This page has been archived and commenting is disabled.
Meet The Foreign Criminals Using L.A. Real Estate To Launder Money & The Developers Who Help Them
Submitted by Mike Krieger via Liberty Blitzkrieg blog,
Here, as in other roosting places of the superrich, the recent influx of foreign money has gone hand in hand with the rising use of shell companies — generally limited liability companies. Shell companies were used in three-quarters of purchases of over $5 million in Los Angeles over the last three years, a higher rate even than the roughly 55 percent in New York, according to a New York Times analysis of data from PropertyShark. What is more, in Los Angeles, where so many of the new palaces are spec houses — luxury magnets for global wealth — not only are the buyers shielded by shell companies, but the developers are, too.
– From the New York Times article: A Mansion, a Shell Company and Resentment in Bel Air
While New York City and London are already well known as top destinations for shady, foreign-money laundering oligarchs who often attain untold riches by thieving from their own people, the Los Angeles area has likewise morphed into a criminal real estate hub.
Monday’s article in the New York Times, titled, A Mansion, a Shell Company and Resentment in Bel Air, sums up so much of what is wrong about the U.S. economy and society as we reflect on how far we’ve fallen in 2015. A culture in which not only are the rich and powerful above the law, but where foreign criminals also can do whatever the heck they want and get away with it as long as they have billions to throw around. The fact that no one seems to be doing anything about any of it tells you all you need to know.
What follows are a few excerpts, but you should really read the entire article. From the New York Times:
Yet for all that, over four years of violation notices, inspections and hearings, efforts to hold someone accountable for the mess at 901 Strada Vecchia have repeatedly hit a legal wall. It is, as a judge said during an October session where once again nothing got done, “an extremely complicated case.”
That is because “themodernhouseofhadid” belongs not to Mr. Hadid but to an entity that keeps the actual owner at a legal remove — a shell company named 901 Strada L.L.C.
Fueled largely by the vast streams of wealth crossing the globe as never before, a new generation of hyper-luxury homes with stratospheric price tags is colonizing the most gilded hillsides and canyons of Los Angeles. In some areas, every third or fourth home has been torn down, leaving gashes of dirt and debris where new mansions will rise.
And more often than not, the people behind the purchases are hidden by shell companies.
Here, as in other roosting places of the superrich, the recent influx of foreign money has gone hand in hand with the rising use of shell companies — generally limited liability companies. Shell companies were used in three-quarters of purchases of over $5 million in Los Angeles over the last three years, a higher rate even than the roughly 55 percent in New York, according to a New York Times analysis of data from PropertyShark. What is more, in Los Angeles, where so many of the new palaces are spec houses — luxury magnets for global wealth — not only are the buyers shielded by shell companies, but the developers are, too.
Today in Los Angeles, as at 901 Strada Vecchia, L.L.C.s have provided insulation — some would say impunity — amid a gathering anti-development backlash.
Head up North Alpine Drive in Beverly Hills, for example, and on the right is a $14.7 million home owned by a shell company tied to Kola Aluko, a Nigerian businessman who is a figure in an investigation of that country’s former oil minister.
A block away is one of several local properties that have been owned by shell companies tied to a son of Suharto, the corrupt and brutal former president of Indonesia.
And back down the hill is Le Palais, a faux chateau — with a swan pond and a Turkish bath with hand-carved Egyptian limestone columns — that a shell company tied to Mr. Hadid sold to a shell company tied to Lola Karimova-Tillyaeva, a daughter of the president of Uzbekistan. The Karimov family faces corruption investigations in several countries, according to two people who have worked in law enforcement and have knowledge of the inquiries.
The property at 901 Strada Vecchia is the crystallization of all this — in its grandiosity, its 60 pages of violations and other notices, and the ire it has provoked.
Silver-maned at 67, Mr. Hadid, like many of his clients, is an immigrant. Born in Israel, he moved to Virginia as a teenager with his Palestinian family and spent his early business career in the Washington, D.C., area, developing office buildings and Ritz-Carlton hotels. Central to his success even then was his ability to woo foreign financiers — French and German backers, and in particular the SAAR Foundation, a group of Saudi investors.
Among his big-ticket sales was a Beverly Hills house, with a glowing pyramid in a reflecting pool, that was acquired in 2010 by a shell company tied to the stepson of the prime minister of Malaysia. (The prime minister is now a target of corruption investigations at home and abroad.)
No. 73 is a home owned by TBN Holdings Inc., which traces to a Saudi prince, Turki bin Nasser. As a high-ranking military official during the 1980s and ’90s, Prince Turki was involved in arms deals with the aerospace company BAE that led to allegations of bribery and large fines in Britain and the United States. According to reports by The Guardian, the BBC and “Frontline,” Prince Turki was a bribe recipient, but, as had long been their practice, American and British authorities prosecuted only the company.
