About the Oleg Deripaska Reference in the Mueller Memo

As I promised in my general summary of the Mueller memo and my assertion that there are more memos from DAG Rosenstein authorizing expanded scope on Mueller’s investigation, I want to comment on the reference to Oleg Deripaska in the memo.

The memo, remember, ostensibly only needs to lay out how Mueller’s appointment “to investigate Russian interference with the 2016 presidential election and related matters” authorizes him to prosecute a bunch of money laundering used to hide the fact that Paul Manafort was lobbying for the interests of the Party of Regions, the Russian backed effort to keep its favored oligarchs in power in Ukraine, when he was pretending to represent an independent entity.

But at the end of a long paragraph explaining how Rosenstein’s appointment order alone would justify that prosecution — because Manafort played a key role in Trump’s campaign, and because Manafort resigned after his extensive ties to Yanukovych were exposed — Mueller drops in a reference to “open source reporting” tying Manafort to Deripaska.

The Appointment Order itself readily encompasses Manafort’s charged conduct. First, his conduct falls within the scope of paragraph (b)(i) of the Appointment Order, which authorizes investigation of “any links and/or coordination between the Russian government and individuals associated with the campaign of President Donald Trump.” The basis for coverage of Manafort’s crimes under that authority is readily apparent. Manafort joined the Trump campaign as convention manager in March 2016 and served as campaign chairman from May 2016 until his resignation in August 2016, after reports surfaced of his financial activities in Ukraine. He thus constituted an “individual associated with the campaign of President Donald Trump.” Appointment Order ¶ (b) and (b)(i). He was, in addition, an individual with long ties to a Russia-backed Ukrainian politician. See Indictment, Doc. 202, ¶¶ 1-6, 9 (noting that between 2006 and 2015, Manafort acted as an unregistered agent of Ukraine, its former President, Victor Yanukovych—who fled to Russia after popular protests—and Yanukovych’s political party). Open-source reporting also has described business arrangements between Manafort and “a Russian oligarch, Oleg Deripaska, a close ally of President Vladimir V. Putin.”8 [my emphasis]

There’s no explicit reference to Deripaska in Manafort’s indictment. The only public references to him in the Manafort prosecution I’m aware of are instead to Deripaska’s crony, Konstantin Kilimnik, laying out his efforts to spin the indictment in an op-ed in the Kyiv Post, which Mueller’s prosecutors argued was an attempt to skirt the gag rule in the case. There’s admittedly more detailed reference to Kilimnik — referred to as Person A — in the same team’s sentencing memo for Alex Van der Zwaan, including the assertion that,

[T]he lies and withholding of documents were material to the Special Counsel’s Office’s investigation. That Gates and Person A were directly communicating in September and October 2016 was pertinent to the investigation. Federal Bureau of Investigation Special Agents assisting the Special Counsel’s Office assess that Person A has ties to a Russian intelligence service and had such ties in 2016. During his first interview with the Special Counsel’s Office, van der Zwaan admitted that he knew of that connection, stating that Gates told him Person A was a former Russian Intelligence Officer with the GRU.2

2 Person A worked with Manafort and Gates in connection with their Ukraine lobbying work. Person A is a foreign national and was a close business colleague of Manafort and Gates. He worked in Ukraine at Manafort’s company Davis Manafort International, LLC (DMI). Up until mid-August 2016, Person A lived in Kiev and Moscow

But thus far, nothing specifically relating to Deripaska or Kilimnik has been charged, even while a different open source report describing Manafort’s offer to give private briefings to Deripaska via Kilimnik laid out a much closer tie between Deripaska and election tampering, and another open source report described FBI scrutiny of Kilimnik’s role in changing the GOP platform.

As noted, instead of referencing those more damning open source reports, Mueller instead points to the August 15, 2016 NYT article that precipitated Manafort’s resignation from the Trump campaign. The report, sourced to investigators in “Ukraine’s newly formed National Anti-Corruption Bureau” laid out the secret ledgers showing that Manafort may have received $12.7 million in off-the-book payments for his consulting services that tampered with Ukraine’s electoral process.

