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Russia's Most Notorious Mob Boss Is Not Russian - He's Israeli

In 1987, just three years after he attended the closing with Trump, Bogatin pleaded guilty to taking part in a massive gasoline-bootlegging scheme with Russian mobsters. After he fled the country, the government seized his five condos at Trump Tower, saying that he had purchased them to “launder money, to shelter and hide assets.” A Senate investigation into organized crime later revealed that Bogatin was a leading figure in the Russian mob in New York. His family ties, in fact, led straight to the top: His brother ran a $150 million stock scam with none other than Semion Mogilevich, whom the FBI considers the “boss of bosses” of the Russian mafia.

At the time, Mogilevich—feared even by his fellow gangsters as “the most powerful mobster in the world”—was expanding his multibillion-dollar international criminal syndicate into America.

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I have spent the last twenty years of my life working on money laundering cases and carrying out international financial investigations. I had never heard of Semion Mogilevich. Unger's claim piqued my interest. So I started digging.

My first stop was PACER (it is a database of federal cases that encompasses everything from bankruptcies to felonies). I figured that someone of Mogilevich's alleged status as "boss of bosses" would have earned him several criminal indictments at the Federal level. Wrong.

I only uncovered one case. It is case number 2:2002cr00157. It was filed in the Eastern District of Pennsylvania in March 2002 and accuses Mogilevich of being part of a major stock fraud involving a publicly traded company that he helped establish. According to the indictment:

Mogilevich, along with Jacob Bogatin, Anatoly Tsoura and Igor Fisherman devised . . . a scheme and artifice to defraud thousands of investors in the United States, Canada, and elsewhere, and to obtain money and property by means of false and fraudulent pretenses, representations and promises ("the scheme to defraud").    

This case has never come to trial because all of the accused are listed as "fugitives." I am not suggesting that this case is not serious. But I am struck by the absence of any other cases that involve the types of crimes normally associated with organized crime, especially the Russian variety, such as prostitution or drug trafficking. There is nothing on the record in this country.

My attention then turned to trying to understand why the FBI is cited routinely as the source for verifying Mogilevich's infamous status. This search led me to an August 1996 FBI publication, Semion Mogilevich Organization Eurasian Organized Crime.  Read it yourselves. I was shocked. If this report is representative of the quality of work by the FBI in pursuing criminals and collecting evidence then we, as taxpayers, are being ripped off. This document offers proof, not of Mogilevich's guilt but of the FBI's incompetence.

Let me take you through it step by step. Although published in August of 1996, the information allegedly was generated as a result of a November 1994 conference in Moscow by a multinational working group on organized crime:

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The working group, consisting of Russian, Gennan, Italian, and U.S. law enforcement representatives, identified five Eurasian criminal groups with multinational operations that are of mutual investigative interest.

One of these groups is the Semion Mogilevich Organization, based in Budapest, Hungary. . . . Principal activities of the Mogilevich Organization include weapons trafficking, nuclear materials trafficking, prostitution, drug trafficking, dealing in precious gems, and money laundering. The Mogilevich Organization operates across Central Europe, including Prague, Czech Republic; Vienna, Austria; and Moscow, Russia. Its activities also extend to the United States, Ukraine, United Kingdom, France, Slovakia, and Israel.

That is quite a list. Certainly exceeds anything law enforcement has seen from the likes of the Cali Cartel or the Sinaloa Cartel. If these claims are true than Mogilevich is a genuine global threat.

Quite a jump for a chubby Jewish kid who was born in 1946 in the Ukraine. The mere fact that Semion's parents were still alive to procreate in the Ukraine in 1946 and survived is a miracle in light of what the Nazis and their Ukrainian collaborators did to exterminate more than one million Ukrainian Jews during World War II.

So why is a Ukrainian born Jew who holds Israeli citizenship described as a "Russian mobster?" It is a deliberate fabrication to classify him as a "Russian." He is an Israeli and a Ukrainian. He is not a Russian by birth nor ethnicity.

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How did Mogilevich become this alleged grand criminal mastermind? Here's what the FBI report asserts:

Semion Mogilevich began his' criminal career in the 1970s with the Lyuberts Mafia group in Russia. His primary activities were petty crimes and counterfeiting. He also derived profits from funeral arrangements. . . .

