Recently, a Manhattan- based court dismissed a case against the businessman guru Felix Sater. Felix Sater was being accused of having embezzled 250 million dollars in civil tax. Felix Sater is a Russian- American entrepreneur and the co-founder of Tevfik Arif Bayrock (a real estate organization). Additionally, Felix Sater is also a former associate of the President of the United States of America, Donald Trump. The civil tax-fraud case against the organization and Felix Sater was proceeded as a qui tam case. The qui tam case enables the whistleblower to file the case and represent the state. Additionally, the qui tam case allows the office of the Attorney General to either intercede or not.
Fred Oberlander in this case was the whistleblower and the representative of the state. Fred Oberlander is a lawyer. Previously, he represented both Felix Sater and Jody Kriss (Felix’s former partner). The lawyer represented them against a case involving money laundering at the firm.
An Attorney who was present during the hearing stated that Fred Oberlander said that he had submitted his qui tam complaint due to the information that had been removed by federal judges who heard the original complaint from Jody Kriss. The Attorney added that during the hearing, the case was unfavorable for Oberlander. This is because he had used information that the federal judges had stricken from the previous complaint. The judges had termed the information as confidential. Later after the hearing, Sater and Robert Wolf (his lawyer) confirmed that the case had been dropped.
Last year, the office of the Attorney General refused to intercede in the case. Instead, on February 2016, the Attorney General, Eric Schneiderman sent a letter informing the New York Supreme Court that Oberlander had released a misleading statement saying that Eric had authorized for the proceeding of the case. In the letter, Eric added that the state had refused to intercede on the case. Eric Schneiderman said that his office would continue observing the case to ensure that the state’s interest and rights were secured.
After the hearing, Robert Wolf said that the case was dropped due to merits and not considering the procedural grounds. He also added that Felix Sater and Richard Lerner (another lawyer associated with the case against Felix) had been forwarded to the Department of Justice twice because of criminal contempt. This was because of their misconduct during the hearings against Felix. Moreover, during a conversation with a reporter, Richard Lerner said that he was going to appeal the decision made by the court to drop the qui tam case.
The original complaint filed by Jody Kriss (former finance director of Bayrock) in 2010 stated that the Organization was involved in many crimes such as wire, bank, and mail fraud. Besides, other crimes that the organization conducted include money laundering, tax evasion, embezzlement, bribery, conspiracy, and extortion. In the case, Jody accused Tevfik Arif (founder of the firm) and Felix of stealing from him millions of dollars through mooney laundering, fraud, racketeering, and many other ways. Later, the case was dropped and the Judge recommended that the case be taken as a racketeering case.
In the complaint filed by Jody, he said that Tevfik Arif and Felix started negotiating with the Trump organization in the year 2003. The negotiations were to enable Arif’s firm to create various projects using the Trump brand. Jody said that Arif and Sater did not inform Donald Trump about Felix’s past criminal activities.
During a deposition held in 2007, Trump stated that his corporation would not have partnered with Arif’s firm during the creation of Trump SoHo if he had had information concerning Felix’s past.