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An American airline that has been transporting protected witnesses for the U.S. government was once part-owned by two Russian organized crime figures, and is still owned by the son of their business partner, an OCCRP investigation has found.
These men, Anatoly Golubchik and Vadim Trincher, were jailed in 2014 for operating an illegal gambling and extortion ring out of an apartment in Trump Tower in New York City. U.S. prosecutors said they were part of a “far-reaching Russian-American organized crime ring” known as the Taiwanchik-Trincher Organization, under the protection of notorious Russian crime boss Alimzhan “Taiwanchik” Tokhtakhounov.
Two other investors who ran the airline afterwards also had legal troubles, and one fled a warrant for his arrest in the U.S. and remains on the lam.
Nonetheless, an OCCRP investigation shows Monarch Air Group has won more than 120 U.S. government contracts worth over $6 million, and was making government flights as recently as September.
The airline and its affiliate, WAB International, have been awarded contracts for sensitive jobs such as moving fuel in Israel for the Department of Defense (DoD), flying people around Afghanistan, and transporting protected witnesses in the U.S. for the Marshals Service. WAB International reported earning some $70 million from work for the U.S. military in 2013 alone. (The witness-protection contracts were first reported by blogger Patrick Simpson last year.)
“The negligence is startling,” said Gary Kalman, director of the U.S. chapter of Transparency International. “Airlines with a history of criminal affiliation contracted by the government to transport protected witnesses is something we’d expect to see in a spy novel, not in a news report.”
In a 2013 court document, prosecutors claimed Golubchik acted as Tokhtakhounov’s “enforcer,” and accused the men of laundering about $100 million on behalf of “high-level criminals” — some of it through Monarch and another airline company Golubchik and Trincher owned in the U.S. called Skyway International.
On one occasion, customs agents in Miami discovered 16 kilograms of cocaine on one of Monarch’s planes. Prosecutors noted the seizure at Golubchik’s bail hearing in 2013, adding of the airline: “We do not believe this business is legitimate.”
The U.S. Marshals Service told reporters that it placed protected witnesses on Monarch planes through contracts overseen by the General Services Administration (GSA), which provides leasing, management, and other professional services to U.S. government agencies. The GSA did not respond to a request for comment.
Golubchik and Trincher both left Monarch in 2012, before the airline won the DoD and the GSA contracts. Monarch was audited by the GSA in 2013, the same year Golubchik and Trincher’s arrest was widely reported, and the agency awarded the airline a 10-year contract in 2014 under which the U.S. Marshals service employed them to transport protected witnesses. The company is currently owned by the son of Golubchik and Trincher’s former business partner.
A spokesperson for the Defense Logistics Agency, which manages the U.S. military’s supply chains, said the agency followed the proper procedures when vetting Monarch for a contract awarded in 2012 to deliver fuel to a military base in Israel. Neither Golubchik nor Trincher were “involved in the bidding or performance of the contract,” he added in an email.
Federal Acquisition Regulations require contractors like Monarch to provide details of any criminal offenses by its employees, even if they don’t relate directly to the contract, according to Jessica Tillipman, a professor at George Washington University Law School with expertise in anti-corruption and government contracting. The agency is then required to make further enquiries, and it is at their discretion to decide whether to work with the company.
Alina Gavrushenko, Monarch’s director of marketing and public relations, said the airline has not been affiliated with Golubchik or Trincher since 2012.
“Like many startups, especially in aviation, the company has changed ownership and evolved its business model over the years,” she said, adding: “Our business operations are conducted with full integrity and transparency.”
The current owner of Monarch, David Gitman, did not respond to a request for comment.
With the 2008 financial crisis threatening to ground Monarch Air, then a small Florida-based air cargo company, its owner, career pilot Paul Slavin needed an injection of funds.
Slavin, who had worked in the aviation industry for 35 years, started looking around for backers. A “trusted aircraft broker” he knew introduced him to two Russians, who agreed to invest while staying out of the airline’s day-to-day operations. For a while, it seemed an ideal solution.
