CHAPTER 12. THE PROPERTY DEVELOPER
THE GOULETAS’ REAL ESTATE EMPIRE
The real estate empire of the Gouletas clan – brothers Victor and Nicholas, and sister Evangeline – was a vast, interlocking enterprise composed of multiple layers of ownership, comprised of firms nestled within holding companies and with tendrils that spread out from its capital city of Chicago and spanned from New York City to San Diego.
Each of the Gouletas, through individually-owned firms, were the shareholders in Ambelos Corp., the 100% owner of their flagship company, American Invesco Corp. There was also Tamco Holding Co., another company owned by the family. More specifically, this was a holding company that controlled Tamco Industries Inc. American Invesco would pour its money into Tamco, in order to both finance the company’s operations – which consisted mainly of acquiring other companies, in an embrace of the wild corporate takeover culture of the 1980s – and to protect the Gouletas’ wealth from the creditors that so often dogged Invesco.
It’s actually something of a mystery where the Gouletas’ wealth came from in the first place. Newspaper records show that, in the early 1970s, American Invesco peddled apartments, and then condominiums, but the units that they offered were unremarkable. Then, suddenly, sometime between 1976 and 1978, their fortunes exploded. The Gouletas became the source of condominiums in Chicago, and American Invesco was turning millions upon millions over in annual profit.
One explanation that has been offered for this sudden change was that the Gouletas were backed by Greek shipping money, particularly that of Aristotle Onassis. These rumors were fueled by American Invesco’s interest in purchasing half of New York’s Olympic Tower, which had been developed and co-owned by Onassis.1 Another was that their coffers were flush with money from the Middle East. This notion arose because one of Invesco’s partners was the J.P. Construction Company, which specialized in construction projects in that particular region.
Another, perhaps more likely although ultimately unproven, allegation is that the Gouletas were fronting for organized crime interests. Fortune magazine, in 1981, alluded to an "anonymous report received … by Congressman Benjamin Rosenthal, chairman of the House subcommittee on commerce, consumer, and monetary affairs" that "traced American Invesco’s seed money back to Greek mobsters in Chicago."2 There was also the issue of a "confidential intelligence bulletin, issued in 1978 by the Los Angeles County district attorney" that raised the possibility that American Invesco was tied to "Briar Management Co., 'a vehicle for organized crime infiltration of Chicago real estate’."3
Other hints of potential organized crime connections can be found among some of American Invesco’s management. A long-time president of the company was Douglas Crocker II, who, by the time he linked up with the Gouletas, had amassed a serious track record in the high-stakes real estate game. According to a 1987 issue of the Chicago Tribune, one of Crocker’s early business partners was Sam Zell, another wizard in the Chicago real estate scene who, like Ronald Lauder, is a major funder of the intelligence-connected IDC Herzliya. The same article describes another "partner in some of those early ventures" as being Burton Kanter – the mob-linked attorney who joined together with CIA banker Paul Helliwell to form management Castle Bank & Trust, the offshore hot money vortex located in Grand Bahamas’ Freeport (see chapter 1).4 In 1976, Kanter, Zell, and two other associates were charged with having used Castle Bank accounts to evade taxes on the sale of a Reno, Nevada, apartment complex that the group – along with other principals, such as Florida senator George Smathers (who had boasted of his own ties to organized crime) – had purchased in 1969.5
In 1983, the Gouletas decided to break into the savings and loan game. Through Tamco, they purchased Imperial Corp., a holding company that controlled Imperial Savings and Loan. Imperial controlled numerous thrifts scattered across the United States – at one point, these totalled 40 different institutions with $6.8 billion in assets.6 The holding company had fallen under the control of Saul Steinberg, the corporate raider, friend of Michael Milken, and eager client of the Drexel Burnham Lambert junk bond pipeline. Shortly thereafter, "he split Imperial Corp’s S & L operations into two entities, Imperial Savings in San Diego and Gibraltar Savings in Texas."7 Gibraltar passed through a chain of owners before finally ending up in the hands of Ronald Perelman, another participant in the Milken junk bond universe. Twenty-five percent of Imperial was then bought by Tamco.
In keeping with tradition, Imperial under the control of the Gouletas saw its portfolio swell with Drexel Burnham Lambert junk bonds. It also tapped other Milken clients for financing. Among these was Fred Carr’s First Executive Corp, which, by 1990, owned nearly $10 billion worth of debt sold through Drexel. First Executive went insolvent in 1991 and was taken over by the State of California. This followed Imperial’s own spectacular collapse at the end of 1990. In all likelihood, the two collapses were intertwined, as the run-up to their parallel breakdowns was characterized by highly irregular business activities that appear to have indicated a large-scale case of stock manipulation.
Those "irregularities" played out as follows: by 1987, the thrift industry as a whole was destabilizing, and a massive cascade of failures was well under way. In late summer, the Gouletas defaulted on a massive loan from First Executive. While Tamco still owned a big chunk of the company, majority ownership was edged out by Fred Carr’s insurance firm. Yet, by October, the markets were in turmoil, and the stock price of Imperial was plummeting. It was at this point that strange moves began to be made. As Peter Brewton writes, "who should come to the rescue – none other than Larry Mizel’s M.D.C. Holdings, another one of Milken’s big clients." (M.D.C. had "raised more than $700 million from Drexel junk bonds.")8
M.D.C. – which continues to exist today – was a major development company with a slew of subsidiaries that specialized in things like home construction. Brewton points out that the manager for Mizel’s various investment trusts was Calvin Eisenberg, formerly of Burton Kanter’s law firm.9 Given the ties between Invesco manager Douglas Crocker and Kanter’s circle, it appears that there was a shared social network or milieu, where the worlds of real estate, organized crime, and intelligence intersected in Chicago.
