Follow the Money

Guest blog by Jo Sage

 

Recently, Priti Patel called on the Electoral Commission in the UK to investigate the Remain campaign of Brexit.   The Commission turned her down on her first point and on the second said she didn’t back up her argument enough. Patel was let go from her government position for not disclosing meetings she had with Israel. This should raise question marks as Netanyahu, his wife and others in his government are under corruption investigations. Indeed Sarah Netanyahu is about to be indicted, if you follow the Israeli press.

EU Referendum & the Horseshoe

 

Screen Shot 2018-01-22 at 18.50.23
Courtesy of Wikipedia

 

Putin & co like to play the horseshoe theory. In this case the horseshoe would have been to divide public opinion in the UK from moderate, central positions into the extremes Brexit is still presented in today, hard Brexit vs. soft Brexit. During the campaign: racist, anti-immigrant go-it alone Farage supporting Leavers vs. egalitarian-minded Europe as the best place to stay. Farage & fascism vs. Project Fear, as Remain’s campaign was called. There was clearly Russian money flowing & influence into the brash ‘Bad Boys of Brexit’ Aaron Banks/Farage campaign. Like Trump in the US, it was pretty open in it’s brazenness and The Electoral Commission is investigating the Leave campaign again, at the moment.. In the main Leave campaign there were plenty of factual blunders, as well. In order to divide public feeling and make the most of identity politics, one would also have to assume that Remain also was funneled some dark money from Russia oligarchs and friends in some way, too. According to the Serious Fraud Office, the UK loses £24 million a year to money laundering. Many oligarchs have their homes in the UK particularly in London and in Scotland. There was a lot at stake for them in this referendum.

With that in mind, let’s take a look at the funding behind Daniel Korski’s Public Group, which was started in April 2017 after Mr. Korski left his career with Mr. Cameron’s government post-Brexit.

All information is from open source and timelines given are from various linked news sites. I’m not drawing conclusions on the characters of people involved. But there are questions.

Mr. Korski has had a distinguished career. He was deputy head policy advisor to David Cameron after UK GE 2015 until post EU referendum June 24, 2016 when Cameron stepped down. Cameron stepped down because he was so committed to Remain and staying in the EU.

In May 2017, Korski launched a new company called Public Group, public.io. He got £45 billion to create a company that could help the public sector via private/public partnerships to streamline technology. Mr. Korski loves what’s called disruptive tech. Think Airbnb and Uber who do what they do while working without the usual governmental red tape of inspections, licenses, etc.

There’s an interesting article here, to read about the launch and includes background on Mr. Korski and information on his backers. Here are some of his thoughts.

Korski GovStart cohort-like digtalagenda.co.uk 24:5:17
Clip from Digital Agenda 24 May 2017

Heineken, Lion Capital & Russia

Let’s take a look at some of Public’s investors and see where that takes us. How about his co-founder, Alexander de Carvalho and the firm Lion Capital? Alexander Carvalho is the heir to the Heineken fortune and joined its board in 2013. Note: Heineken in Russia is one of 4 companies selling beer. In Russia, that market is 85% owned by foreigners.

Graph beer USDA 2016 trade report
©USDA 2016 Percentage of business in the Russian market by the main breweries there.

Heading over to Lion’s website two things immediately become clear. Orangina/Schweppes went into Russia in 2006 as part of Lion Capital’s ‘geographic expansion.’ There’s nothing wrong with making money, right?

What happened with Orangina Schweppes in 2006? They were taken over by Blackstone & Lion Capital. Remember Blackstone &Kushner? They changed the name from Cadbury Schweppes in 2006. See the graph on VC investments Harvard report. The report is worth reading for a deep background of market conditions in 2006 and before and of the deal itself.

VC bouyouts graph 1990-2005 Harvard
Courtesy of Harvard Business School Hardemon, Lerner, Leamon, May 21, 2008

As per the Harvard case study it was Allied Domencq that precipitated their interest in getting into the drinks market. They’d recently come out of battles over trademarks with Russia and SPI, company that controls Stolichnaya, in the early 2000s. SPI is synonymous with Yuri Shelfner. What is up in the beverage industry? All roads lead to Scotland, Russia & Japan with these deals. Russia was the fastest growing alcohol market from 1999 until Putin cracked down on the alcohol consumption right around Crimea & sanctions hitting in 2014/2015. Knowing that Russia is a mafia run state with Putin always making sure he gets the biggest cut puts these deals in another light all together.

Stolichnaya bigggest brand ahead of Bacardi gangs, Kristall
Paul Farrelly, The Guardian, 12 Nov 2000

 

Lion Capital & Blackstone sold Orangina Schweppes to Suntory in November 2009. Suntory also has malt whisky.  They left Russia in Dec. 2009, according to Lion’s website.

