Exclusive: Developer Of Trump Tower Moscow Received Loan From Sanctioned Sberbank Three Weeks After Signing Letter Of Intent

IC Expert Investment Company Owners Include Three Mystery LLCs Located In Cyprus And The Marshall Islands; Chairman Was Charged With Negligent Homicide In 2011.

By: Scott Stedman

The developer of Trump Tower Moscow received a non-revolving line of credit from the U.S. sanctioned Sberbank three weeks after signing a Letter of Intent (LOI) with Trump Acquisitions LLC. A letter of intent describes the details of a real estate transaction before it is finalized. The agreement was signed by Donald Trump on October 28th, 2015, four months into his presidential run.

A non-revolving credit line is typically in the form of an installment loan, which is given in a lump sum and then paid back over regular installments with interest assessed. This means that money was being borrowed by IC Expert from the state-owned Sberbank. Previously, Trump Organization Lawyer Michael Cohen claimed that the deal fell through in January 2016, after he lost confidence that the firm could secure financing.

An analysis of banking, financial, and tax records shows that IC Expert received a non-revolving line of credit from Sberbank on November 18th, 2015. The company pledged 100% of its equity to secure the 10.6 billion ruble credit line, indicating a level of significance.

The records have also uncovered the shadowy owners behind IC Expert — a complex web of both Russian and offshore shell companies whose frequent changes of ownership, directors, company names and addresses effectively obfuscates their financial dealings. The company’s current ownership is registered to three LLCs, with 85% of the ownership shared between two offshore companies located in Cyprus and Marshall Islands.

The shareholders in the company as of 2015 included Colinsen Trading Limited, a Cyprus-based LLC with 60% share in IC Expert, Trianguli Limited, a Marshall Islands LLC with 25% share, and “EKOPRESTIZH”, a Russian LLC with 15% share.

Equity pledged

In a written statement released in September by Trump’s lawyer Michael Cohen he claimed that, “In late January 2016, I abandoned the Moscow proposal because I lost confidence that the prospective licensee would be able to obtain the real estate, financing and government approvals necessary to bring the proposal to fruition.”

With these new revelations, Mr. Cohen’s statement appears misleading. Sberbank is Russia’s largest state-owned bank. A pledge of 100% of the company equity for the line of credit suggests that not only was IC Expert well on its way to obtaining the financing needed for site selection, regulatory work, etc., but it also had a degree of confidence from Putin’s government.

In 2014, after the annexation of Crimea, the US and EU imposed sanctions on many Russian institutions including Sberbank. These sanctions barred companies from dealing in any debt Sberbank issued of longer than 30 days maturity.

Andrey Rozov, the IC Expert Chairman and Trump LOI signatory, founded the company in 2005. The company’s first project was awarded in 2011 for a residential development project called Novokosino-2 in the city of Reutov, a suburb of Moscow. Sberbank appears to have provided the initial financing for the project, as well.

That same year, Rozov was involved in a fatal boating accident in the harbor of Crocus City. Rozov was charged with negligent homicide, yet the case stalled and it is unclear what became of the charges.

By the end of 2014, IC Expert had become mired in scandal over its failure to construct thousands of apartment units paid for by home buyers. The Novokosino project has required ongoing intervention by local and regional government officials to address the growing protests of co-investors. Even under this supposed government supervision, many of the buildings — first promised in July 2015 and then December 2015 — still remain under construction.

Construction at Novokosino-2 continues to lag years behind schedule, with promised schools and other public facilities left undelivered

Yet in 2015, Rozov’s scandal-plagued IC Expert was looking to expand into the luxury skyscrapers sector in Moscow City. The licensing deal with Trump was predicated on the firm’s ability to secure financing, land, and government permission. It included an initial $4 million dollar ‘upfront’ payment to ‘Trump Acquisition LLC and/or one or more of its affiliates’. It is unclear whether such a payment was ever made.

The project was deemed so “important” to Cohen that in January 2016, he reached out to Putin’s spokesperson Peskov for help. In that email, Cohen wrote, “without getting into lengthy specifics, the communication between our two sides has stalled.”

Trump’s lawyer, Marc Kasowitz, is the lead defense counsel for Sberbank in a Manhattan case. During Trump’s trip to Moscow in 2013, he met with the Sberbank CEO Herman Gref. “There was a good feeling from the meeting,” Gref said in an interview. “He’s a sensible person, very lively in his responses, with a positive energy and a good attitude toward Russia.”

The deal signed by Trump and his lawyer Michael Cohen offers no signs that they properly vetted IC Expert. Neither mystery offshore owners nor a homicide appears to have deterred them from signing the Letter of Intent. Doing business deals with shady characters in foreign countries open political candidates up to potentially being compromised. This material can be held against the political figure in order to ensure loyalty.

Kasowitz and Cohen did not return requests for comment.