The way that M.D.C. "saved the day" was by buying, between November 1987 and February 1988, massive shares of Imperial, causing the stock price to rise from $7.50 to $12.50. Then, between June and September of 1988, the company sold off all its stock for "nominal gain."10
M.D.C.’s timing was auspicious. In October 1988, regulators opened an investigation into a potential "daisy chain" operation involving M.D.C., Silverado Savings in Colorado, Charles Keating’s Lincoln Savings in California, San Jacinto Savings in Dallas, and its parent company Southmark – a "vulture capitalist" institution that feasted on the remains of dead thrifts.11 Daisy chains made the illusion of liquidity where it may actually have been scarce, and entailed a network of financial institutions making loans to one another, swapping stock and flipping properties among themselves. These complex wranglings were also deployed by Milken to circulate junk bonds, by making them look more attractive. With that in mind, it’s not surprising at all that when the regulators were looking at this specific cluster of entities, "particular interest was whether securities had been 'parked’ at the insured institutions by Drexel Burnham and other brokers."12
There were close ties between all of these institutions. Charles Keating of Lincoln was a major Drexel Burnham client, while Southmark was "the largest estate-based conglomerate financed by Milken."13 Over at Silverado Savings, Colorado attorney Norman Brownstein, who also did legal work on behalf of Larry Mizel and M.D.C., had a position on the board. Brownstein was also reportedly a co-trustee for some of Mizel’s investment trusts, alongside the aforementioned Calvin Eisenberg.14
Brownstein had other clients of interest. There was "Ohio shopping center magnate Edward DeBartolo," and – importantly – American Invesco. DeBartolo’s considerable ties to both organized crime and Leslie Wexner are discussed in the next chapter. The Gouletas’ ties to this "daisy chain" didn’t stop there, however. Serving as president of Southmark and vice president and chief loan officer of its subsidiary, San Jacinto Savings, was Joseph Grosz – formerly of American Invesco, where he had served under Douglas Crocker.15
Given the ties between all the individuals involved and the way that the events overlapped at the time, it seems very likely that M.D.C.’s pump and dump of Imperial stock was connected directly to the "daisy chain" operations between M.D.C., Lincoln, Silverado, and Southmark.
ALLAN TESSLER: THE GOULETAS’ ATTORNEY
As Imperial was nearing collapse, Allan R. Tessler, the Gouletas family’s attorney and board member at a number of their enterprises, was briefly appointed CEO of the thrift combine. His goal was to restructure the organization, salvage its finances, and get it up and running again. In this task, Tessler failed. It is a black spot on his long career, which has included some curious connections.
Tessler was a mergers and acquisitions specialist from the New York City law firm Shea & Gould. The firm’s partners and clients were prominent. They had, for example, represented Carmine de Sapio, the last boss of the Tammany Hall political machine, close associate of mobsters like Frank Costello as well as a close personal friend of Roy Cohn. One of the firm’s partners was Thomas A. Macioce, brought in by the Vatican in 1989 to help clean up its scandal-ridden bank.16 Macioce, who chaired Allied Stores, was also on the board of Capital Cities, which took over the American Broadcasting Corporation (ABC) in 1985. There he had served alongside William Casey, who worked for the company between 1976 and 1981, at which point Casey became director of the CIA.17 Casey continued to hold a significant amount of stock in Capital Cities well into his tenure as CIA director.18
This wasn’t Casey’s only connection to Shea & Gould. Milton Gould, the firm’s co-founder and senior partner, was Casey’s friend and lifelong attorney. It’s fair to say that Shea & Gould wouldn’t even have existed if it weren’t for Casey, as he had introduced Gould and his fellow co-founder William Shea to one another sometime in the 1960s.19
It isn’t clear exactly when Tessler became counsel to the Gouletas, but it was certainly prior to their acquisition of Imperial, and probably dated back to the late 1970s, right around the time that the family’s wealth began to rapidly expand.
Throughout this same period, Tessler had another important client: Dr. Earl W. Brian, the Ronald Reagan crony and one of the main architects of the PROMIS software bugging and related scandals (see chapter 9). Brian was also head of the venture capital firm Infotechnology. In 1990, Infotechnology was teetering on the brink of collapse, with cash flow problems tearing the company apart. Tessler, in a move that directly paralleled his actions at Imperial not even a year prior, became Infotechnology’s co-CEO, with a mandate for a corporate restructuring that entailed selling off subsidiary firms, among other things.20
By his own admission, Tessler had been involved with Brian’s business affairs since around 1977. This aligned with Brian’s time as president of a technology firm called Xonics – and more specifically, with an SEC law-suit against the company for, among other things, artificially manipulating its stock price to raise money for acquisitions. Xonics managed to limp on for several years before it finally collapsed, at which point Brian took control of a subsidiary company called Hadron. As noted in chapter 9, it was Brian, operating through Hadron, who attempted to acquire the PROMIS software from William Hamilton’s Inslaw on behalf of the Department of Justice, and he, as well as Hadron, remained deeply tied to the events that surrounded the software’s eventual theft and illicit use by intelligence agencies.
Tessler himself makes a brief appearance in the annals of the "Inslaw Affair" itself. William Hamilton of Inslaw Inc. charged that a venture capital firm called 53rd Street Ventures, which held a stake in Inslaw, was party to the Hadron-DOJ conspiracy to acquire PROMIS. An affidavit by Hamilton states that 53rd Street’s founder and owner, Daniel Tessler, was "a relative of Alan [sic] Tessler, the senior partner in the New York City law firm of Shea and Gould responsible for Brian and Hadron’s mergers and acquisitions work."21 Daniel Tessler’s wife, Patricia Cloherty, was reported to have told an officer at Hambro International Bank that she "'knew all about’ Brian’s role in the INSLAW matter." The report of special counsel Nicholas J. Bua – a dismissal of Hamilton and Inslaw’s allegations – says that Daniel Tessler met with Inslaw concerning potential investments into the company on behalf of another investor in the company, Hambro International. He further denied that he was related to Allan Tessler and that he or his wife knew Earl Brian.
