The investigation revealed links that include a Russian man who was previously wanted in connection with a bid to rig Winter Olympic skating competitions, a Bronx plumbing business, a Brooklyn car-repair shop, banks in Cyprus and Russian oligarchs.
The Nahmad family members, who belong to the Lebanese Sephardic community and maintain art galleries in New York and London, are considered highly prominent in the art world. In recent years, they have been among some of the most consistent purchasers at high-end auctions worldwide, buying and selling millions of dollars of art.
According to Forbes magazine’s annual ranking of the world’s richest people, the family’s fortune is estimated to be worth $3 billion.
In addition to charges that he contributed financing to a multimillion-dollar gambling ring in the United States, Nahmad is accused of defrauding an unnamed individual by selling him a painting for $300,000 which was actually worth only $50,000, according to the indictment. The art mogul is also charged with wiring money totaling well over $1 million from his father’s bank account in Switzerland to a bank account in the United States to enable further funding of the gambling operation.
The charges outline activities of what prosecutors describe as two separate but interconnected criminal groups — one functioning overseas and one in the U.S.
According to the indictment, a central figure of the overseas operation is Alimzhan Tokhtakhounov, who is said to be a member of a Russian organized-crime gang known as the “Taiwanchik-Trincher Organization.”
“The Taiwanchik-Trincher Organization was an international organized-crime group with leadership based in New York City, Kiev and Moscow, and that operated throughout the United States,” the indictment states.
Mr. Tokhtakhounov was an “elite” Russian gangster, according to the indictment, who had great influence in the criminal underworld and offered vital assistance to the group. He was listed as one of the world’s ten most wanted fugitives in 2011.
Tokhtakhounov is charged with supervising the laundering of money generated by a giant sports-betting operation in Ukraine and the former Soviet Union that catered to Russian oligarchs. The indictment says that tens of millions of dollars were laundered from the operation through shell companies and bank accounts in Cyprus and sent to the United States.
In the United States, Hillel Nahmad, who ran a high-stakes gambling operation, was one of the primary directors of the group. The organization operated a “high-stakes illegal gambling business run out of New York City and Los Angeles that catered primarily to multimillionaire and billionaire clients,” according to the indictment. According to the indictment, the organization would enforce payment of gambling debts through threat and force. For example, the organization acquired a 50 percent interest in Titan P&H plumbing company in the Bronx as repayment for a $2 million gambling debt.
“I know almost nothing” about the raid, commented Hillel Nahmad’s father David from London. He added, “I think it’s totally stupid” when told about the government’s allegations that his son was connected with Russian organized crime.
The government is attempting to effect the forfeiture of four luxury properties, including an apartment at Trump Tower on Fifth Avenue and two Miami estates, in connection with the case.
The indictment outlines several money laundering schemes, including an attempt by a branch manager at a JPMorgan Chase bank in Manhattan to structure transactions in a fashion that would not generate currency transaction reports.
In addition to the millions that flowed illegally between banks in the United States and Cyprus, the indictment charges that several co-conspirators laundered money through an automobile repair shop in Brooklyn, a real estate company in New York and a company that sold used cars online.
In a 2007 profile of the Nahmad family, Forbes magazine described in detail how they are one of the most powerful megadealers of modern and impressionist art, including such masters as Monet, Matisse and Renoir. While the majority of their art deals are performed through the famed Sotheby’s and Christie’s auction houses, the Nahmad family sells a significant amount of art through Helly’s New York gallery and a cousin’s gallery in London.
The original patriarch of the Nahmad family was a wealthy banker from Aleppo, Syria. The family’s current art inventory fills up 15,000 square feet of a building in Geneva, Switzerland, which houses close to 5,000 pieces of art worth in total anywhere from $3 to $4 billion. Notably, the inventory includes 300 classic works by Picasso, estimated in value at $900 million.
“Today’s charges demonstrate the scope and reach of Russian organized crime,” declared George Venizelos, the FBI’s Assistant Director-in-Charge of the bureau’s New York office. “Crime pays only until you are arrested and prosecuted.”
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