The report goes on to lay out the general logic of the money laundering prosecution at issue — how Manafort’s money laundering prevented others from understanding how much he actually made for his services to Yanukovych and the Party of Regions.

Mr. Manafort never registered as a foreign agent with the United States Justice Department — as required of those seeking to influence American policy on behalf of foreign clients — although one of his subcontractors did.

It is unclear if Mr. Manafort’s activities necessitated registering. If they were limited to advising the Party of Regions in Ukraine, he probably would not have had to. But he also worked to burnish his client’s image in the West and helped Mr. Yanukovych’s administration draft a report defending its prosecution of his chief rival, Yulia V. Tymoshenko, in 2012.

Whatever the case, absent a registration — which requires disclosure of how much the registrant is being paid and by whom — Mr. Manafort’s compensation has remained a mystery.

From there, it turns to the Pericles Open Market fund that Manafort, Gates, and others got Deripaska to fund. The story doesn’t describe any direct tie between the secret ledgers at issue in the story and the Deripaska investments. Rather,the Deripaska lawsuit against Manafort made details of the fund available to Ukraine’s special prosecutor, who cited them as an example of how Yanukovych’s cronies laundered money.

In a recent interview, Serhiy V. Gorbatyuk, Ukraine’s special prosecutor for high-level corruption cases, pointed to an open file on his desk containing paperwork for one of the shell companies, Milltown Corporate Services Ltd., which played a central role in the state’s purchase of two oil derricks for $785 million, or about double what they were said to be worth.

“This,” he said, “was an offshore used often by Mr. Yanukovych’s entourage.”

[snip]

Mr. Deripaska agreed to commit as much as $100 million to Pericles so it could buy assets in Ukraine and Eastern Europe, including a regional cable television and communications company called Black Sea Cable. But corporate records and court filings show that it was hardly a straightforward transaction.

The Black Sea Cable assets were controlled by a rotating cast of offshore companies that led back to the Yanukovych network, including, at various times, Milltown Corporate Services and two other companies well known to law enforcement officials, Monohold A.G. and Intrahold A.G. Those two companies won inflated contracts with a state-run agricultural company, and also acquired a business center in Kiev with a helicopter pad on the roof that would ease Mr. Yanukovych’s commute from his country estate to the presidential offices.

The Deripaska reference in a memo describing why Mueller was authorized to prosecute Manafort for related (but not explicitly) money laundering would otherwise be a non-sequitur. Because it appears in an article that not only lays out the basis for the underlying charges, but does so in an article that had an impact on Manafort’s role in the campaign, it doesn’t seem so obviously tangential. Plus, it has the added benefit (unlike the open source reporting deriving from leaks from Congress or law enforcement) of being an on-the-record source from someone perfectly entitled to the talk to the press about Ukraine’s investigation into Manafort. This, then, was a legally permissible way to insert Deripaska into a filing where he otherwise might not have belonged.

Plus, that same open source report lays out that Ukraine’s National Anti-Corruption Bureau can’t prosecute suspects, but instead has to rely on entities like the FBI — with which it has an evidence sharing agreement — to do so.

The bureau, whose government funding is mandated under American and European Union aid programs and which has an evidence-sharing agreement with the F.B.I., has investigatory powers but cannot indict suspects. Only if it passes its findings to prosecutors — which has not happened with Mr. Manafort — does a subject of its inquiry become part of a criminal case.

During Jim Comey’s March 20, 2017 testimony (which is cited explicitly in the Mueller memo to lay out the initial unclassified scope of the investigation), Jim Himes tried to get the then FBI Director to admit that DOJ had not responded to seven requests for MLAT assistance to secure Manafort’s cooperation in their inquiry.