In the "Rebuttal of the Bua Report", drafted by Hamilton’s lawyers, it is pointed out that Daniel’s statement concerning his and wife’s unfamiliarity with Brian was unlikely to be true: Cloherty served alongside Brian on the board of National Association of Small Business Investment Companies in 1980.22 The question of a family relation between Daniel and Allan Tessler is not mentioned, however.
As detailed in chapter 9, the CIA’s modification of the PROMIS software was alleged to have taken place at the Cabazon Indian Reservation in Indio, California. Cabazon, at this point, was under the dominion of a mobster (and possible CIA asset) named John Nichols, who had managed to take control of the reservation from the tribal government after becoming the manager of a bingo hall – and projected casino project – at the reservation. Between 1981 and 1983, Nichols and his partner G. Wayne Reeder, a land developer of ill repute, steered Cabazon into a joint venture with the Wackenhut Corporation and several smaller companies. The multifaceted plan – which never came to full fruition, despite a surprising number of dead bodies turning up along the way – included a scheme for an arms research, development, and manufacturing plant. It seems that the weapons made at Cabazon were to be deployed into the different theatres of the Reagan administration’s various covert wars. For instance, as previously mentioned, it is a matter of record that representatives of the Contras attended a meeting at Cabazon to observe a weapons demonstration.
According to a Riverside, California, district attorney intelligence report that was later made available to Inslaw, that meeting took place in September 1981, before the consolidation of the Contra-support apparatus. It was attended by two Contra generals, representatives from the Cabazon tribal government, and the president of the weapons company Armtech. Also in attendance were Earl Brian and Wayne Reeder. According to the report, the pair "arrived together in a 1981 White Rolls Royce, License Plate 2XG2302."23
The connection between Brian and Reeder is Brian’s second connection, following his relationship with Tessler, to the world of savings and loans. Reeder was a prolific borrower from Silverado Savings. For instance, later, when the thrift was near collapse, one of Reeder’s companies defaulted on a $14 million loan. He was also affiliated with Herman Bee-be, the king of bad S & Ls that had a long list of mob and intelligence ties stretching back to the 1960s, if not earlier.24 A 1985 report by the Comptroller of the Currency on Beebe’s banking and insurance empire listed San Jacinto Savings – a key node in the S & L "daisy chain" that involved the Gouletas, M.D.C., Lincoln, and Silverado – as an institution under his control.25 Beebe’s pernicious influence could also be felt at the parent company, Southmark. "The company’s 1985 10-L showed that Herman Beebe held nearly 62% of Southmark’s Series E Preferred Stock."26
To return briefly for a moment to Tessler, in 1987 he joined the board of Leslie Wexner’s company The Limited.27 This is the same year that Epstein officially entered Wexner’s inner circle by becoming his financial advisor and the same year that he began sharing an office with Evangeline Gouletas. Tessler remained at The Limited for some time, and by the mid-late 1990s, he became chairman of the company’s finance committee. Thus, Tessler would have come into contact with Epstein at some point – and indeed, Tessler appears in Epstein’s contact book, with two addresses and four different phone numbers listed. Among the numbers was Tessler’s line at Data Broadcasting Corp – an "electronic news summary" company that had been acquired by Earl Brian’s Infotechnology in 1987.
THE GOULETAS IN NEW YORK, PART I: HUGH CAREY’S WORLD
In 1982, just as the Gouletas’ adventures in the wild world of savings and loans were just getting started, Evangeline Gouletas left Chicago for New York. The reason was marriage: she had married New York governor Hugh Carey, just three months after meeting him. Evangeline’s surname was then changed to Gouletas- Carey and, even though the marriage wouldn’t last, the name-change would. The exact circumstances through which Hugh and Evangeline met remains unknown, but one possibility is a mutual relationship to the law firm of Shea & Gould. Carey himself would later be a veteran of the firm, and had long counted Shea as a close, personal friend.28 Shea’s protégé -- and NYC governmental law specialist at Shea & Gould – Kevin McGrath worked on Carey’s 1974 and 1978 gubernatorial campaigns.29
Carey surrounded himself with other curious individuals. One of these was Arthur D. Emil, an attorney from Surrey & Morse – the law firm of Walter Surrey, the OSS alumni who had helped set up the World Finance Corporation. Emil had served as the treasurer for Friends of Governor Carey, Hugh Carey’s campaign finance vehicle during the 1978 campaign season. In 1979, he was mentioned in a New York Times article on the allegations that Anthony M. Scotto – head of the International Longshoremen’s Association Local 1814 and a racketeer for the Gambino crime family – had provided large sums to both Mario Cuomo and Carey.30 "Around this time," Peter Brewton writes, "Edgar Bronfman allegedly made a $350,000 loan to Carey to help pay off a campaign debt."31
The nexus around Governor Carey wasn’t the only place where Arthur Emil and Edgar Bronfman could be found together. In the 1980s, both served on the board of the Gulfstream Land & Development Corp, a major Florida real estate concern, with Bronfman serving as chairman.32 In 1986, Gulfstream was purchased by a real estate developer named Kenneth M. Good, using $250 million he had borrowed from a variety of sources. "This included $70 million of the usual junk bonds and $90 million from major East Coast banks and the rest from a group of mostly Florida savings and loans".33 Also telling is the man then serving as Good’s attorney: Norman Brownstein, the same lawyer who sat on the board of Silverado, and had represented M.D.C., Edward DeBartolo, and the Gouletas’ American Invesco. After Gulfstream was acquired, Good put two new individuals on the board. One was Brownstein, and the other was Brownstein’s fellow Silverado director, Neil Bush, the brother of then-Vice President George H.W. Bush.