In the early 1980s, Semion Mogilevich became affiliated with the Solntsevskaya Organization. During this time he was involved with the organization of Jewish emigration from Russia. With limits on assets taken out of the country, Mogilevich arranged for emigres to take out additional assets, earning profits for his services. Russian authorities reported that Mogilevich was sentenced by a Kiev court in 1977 for illegal currency dealings.

Wikipedia describes "Solntsevskaya Organized Crime Group (Russian: Солнцевская организованная преступная группировка), also known as the Solntsevskaya Bratva (Russian: Солнцевская братва). It is alleged to be the largest and most powerful crime syndicate of the Russian mafia. Yet, Wikipedia account highlights an important discrepancy with the FBI report--The Solntsevskaya gang was founded in the late 1980s by Sergei Mikhailov.

How could Mogilevich affiliate in the "early 1980s" with a group that did not yet exist? One of these accounts is wrong. Either Solntsevskaya was created in the early 1980s or the late 1980s. It cannot be both.

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And what was Mogilevich's alleged massive criminal activities from the mid-1970s until 1989? Petty crimes, counterfeiting (no further explanation provided) and helping Jews escape Russia and keeping their assets away from the Soviet clutches. Based on this account Mogilevich is acting more like a Jewish Robin Hood than Al Capone. This is not the ideal recipe for becoming the preeminent global criminal mastermind.

In 1989, according to the FBI report, Mogilevich moves to Hungary, gets married and opens the Black and White Nightclub and U Holubu restaurant in Prague, Czech Republic. Mogilevich also is claimed to have registered a company, Arigon, in 1990 in Alderney, Channel Islands, United Kingdom. This company, per the FBI, was a subsidiary in some fashion of Arbat International in Moscow, Russia. But there is no additional explanation nor evidence in the FBI report explaining the nature of the relationship between the two companies. The FBI claims:

Semion Mogilevich changed his methods of operation in 1992, turning to international investment, and illegal financial speculation in Hungary (exchanging rubles into East German marks). The firm YBM Magnex was established in Budapest in 1992, with Anatoly Kulachenko the chairman. Other officers included Igor Fisherman, Alexander Alexandrov, Jacob Bogatin, Frank Greenwald, and Sergei Maximov.

If Mogilevich actually was the towering criminal malevolent force that the FBI claims, one would expect his activities to have branched out into illegal narcotics, prostitution, human trafficking and arms trafficking. Instead, the FBI report shows Mogilevich ripping off the former Soviet Union and members of its bloc. Odd.

In 1993, Semion Mogilevich consolidated his businesses, investing his own and other investor's assets. Through Arigon, he obtained a 90% interest in the firm Army Co-op (701 million forints) with the assistance of Victor Naishuller.  Army Co-op was then used to privatize the state-run Digep machine factory. This transaction enabled Mogilevich to become a direct owner of the Hungarian armaments industry. Mogilevich also owns a furniture-manufacturing company in London, United kingdom, and a casino in Moscow, Russia.

Nothing in these activities is inherently illegal. What I see is an entrepreneur who is not averse to trying to profit on the collapse of the former Soviet Union. 

At this point in the FBI report, the narrative becomes contradictory:

Semion Mogilevich is a key contact of the Solntsevskaya Organization. . . .Mogilevich's relationships with Sergei Mikhailov and Viktor Averin, leaders of the Solntsevskaya Organiation, are described as characterized by fear, but not of subservience. Mikhailov and Averin use Mogilevich for establishing financial operations.

Mogilevich is Jewish. Mikhailov and Averin are not. Mogilevich is Ukrainian. Mikhailov and Averin are Russian. How is Mogilevich a "key contact" in a relationship that is, to quote the FBI, "characterized by fear?" No explanation is provided. One must simply accept the FBI assertion on faith.