Prince Turki did not respond to requests for comment.
At No. 58 is a home bought in 2004 by a shell company tied to another Russian politician, a former senator named Alexander Sabadash. Last spring, Mr. Sabadash was sentenced in Russia to six years in prison for attempted embezzlement of public funds, according to Russian news reports. A man who answered at the phone number listed for the shell company said the Sabadashes might be renting the house.
Finally, at No. 27, is a home owned by a shell company that has ties to the family of Bambang Trihatmodjo, long a contentious figure in Indonesia because his businesses amassed great wealth during the reign of his father, Mr. Suharto. Though Mr. Suharto died in 2008, his family’s fortune remains a focus of questions and legal action. Last summer, the Indonesian Supreme Court ordered the Suharto family to return $324 million that was embezzled from a foundation established with public money, according to news reports.
The money was to have paid for education for the poor.
In July 2014, the city said it intended to revoke the project’s work permits. That week, Mr. Hadid posted on Instagram, “The construction must go on.” It did, even after the permits were pulled. Neighbors documented workers on the site that Thanksgiving.
Mr. Hadid is not the only developer flirting with nine-figure price tags. His main competitor is Nile Niami, a former film producer building a Bel Air home he has said he hopes to sell for $500 million.
One of Mr. Niami’s past projects was a boxy, modern house at 755 Sarbonne Road. In April 2012, a shell company tied to Mr. Niami sold it to a shell company traced to Kola Aluko, the Nigerian businessman.
What followed was a tangle of events spanning two continents, involving oil and water, a host of shell companies and lessons in the difficulty of tracing responsibility.
Mr. Aluko, it turned out, was on a buying spree. In addition to purchasing the Sarbonne Road house for $24 million, shell companies tied to him soon bought another Beverly Hills house for $14.7 million and two others in Santa Barbara for $33 million.
Letting these characters and their billions enter the country is a far bigger threat than Mexican immigrants, but as is typically the case, people prefer to punch downward.
»
- 37 reads
- Printer-friendly version
- Send to friend
- advertisements -
National association of realtors successfully fends off any efforts to crack down on money laundering. They aid and abet terrorists for sure.
Haven't read it yet, but pretty sure there's at least one major TBTF bank involved.
[Edit] I was wrong, not one was mentioned by name.
Does explain how Tarek El Moussa can "Flip or Flop" every piece of crap he finds in LA for a miraculous profit.....
Chinese fugitive returns from US amid crackdown
BEIJING (AP) — One of China's most wanted fugitives voluntarily returned from the U.S. on Saturday in a new victory for the government's campaign to track down corruption suspects who have fled abroad, the ruling Communist Party said.
http://news.yahoo.com/chinese-fugitive-returns-us-amid-crackdown-055335676.html
When california adjusts its property taxes they will soak these punks anyway....go ahead, make my day
Meanwhile, Joe 24-Pack (There was a great deal on beer at Costco) can't afford rent because of these assholes. Hard to compete for housing when Chinese Oligarchs are buying broom closets for millions of dollars.
Stater Bros, Albertson's and others here in Southern California have the ultimate...the 36 pack. I buy about three a week.
Shadow Banking much?
Private Equity- Banking?
LLC- Banking?
= $ excess reserve laundering 101
It's for the children... Bitchez </sarc>
Are you listening Fhoney Star?
The Miillenials are too infatuated, with their oculus headsets..,
The shit going on in Vancouver, BC is off the charts as well. Chinese money pouring in there pushing prices into the stratosphere.
BoP It's rampant.[graft].. There's entirely too much " funny money" floating around.
The Fed thinks they know... They don't know Jack Shit.
Heard from an architect friend who told me about looking through a window on an upper floor of a hotel in Vancouver, BC and into a high rise building of uninhabited condos. There was no sign of life. Found out that all of the units had been sold to Chinese who had made no attempt to occupy or rent their condos.
How much of this money is being funneled through the Clinton Foundation?
Shut it all down and keep it down until all ownership is made clear and source of funds is verified not to be from corrupt sources.
I'm more concerned about the State coming after my house since the cash hungry State owns the official property title ledger and taxes transfers (and can prohibit them at will) than I am about some alleged criminals laundering money.
There are good and legitimate reasons to title non-portable assets such as land and buildings in an immortal and easily transferable corporate person's name.
Darling, the dark pools of liquidity are to die for.