When Silverado finally collapsed, the blame was placed on Good and one of his business associates, Bill Walters. The pair not only "walked away from more than $132 million in bad debts" – both were investors in JNB Exploration, an oil company formed by Neil Bush in 1983.34 Remarkably, Bush had invested a mere $100 into the company, while Good and Walters put in $160,000 and a bank Walters controlled issued JNB a $1.75 million line of credit.35 It was two years after this operation was up and running that Bush arrived at Silverado, with the S&L subsequently issuing multi-million dollar loans to Good and Walters. Real estate developments and other investments across the country were the recipients of this money.
Were the Silverado shenanigans that ensnared Bush, Brownstein, Walters, and Good just a case of cronyism when it came to lending practices, or was there something else going on? The problem with suspect S&L lending during this period is that, without having a full picture of where the money was coming from, it becomes more difficult to see the significance of where it was going. In cases where this full picture has been developed, it becomes clear that the flow of money was often related to broader money laundering networks that involved organized crime and intelligence services. Then, there was the junk bond-related "daisy chain" that Silverado was engaged with, and that involved M.D.C., the Gouletas, and Keating, in this same period. Money from this network could have been siphoned out into Walters and Good’s various operations.
There is a possibility that paints Silverado’s lending activities in a darker light, and which might be relevant to the daisy chain operation as a whole. Silverado had appeared in Operation Polar Cap, a major DEA investigation into Medellin cartel money laundering networks in the US.36 Culminating at the end of the 1980s, Polar Cap involved revelations around "La Mina" or "The Mine," a triangular formation linking banks, jewelers, and precious metals dealers in Florida, New York City, and Los Angeles. One informant described the objectives of "La Mina" as:
…the exploitation of legitimate gold mines for the purposes of laundering illegitimate monies. This involved linking up with and taking control of gold mines in Peru, Venezuela, Chile, Uruguay, etc., of gaining access to US gold refineries and jewelry stores, and of amalgamating money generated through legitimate gold sales with drug money to conceal its origin. Some of the money was reinvested by the cartel to fund the operation. Laundered drug money paid for airplanes and boats in the United States, and bought coca paste in Bolivia and Peru. Later, accounts in Banco de Occidente and BCCI were identified by the US and the Canadian RCMP as having been used to purchase aircraft used to ferry drugs. The RCMP also identified a number of cartel operatives and airplane manufacturers and fixed-based operators (FBO) such as Aviel in Colombia, Eagle Air in Memphis, and Downtown Air, in Oklahoma City.37
The details of Silverado’s connection to La Mina and/or to related money laundering operations are unknown, but there are several reasons to consider the possibility that cartel money laundering was key to this network:
• While BCCI accounts were directly used by the cartels, other banks in the wider BCCI network were also deployed. Among these was Independence Bank in LA, which was owned by BCCI frontman Ghaith Pharaon.38 Pharaon also owned an S&L in Florida called CenTrust, which did extensive business with both Keating and Milken’s Drexel Burnham Lambert.39
• Neil Bush’s brother, Jeb Bush, was close to a major Florida GOP activist and fundraiser named Leonel Martinez. Ostensibly a prominent construction magnate, Martinez was involved in the trafficking of cocaine and marijuana into Florida from Colombia and elsewhere.40 Both Martinez and Jeb were boosters of the Contras, and Martinez was particularly close to Eden Pastora – the same Eden Pastora who appeared at Cabazon in the company of Earl Brian and Silverado borrower Wayne Reeder.
• According to Cheri Seymour, the final leg of Danny Casolaro’s investigation was into connections between his "Octopus" and cartel money laundering, with a focus on Michael Abbell, a high-ranking DOJ official-turned-cartel attorney. The cartel in that case, however, was the Cali Cartel, and not the Medellin cartel.41
• One of the New York City banks utilized by Medellin’s money laundering networks that was turned up by Polar Cap was Republic National Bank. Robert Owen, Oliver North’s primary liaison to the Contras, utilized an officer at Republic National Bank named Nan Morabia as a courier.42 The founder and owner of Republic National was Edmond Safra, as noted in chapter 7. According to Gordon Thomas, and as previously noted in chapters 7 and 9, Safra was a close friend of Robert Maxwell and allowed Maxwell-linked crime syndicates to move money through his bank.43 Safra’s name, address, and number can also be found inside Epstein’s contact book.
THE GOULETAS IN NEW YORK, PART II: IMB CAPITAL
In 1985, Evangeline Gouletas-Carey oversaw the relocation of Tamco’s merchant banking subsidiary, IMB Capital, to New York City, and also became the family member tasked with overseeing its operations. That same year, IMB Capital, working through a front called 457 Corp, acquired Electronic Realty Associates Inc. (ERA) from its "financially-troubled" parent company, Control Data Corp.44 Part and parcel of this acquisition was a software program that had been developed for ERA and was called Remote Mortgage Origination (RMO) – "a computerized prequalification, origination, loan tracking, process, and underwriting network."45 RMO had been developed by an "affiliate" of ERA, the Commercial Credit Mortgage Company; a perusal of newspaper archives and other records shows that Commercial Credit often worked with various savings and loan associations.