One of the major flaws in the FBI report is their repeated insistence that Mogilevich was involved in financial crimes without providing any corroborating evidence. The description of Arigon is illustrative of this problem:

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The center of the Mogilevich Organizatio1ns financial operations is Arigon, Ltd. . . . Arigon, Ltd. deals extensively with the Ukraine, selling oil products to the Ukrainian Administration of Railway Communications. Arigon, Ltd. is also involved in selling clothing to the FSU and maintains exclusive rights to insure tourists traveling to the Ukraine. Mogilevich also reportedly maintains dealings with the Ukrainian energy minister and energy­ affiliated companies. Mogilevich, through Arigon, Ltd., has reportedly laundered over $30 million from Europe into the United States. Arigon uses a number of banks in its operations, with accounts identified in Stockholm, Sweden; London, United Kingdom; New York City; and Geneva, Switzerland.

The operative word, "reportedly" is an empty, meaningless term. Reported by whom or what? The claim of "money laundering" is particularly ridiculous. To have "money laundering" there must be a predicate crime. In other words, the money being moved originated from an illegal activity such as drug trafficking or money laundering. Where did the $30 million come from? We do not know and the FBI does not know. It is just assumed that it must have come from something nefarious.

The FBI actually concedes in the report that it does not have the goods on Mogilevich:

The focus of Semion Mogilevich's operations in the United States appears to be money laundering. Mogilevich has established [front companies] in Los Angeles, California, and YBM Magnex in Newtown, Pennsylvania. . . .The exact nature and extent of these activities is still under investigation, but thus far no definitive illegal activities have been directly linked to the flow money from Mogilevich's accounts in Europe to the United States.

The failure to identify any "definitive illegal activities" does not prevent the FBI from insisting that Mogilevich is a mastermind criminal.

Another significant discrepancy involves differing accounts of an alleged plot to whack Mogilevich in Czechoslovakia. I am indebted to David Habbakuk for being the first to notice the significant differences. Here is the FBI account:

In May 1995, Czech police raided a summit meeting of Eurasian Organized Crime leaders at the U Holubu Restaurant in Prague. Leaders were meeting on the occasion of Sergey Mikhailov's birthday to discuss carving up criminal jurisdictions and to iron out a dispute between Semion Mogilevich and the Solntsevskaya Organization. . . .Mogilevich and his lieutenant, Alexei Alexandrov, were absent from the meeting. This meeting, unlike the February 1995 meeting in Vienna, Austria, . . . was attended by bosses only. The meeting did not resolve differences between Mogilevich and Solntsevskaya. 

Prior to the meeting, an unidentified Russian delivered an anonymous letter to the chief of police in Budapest, Hungary, in which it was alleged that Semion Mogilevich was to be assassinated that evening at the summit meeting in Prague. The Czech prosecutor decided to initiate action to prevent the killing and ordered a raid on the restaurant. The police detained the meeting participants and took photographs, fingerprints, diaries, journals, and other records for photocopying.

Following their release from police custody, the participants returned to various destinations, including Germany, Hungary, Russia and Israel. There is ongoing debate over the tip to Czech police concerning the time and place of the meeting. Mogilevich may have made the tip himself as a protective measure, or, having arrived late, noted the police presence and fled.

In the aftermath of the meeting and raid, Semion Mogilevich initiated counteraction against the Czech police;

To recap--a "summit" of Eurasian crime bosses was held in May 1995 and Semion's Prague, Czechoslovakia restaurant. Someone tips the the Chief of Police in Hungary that Mogilevich will be murdered at the Prague meeting (the FBI report does not indicate when this supposed tip was made). Somehow (again, not explained) the Hungarians alert the Czech prosecutor who in turn order the police to raid the meeting and arrest the attendees. Mogilevich subsequently "initiates" counteraction against the Czech police. We are asked to believe that Mogilevich decided to hurt the police who detained the people who were supposedly plotting to kill him. This borders on the nonsensical.

Even more troubling is the fact that the meeting that took place to generate this report about Mogilevich's nefarious activities took place in November 1994, but the "summit" of crime bosses came six months later. 

David Habbakuk kindly directed me to a December 1999 Panorama program, The Billion Dollar Don, that provides a very different account:

‘BOB LEVINSON: In May of 1995 the number two man in the most powerful gang , the Solsnetskaya (sic) organisation – a man by the name of Victor Averin – was celebrating a birthday. Traditionally the birthdays are used as an excuse to get members of the group together, primarily the leaders ... the brigade leaders. And so a meeting was planned and we got wind of it.

