Brighton Beach Russian Mafia Godfather Marat Balagula to be Released from Jail on 24Sep2004
Stefan Lemieszewski
No one took much notice until Marat Balagula, the owner of the
Odessa Restaurant in Brighton Beach, put the Russian emigre
underworld on the map in a big way. In the mid-1980s, Balagula
teamed up with members of various Cosa Nostra crime families
to pull off an elaborate gasoline distribution scheme that cost the
government over $42 million a year in lost tax revenue.
When Balagula was finally locked up in 1989, Russian crime
figures had already been introduced to the world of high finance
and "real" mafiosi. The collapse of the Soviet Union and a second
wave of Russian emigration to the United States in the early 1990s
made the situation even worse. Whereas the early emigres had
been primarily Jews granted political asylum, now virtually anyone
could obtain a Russian exit visa and slip into the country as a
tourist; along with tens of thousands of bona fide refugees came
an estimated 2,000 convicted criminals. Although Marat Balagula
was out of the picture, it appeared that there was now a small
army of excellent students to take his place.
"Spreading out from their base in Brighton Beach," Robert Friedman
wrote in the January 1993 issue of Vanity Fair, "the Russians have
pulled off the largest jewelry heist, and insurance and Medicare
fraud, in American history, with a net haul exceeding $1 billion.
They are importing heroin into the U.S. from Southeast Asia as
well as from poppy fields around Chernobyl.... Through their control
of gasoline terminals and distributorships in the New York metropolitan
area and elsewhere, Russian mobsters evade as much as $5 billion
a year in state and federal taxes, a portion of which goes as tribute
to the Italian Mafia." Other journalists painted an equally ominous
picture. "More and more Russian Mafiosi and their hired thugs are
pouring into the United States," reported Andrew Meier in Image
magazine in December 1993, "and expanding their murderous
network into new markets at a rapid clip."
---- Harper's Magazine, (Dec 1995; "Looking for Mr. Yaponchik:
the rise and fall of a Russian mobster in America - Vyacheslav
Kirillovich Ivankov" by Scott Anderson)
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In Red Mafiya, Robert I. Friedman devotes a whole chapter to Marat Balagula,
who became the second Brighton Beach godfather by whacking the first
Russian Mafia godfather named Evsei Agron, his boss and a vor v zakone.
Balagula had been Agron's consigliere for many years in Brooklyn, after
emigrating from Odesa. In Ukraine, Balagula had an apartment in Odesa
and a dacha on the Black Sea while running Ukraine's largest food co-op
and black marketeering. On Balagula's thirtieth birthday, Mikhail Gorbachev,
a regional Communist Party boss at the time, showed up at the dacha to
pay his respects and pose for a photo with Balagula. Friedman quotes
Balagula as saying he "never felt anti-Semitism" but "I used that as an
excuse when I applied for my visa" [to USA in 1977].
After taking over the Organizatsiya in Brighton Beach, Balagula reorganized
the Russian Mafia in a hierarchy similar to the Italian Mafia with whom he
did mafia business. He developed the Organizatsiya into a
multi-billion-dollar-
a-year criminal syndicate with operations in Eastern Europe, Africa and
Southeast Asia. In New York, using dummy companies, Balagula organized
a massive gasoline bootlegging scheme that evaded billions of dollars in
sales taxes. The Balagula operation paid 2 cents on every gallon to four
of the five Cosa Nostra mob families in New York, generating them income
of over $100 million per year. Balagula also partnered with Leo Liebowitz
and Power Test which soon took over Getty Oil (one of the fabled oil "seven
sisters"). Forbes Magazine lauded Liebowitz as "one of the most brilliant
businessmen in America" -- that was years before Fortune Magazine lauded
Kenneth Lay and Enron as one of the "100 Best Companies to Work For in
America". After the proverbial hit the fan, Getty Oil became the first major
oil company to be convicted of gasoline bootlegging. In Nov 2000, Getty
was bought by LUKoil, a corporation linked to the billionaire mafia oligarch
Vagit Alekperov (who also bought the Odesan Oil Works in Ukraine). Lots
of marketing hype was created from the Getty purchase when President
Vladimir Putin and Sen. Charles Schumer were engaged to eat some
glazed Krispy Kreme doughnuts at the new LUKoil/Getty gas station
during Putin's visit to New York.
Friedman also explains how the mafia money from the bootlegging scheme
ended up in politician pockets citing the case of New York Governor Hugh
Carey. Sworn testimony alleged that Hugh's brother, Martin Carey, skimmed
millions of dollars from his gas stations and channelled them to Hugh
Carey's
campaign. By 1985, Balagula's empire included over 100 gas stations run by
Soviet Jewish emigres, oceangoing tankers, seven oil terminals, a fleet of
gasoline trucks, truck stops, and even oil-refineries in Eastern Bloc
countries.