Control Data Corp, previously discussed in connection with PROMIS, the World Bank and technology transfer in chapter 9, was a long time defense contractor that was started by a team of engineers dedicated to developing codebreaking technology. It was historically close to the Navy, and supplied this branch of the Armed Forces with super computers. Later, in the 1960s, it began to acquire various technology-oriented firms that were less directly connected to the national security state. In 1976, they hired one of Edwin Wilson’s companies – possibly Consultants International, where Robert Keith Gray served on the board – in an advisory capacity. Notably, this would have taken place prior to the shutdown of the Navy’s Task Force 157, where Wilson was working. In addition, Wilson apparently bugged the offices of the Army Materiel Command on behalf of the Control Data Corp in order to "get inside information on the Army’s bidding and procurement plans."46
The address for the New York City corporate headquarters of IMB Capital was 457 Madison Ave – the location of the Villard Houses, where Gouletas-Carey shared an office with Jeffrey Epstein.47 This suggests that the shared office of Gouletas-Carey and Epstein was, in fact, also the offices of IMB Capital, thus hinting at possible ties between Epstein and the firm.
DONALD TRUMP, THE REAL ESTATE MOGUL, AND JEFFREY EPSTEIN, THE “PROPERTY DEVELOPER”
The year 1987 was a pivotal year for Epstein, as it was the year he not only became involved with Hoffenberg and the Gouletas, but also with Donald Trump and Leslie Wexner. Both Trump and Wexner, at the time, were deeply involved in the worlds of New York real estate, as were the Gouletas. It was during this period that Epstein would begin branding himself a "property developer" and become focused on real estate deals, with numerous media reports referring to Epstein as "a property developer" well into the 2000s.48
However, it seems that Epstein’s involvement with real estate may have been a new means of disguising his old financial tricks, as many of his real estate transactions during this period involved the sale of the same property multiple times, all for miniscule sums, including for as low as $1. Another property under his control he had mysteriously obtained from the US State Department. The specifics of Epstein’s real estate involvement were intimately interwoven into his relationship with Leslie Wexner, whose connections and ties to organized crime are dealt with specifically in the next two chapters.
Commercial real estate in the US has a long history of being used to launder money, and the practice is particularly common in specific American real estate markets, like New York City and Palm Beach, Florida.49 These are notably two places where Epstein, as well as Trump, have long been active in property markets. Trump and his inner circle, including the family of his son-in-law Jared Kushner, have long been accused of both permitting or engaging in money laundering in connection with their real estate interests, particularly in New York.50 Much of the money laundering accusations that would later dog Trump during his political career revolved around his alleged cooperation with Russian mobsters whereby those mobsters used Trump properties to launder their ill-gotten gains.
However, while some in the mainstream press misleadingly painted this Russian mobster-connection as meaning that Trump was "owned" by Vladimir Putin, it is important to note that the Russian mobsters in question tied back to Russian mob boss Semion Mogilevich. As noted in Chapter 9, Mogilevich was a major business partner of Robert Maxwell and a key fixture in the global criminal syndicate that Maxwell had helped create at the end of the 1980s. Thus, the connections point more to money laundering on behalf of a Maxwell-connected criminal enterprise that encompassed Eastern European/Russian organized crime than one necessarily tied to the current Russian government. Trump very much appeared to exist in the Robert Maxwell orbit, having been photographed attending parties in the late 1980s hosted by the media baron/intelligence asset on his yacht, the Lady Ghislaine.51 His connections to such circles is also evident given his relationship with Jeffrey Epstein as well as Epstein’s "girlfriend" Ghislaine Maxwell.
As previously mentioned, Epstein is known to have met Trump in 1987. It is unclear exactly how the two men met, but it may have been through Epstein’s relationship with Steve Hoffenberg, which was established that same year. Hoffenberg would later tell the Washington Post that, during this period, "Donald’s crowd was my crowd."52 He is also known to have rented a floor in Trump Tower before his arrest.53
In 1988, Trump purchased the Plaza Hotel, once the site of sexual blackmail "parties" involving minors that had intimately involved Roy Cohn and were first discussed in chapter 2. Cohn was not only Trump’s lawyer, but his mentor and friend, and the two men regularly partied together. Cohn’s former switchboard operator Christine Seymour claimed that, prior to Cohn’s 1986 death, Trump called Cohn regularly, "up to five times a day."54 Cohn is also alleged to have aided the judicial career of Trump’s sister, Maryanne Trump Barry.55
After purchasing the Plaza Hotel, it would be reported and confirmed by then-attendees that Trump "used to host parties in suites at the Plaza Hotel when he owned it, where young women and girls were introduced to older, richer men" and "illegal drugs and young women were passed around and used."56
Andy Lucchesi, a male model who had helped organize some of these Plaza Hotel parties for Trump, said the following when asked about the age of the women present: "A lot of girls, 14, look 24. That’s as juicy as I can get. I never asked how old they were; I just partook. I did partake in activities that would be controversial, too."57
Some authors, such as Michael Wolff, have alleged that, during the late 1980s and early 1990s, Trump and Epstein, along with Tom Barrack, were a "set of nightlife Musketeers" who frequently partied together.58 Barrack, founder and CEO of Colony Capital, was also a major player in real estate and subsequently played a key role in Trump’s later political career. During this same period, in 1990, Epstein bought a home in Palm Beach, making him Trump’s neighbor. This suggests that – at the very least – the two men became even better acquainted after that purchase.
Other evidence for the early partying days of Trump and Epstein later emerged with a video recording of the two men chatting and laughing while pointing at women during a Mar-a-Lago party held in 1992.59 It certainly appears from the video that the two men were well acquainted. There are several other occasions where Trump was photographed alongside Ghislaine Maxwell during the 1990s.