HIMES: And the reason I bring all this up with you is because the story also says and it appears to have been confirmed by the Department of Justice that the current Ukraine regime, hardly a friend of the Russians. And very much targeted by the Russians has made seven requests to the United States government’s — the United States government for assistance under the MLA treaty in securing the assistance of Paul Manafort as part of this on anti-corruption case. And in fact, the story says that you were presented personally with a letter asking for that assistance.

So my question Director Comey is, is that all true? Have you been asked to provide assistance to the current Ukrainian government with respect to Paul Manafort? And how do you intend to respond to that request?

COMEY: It’s not something I can comment on. I can say generally, we have a very strong relationship and cooperation in the criminal and national security areas with our Ukrainian partners, but I can’t talk about the particular matter.

Comey, while not confirming the report, instead suggested that the FBI continued to cooperate closely with Ukraine on this issue — a strong suggestion that Ukraine ultimately had asked an entity that could take prosecutorial action to do so.

To sum up thus far: this reference to Deripaska is, to the best of my knowledge, the first explicit reference to him anywhere in the Manafort docket. It has no obvious place in a memo explaining why Mueller is authorized to prosecute Manafort for money laundering tied to the Party of Regions. But there it is, in the middle of a paragraph explaining why Manafort’s prosecution follows logically even from the original grant of authority, to say nothing of any unredacted or redacted bullet points explicitly including Manafort’s alleged and documented ties to Deripaska in the scope of Mueller’s authority. By including it in the memo, Mueller effectively includes Deripaska in the ongoing discussions of the things Judge Amy Berman Jackson will likely soon agree Mueller has the authority to prosecute.

It is, then, the most telling line in the entire memo, and the most clever. It uses the opportunity of this memo to pre-authorize where Mueller is going, without having to reveal what evidence Mueller is sitting on to go there.

Of course, where he’s going — to this oligarch and his crony’s role in Trump’s election — is very obviously tied to the case in chief, the Russian tampering in the US election.

Update: Later today Mueller’s team requested permission to file one of the exhibits from their filing — which given Judge Berman Jackson’s description has to be the Rosenstein memo — under seal. Which suggests they want him to know what else he’s being investigated for, which is probably the Deripaska stuff.

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32 replies
  1. Trip says:

    What ever happened to Anastasia Vashukevich? Would Navalny’s expose be considered open source?

    • emptywheel says:

      She’s still in jail in Thailand. FBI is showing increasing interest in talking to her and her friend.

      • Trip says:

        Bad news for her:

        From Thai Jail, Sex Coaches Say They Want to Trade U.S.-Russia Secrets for Safety
        They have influential enemies in Russia. They were arrested with the help of a “foreign spy,” according to the Thai police, and locked up on what is a fairly minor offense: working without a permit. And the F.B.I. tried to talk to the pair, suggesting that American investigators had not dismissed their account out of hand.
        “They know we have more information,” one of the pair, Alexander Kirillov, 38, told The New York Times last month in an unauthorized phone call from the detention center, in Bangkok. Mr. Kirillov said his co-defendant, Anastasia Vashukevich, 27, had angered some powerful people. “They know she knows a lot,” he said. “And that’s why they made this case against us.”
        https://www.nytimes.com/2018/04/02/world/asia/nastya-russia-trump-election.html

        ‘Nastya Rybka’ could be coming home from Thailand
        Anastasia Vashukevich and Alexander Kirillov, the Belarusian “sex trainers” better known as “Nastya Rybka” and “Alex Leslie,” have reportedly agreed to plead guilty to disrespecting the culture and religion of Thailand, the penalty for which is deportation and banishment from the country for at least 10 years.
        https://meduza.io/en/news/2018/04/03/nastya-rybka-could-be-coming-home-from-thailand

        It sounds like they will be deported back to Russia, where Deripaska filed a lawsuit against them.