Balagula also brokered oil deals with Marc Rich (who became wanted by the
FBI and later pardoned by Bill Clinton). Balagula had ties with "KGB spies,
corrupt Third World despots, and international terrorits." He transported
automatic weapons from Florida to the USSR via New York. In Sierra Leone,
Balagula and the Genovese gangsters financed the presidential campaign
of Joseph Momoh in 1985 gaining access to many subsequent business
deals such as importing whiskey, printing the country's money, and the
importing of oil -- the last a deal brokered by Marc Rich and Rabbi Ronald
Greenwald, a prominent player on Nixon's CREEP, the "Committee to
Reelect the President", and the person alleged to have gotten Evsei Agron
his passport to USA. In 1983, federal investigators were looking into a
Mafia skim at the Dunes Hotel casino in Las Vegas and "stumbled onto
a multimillion-dollar fraud perpetrated jointly by Agron and Wilson and
planned with Greenwald in Greenwald's office." In 1989 Murray Wilson
was convicted of conspiracy to defraud Dunes of more than a million
dollars.
The mobster takeover of Sierra Leone allowed them to establish global
smuggling and money laundering operations. For example, blood
diamonds from Sierra Leone were smuggled to Thailand where they
were swapped for heroin which was distributed in Europe. The heroin
distributor was Balagula's friend Efim Laskin who was arrested for
weapons smuggling and providing explosives to the Red Brigades
terrorists in Milan, Italy. Balagula's lietenant in Sierra Leone was
Shabtai Kalmanovich who provided the personal security to President
Momoh. In return, Kalmanovich was granted fishing and mining rights
and ran the country's largest bus company. Kalmanovich was also a
Mossad operative. In 1988, he was arrested in Israel as a KGB spy.
Wolf Blitzer reported that Kalmanovich was suspected of passing to
the KGB sensitive information stolen in the USA by the Israeli spy
Jonathan Pollard. Rabbi Greenwald introduced Kalmanovich to
Balagula. Kalmanovich later was involved in a scheme with the
Russian and Italian mobsters to defraud Merrill Lynch. When he was
convicted for credit card fraud, Balagula considered an appeal and
was introduced by Rabbi Greenwald to attorney Alan Dershowitz.
Dershowitz refused to take on the case after Balagula asked him to
bribe the appeals judge.
Marat Balagula was tried and convicted twice, once in 1989 and
once in 1992. KLTV in Texas is reporting that he will be released
from federal prison tomorrow (24Sep2004).
With Balagula out of the picture, a mafia turf war developed between
the vor v zakone Monya Elson and Boris Nayfield in 1990. Elson had
been in an Israeli prison since 1984 for cocaine smuggling. While in
jail, Elson had met Shabtai Kalmanovich who became his cell mate.
It was the start of a criminal alliance. When Elson arrived in Brighton
Beach in 1990 he faced a challenge from Nayfield who had been a
lieutenant for both Evsei Agron and later Marat Balagula. Among his
many business interests, Nayfield ran a heroin smuggling network
from Thailand to Poland. Dozens of dead gangsters later, the mob
war ended with the arrival of the vor v zakone, Vyacheslav "Yaponchik"
Ivankov -- one of Semion "Brainy Don" Mogilevich's lieutenants.
Mogilevich is one of the godfathers of the Solntsevo crime syndicate.
Ivankov took the name "Yaponchik" after the original "Yaponchik"
whose real name was Mishka Vinnitsky, a gangster in the Jewish
underworld of pre-revolutionary Odesa. The original Yaponchik was
made famous as Benya Krik in a 1926 Yiddish-language silent film
written by Isaac Babel. In addition to Mogilevich (born in Kyiv), Ivankov
had powerful patrons such as Otari Kvantrishvili and Joseph Kobzon
who helped get him out of a Soviet prison. Kobzon was the arms
smuggler who was formally introduced to the U.S. Senate by New
Jersey Democrat Frank Lautenberg. Kobzon (aka the "Russian Frank
Sinatra") was elected to the Russian parliament. One of Ivankov's
partners was Ludwig "Tarzan" Fainberg, who was born in Odesa,
co-owned the Porky's strip club in Florida, and tried to buy a Russian
submarine for the Columbian mafia to smuggle cocaine into the USA.
Mogilevich's more famous gangster friends include Grigori Loutchansky,
Sergei "Mikhas" Mikhailov and Vadim Rabinovich. Ivankov was arrested
in 1995, convicted, sentenced and released from a U.S. prison in 2004.
Ivankov was transferred recently to Moscow to face murder charges
and joined the billionaire Yukos/Menatep oligarch Mikhail Khodorkovsky
in the same prison. Mogilevich placed a $100,000 contract on author
Robert I. Friedman, and while in prison, Ivankov sent Friedman a death
threat note inside a Hallmark greeting card.
Stefan Lemieszewski
===================================================
KLTV
22Sep2004
Russian Mafia figure to be released from federal prison
BASTROP, Texas -- A Russian Mafia don who masterminded a 1980's
tax scheme is set to be freed Saturday from a federal prison in Bastrop.
Authorities say 61-year-old Marat Balagula led a scam to cheat the
U-S government out of 85 (M) million dollars in gasoline taxes.
He's been behind bars since the early 1990's following convictions
on federal conspiracy and tax evasion charges.
Investigators say before that, Balagula headed a global criminal
enterprise from his Brooklyn, New York, restaurant.
[ . . . ]
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