so-called officers went off with some $2.8 million worth of jewelry, and 600,000 euros ($670,000) in cash.

The robbery took place in August 2010. When investigators finally got around to prosecuting two years later, their attention fell on Russian-American businessman Gennady Klotsman. He was eventually sentenced by Moscow’s Lefortovo Court to 10 years in a Russian penal colony.

I won’t even use the Bay Ridge beatdown of Salvatore Lauria as my opening scene:

Three years after accusing his former business partner of endangering his life with “mob tactics,” former Mafia informant Salvatore Lauria has withdrawn a $5 million lawsuit, saying that he wants to “move on with (his) life” and disengage from the media scrutiny brought on by his ties to Donald Trump.

Lauria, who worked at Bayrock Group in the mid-2000s, sued Jody Kriss, now with East River Partners, for allegedly endangering his life with ongoing lawsuits against their former firm. Bayrock worked on a number of Trump projects, including Trump SoHo and Trump International in Fort Lauderdale.

In the suit, Kriss was accused of giving sealed court documents to a lawyer that represented the people that Lauria helped put in jail. This allegedly led to a beating for Lauria. In July 2012, a Mafia member supposedly beat up Lauria in broad daylight at a restaurant in Bay Ridge, Brooklyn. According to the lawsuit, the Mafia member told Lauria: “You’re dead… I did two years because of you.”

This will be my opening scene, and it will focus on the unluckiest commodities broker in the history of the world.

Mr. [Felix] Sater’s first brush with the law came in 1991. Mr. Sater and Mr. Klotsman were at El Rio Grande, a Midtown watering hole, celebrating with a friend and eventual co-conspirator, Salvatore Lauria, who had just passed his stockbroker’s exam.

Mr. Sater later told a judge that he was in a good mood, having made a quick $3,000 in commissions that day. But he got into an argument with a commodities broker at the bar, and it quickly escalated. According to the trial transcript, Mr. Sater grabbed a large margarita glass, smashed it on the bar and plunged the stem into the right side of the broker’s face. The man suffered nerve damage and required 110 stitches to close the laceration on his face.

“I got into a bar fight over a girl neither he nor I knew,” Mr. Sater said in an interview. “My life spiraled out of control.” Mr. Sater was convicted at trial in 1993, went to prison and was effectively barred from selling securities by the National Association of Securities Dealers.

Of all the gin joints in all the towns in all the world, this commodity broker walked into the one where Felix Sater, Salvatore Lauria, and Gennady Klotsman were drinking and he got into a fight with them over a girl none of them even knew. I wonder if she’s learned what became of these characters.

All three of them eventually become government informants but not before they were arrested many years later for a pump-and-dump stock trading scam that robbed about $60 million dollars from little old ladies, including several Holocaust survivors.

My movie gets better of course. Much better. After Gennady Klotsman was arrested and sent to a penal colony in Russia, the Kremlin offered him back to the United States in an interesting trade proposal:

…earlier this month [August 2016] Klotsman was thrust from relative anonymity by news that he was one of a list of 13 Americans in Russia that Moscow was looking to exchange for two of its own imprisoned in the United States.

Under normal circumstances, this might be an easy swap: thirteen of yours for just two of ours. But, the two men in question were not easily swappable. According to a Foreign Ministry document cited by Izvestia newspaper on Aug. 3, Russia went straight for the top of its wish-list: the infamous international arms dealer Viktor Bout and a drug-running pilot, Konstantin Yaroshenko. These are men who may or may not have dirt on Russia’s leadership.

The U.S. Embassy in Moscow declined to comment on the exchange proposal, but confirmed Klotsman is in Russian custody. The proposal cited by Izvestia was, however, confirmed in part by the Russian Foreign Ministry.

“The details still need to be discussed confidentially,” Deputy Foreign Minister Sergei Ryabkov told the RIA Novosti news agency on Aug. 3. “[But] Yaroshenko is one of those we would like to see released under this scheme, as well as Bout.”