‘MANGOLD: The FBI saw Averin’s birthday guest list as a “Who’s still Who” of Russian organised crime. There was Sergei Mikhailov, alleged head of the notorious Solsnetskaya organisation, a gang linked by the FBI to Mogilevich. Gafour Rakamov – the most powerful gangster in Uzbekistan, allegedly a major trafficker of heroin into Europe. Dzhemal Khachidze -
narcotics, Moscow. And Aleksandr Sedov, reputedly one of the most vicious killers in
Russia.

‘BOB LEVINSON: They were having an elaborate dinner and entertainment, they had a Russian singer and a comic and they had some cabaret entertainers, and everyone was having a very good time for themselves. Somewhere in the middle of the performances, ropes from the ceiling came down and members of the Czech Republic’s organised crime SWAT team came into the restaurant, jumped on the stage and with machine guns basically ordered the crowd not to move.
Everyone was transfixed, thinking it was part of the show. It was a ... it was an elaborate joke
at their expense. Slowly people realised that the men in the black clothing with the machine
guns were not a joke but the real thing.

‘MANGOLD: It was also a rotten night out for the girls from the Black and White club as they too were hauled off, still in their working costumes, by an enthusiastic SWAT squad. This was a
deliberate humiliation designed to warn Mogilevich that even the minor figures in his empire
were not immune.

‘BOB LEVINSON: Everyone was identified. They were photographed, the cameras were seized and basically to get, in effect, an order of battle from this organisation and identify the players. It was a very successful raid.

‘MANGOLD: But the one man who escaped the indignity, the one man the Czechs and FBI most wanted to have a chat with, avoided being in the restaurant that night. By remarkable twist of fate
Mogilevich flew in for the party but it appears his plane arrived late.’

In contrast to the FBI account, the Panorama correspondent interviewing retired FBI Agent Bob Levinson (yes, the same one who went missing and is believed to be in the hands of the Iranians) insist this was birthday party attended by major crime figures. They were in the restaurant owned by Mogilevich but he never showed. Not a word about an assassination plan nor how the Czech authorities learned about the event.

If I was one of the bad guys in attendance and suffered the indignity of being arrested, I would cast blame on the man who was not there--Semion Mogilevich. In fact, it would appear that Mogilevich had helped set the whole thing up. This raises a more interesting possibility--was the FBI telling a big lie about Mogilevich in order to establish his bona fides and divert attention from the fact that he was an FBI informant?

Trafficking in Stolen Art?

This portion of the FBI report is bizarre. Besides being poorly written and badly edited, the alleged crimes being described occurred months after the summit of law enforcement officials in Moscow in November 1994.  This portion of the FBI report starts with this description:

In early 1995, the leaders of the Solntsevskaya Organization, Sergei Mikhailov and Viktor Averin, reached an agreement with Semien Mogilevich to invest large sums of money in a joint venture to acquire and operate a jewelry business in Moscow, Russia, and Budapest, Hungary.

Sounds like a done deal. But in the next paragraph you will read the following:

Gold jewelry products will be made in Moscow and shipped to Budapest where they will be fitted with precious stones. Stolen Russian antiques, such as Faberge eggs, will also be sent from Moscow to Budapest for "restoratiori." In actuality,·Semion Mogilevich will ship the antiques to London, United Kingdom, where they will be sold through Sotheby' s auction house.

This is what is known as "blue sky." Supposed plans. Any critical reader or editor would naturally ask why is a conditional description being allowed into a document that was published in August 1996. If these events actually took place in early 1995 as claimed then there should have been actual evidence that the plot was carried out. But the FBI does not provide any such information.

On page thirty six of this report the reader is treated to a severe case of FBI schizophrenia. An FBI source claims that:

a high-level employee of Ritual funeral Services traveled to Budapest, Hungary, in July 1995, bringing a list of paintings, antiques, and Faberge eggs which were acquired in an art theft operation run by Semien Mogilevich and the Solntsevskaya Organization.

