The Bayrock Group and Felix Sater: Trump's Business Partnership with a Convicted Felon He Claimed Not to Know
Tier 4Documented2002-01-01 to 2019-03-31
Factual Summary
Between approximately 2002 and 2011, the Trump Organization maintained an extensive business relationship with the Bayrock Group, a real estate development company headquartered in Trump Tower. Bayrock's managing director, Felix Sater, was a convicted felon with ties to Russian organized crime who had previously pleaded guilty to a racketeering charge connected to a $40 million stock fraud scheme involving the Russian and Italian mafias. Despite years of close collaboration on multiple Trump-branded projects, Donald Trump stated under oath that he would barely recognize Sater.
Bayrock Group was founded by Tevfik Arif, a former Soviet-era commerce official from Kazakhstan, and established its offices on the 24th floor of Trump Tower in Manhattan. Felix Sater joined the firm and became its managing director. Sater had pleaded guilty in 1998 to one count of racketeering in connection with a stock manipulation scheme, but his conviction was sealed as part of a cooperation agreement with the FBI and federal prosecutors, in which Sater provided intelligence related to organized crime and, reportedly, national security matters.
From Bayrock's offices in Trump Tower, Sater worked directly with the Trump Organization on multiple development projects. These included the Trump SoHo condominium-hotel in Manhattan, a Trump-branded project in Fort Lauderdale, Florida, and proposed Trump-branded developments in Phoenix, Arizona, and several international locations. In a 2008 sworn deposition, Sater testified that he would pitch Trump business deals on a "constant basis" and that the meetings were "just me and him." Sater carried a Trump Organization business card that identified him as a "Senior Advisor to Donald Trump."
In a 2013 deposition in a civil lawsuit related to the Fort Lauderdale project, Trump was asked about Sater. Trump testified: "If he were sitting in the room right now, I really wouldn't know what he looked like." This statement contradicted the extensive documented record of their interactions, including meetings, travel, and Trump's own decision to provide Sater with a Trump Organization business card and office space.
The Washington Post reported in May 2016 that Sater described a close working relationship with Trump spanning years, including visiting Trump's office, attending meetings, and working on deals together. ABC News reported that Trump appeared to have a "memory lapse" regarding a figure who had operated from within his own building and carried his organization's business card.
Bayrock itself was the subject of a lawsuit by its former finance director, Jody Kriss, who alleged that the company was "substantially and covertly mob-owned and operated" and that it had engaged in tax evasion, money laundering, and fraud. Kriss alleged in his lawsuit that Bayrock funneled money from sources in Russia and Central Asia through Trump-branded projects. PBS NewsHour reported that the lawsuit alleged Sater "looked to launder cash through Trump projects."
Sater reemerged in Trump-related news in 2017 when it was revealed that he had hand-delivered a proposed Russia-Ukraine peace plan to Michael Flynn at the White House. Sater was also involved in early discussions about a proposed Trump Tower Moscow project, communicating with Trump's personal attorney Michael Cohen about the deal during the 2016 presidential campaign.
Primary Sources
1. Felix Sater guilty plea, racketeering charge, U.S. District Court, Eastern District of New York, 1998 (sealed, later partially unsealed)
2. Trump deposition in Fort Lauderdale condominium litigation, 2013
3. Felix Sater deposition, 2008, describing meetings with Trump
4. Kriss v. Bayrock Group LLC et al., civil complaint filed in U.S. District Court, Southern District of New York
5. Mueller Report, Vol. I, referencing Sater's involvement in Trump Tower Moscow negotiations
Corroborating Sources
1. The Washington Post: "Former Mafia-linked figure describes association with Trump," May 17, 2016
2. ABC News: "Memory Lapse? Trump Seeks Distance from 'Advisor' with Past Ties to Mafia," December 2015
3. PBS NewsHour: "Lawsuit says Felix Sater looked to launder cash through Trump projects," 2017
4. Fortune: "Trump Russia: The U.S. President's Disturbingly Deep Ties to Russia," May 17, 2017
5. The Intercept: "Did Felix Sater's 20 Years as an Informant Help Land Him at the Center of the Trump-Russia Story?" March 31, 2019
Counterarguments and Context
Trump's representatives maintained that Trump's interactions with Sater were limited and that Sater was primarily a Bayrock employee rather than someone with whom Trump had a direct, personal business relationship. They argued that in the course of managing a large real estate empire, Trump interacted with many people and could not be expected to remember all of them in detail. Regarding the "Senior Advisor" business card, Trump's team indicated that such cards were sometimes issued broadly. Defenders also noted that Sater's criminal record was sealed by federal court order, making it plausible that Trump did not know the full extent of Sater's background. Sater's cooperation with U.S. law enforcement, including on matters reportedly related to national security, complicates a simple characterization of him as merely a criminal associate. However, the sworn testimony from Sater describing regular, direct meetings with Trump, the physical proximity of their offices, the scope of the projects they developed together, and the specific "Senior Advisor" title on Sater's Trump Organization business card all make Trump's claim that he would not recognize Sater difficult to credit. The gap between Trump's deposition testimony and the documented record raises questions about whether Trump was forthcoming under oath.
Author's Note
This entry is classified as Tier 4 because the primary evidence consists of investigative journalism, depositions in civil litigation, and a lawsuit by a former Bayrock insider, rather than a criminal adjudication of Trump's conduct. No criminal charges were filed against Trump in connection with the Bayrock relationship. The Mueller investigation examined Sater's role in the Trump Tower Moscow negotiations but did not charge Trump. The significance of this entry lies in the contrast between Trump's sworn testimony and the documented factual record. When a person testifies under oath that he would not recognize someone who carried his business card, worked from his building, and pitched him deals on a "constant basis," the credibility of that testimony warrants scrutiny.