Both Russians were seized in sting operations far beyond Washington’s traditional territorial jurisdiction. Yaroshenko was arrested in Liberia in 2010 on charges of conspiring to smuggle $100 million of cocaine into the U.S. Bout, the more significant figure, was arrested in Thailand two years earlier.

In my early years of blogging, I used to write about Viktor Bout (pronounced “butt”) a lot because I considered him the most dangerous man in the world. In 2002, PBS did an entire series on him and how his business activities were fueling civil wars all around the world. It says a lot about Russia that they are so concerned to see him a free man. But it also says a lot about Felix Sater’s drinking buddy that the Russians think our government is still interested in freeing him after he pulled off a giant and elaborate diamond heist using FSB officers (or impersonators).

Allegiances in the world of espionage can be fleeting, but these three gentlemen take the cake.

Obviously, the most interesting of them is Felix Sater because of his long and close association with Donald Trump. When BuzzFeed reporters Anthony Cormier and Jason Leopold caught up with him recently in Los Angeles, they discovered a man who “had his Porsche shipped over from Long Island” and “gets the good table at Delilah, a see-and-be-seen West Hollywood nightclub.”

They also discovered a man who claims, with significant governmental corroboration, to have betrayed the Five Families of La Cosa Nostra in New York City and the Russian mafia, while also penetrating both al-Qaeda and the Taliban. Not only that, but he has enough dirt on the president of the United States to single-handedly take down his administration. Yet, he has the good table at a see-and-be-seen West Hollywood nightclub and doesn’t appear to have a care in the world.

By way of comparison, Paul Manafort’s business partner Rick Gates recently cancelled a planned trip to Boston that he had convinced a judge to approve because he was sensibly fearful that someone would kill him or harm his family. Gates’s only enemies are Russians and maybe an unhinged Trump supporter or two. Sater’s list of lethal enemies is comprehensive.

Yet, he struts around without an entourage of bodyguards and makes planned appearances like his segment on Chris Hayes’s MSNBC show on Friday night that was well publicized ahead of time. This is truly inexplicable. Maybe Salvatore Lauria was just unlucky when a mobster he’d fingered found him at a Bay Ridge restaurant and savagely beat him, but anyone looking for Sater knows which table he has reserved at Delilah’s.

If we’re to believe the official story on Sater, he’s been spying against Russia for the United States for twenty years now, but the Russians have known about this at least 2010 when his role was inadvertently unsealed (briefly) by a federal court. Yet, the Russians certainly don’t seem to care. Sater has been traveling and doing business in Moscow so freely that the Trump organization hired him in 2010 to help them build a tower there. And, if Russia cared that Sater was an American spy, then how was this possible?

A business associate of President Trump promised in 2015 to engineer a real estate deal with the aid of the president of Russia, Vladimir V. Putin, that he said would help Mr. Trump win the presidency.

The associate, Felix Sater, wrote a series of emails to Mr. Trump’s lawyer, Michael Cohen, in which he boasted about his ties to Mr. Putin. He predicted that building a Trump Tower in Moscow would highlight Mr. Trump’s savvy negotiating skills and be a political boon to his candidacy.

“Our boy can become president of the USA and we can engineer it,” Mr. Sater wrote in an email. “I will get all of Putins team to buy in on this, I will manage this process.”

On Chris Hayes’ show Friday, Sater was still claiming to have lined up funding for a Moscow Trump Tower from a sanctioned-Russian bank, arguing that this was the only possible way to make the project happen.

Mr. Sater, a Russian immigrant, said he had lined up financing for the Trump Tower deal with VTB Bank, a Russian bank that was under American sanctions for involvement in Moscow’s efforts to undermine democracy in Ukraine. In another email, Mr. Sater envisioned a ribbon-cutting ceremony in Moscow.

“I will get Putin on this program and we will get Donald elected,” Mr. Sater wrote.