But in the subsequent paragraph we are presented info from another FBI source:

that the stolen art operation slowed down following the arrest of Vyacheslav Ivankov in June 1995. The source identified several specific works of art already in transit to be refurbished and sold at auction. (Note--Ivankov had no known relationship to Mogilevich and was extradited from the United States to Russia, where Ivankov was put on trial).

So, was art trafficking project in full swing or slowing down? And when did it actually get off the ground? What was actually sold? The FBI report offers zero insight into these questions.

Extortion

The extortion section of this FBI report is a jumbled mess. The account regarding the kidnapping of Aleksander Konanykhine. Konanykhine, according to Wikipedia, "was the founder, co-owner, and President of the Russian Exchange Bank, which became the first institution to receive a currency-trading license from the Yeltsin government." The FBI report levels the following allegation:

Semion Mogilevich was also tied to the Solntsevskaya Organization's efforts to extort Aleksander Konanykhine, a wealthy financier currently in hiding. Konanykhine reportedly escaped a recent extortion attempt by the Solntsevskaya Organization and Semien Mogilevich in Budapest, Hungary. U.S. Immigration and Naturalization service (INS) agents arrested Konanykhine and his wife in Washington, D.C., on June 27, 1996, on charges of violating the conditions of their visas.

But no actual evidence of any role by Mogilevich is offered. To the contrary, circumstantial evidence points to the pressure coming from Russia's overseas intelligence organization. FBI agents testified in 1996 at Konanykhine's deportation trial that the Russian mafia had taken out a contract to murder the banker. Nothing was said in court on the record about any "extortion" attempt. Konanykhine and his wife were ultimately granted asylum in the United States. 

Murder

This section of the FBI report is appalling. It appears it was inserted as an after thought. The three paragraphs border on incoherent. It is alleged that Semien Mogilevich was tied to the murder of Oleg Shirokov, a businessman from Sverdlovsk, Russia. But the report does not even provide the date nor location of the murder. Moreover, asserting that Mogilevich is "tied" to the event is not accompanied by any explanation about the nature of such ties. 

The succeeding two paragraphs of this section focus on someone unrelated to Mogilevich.

Other Alleged Criminal Activities

The report continues with a litany of alleged crimes by Mogilevich, which includes the production and distribution of counterfeit liquor, money laundering, prostitution, visa fraud and drua (sic) trafficking. Although grammatical errors and spelling mistakes litter this report, there is scarcity in substance and proofs to back up the claims of alleged criminal conduct. For example, in the section on "drua" (sic) trafficking it is claimed:

Semion Mogilevich reportedly purchased a bankrupt Georgian airline recently to facilitate the smuggling of heroin from Southeast Asia. Among the airline's destinations is Prague, Czech Republic, according to the USIC.

The information is sourced to the U.S. Intelligence Community. But we are not informed whether that is a human source or comes from a technical collection, such as sigint. Because this report was created ostensibly to inform other law enforcement entities, one would think that identifying the airline would be important. Think again.  It would be nice to know how many planes and the type of aircraft that populated this bankrupt entity. Too bad. That would be an important data point for helping law enforcement officials target possible drug shipments.

What About the Nukes?

The report, if you recall, begins with a litany of alleged crimes that includes trafficking in nuclear material. That is certainly an eye catcher and, one would assume, merited a detailed presentation of the evidence of Mogilevich's activities in this arena. But nothing is presented to substantiate the allegation.

What About Semion Mogilevich?

I do not know if Semion is a genuine mobster. He certainly is portrayed that way in this very flawed FBI report. And that report has become ground truth for a host of writers who mindlessly repeat the fantastical claims and allegations without insisting on corroboration. Going back to my discussion about the busted gangster summit in Prague in May of 1995, I keep wondering if Mogilevich is actually an FBI asset or working for one of our friends, such as Israel. For a guy who is supposedly engaged in a broad swath of illegal activities that encompasses the gamut of bad behavior, Semion has enjoyed a relatively peaceful life. If he actually had such a record I would expect him to face a mountain of extradition requests. But that is not the case.

The final issue of relevance concerns Semion's ethnicity and citizenship status. He is not a Russian. Never has been. He is Ukrainian and a citizen of Israel. So why are media types so eager to claim Semion as proof that Donald Trump is under the thumb of the Russian mob? It does not compute.

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