The curious case of Jeff Sessions and former mobsters close to Trump.
Salvatore Lauria and Felix Sater nearly made a fortune by participating in a large scale stock fraud and money laundering operation, organized by families of La Cosa Nostra. Lauria and Sater plead guilty in 1998 for running two brokerage firms (“State Street” & “White Rock”) that were central to the operation. (source, p. 195)
Neither Salvatore Lauria or Felix Sater went to prison however, as both men ended up becoming informants for law enforcement.
Recently unsealed federal court records show that Mr. Sater helped the government disrupt an organized crime ring on Wall Street and deal with an unexplained national security matter involving his foreign connections. He was not the only F.B.I. informant in Bayrock’s offices. Another was Salvatore Lauria, an associate of Mr. Sater, who sometimes showed up to work wearing a court-ordered ankle monitor. source
If you haven’t closely looked into Trumps connections with Russia before, the name Bayrock might not mean much. To summarize very quickly, Bayrock was a real estate development firm that worked closely with The Trump Organization in the 2000's. Bayrock has ties to Russian oligarchs and organized crime, along with numerous lawsuits against it for money laundering and similar crimes (eg: 1, 2).
As much as Trump denies it, Felix Sater is still near the White House. Most recently he met with Trump's personal lawyer, Michael Cohen, in early February of this year to deliver the “peace plan” on lifting Russian sanctions.
However, Salvatore Lauria eventually distanced himself.
According to this lawsuit, back in January 2007 representatives from Bayrock we’re pitching an Icelandic investment company, FL Group, a very shady deal to fund Trump SoHo (Spring street), Trump International Hotel & Residence (Camelback), Trump Merrimac, Trump Ferry Point (Whitestone). FL Group offered Bayrock the following deal,
$50 million in exchange for equity interests in those four Bayrock Entities that would entitle it to 62% of the total profits.
There were a few problems with this deal however. First, Bayrock executives made the deal knowing they did not control that much equity and couldn’t exchange it with FL. Second, part of the $50MM payment was distributed to members of Bayrock, including $2.5MM to Salvatore Lauria for his work on securing the deal.
Another member of Bayrock, Jody Kriss, felt indifferent about this deal. Jody Kriss was the CFO & Director of Finance for Bayrock. The compensation agreements Kriss agreed to gave him rights to some of the company distributions. After the FL deal he inquired with Felix Sater about his distribution payment, and was instead given a $500,000 bonus in early September 2007 and resigned not long after.
Additionally in the year of 2007, Salvatore Lauria ran into a problem when trying to re-enter the country. Lauria was told by an immigration officer he couldn’t enter because of his past crimes committed in the 90’s, and specifically violating 8 U.S.C. § 1101(a)(13)©(v).
Lauria applied for asylum which let him legally stay in the country while waiting for a decision.
A year later in 2008, Kriss went back to Sater asking about his distribution payment, and was apparently told to “drop his demand for distributions, or accept the risk that someone Sater knew might injure or kill Kriss.”.
Then in the year of 2010, Kriss went after everyone linked to Bayrock in a lawsuit claiming a billion dollars in damages. As part of this suit, he got ahold of documents that showed who Salvatore Lauria was informing on for the Federal government and the documents were subsequently published. Additionally, Kriss had his lawyers send sealed court documents to another lawyer that was representing a member of the mob Lauria helped put away. This led to Lauria being attacked at a restaurant in Brooklyn in July 2012.
This case with Jody Kriss has nothing to do with the Trump administration or his organization directly, but it does show the type of individuals he was associated with.
In August 2013, Salvatore Lauria was in immigration court for a ruling on his asylum application. He & his lawyers had previously argued that Lauria committed his crimes from 1993 to 1996, and ceased afterwards. This is important because he was originally denied admission due to the Immigrant Responsibility Act of 1996 (“IIRIRA”), which didn’t go into effect until April 1st, 1997. The immigration judge did not do any further fact finding, and denied his asylum request. Lauria appealed to the Board of Immigration and Appeals (BIA).
In an unrelated case in March 2014, Lauria filed a summons in NY against Jody Kriss for the continued harassment he received. In the suit he makes numerous accusations, including that Kriss fundraised from the Russian mafia and took a million dollars from Lauria’s $2.5MM commission he received for brokering the FL deal. Kriss is set to appear in court next month.
On March 30th 2015, the BIA denied Salvatore Lauria’s request. The BIA conducted its own fact finding investigation and concluded Lauria did in fact break the law again on similar charges in 1998. Without access to the case I cannot verify the specific evidence they relied on, but I did find an SEC investigation on Felix Sater which shows he committed financial crimes up until 1998 (source, p. 18). While not direct evidence Lauria committed such crime, it leads me to believe there is something to be found.
Regardless, based on precedent the BIA is not allowed to conduct this type of fact finding mission. The BIA can only make a determination based on what is in the record, which at this point was only the fact Salvatore Lauria was running his scheme from 1993–1996.
Due to the evidence they discovered, however, the BIA again denied Lauria’s request and a petition for review was subsequently filed.
A petition for review means your case is elevated to the federal court of appeals. The US court system is designed to address problems exactly like this one, where the lower court might have incorrectly handled a case. However, the Attorney General retains the right to intervene in BIA decisions that are appealed. According to this paper from NYU Law Review, there are no safeguards in place to prevent an Attorney General from abusing this power. Here is the entire excerpt,
Of the more than 250,000 cases the immigration courts decide each year, between 30,000 and 46,000 are appealed to the BIA; of those, a mere handful are certified by the Attorney General for review. Certification is almost always controversial, in part because the Attorney General has used the certification power to announce new rules and overturn longstanding precedent, but also because he often does so in “a precipitous manner, without affording an adequate opportunity for parties and interested amici to provide full briefing of the serious issues involved.” The Attorney General’s authority on review is extraordinarily broad, and it is almost wholly unconstrained by procedural safeguards. The regulations governing certification require only that the Attorney General’s decision be stated in writing and transmitted to the BIA or the Department of Homeland Security (DHS) for service upon the party affected. They impose no requirement that the Attorney General give notice of the issues to be considered on review, provide an opportunity for the parties to be heard, or solicit input from amici on issues of broad significance. Whether the Attorney General invites briefing or even provides notice of the issues under consideration appears to depend on little more than whim: In some cases, both the parties and amici are given an opportunity to participate, while in other cases of equal import, the parties are provided neither sufficient notice nor an opportunity to be heard.
However, federal regulations permit the Attorney General to intervene in the administrative appeals process by certifying a BIA decision to himself or accepting referral of a BIA decision by DHS or the Board itself. Once a case has been referred, the BIA decision is no longer final and cannot be reviewed by a federal court or relied on as precedent; the decision issued by the Attorney General becomes the final agency decision and serves as precedent binding on future cases.
On February 24th, 2017, less than a month into office & days after Felix Sater met with Michael Cohen, Jeff Sessions intervened in Salvatore Lauria’s petition and granted it, allowing him to stay in the country.
It should be noted, it’s entirely possibly a federal court would have ruled in Lauria’s favor, but we will never know because Jeff Sessions made the call instead. Without the case file, it’s unclear if this petition was referred to the Attorney General’s office by the BIA, the previous AG already decided to intervene, or if Jeff Sessions himself decided to intervene.
If Jeff Sessions did make the decision, it would be clear he pulled a favor for a former Trump associate, and a dark sign that organized crime holds influence over the Trump administration.