It would be one thing if the Russians didn’t know that Sater was a spy and an informant, but they were aware the entire time. So, in my movie where I am allowed to take some poetic license, Felix Sater is possibly a double agent who was turned against the Russians and then turned back against the Americans. And then, in a final twist, he is turned one last time, but this time against the president of the United States.

But, first, his reputation has to be rehabilitated, which means he will become the most patriotic, daring, spy of all time. So, BuzzFeed gets some access and here is what they report:

  • He obtained five of the personal satellite telephone numbers for Osama bin Laden before 9/11 and he helped flip the personal secretary to Mullah Omar, then the head of the Taliban and an ally of bin Laden, into a source who provided the location of al-Qaeda training camps and weapons caches.
  • In 2004, he persuaded a source in Russia’s foreign military intelligence to hand over the name and photographs of a North Korean military operative who was purchasing equipment to build the country’s nuclear arsenal.
  • Sater provided US intelligence with details about possible assassination threats against former president George W. Bush and secretary of state Colin Powell. Sater reported that jihadists were hiding in a hut outside Bagram Air Base and planned to shoot down Powell’s plane during a January 2002 visit. He later told his handlers that two female al-Qaeda members were trying to recruit an Afghan woman working in the Senate barbershop to poison President Bush or Vice President Dick Cheney.
  • He went undercover in Cyprus and Istanbul to catch Russian and Ukrainian cybercriminals around 2005. After the FBI set him up with a fake name and background, Sater posed as a money launderer to help nab the suspects for washing funds stolen from US financial institutions.

And then he goes on Chris Hayes and tells the same story, complete with a charming anecdote about how he was initially recruited by a U.S. arms merchant named Milton Blane who was secretly working for the Defense Intelligence Agency.

[In 1996], he went to Russia to work on telecommunications deals with AT&T and others. One night, Sater was at dinner with a group of Russians in Moscow when he was introduced to an American defense contractor named Milton Blane. Sater said Blane, who died last year, followed him into the restroom that night and asked for his phone number to set up a meeting the following day.

At an Irish pub, Blane explained that he worked for the DIA and that some of the people Sater had been dining with were high-level Russian intelligence agents. “‘You’re in with a group who could deliver,’” Sater recalls Blane telling him. Blane, Sater said, asked him to work as an asset, intelligence lingo for a confidential source, but warned, “‘I want you to understand: If you’re caught, the USA is going to disavow you and, at best, you get a bullet in the head.’”

This provides me another interesting angle for my screenplay. It seems odd that an important Defense Intelligence Agency spy would find himself in this type of situation.

On September 1, 2006, Blane moved to have his criminal record expunged, arguing that the record is “misleading” and that it has had a detrimental effect on his ability to run his business.1  In his motion, Blane summarizes the facts surrounding his conviction as follows:  He had purchased some jewelry from a pawnshop, but he was unable to pay for the jewelry at the time of purchase because he was “all out of checks.”   Blane promised to send a check by mail, but he “forgot to pay for the jewelry.”   He argued in his motion to the circuit court that his actions did not constitute theft of property because, he argued, he lacked the requisite mental state necessary to commit the crime.   Instead, he argued, his actions constituted civil fraud.   Therefore, he argued in his motion to expunge, “the charge of theft of property is misleading in that it is more accurately characterized as fraud, and should be purged from Mr. Blane’s record.”

He wanted to get his record quashed, apparently, because it was causing problems for his business in its efforts to win government contracts. And, even today, two years after Blane died, his business is supplying the Ukrainian border guards through the U.S. Embassy in Kiev. As for the Defense Intelligence Agency, in 1999 they gave Blane a no-bid non-itemized contract for $1.2 million. But what really ought to make it into my movie is this conflict that Blane had with Boeing.

An international arms dealer won a jury verdict against Boeing after saying the aerospace behemoth stiffed him on a purchase, then tried to trash his reputation, a newspaper reported Saturday.

