But the cops desperately wanted this story told. Three years ago, when Ray Kelly became New York City's Police Commissioner, he revamped the NYPD to deal with the dangers of a post-9/11 world. He created a counterterrorism unit, he hired talent from the CIA and the military, and he vowed that fighting terrorism would be just as important as fighting street crime.
However, when you're battling street crime, success and failure are easy to measure. Murder goes up or goes down. Rapes increase or they decrease. But how do you effectively measure the terrorist acts that didn't happen? The ones all the painstaking work may have prevented? In fact, most of the successes will never be made public.
Telling the story of the arrests of James Elshafay and Shahawar Matin Siraj gave the NYPD an unusual opportunity to get the word out.
Justin Kane and Jason Felch
To Catchan Oligarch
from San Francisco magazine
The strange and epic case of the United States of America versus Pavel Ivanovich Lazarenko, which this spring asked twelve Bay Area residents to decide whether the former prime minister of a country six thousand miles away had broken the nation's laws more than a decade ago, actually began one cool night in January 1998 when FBI special agent Bryan Earl paid a visit to a small Dumpster in Sausalito.
Earl is not the type to skulk under cover of darkness. A smoothfaced man with hints of gray at his temples, gentle blue eyes, and a profound sincerity, he looks more like a tax accountant than one of Louis Freeh's or Robert Mueller's blue-suited special agents. His pious demeanor hints at his Mormon upbringing on the quiet side of Las Vegas, and it's easy to picture him wandering around Mexico in a suit and tie, with a small black name tag on his chest and the Book of Mormon under his arm, as he did twenty years ago. Not the first man you would imagine in the FBI, he is the first man you would want working there-the embodiment of God, family, and country.
At age thirty-two, tired of practicing corporate law in D.C., he had sent an application to the FBI on a whim and then surprised himself by joining up. A year later, as a rookie fresh out of Quantico, he found himself in San Francisco, eventually part of the FBI's local ten-member Eurasian Organized Crime Squad, investigating financial fraud and money-laundering schemes linked to the former Soviet Union and, in some cases, the infamous Red Mafiya. Earl enjoyed being part cop, part missionary, spreading the gospel of the American legal system among former communists for whom the distinction between politics, business, and crime had fallen with the Berlin Wall.
In late 1997, Earl had been handed the name of Peter Niko-layevich Kiritchenko, a Sausalito businessman whom Ukrainian authorities had asked the FBI to check out. It was a routine foreign police request, the kind, Earl's supervisor would later say, that most FBI agents would fulfill and forget. According to the Ukrainians, Kiritchenko had come up in the early stages of a Ukrainian investigation into the just-deposed prime minister, Pavel Lazarenko. At the time, Ukraine was a new ally of the United States, helping reduce the dangerous stockpile of nuclear weapons in the former Soviet Union, and nobody wanted to endanger the fragile relationship that had been forged with Ukraine's autocratic president, Leonid Kuchma. Lazarenko was Kuchma's biggest political rival. Many Ukrainians considered the investigation into the upstart presidential challenger to be a politically motivated ploy.
But Earl pushed on. By January 1998, he had pieced together an outline of Peter Kiritchenko's story. Three years earlier, Kirit-chenko had uprooted his life as a middle-aged Ukrainian commodities trader in Warsaw to move his wife, daughter, and business to the Bay Area. A compact man with sandy blond hair, cheeks ruddy from vodka, and a taste for excess, Kiritchenko stuck out in San Francisco's Russian-speaking community. He drove a burgundy Bentley and, on a two-acre lot high atop Tiburon, was building a Mediterranean-style mansion with a 360-degree view of three bridges that he dubbed Shangri-la. His neighbors knew him from his petition asking the city to let him install a shooting range in the basement. Meanwhile, he had invested about $25 million in local real estate, snapping up a Sausalito condo, two small San Francisco apartment buildings, and over eighty undeveloped acres in Tiburon. The Ukrainian, Earl thought, was worth a closer look.
At 10:00 p.m. one weeknight that January, Earl tucked his young child into bed, kissed his wife good night, and slipped into jeans and a sweatshirt. From his home in the city, he drove north across the Golden Gate Bridge into the hulking darkness of the Marin Headlands, following the necklace of lights to the Sausalito shoreline. From Bridgeway he turned onto Harbor Drive and pulled his standard-issue domestic sedan into the empty parking lot of the brown three-story office building at One Harbor Drive. In a Dump-ster at the back of the lot, he found a single trash bag with the day's detritus from Kiritchenko's office. He tossed it in his trunk and drove away. No search warrant needed. By eleven, Earl was home in bed.
The "trash cover," as agents call it, became Earl's nightly routine. Every weekday morning for eighteen months he would bring the bag thirteen floors up the elevator of the Phillip Burton Federal Building on Golden Gate Avenue and dump its contents on his desk. Occasionally Earl felt silly taking off his suit jacket to sift through garbage like a Tenderloin hobo. His colleagues ribbed the rookie for the mess he made. But it was fruitful. The trash yielded clues- envelopes from something called European Federal Credit Bank; a Post-it note with the word Dugsbery scrawled on it; envelopes bearing the return addresses of some of San Francisco's most respected banks. All of it suggested to Earl that the Ukrainians could be right-there appeared to be a multimillion-dollar pipeline between Ukraine and the Bay Area.
Among San Francisco's thirty thousand Russian-speaking emigres-many of whom are Jews and political refuseniks who arrived as refugees over the past thirty years and congregate in the bakeries, churches, and restaurants along Geary Boulevard-only a small number have attracted the attention of the Eurasian Organized
Crime Squad. In the 1970s, the KGB released thousands of hardcore prisoners from the Soviet gulags, where they had formed tight-knit criminal clans, and allowed them to emigrate across the globe. Over time these clans evolved into the sophisticated Russian Mafiya, operating multinational drug, prostitution, and insurance and welfare fraud rings, among other enterprises. The California Department of Justice has reported that Russian criminal groups are operating in California, including "approximately three hundred former Soviet Union crime figures and associates in the San Francisco Bay Area." Many are from the Ukraine, members of an offshoot of the Odessa Mafiya.
The Bay Area, one of the world's banking hubs as well as home to many Russian-speakers, has become a favorite place for the Mafiya to launder some of its global take. Much of the EOC squad's work involved tracking that money down. For example, as Earl staked out Kiritchenko's Dumpster by night, by day he was helping investigate a young Russian emigre, Alexander Lushtak, who had bilked the local Russian community out of millions with an elaborate Ponzi scheme that promised tax-free returns of up to 25 percent. Lushtak pleaded guilty in June 2000 to money laundering. During his trial, according to one published report, an FBI memo emerged claiming Lushtak had laundered as much as half a billion dollars of Russian organized-crime money through his bank account in New York.
But not all the Russian loot that has flooded into San Francisco comes from the Mafiya. As the Soviet Union collapsed, state-owned industries were divvied up among politicians, crooks, and entrepreneurs. These new oligarchs built a Wild West capitalist economy in which pay-to-play was the rule. Government contracts, international trade deals, the rights to natural resources-every potential profit came at a price. Later, as the young countries tried to impose the rule of law on the chaotic system, the oligarchs responded by spiriting their politically embarrassing fortunes out of the country and into banking systems where they couldn't be touched.