This is what the boys that stormed Normandy Beach fought for, a country so steeped in materialism and doing anything to make a buck. Bet all involved have nice snuff film collection.
Yes as a matter of fact...the men who "stormed normandy", actually fought against God consciousness.
'Merica is an evil fallen country, lost before those guys who died for those who call themselves jews (but are not) were born.
http://youtu.be/9gXVa3yogLk
Avaiator Charles Lindberg warned us to stay out of that war. ASo what did those semitic European banksters families do? They murdered his baby. Then blamed it on a German immigrant.
They aren't semites.
They are turkish (tatars) khazars.
They have the same linkage to Palestine as I do to Japan.
"Letting these characters and their billions enter the country is a far bigger threat than Mexican immigrants, but as is typically the case, people prefer to punch downward".
Are you kidding me!!!
Seems like both are a very large problem (if your talking about illegal immigrants). At least the criminals from other countries pay property taxes, and by the way, what does one have to do with the other.
You think occupy wallstreet will ever show up in their yards?..........
Local and state tax authorities, gleeful over the new tax revenues, turn blind eyes to fund sources.
You're funny.
Muslims don't pay taxes to Christians if they have a choice.
This is bullshit. If a guy comes to me and wants to buy MY house and he has a million dollars in cold hard cash (and it's only worth 250K) - am I suppose to question him about where he got the money - if it's legal or not - or or or or? If it's not counterfeit - I'm taking it.
What's your argument? I think 99.9% of Zero Hedge readers would agree with you.
How exactly, do you intend to re-invest that money to improve your lifestyle('s)
Are you just going to buy an island?
What's your "moral" responsibility?
Have you contemplated the expense of your comments?
That guy won't be nearly as interested in buying your house as he would be in buying a house from a party to whom he is trying to funnel money. Meanwhile, the appraised market value on your home goes up and you pay more taxes. The gains are for the insider counterparties.
"I'm a businessman." -- The Godfather
California......ahhhhh. Lovely.
Is California the state that prides itself with their staggering civil forfeiture - you know, cops taking your stuff because they think it's possible that at some point, your stuff might have kinda possibly been used for something that may possibly be connected to a crime? Why don't you guys just take these houses?
Los Angeles has a deeply ironic name, being the H.Q. of virtually all that has to do with our Lesser Angels. Washington West for the Prancing Monkeys I´d say. But then, I was born there.
NO this money is NOT more dangerous than *ILLEGALS* pouring over the border. Who the hell is this guy trying to fool and what alternate universe is this libtard in?
Illegals are not allowed to vote, yet they do anyway and get away with it.
This next election they already swore to throw the election this time around. THAT IS A CLEAR AND PRESENT DANGER!
http://www.theblaze.com/stories/2015/12/13/hispanic-activists-say-theyll...
Oust the illegals first. At least the money is taxable, unlike the illegals.
Another libtard, another idiot. No difference!
When do they come to Chicago, the condo market is dead since all they have built in the last seven years is one rental building after another
You do realize that Chicago, unlike NYC, was a big "renters' city" until the 1990's when the condo boom really took off, especially downtown. Just saying (having spent half of every year of my childhood in the 60's and 70's in a luxury rental on Michigan Av and Oak along with loads of other people who could have afforded a condo, but got a lot more bang for their buck in a luxury rental building). It looks as if things have gone full circle up there.
High End Real Estate market is full of "ALL CASH BUYERS, QUICK CLOSE". Now, that tends to give it away right from the start.
Who cares, they give to Democrats and most likely the Clinton Crime Family Foundation; nothing to see here Sheeple. Deep blue state corruption at its finest.
www.traderzoo.mobi
In this world, shipmates, sin that pays its way can travel freely and without a passport; whereas Virtue, if a pauper, is stopped at all frontiers.
Money laundering? How about the outrageous IPOs for companies that border on the bogus?
If a cartel can't move narco money that way, they are low on talent and imagination. Can't be too hard to find a crooked investment banker.
Thank god there's no money laundering going on in Miami Beach/Miami or anywhere along the coast of Palm Beach County. [sarc]
Feet of clay
gold leaving
$ coming
how many 10's of trillions of American tax-dollars has been lost for all the criminality in the housing market from 1998-2015 with American banks realtors, and govt. employees?
how many govt. employees, and appointees spend .and live like they've hit the lottery while being employed, and after their govt. employment, I'd like to see they're finances audited.
The tribe seems to have trouble getting building permits.
"Letting these characters and their billions enter the country is a far bigger threat than Mexican immigrants, but as is typically the case, people prefer to punch downward."
You poor, mentally ill cuck... This Tyler... probably the kike who keeps talking pathetic shit about Trump. Way too obvious.