  2. NorskieFlamethrower says:

    Well then, there it is, the knot that ties the thread of conspiracy between all the American Nazis and the Russian state. This conspiracy and election tampering goes all the way from the Ukraine through central and western Europe into the USofA and maybe further south and into South America. The complexity of this world-wide conspiracy requires close work among all the NATO and western powers while the US government is working for the Russians. Mueller and whatever is left of the US “deep state” are all that stand between the safety of nations and a Russian Reich. The longer the coup in the US is allowed to consolidate (Sinclair Broadcasting, the manipulation of the stock market, the laundering of Russian oligarchs’ money to fund the coup and the creation of an international “emergency” at our southern border) the closer to the end of history we get. Have a nice day.

    • tinao says:

      Take a guess where daddy koch made his money. When the american oil boys wouldn’t let him in for a cut after developing a new process, he went to…russia and made his first slice. Then, the german nazis needed updated oil refineries and there is where the original koch fortunes were made. Interesting huh? Just saying :) Jane Mayer’s Dark Money is chalk full of very interesting history on how we got to this deplorable state. Crap I hate seeing their think tank assholes on msm as f***ing experts.

  3. Trip says:

    Mueller told Trump’s attorneys the president remains under investigation but is not currently a criminal target
    Special counsel Robert S. Mueller III informed President Trump’s attorneys last month that he is continuing to investigate the president but does not consider him a criminal target at this point, according to three people familiar with the discussions.
    In private negotiations in early March about a possible presidential interview, Mueller described Trump as a subject of his investigation into Russia’s interference in the 2016 election. Prosecutors view someone as a subject when that person has engaged in conduct that is under investigation but there is not sufficient evidence to bring charges.
    https://www.washingtonpost.com/politics/mueller-told-trumps-attorneys-the-president-remains-under-investigation-but-is-not-currently-a-criminal-target/2018/04/03/d7832cf0-36c1-11e8-acd5-35eac230e514_story.html

    southpaw‏ @nycsouthpaw
    It strikes me that if Mueller has decided–either as a prudential matter or on constitutional grounds–that he will not be indicting a sitting president, that would mean the president will never be a “target” as defined in the US Attorneys’ Manual so long as he remains in office.
    https://twitter.com/nycsouthpaw/status/981323791967113216

    • bmaz says:

      Um, so Trump is very much still a “subject”? Because all the designator of not being a “target” means is that DOJ/OSC has no “current” intention of indicting you. Well, indictment for Trump himself was likely never on the front burner or likely in any instance.

      So, honestly, there is nothing, and I mean nothing, in here that ought give Trump any relief. In fact, quite the opposite.

    • greengiant says:

      The same WH that said how many times the investigation would be over? This seems like fluff cover for some stupid Trump action. Law Enforcement regularly lies to perps,  thus in the past telling Trump he is not under investigation carries no weight. Best case for Donald is that he so far is an unindicted co conspirator to deep six any pardons or commutations that don’t have virgin births,  yes?

      • Trip says:

        Like bmaz said, do you really take comfort in being a ‘subject’?  Mueller, at least according to the story, didn’t tell Trump he was only a ‘witness’.  And “At this point” not being a target leaves open the possibility of a later point where that changes.

    • Bob Conyers says:

      My reading of that Post article is that one or more people on Trump’s side are leaking it to try to scare Trump into taking Mueller more seriously. The article makes a point of noting that Trump and some of his friends seemed relieved at the statement of his status, but the article immediately followed by saying others warned that it’s easy to move from a subject to being indicted, and that Mueller may be setting Trump up for a trap.

      The article said that Mueller’s statement to the Trump team came several weeks ago — it’s a bit striking to me that there were no leaks by the Trump camp earlier. I suspect that this is a sign of the long running debate whether or not to cooperate with Mueller breaking out more into the open, and it may just be a sign that the ones counselling against cooperating are afraid that they’re about to lose.

      However, I’m open to the possibility that it may also be a sign that Dowd is starting to talk to the press, and may have his own reasons for spinning a narrative to the media before others turn the narrative against him. It may be the case that he’s not trying to warn Trump, he’s just trying to preserve his own reputation before Trump talks to Mueller.