There are also other allegations, such as those made by Florida businessman George Houraney. He told the New York Times that, in 1992, he organized an exclusive, "calendar girl" competition that was only attended by Trump and Epstein. Houraney claims that he flew in about 28 women for the event, at Trump’s request. Houraney claimed to know Epstein "really well" and subsequently declined to host more events involving Epstein at Trump’s request.60 Some, however, have accused Houraney’s allegations as being politically motivated and possibly inaccurate, as he had accused Trump of inappropriate behavior toward his girlfriend and business partner shortly before the 2016 presidential election.
The relationship with Trump would continue for some time, with Trump flying on Epstein’s plane in 1997 and the two men being photographed together at a Victoria’s Secret party that same year. A year later, Epstein had claimed to have introduced Trump to his current wife, Melania, at an event during New York fashion week. They would attend other parties together, including an event in 2000 hosted by media baron and convicted fraudster Conrad Black, who appears in Epstein’s book of contacts.
Also, in 2000, Epstein, Maxwell, and Prince Andrew attended a celebrity tennis tournament at Mar-a-Lago, where Trump and the Prince took pictures together.61 Mar-a-Lago would figure prominently as a place of socialization for Epstein and Maxwell, as well as a place where they recruited minors into their sexual blackmail/sex trafficking operations, with the most well-known of these being Virginia Roberts (now Virginia Giuffre). However, the Trump Organization has claimed that Epstein was not a dues-paying member of the club. Trump is also present in Epstein’s contact book with several numbers listed; Melania Trump is also listed among his contacts.62
In 2002 and 2003, Trump was still in Epstein’s good graces, attending several of his dinner parties in Palm Beach as well as in Manhattan.63 At one 2003 dinner at his Upper East Side home, other attendees besides Epstein and Trump included Google co-founder Sergey Brin, Leslie Wexner, controversial British political operative Peter Mandelson, and Bill Clinton aide Doug Band.64 In 2002, New York Magazine quoted Trump as saying the following about Epstein: "I’ve known Jeff for fifteen years. Terrific guy […] He’s a lot of fun to be with. It is even said that he likes beautiful women as much as I do, and many of them are on the younger side. No doubt about it – Jeffrey enjoys his social life."65
However, in 2004, the two men had a falling out, reportedly over their rivalry to purchase a Palm Beach property called Maison de l’Amitie that was being sold out of bankruptcy. Trump, for his part, declined to publicly state exactly why their friendship ended, saying that "the reason doesn’t make any difference, frankly" and that what mattered is that the relationship had ended well over a decade before his political career and prior to Epstein’s arrests.66 Years later, lawyer Brad Edwards, who has represented victims of Epstein’s, said that, in 2009, Trump was very cooperative in providing information about Epstein for the cases against him.67
Some, such as Steve Hoffenberg, have alleged that – in the early days – Trump was not only close to Epstein, but was arguably even closer to Ghislaine Maxwell.68 After Epstein’s 2019 arrest, Trump attempted to distance himself even further from Epstein, saying he was "not a fan" of the then-jailed billionaire. However, when Ghislaine was arrested roughly a year later, Trump publicly offered her well wishes instead of aiming to distance himself from her as he had with Epstein. This is despite the charges she was then facing, all of which pertained to sex trafficking of minors in connection with Epstein.69
EPSTEIN’S REAL ESTATE WEB
According to a Columbus, Ohio police document from the early 1990s, numerous Wexner-linked entities, like the Wexner Investment Company, SNJC Holdings, and PFI Leasing, shared the same office space and telephone numbers.70 That document, part of a murder investigation detailed extensively in the next chapter, also noted that this office was on the same floor as Wexner’s New Albany real estate project and the offices of New Albany’s co-founder Jack Kessler. One of the companies that shared this space was originally named Lewex and was later renamed Parkview Financial.
Records from 1990 list Leslie Wexner as Parkview’s director and president whereas Epstein is listed as vice president and treasurer. Records from 1987 show that the role of vice president had previously been occupied by Harold Levin, Wexner’s money manager before Epstein took over that role.
This specific office space shared by all of these entities was located on the 37th floor of the Huntington Center, located at 41 South High Street, Columbus, Ohio. Beginning in 1982, the Huntington Center was largely controlled by the business interests of Gerald D. Hines, a Houston-based real estate developer and chairman of the Federal Reserve Bank of Dallas from 1981 to 1983. Hines’s other notable real estate projects include Houston’s Galleria, which was discussed in chapter 7 as money from the Marcos family was invested into that particular project and Adnan Khashoggi, who was also involved with Marcos family finances, had suspect real estate dealings immediately adjacent to the Galleria. Another notable Hines project was Pennzoil Place in Houston, which leased space to the Bush family-connected companies, Pennzoil and Zapata Petroleum.
Hines had also been an investor in Houston’s "Fantasy Island" project alongside Walter Mischer, whose connections to George H.W. Bush were discussed in chapter 6.71 There, it was also mentioned that Mischer may have played a role in Bush’s own private intelligence network and that Mischer’s son-in-law, Robert Corson, had been connected to both American and Israeli intelligence.
Another investor in "Fantasy Island" alongside Hines and Mischer was Joe Russo, a close associate of both Bush and Mischer. Russo was also connected to the suspect S & L Lamar Savings, which had alleged connections to Israeli intelligence and Adnan Khashoggi, as noted in chapter 7. Russo, incidentally, was also a "minority owner" of the media outlet UPI at the time that a company controlled by Earl Brian, one of the architects of the PROMIS scandal, took control of the outlet. Russo, on Brian’s role in acquiring UPI, told the Houston Post "He [Brian] knows what he is doing."72
It is unknown if there were any direct interactions between Hines and Wexner aside from Wexner-controlled companies leasing office space from Hines’s Huntington Center. However, it is interesting that many of Wexner’s business entities, particularly those flagged by Columbus police as part of a murder investigation, leased office space from a man whose other ventures were enmeshed with Mischer, the Bush family, Khashoggi and other intelligence-linked entities, particularly when one considers Epstein’s own intelligence connections and his intimate involvement, from 1987 on, in several of these specific companies.