 

Lion Capital & Russian Alcohol Group

There’s another deal of interest regarding Lion and their deal to buy Russian Alcohol in 2008. The deal was done with the help of Goldman Sachs and the Central European Distribution Company, who’s the largest distributor there. Interestingly they decline to comment on the ‘structure of the debt quantum and the debt structure of the deal.” The question must be asked is this because it was done in conjunction with a mob led company?

Looks like somebody really wanted into the Central European and Russian Market. This is also about two years after hedge fund manager Bill Browder was kicked out of Moscow in 2005 for highlighting a bit too much corruption for Putin’s liking. The Magnitsky Affair was unfolding in 2008. See a good timeline here.

 This deal leads to a load of shell companies for Lion Capital. Ok hedge funds set up numbered funds, it could be that, but Caymans are a well-known tax shelterJones Day advised on the deal and talk about Lion/Rally Cayman 1. Looks like Lion Capital was Goldman’s way into this deal/market.

Jones Day advised on the deal and talk about Lion/Rally Cayman 1. Looks like Lion Capital was Goldman’s way into this deal/market. The SEC filing for this deal has loads more information.

Central European Distribution runs out of Poland, It has Russian and Hungarian operations. Hungary used to be Semion Mogilevich’s base before he had to go live in Russia. CED’s head is Roustam Tariko. The guy that had one of the boxes for Trump’s after party for Miss Universe in 2013. Tariko sponsored Miss Russia.

All of this makes one wonder what Lion Capital’s interest in Daniel Korski’s start up? Obviously the £320 billion public sector market would be enticing. Is there anything else? Does he know that his co-founder’s firm made money from doing deals with Russian oligarch/mafia tied firms? What was the quid pro quo, favors that have been asked for? Or is this really just all about the money?

 The Kleins, Wonga, SVB, Sberbank, Israel

 Let’s move onto some of the other investors in Korski’s company. Let’s look at Robin & Saul Klein. Both of them are highly respected tech investors. Both were involved in Tweetdeck, which many users have complained is prone to infiltration by Russian bot accounts over the last couple of years. Saul got an OBE just before the Brexit vote. Many people questioned if Cameron was handing out favours to his friends.

Robin’s been doing tech deals for over 25 years. Here’s the thing Robin’s been an advisor for SVB, Silicon Valley Bank. That ‘s the same one that invested in Kushner brother’s Thrive and worked with Sberbank, a sanctioned US bank in 2012 in the Silicon Valley. As Zev Shalev & Tracie McElroy note: “ Sberbank is the same bank which sponsored Donald Trump’s 2013 Moscow Miss Universe and VTB Bank was involved in funding the proposed Trump Tower in Moscow.  There are many questions about whether the Kremlin used Sberbank to launder money through Cyprus, Trump properties and the tech sector.”

Robin Klein Tech 100 Judge 2011 SVB bank, editor Milo Y
©Telegraph.co.uk 2011 Notice Milo Yiannopoulus was Commissioning Editor for The Start-Up 100. He’s a former Breitbart editor & hard-right speaker/writer. See Horseshoe at the top of this piece.

One of Robin’s companies of the many he’s been a part of was Wonga. Wonga got a very bad name in the UK. He was on the board for the good times and many of the bad.

In 2011, reports emerge that borrowers are struggling. This gains steam as it includes student loans and by February 2012 the Office of Fair Trading starts to investigate. Wonga increases its profits, adds interest rates in one part of the company to 17% and accuses its costumers of fraud. They even send harassing tweets to a Labour MP. In other articles about Wonga it is noted that it had a Ukranian development team working along with London staff.

As 2013 rolls on tens of millions of pounds are found to be in bad loans, as it writes off its debt. In March of 2013, the OFT comes down hard during the course of the year telling them they have twelve weeks to change their ways ‘after finding irresponsible lending and breaches of the law.’ When their profit report is released in September they report they made £1million/week. By October there is even more of a crackdown and George Osbourne says FCA will make a lending cap. An excellent timeline of the Wonga saga is here.

It was the summer of 2013 that the Snowden affair was unfolding. In November 2013 Trump hosts Miss Universe in Moscow. Remember Lion Capital and CED’s Roustam Tariko?

Sticking with Wonga, they sent fake letters from law firms to customers to get them to pay up from Oct. 2008-November 2010. Loan sharking. Sounds mob-like. No criminal charges were pressed.

Robin Klein steps down from the board in February 2015. The firm’s offices are in Dublin, tax shelter, low corporate taxes and Tel Aviv, with other offices in London and Capetown. “Wonga, once the darling of the startup world for bringing innovation to finance and loans before falling out of favour, experienced a 50 per cent fall in profits last year.”