      • Trip says:

        Yeah, I felt like something wasn’t completely kosher with Dowd leaving. It didn’t feel like the other routine Trump firings or push-outs. He might have left on his own to avoid his own further exposure?  After he left, they were floating the ‘Dowd was too cooperative with Mueller’ story, but this was right after he ‘prayed’  that someone would stop the investigation. That’s very contrary to the Dowd as cooperative line, and I always thought that Ty Cobb was the lawyer who advocated for actual cooperation. But who the hell knows, really?

    • earlofhuntingdon says:

      More preaching to Donald-alone-in-the-pew. I don’t think Southpaw’s conclusions reach much of the Don’s exposure.

      If Mueller is going through Trump’s tax filings and financial records, and has confirmation of facts from an abundance of cooperating witnesses, Mueller’s problem will be to pick and choose among possible crimes.

      At a minimum, Mueller is documenting and foreclosing many of the ways and people through which Donald makes money.  If he and his spawn continue any of them after he leaves office, well then.  In any case, I wouldn’t take much comfort here.  Mueller is just getting started and Trump will be out of office after 2020.

  4. SteveB says:

    The article cited in the SC filed motion from 15 Aug 2016 pre dated the appointment of Mueller and predated the Rosenstein memo of  2 Aug 2017 by nearly a year, whereas the other articles referred to are from 20 Sept 2017 and 3 Aug 2017 respectively. Thus it is reasonable to invite the court to infer that the scope of the investigation would have justifiably encompassed matters raised by the first.

    To some extent, by pursuing the dismissal argument, Manafort created a trap for himself to have this material introduced. If the general tactic behind Manaforts motion (assuming that dismissal was never a realistic outcome) was an attempt to tease out what the working hypotheses of the investigation were, then this reference to Deripaska and the article that lost Manafort his role in the campaign, strikes me as the Mueller team taking the opportunity to enjoy a chuckle at Manaforts expense.

    No doubt Mueller is sitting on an awful lot more, not least from Gates.

    If Manafort wants to run in front of a jury “This is all a witchhunt, by an overeaching prosecutor”  then he better buckle up.

  5. SteveB says:

    “Subject of criminal investigation” means that their conduct is a matter within the scope of the investigation, thus they may or may not be eventually prosecuted, “target” means someone against whom there is substantial evidence of criminal conduct and whom in the judgement of the prosecutor is a putative defendant.

    So Trump may take comfort from being a mere suspect and not as yet a probable indictee.

  6. SteveB says:

    Sorry: page froze so last post appeared way after others saying much the same.

    Re EW update:
    Is the sealed filing referred to
    A) Judges eyes only
    B) Judge plus Attorney eyes only
    C) Judge and parties only
    D) other

    Thanks

  7. Willis Warren says:

    This is fantastic work, Marcy. I noticed the Deripaska stuff yesterday but assumed it was old hat.

    Are we certain that mueller won’t indict Yrump, or Rosenstein won’t allow?

    • Peterr says:

      Marcy can answer for herself, but my answers to your questions are that we are NOT certain of either of those scenarios. As this filing demonstrates, Mueller will go where Mueller will go, which is wherever the evidence leads and the law allows. In any manner of elements about this case thus far, he has been careful not to tip his hand about future directions, until he is good and ready to tip his hand if not place his cards on the table.

      The handling of Deripaska in this filing is a master stroke of tipping his hand in a way that makes the direction clear without having to prematurely unveil more than he wants to show at this point.

      Shorter Mueller: Be afraid, Oleg Vladimirovich, be very afraid. And you know why without me telling you.

  8. pseudonymous in nc says:

    And of course, Deripaska has already leeched off Mueller’s work for his civil suit in NY against Manafort and Gates. That felt a little too brazen, a little too oligarch-y at the time, and it probably pissed off a few people in the special counsel’s office.