Boeing was ordered by a jury in Georgia to pay $3.6 million in punitive damages and compensatory costs to Milton Blane, who claimed the military contractor backed out of pact to buy two missile launchers and caused him to lose million of dollars, The Atlanta Journal-Constitution said in its Saturday edition.

A Gwinett County Superior Court jury ordered Boeing to pay BA, +0.23% Milton Blane $3.5 million in punitive damages and $100,000 in compensation for the Russian-made launchers that the company allegedly intended to resell to the U.S. Navy, according to the Journal-Constitution.

Blane, who owns Cumming, Ga.-based Blane International Group, said he approached Boeing about some combat missiles that were available. Blane’s attorney said weapons and technology were available after the fall of the Soviet Union.

Boeing allegedly asked Blane to buy two Russian-made missile launchers, said attorney Lawrence Newlin, characterizing the deal as a way for Blane to “prove what he could do” before asking for a larger order.

Blane alleged that Boeing reneged on the deal to pay $80,000 for the launchers, then tried to discredit him after he filed a lawsuit in 2002.

To recap, Blane supposedly recruited Sater in a Moscow restaurant bathroom and Irish Pub in 1996. Shortly thereafter, this happened:

One of Sater’s early operations involved the pursuit in 1998 of Stinger anti-aircraft missiles. The CIA had originally given the missiles to the mujahideen to oust the Soviets during their occupation of Afghanistan — but now the agency wanted to prevent them from falling into the hands of radicalized jihadists. Sater managed to find some, complete with their serial numbers.

Sater’s attorney, Robert Wolf, said he acted as his conduit to the CIA. As Wolf tells it, he called someone he had long known: David Kendall, Bill Clinton’s lawyer, telling him that he had serial numbers for the Stinger missiles that the Clinton administration had been trying to obtain. Kendall, Wolf said, called back and said he had spoken with President Clinton and that Wolf should call Robert M. McNamara Jr., the CIA’s general counsel. During the phone call with McNamara, Wolf read out the serial numbers for the Stinger missiles.

But, intelligence sources told BuzzFeed News, CIA officials were skeptical. So Sater provided photographs of the missiles — with their serial numbers and a copy of a daily newspaper to prove the photo was current. Two former intelligence officers and an FBI agent confirmed that Sater had provided the photographs, an incident they said bolstered his credibility.

Meanwhile, Wolf recalled, McNamara brokered a meeting at a restaurant near the CIA headquarters in Langley, Virginia, which was attended by Wolf and two employees of the CIA’s clandestine division: an operations officer and an attorney named Steve Hermes. For the next year or so, Wolf said, he talked regularly with Hermes by pay phone or landline when Sater wanted to pass on new information — or when the CIA wanted more intelligence. “We just went back and forth for months and months about al-Qaeda, bin Laden, and the return of the Stingers,” Wolf said.

In my movie, the CIA was correct to be skeptical because the Stingers came from Sater’s handler, Milton Blane, who had secured them from the same Russian sources that would later provide him with missile launchers to sell to Boeing.

In the end, my movie ends with unanswered questions. Did Blane get arrested for stiffing an Alabama pawn shop as a way of maintaining his cover? Did the Russians ever suspect that he worked for the DIA before Felix Sater told the world about it? Did he get turned by the Russians?

As for Sater, I still can’t figure out how to make his story work. I have the strong feeling that he’s been playing the Americans for suckers, but I also think he’s come in from the cold now and U.S. intelligence is rehabilitating him so can serve as a witness. To bolster this theory, one of his handlers in the Brooklyn attorney’s office was Andrew Weismann who now serves on Robert Mueller’s investigative team. In fact, it was Weismann who signed Sater’s cooperation agreement in 1998.

So, if I write this script, will you come see my movie?

Martin Longman

Martin Longman is the web editor for the Washington Monthly. See all his writing at ProgressPond.com