Parkview Financial, following the Shapiro murder, became a key vehicle for Wexner’s, and later Epstein’s, role in real estate, specifically in New York City. However, Wexner’s interest in Manhattan real estate pre-dated his relationship with Epstein, as – by 1985 – he had already acquired the Gurney House on East 74th Street for $5.8 million and was cited by New York Magazine that year as already owning "small chunks of New York" at the time.73
Once Epstein became Wexner’s financial advisor, Parkview Financial continued to expand Wexner’s real estate holdings in the metropolis by scooping up a condominium complex in Queens called Dara Gardens. The financing for this purchase was arranged by Dime Savings Bank of New York – one of the largest S & Ls in the state.74
During this time, Dime Savings was one of many savings and loans that "had extended themselves too far, making real estate loans to questionable borrowers."75 When the S & L crisis erupted, Dime was "left with huge losses on some 1500 defaulted mortgages," but avoided collapse, largely thanks to the bank’s top executive at the time – Richard Parsons, a lawyer and former aide to Nelson Rockefeller.76 As a lawyer, Parsons’ clients had included "members of the Rockefeller family and Estee Lauder among others." In 1991, Parsons was recommended to Time Warner CEO Steve Ross, a fixture on Robert Maxwell yacht parties with past ties to organized crime, by Laurance Rockefeller. He joined Time Warner’s board and later became the company’s CEO.77
Once Wexner’s business interests had taken over Dara Gardens, it was revamped and financially managed by Imperial Properties, the president of which was Myles J. Horn.78 A few years later, in 1994, Horn was reported to be the owner of the company HSI Inc. and was arrested after attempting to bribe the Trump-owned Taj Mahal casino to recover a lost contract. Horn had mistakenly offered the bribe to an undercover police officer.79 This may indicate that Horn, like some other Wexner-connected businessmen from this period (e.g. Frank Walsh, see the next chapter), had a tendency to engage in illegal activity prior to his 1994 arrest and at a time when he was actively involved in managing Wexner properties.
In May 1991, Dara Partners L.P. was created, apparently to manage the condominium complex. The filing lists Ossa Properties as the owner, with offices at 457 Madison Avenue, the very place where Epstein and the Gouletas shared offices.80 The same day that Dara Partners was created, Ossa also created 301 66th Street East Acquisition Partners, L.P.81 Jeffrey Epstein’s brother, Mark Epstein, has been the owner of Ossa Properties for several years, and has denied that the company had any connection to his brother whatsoever. This is despite the fact that documentation exists listing Ossa Properties as an "affiliate" of Epstein’s company J. Epstein & Co.82
However, Ossa Properties appears to have been originally founded by Anthony Barrett. Barrett, in 1987, had founded 301/66 Owners Corp, which owned 301 East 66th Street and was listed as an "affiliate" of Ossa Properties.83 During the time these entities were controlled by Ossa, Myles Horn and Imperial Properties were tapped to carry out a conversion on this same property, just as they had done with Dara Gardens.84 There is a possibility that Imperial Properties was connected to the Gouletas family, as the Gouletas had several other companies called "Imperial" and the Gouletas also shared the office space assigned to Ossa Properties in these filings, not only with Ossa, but with Jeffrey Epstein.
Those apartments at 301 East 66th Street would play a role in Epstein’s sexual trafficking and blackmail activities. For instance, Ehud Barak, former Israeli Prime Minister and Israeli military intelligence chief, was a frequent visitor to this location, so much so that The Daily Beast reported that numerous residents of this Ossa Properties-owned apartment building "had seen Barak in the building multiple times over the last few years, and nearly half a dozen more described running into his security detail."85 The Daily Beast report also noted that "the building is majority-owned by Epstein’s younger brother, Mark, and has been tied to the financier’s alleged New York trafficking ring."86 Specifically, several apartments in the building were "being used to house underage girls from South America, Europe, and the former Soviet Union," according to a former bookkeeper employed by one of Epstein’s main procurers of underage girls, Jean Luc Brunel.87 The Brunel-Epstein relationship is detailed in chapter 18.
Reporting from Crain’s New York has noted that the majority of the units in the complex are not sold, but can be rented out as long as the rental period is longer than 30 days. However, it has been alleged that many of the apartments, and apparently those alleged to have been used to "house underage girls" from foreign countries, were being occupied for far less than 30 days, leading to accusations that the site was "illegally operating as a hotel" as late as 2019.88
Barak is also known to have spent the night at one of Epstein’s residences at least once. He was also photographed leaving Epstein’s residence as recently as 2016, and has admitted to visiting Epstein’s island, which has since sported nicknames including "Pedo Island," "Lolita Island," and "Orgy Island." In 2004, Barak received $2.5 million from Leslie Wexner’s Wexner Foundation, where Epstein was a trustee as well as one of the foundation’s top donors at the time. The massive grant to Barak was officially for unspecified "consulting services" and "research" on the foundation’s behalf.89 Barak is alleged to have met Epstein in the 1980s, though Barak himself has asserted that they met much later and were originally introduced by Shimon Peres.