But they soon invited more investors on board, and within three years the clique had taken control of the company. According to Slavin, they started withholding funds and making “operational decisions that conflicted with my standards.” He says he sold his shares in 2011 for a token amount. The new group began aggressively expanding the business, opening new offices and bidding for U.S. government contracts.
Slavin says he didn’t know that two of his investors had ties to Russian organized crime. “If they were involved in any illegal activity outside of the airline it was never revealed to me,” he said in an email to OCCRP.
David Gitman’s father, Jacob Gitman, was among the first investors to join Monarch Air after it hit financial turbulence in 2008.
The elder Gitman was born in the Soviet Union, where he worked as an engineer before immigrating to the U.S. in the early 1990s. He has been linked to dozens of U.S. businesses in everything from logistics and healthcare to aluminium smelting.
In 2017, Gitman was found liable in a civil lawsuit of misleading investors about technology, expertise, and potential profits from an operation to supposedly convert used tires into fuel. The plaintiff, Blizzard Energy, was awarded $3.8 million in damages, and the case is now under appeal. Gitman declined to comment as the case is still ongoing.
Golubchik also joined as an investor in 2008, while Trincher, his criminal partner in the gambling, money laundering, and extortion ring, came aboard in 2011. Another immigrant from the former Soviet Union, Trincher was a professional card player who has reportedly made more than $1.2 million in live tournament earnings during his career, including winning the 2009 World Poker Tour Foxwoods Poker Classic.
Along with Tokhtakhounov, the Russian crime boss who is still on the run, the two men operated what New York prosecutors described as an illegal “large-scale sports book” that was used to launder approximately $100 million from former Soviet Union countries through Cyprus-registered shell companies. Prosecutors said around $50 million of that sum found its way to the U.S.
“Their clients were multi-millionaires and billionaires, oligarchs in Russia,” the prosecutors noted in court documents.
Their group also ran a high-stakes poker game that attracted not only clients from Russia, but also major American actors like Ben Affleck, Leonardo DiCaprio, and Matt Damon, according to the industry publication Poker News. The rise and fall of the star-studded poker game was later made into the film “Molly’s Game,” featuring Jessica Chastain and Idris Elba.
The Taiwanchik-Trincher Organization and its sister crime ring, co-run by Trincher’s son Illya, were broken up in 2013, reportedly after the FBI spent two years collecting information on the Russian money-laundering network using a wiretap hidden inside unit 63A in Trump Tower.
Jacob Gitman told OCCRP he had met Golubchik in 2006, but declined to explain how. He said he had never met or spoken with Trincher. “I don’t have any business relations with them since 2013,” he said in an email.
However, public records show that Gitman partnered with Golubchik and Trincher in at least four aviation companies. Panama-based SkyWay International Holding still lists all three men as corporate officers. Gitman said the Panamanian company was never active, and had never facilitated any transactions or opened bank accounts.
An important addition to Monarch’s team was businessman Boruch “Bob” Freedman, who joined the company in April 2011. Freedman was already involved in air transport in Afghanistan, but he did not have the certificate or experience to procure direct government contracts. Monarch did. The two decided to join forces and, along with Gitman’s son, David, they formed WAB International, which signed a profit-sharing and reimbursement arrangement with Monarch.
Freedman was well-known in the aviation world as the nephew of Alexander Mashkevich, a Kazakh business titan with links to the Eurasian Natural Resources Corporation (see box below), according to John Dawkins, the head of a logistics company that worked with Freedman on a government contract in Afghanistan.
“Boruch was a middleman,” Dawkins said. “He was plugged into everyone using his uncle’s reputation to gain entry and relevance.”
Freedman, who fled the U.S. after a warrant was issued for his arrest for not paying a court-mandated fine, did not respond to a request for comment.
In 2011, Gennady Gryaznov, a former director of Kyrgyzstan’s Department of Civil Aviation, also bought into Monarch. Gryaznov already owned Sky KG Airlines, a Kyrgyz airline that is banned from operating in the European Union due to safety concerns.