Robin’s son Saul, also became a ‘dedicated’ entrepreneur, according to his blog. Indeed he went helped bring Skype to the world along with LoveFilm which was Europe’s answer to Netflix back in the 2000s. In 2007 he created a global ‘coffee club’ for tech people to pitch venture capitalists their ideas around the world. It reached about 90 cities including in the Ukraine & Bangalore, the Silicon Valley of India.

He went to Israel for about a year and a half in 2010 and came back in March 2012 as part of a company he worked in with his dad. He went to explore the booming tech industry in Israel. In December 2012, Cameron named Saul Klein UK Envoy to Israel. He launched the London-based UK Israel tech council. One of the things the UK council explored was Israeli-Arab internet industry in what was called ‘tech diplomacy.’ In Israel, the hub was in the UK Embassy.

Saul & Robin Klein in either April or May 2015 launch their new seed capital venture, LocalGlobe. This is around UK General Election 2015. MP Chris Bryant said, in 2017, that there was ‘clear evidence’ of Russian interference in 2015. According to Companies House LocalGlobe was not incorporated until July 24, 2015. O’Hear reports, they got off the ground quickly with £27 million in 38, mostly UK companies as of June 2017.

 

Barclays Techstars, Russian connections, & the Magnitsky Act

TechStars has some interesting partners if you’ve been following the Russian money in the TrumpRussia affair. We’ve got via the TechStars website:

  1. Barclays of course, which has been fined several times now through the years for money laundering & libor fixing, where three executives were found guilty. The US is still investigating them.
  2. Boeing is one of the main companies that were looking for the Jackson-Vanik Amendment to be repealed so the Magnitsky Act of global sanctions for human rights abusers could be passed in the US in 2012. Presumably this was so that there could be more open trade with Russia, since with that amendment being repealed, Russia could join the WTO.
  3. SVB, Silicon Valley Bank tied to Sberbank is believed to be a Russian Intelligence front.
  4. Warner Music Group= Len Blavatnik. Blavanik’s name is on the Government School at Oxford, donates to the V &A. He gave $1 million to Trump’s campaign and $6.35 million into GOP campaigns in 2016. He also owns a stake in the US Treasury Secretary, Steve Mnuchin’s, old company RatPac/Dune Entertainment, along with Brett Ratner, who’s accused of sexual harassment. Let’s not forget Australian mogul James Packer. Mnuchin’s Scottish actress wife, Louise Linton runs Dune Entertainment now. Her father owns a castle in Scotland. Blavatnik is even giving funds to Trump’s defense.
  5. Booz Allen Hamilton leads right back to Snowden. He was under their employ when he stole from NSA. He’s now in a Russian safehouse. Another contractor with them was also accused of stealing info from the NSA, Harold Martin in 2016.

What does this mean for Public Group?

Public Group wants to get a piece of a very lucrative pie thought to be worth £320 billion pounds by introducing ‘streamlined’ tech into the UK government. This would include lucrative NHS contracts, presumably work & pensions, immigration, ostensibly many things that affect everyday citizens lives in the UK. Mr. Korski himself is under scrutiny for lobbying for Uber to then London mayor Boris Johnson while in No. 10. That’s currently under investigation by The Information Commissioner. It looks like he was trying to protect Uber from regulation and he communicated directly with folks at Transport for London.

Mr. Korski was in charge of a lot of the messaging and work around the EU referendum. He had unique access to the government and information. The Daily Mail, take that as you will, called him the Project Fear ‘enforcer.’  He allegedly made a phone call that got an MP get expelled by the committee he was working on for having a less than positive view of staying in the EU. Above are listed about six different ways the money Public Group is getting is tied to Russian oligarchs and Russian intelligence front, SVB. If we accept that Russia is a mafia state, what does this mean for Britain’s democracy? Putin and his cronies have offshored everything that is not nailed down. Leaving the Russian people with nothing, while they jet, yacht and launder more money throughout the world. When hose who were richly rewarded with high honours from the then Prime Minister Cameron go off and work to ‘disrupt’ our public sector and career civil servants, questions should be asked by media and citizens. Brexit vote-era honours in tech overtook business honours. Why? Were they working for a specific outcome? Remain? Were they working for the good of Britain’s democracy? Or were they just making quick money? Were they useful idiots? Tech has always been a highly valued asset since WWII at least. The stakes are high here: we had Mercer & SCL playing manipulative games on creating divides on our social media for the Leave vote, was there similar on the Remain side? What would this mean?

Many more questions must be asked since the City of London is a prime money laundering place for oligarchs from Russia, former Soviet states and elsewhere. Scotland, too, has its prime assets of oil, whiskey, land and other resources. the Herald of Scotland has been doing excellent reporting on the money laundering through SLPs, and banks that is happening there. There is currently an inquiry via a Select Committee underway in Parliament. This is good. We need to uncover the truth of what happened, so we can understand the influence on our democracy.

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