    • Trip says:

      I think Deripaska always played that it was a “loan”. He sued in the past, but then the case sort of remained dormant while Manafort was part of the Trump campaign. If he couldn’t recoup his investments in actions/results, then he’d push to get back the funds (financial strong-arming) which, in my mind, were payments for services (perhaps not rendered).  Manafort never delivered the Ukraine peace deal nor did he have the Russian sanctions lifted.

      The Kremlin must have been one step ahead knowing the Mueller direction on some level, since Deripaska suddenly resigned as head of Rusal, right before this dropped. Putin creating degrees of separation and plausible deniability once again?

    • emptywheel says:

      I think we all too often forget that Russia is all too happy to hurt Trump and his cronies, even while preferring him to Hillary. Stirring up the prosecution is one way to do that.

      • TheraP says:

        This makes so much sense to me. Russia has him in the Vise. (Vice!) So Trump has to make nice!

        But Putin is not his friend. More like his torturer.

        Question is: Does Trump even realize that?

      • earlofhuntingdon says:

        Yep.  Chaos is a win for Vlad.  Electing a puppet, hamstringing a sitting president, decapitating a government, sowing doubt about a country’s entire electoral system, encouraging dysfunction in that government and chaos among the alliances once led by the former leader of the free world.  All good, if you’re Vladimir Putin.  And I echo the refrain that Vlad is not the Don’s friend.

      • KM says:

        Is this the answer to my earlier questions about Kilimnik’s motives for using his Gmail account?

        Still want to hear why exactly Russia is all too happy to hurt T & Co.  Take sanctions, for one.  Isn’t a Trump admin just obviously better for Russia than a Hillary admin?

        • earlofhuntingdon says:

          They have Trump now.  They would have assessed him as inherently ineffective and a sower of division, alienation and chaos.  All good for Vlad.  They want him to be himself.  But they don’t want him to be more effective or less chaotic.  Being inconsistent in how they deal with him, like a predatory parent, would keep the Don wondering how to please Vlad, while keeping him ineffective.

          • KM says:

            they don’t want him to be more effective or less chaotic

            If they genuinely know him, they know there isn’t much chance of this.

            Being inconsistent in how they deal with him, like a predatory parent, would keep the Don wondering how to please Vlad, while keeping him ineffective

            I like this psychological account better!  Borderline-y way of dealing with a borderline PD!  Makes sense to me.

             

             

            • earlofhuntingdon says:

              My argument assumes that Vlad has a pre-existing hold on Trump, for as yet undisclosed reasons.  That he does is consistent with Trump’s behavior since his campaign.  Maybe Mueller’s team knows what those reasons are.  That should scare both hairs off Donald Trump’s head.

        • emptywheel says:

          I think so. I had a funny convo w/a former intel person about how often Russians use PRISM facilities. He seemed to think they didn’t know about 702 targeting, but that’s got to be wrong, especially since elsewhere Kilimnik uses Telegram and other less accessible apps.

          • KM says:

            I totally believe you.  Seems to me you’re absolutely right about Kilimnik (and his masters) being well aware of what he’s up to.  What I’m less sure about is the why.  I do like EoH’s guess, though.  More than the generic “chaos” answer….

  9. Trip says:

    And on today’s ‘making the world as it once was’ troll, or simply the traditional everyday stupid, here’s what the Energy Dept put out:

    U.S. Agency Puts Ukraine as Part of Russia in Map Illustrating Baltic Summit in Washington
    A U.S. energy agency has mistakenly omitted Ukraine and placed Russia’s westernmost region back into German hands in a pre-World War II map released ahead of U.S. President Donald Trump’s meeting with Baltic leaders.
    In a press release touting energy cooperation with Estonia, Latvia and Lithuania as Trump prepared to host the three heads of state at the White House on Tuesday, the U.S. Energy Association published a map labeling Kaliningrad as “Konigsberg” and the wider region as East Prussia.

    https://themoscowtimes.com/news/us-agency-puts-ukraine-part-russia-map-illustrating-baltic-summit-washington-61045

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