It is also worth noting that Ossa Properties former Vice President and CFO, Jonathan Barrett, was the brother of Ossa Properties’ founder Anthony Barrett. From 1992 to 1996, Jonathan Barrett was an asset manager for J. Epstein & Co., Epstein’s main company during that time, and an executive at Ossa Properties simultaneously. His resumé states that Ossa Properties "acquired and 'turned around’ distressed NYC real estate."90
Jonathan Barrett has since become director of acquisitions and investments at Luminus Management, "a hedge fund that invests in the energy and power sectors." He has held that position since 2003.91 Luminus is also listed as a "declared affiliate" of LS Power, where Barrett is also a managing director.92 LS Power’s CEO is Paul Segal.93 His father, Mikhail Segal, had originally founded LS Power and formerly worked for the Department of Energy in the Soviet Union before becoming president of The Energy Systems Company (ENESCO), "a private developer of cogeneration projects."94 Notably, the "first recorded public transactions of ENESCO were alongside Pagnotti Enterprises, a firm linked to the Bufalino crime family via founder mafia boss Louis Pagnotti."95
Today, LS Power is a major supplier to Elon Musk’s Tesla, while Luminus Management was the largest shareholder in Valaris, which – in 2020 – sold $650 million in oil rigs to Musk’s SpaceX.96 SpaceX plans to transform the rigs into rocket launching platforms. As reported by Business Insider, Jeffrey Epstein had introduced a member of his entourage to Elon’s brother Kimbal Musk, who sits on the board of SpaceX and Tesla. The woman in question, who lived at an apartment at 301 East 66th Street and had previously "dated" Epstein, dated Musk from 2011 to 2012 and the relationship "brought Epstein into contact with the Musk family and its businesses."97 It was alleged that in 2012, Epstein had toured a SpaceX facility, though a SpaceX attorney denied the claim six months after it was initially reported.98 In 2019, it was reported that Epstein had confirmed rumors to journalist James Stewart that he had been secretly advising Tesla.99
Notably, a director for the related Luminus Capital Partners and the Luminus Capital Partners Master Fund is Alex Erskine, who was also a director for Epstein’s financial vehicle Liquid Fundings.100 Erskine is also listed as a director for numerous Glencore subsidiaries, with Glencore being the firm founded by Mossad asset and controversial commodity trader Marc Rich.
Yet another director for Luminus Capital Partners Master Fund and Luminus Capital Partners as well as Luminus Energy Partners is a man named Stephen Martin Zolnai.101 Zolnai was also a director of Forexster Limited, an electronic foreign exchange platform operating from Bermuda that claimed it "would revolutionize the market, taking banks out of forex trades and enabling clients to deal directly with each other."102
Notably, Forexster was co-founded by the Bosnian-born Arman Glodjo who gained a reputation as a highly skilled systems designer working for oil trader John Deuss.103 As mentioned in chapter 6, John Deuss was a major employer of Ted Shackley and his "private CIA." In addition, a director of Deuss’s Transworld Oil, Hugh Edwin Gillespie, was also a director of Epstein’s Liquid Funding alongside Alex Erskine, Bear Stearns principals, and Epstein himself. As will be noted in chapter 16, one of Epstein’s many 1990s "girlfriends" that also lived in the 301 66th Street apartments, Francis Jardine, would end up marrying John Deuss. Epstein took Jardine with him to at least one of his visits to the Clinton White House.
This makes Forexster’s connections to Bear Stearns, Epstein’s former employer where he later became a major client, worth noting. According to an article published by InformationWeek:
Though the system is not yet live, Bermuda-based Forexster is about to go live with Bear Stearns’ prime brokerage customers. "We will sit on the other side of those customers and act as a liquidity provider," explains [Seppo] Luskinen. The function of a prime broker is to extend credit and clear and settle the customers’ trades. Bear Stearns plans to "white label" the system to its clients, which include hedge funds, commodity trading advisors, and money managers, says Luskinen. SEB will take advantage of existing credit relationships so that it can trade with prime brokerage clients of Bear Stearns. "All of their prime brokerage customers will deal in (Bear Stearns’) name, and our counterparty will be Bear Stearns," explains Luskinen.104
There are numerous references to Epstein’s interest and extensive involvement in foreign currency trading throughout the media and elsewhere. He was also a major client of Bear Stearns following his departure from the bank in the early 1980s until its collapse as part of the 2008 economic crisis. This raises the possibility that Epstein himself not only benefitted from Bear Stearn’s "white labeling" of Forexster, but that Epstein potentially could have been a driving force behind the "white labeling" policy himself.
The references to Epstein and currency markets over the years are many and some allude to Epstein having an apparent advantage over others when conducting trades in foreign currency markets. For instance, Vicky Ward’s 2003 report on Epstein stated that he often touted "his skill at playing the currency markets 'with very large sums of money.’"105 Such claims can also be found in the 2002 profile on Epstein by New York Magazine, which alludes to Epstein’s frequent calling of currency traders abroad, and quotes close Epstein associate, Danny Hillis, formerly of the US military contractor and supercomputer firm Thinking Machines, as saying:
We talk about currency trading – the euro, the real, the yen. He has something a physicist would call physical intuition. He knows when to use the math and when to throw it away. If I had acted upon all the investment advice he has been giving me over the years, I’d be calling you from my Gulfstream right now."106
Many journalists and others who have interviewed or met Epstein over the years have also referenced currency trading. For instance, not long before Epstein’s 2019 arrest, journalist James Stewart went to interview Epstein in connection with claims that Epstein had been advising Elon Musk’s Tesla and Epstein was working on a computer. Epstein stated that he "was doing some foreign-currency trading."107
Perhaps the most notable mention over the years of Epstein’s connection to foreign currency markets can be found in a letter written by Epstein’s close friend, Lynn Forester (later Lynn Forester de Rothschild) to then-president Bill Clinton in April 1995. In that letter, Forester wrote:
Dear Mr. President: it was a pleasure to see you recently at Senator Kennedy’s house. There was too much to discuss and too little time. Using my fifteen seconds of access to discuss Jeffrey Epstein and currency stabilization, I neglected to talk to you about a topic near and dear to my heart…108