Sky KG caught the attention of the United Nations Security Council the following year when it began leasing the aircraft that reportedly served as the former presidential plane of Romanian dictator Nicolae Ceaușescu to the powerful Somali pirate boss Mohamed Abdi Hassan. A U.N. report alleged that Hassan added Gryaznov’s plane to his own small airline — which he used, along with other businesses, for the “laundering of piracy proceeds” — before he was arrested in Belgium.
Gryaznov did not respond to a request for comment.
Golubchik and Trincher appeared in Monarch’s paperwork until 2012, the year the airline won its first contract with the DoD. They are last mentioned as investors in a report from April that year, and records show they were gradually replaced as managers by Freedman-controlled entities.
By 2015, corporate records show that Jacob Gitman owned 90 percent of Monarch, but he said he sold his majority shareholder position the following year. His 37-year-old son, David — who did not respond to a request for comment — is now listed as the CEO and sole owner of the airline.
While Slavin had initially welcomed his new investors, the partnership turned sour.
“Unfortunately for me it became obvious that Boruch Freedman wanted control of the airline and used withholding of funds to affect the daily operation of the airline,” said Slavin. “I was then double-crossed by Jacob Gitman, who gave his and Golubchik’s voting shares to Freedman.”
Slavin said he was voted out as CEO in 2011. At first he stayed on as director of operations, but left when he felt the new owners started cutting corners on safety.
When Slavin first launched Monarch Air Group in 2005, his cargo planes flew to just one destination: the Bahamas, a Caribbean island chain beginning 80 kilometers off the southeast Florida coast, and known as an easy-access playground for American tourists, celebrities, and global elites.
Monarch expanded its flight routes when the new investors came on board, and began carrying passengers as well as cargo. Then in 2011, according to a submission from prosecutors at Golubchik’s bail hearing two years later, Florida customs agents discovered 16 kilograms of cocaine hidden in one of its planes.
A former Monarch pilot, who was not on the flight, told OCCRP the plane was searched by customs agents when it returned to Fort Lauderdale International Airport from Haiti. They found a duffle bag full of cocaine inside. The crew was detained for several hours, he said, along with the person who had chartered the flight, a frequent customer whose name he did not recall. The pilot thought it was strange that the aircraft was then released.
“I’ve seen in previous years, when the airplane was involved with drugs and it was in a hanger and it was not to be moved,” he said. “It was under the control of customs.”
The U.S. Customs and Border Protection Agency refused to release any information about the discovery of the cocaine, or explain why no one was arrested.
Gavrushenko, Monarch’s spokesperson, said the cocaine belonged to a passenger. “We have worked with the relevant authorities to develop and enhance existing procedures, to prevent this from happening again,” she said. “In our 15 years of operations, this was the only occurrence.”
In the two years following the bust, U.S. government agencies continued contracting Monarch. The DoD kept up its subcontracts with WAB to provide helicopter transport for passengers and cargo in Afghanistan. Court records show WAB subcontracted the jobs to a small Kazakhstan-based aviation company, JSC Airline Burundaiavia.
The DoD contracts ceased after a helicopter crash in Afghanistan, according to court documents. In early May 2013, two Burundaiavia choppers took off from a U.S. military forward operating base about 40 miles outside Kandahar, in southern Afghanistan. A short time later, the engines failed in one of the helicopters and it went down over a populated area, “causing much damage and destruction to the village.”
The court documents say Burundaiavia failed to investigate the incident, as was required under international, Afghan, and U.S. law. The crash “tarnished” the company’s reputation, according to a court submission made by Burundaiavia, and it was never awarded another U.S. government contract.
The incident appears to have led to a falling out between the business partners, culminating in a lawsuit in Florida. Burundaiavia successfully sued WAB in 2015 for failing to pay almost $8 million in fees it owed. A warrant was issued for Freedman’s arrest the following year after he was held in contempt of court for not paying the fine. U.S. Marshals were unable to track him down, and he now lives in Israel, according to a court document.
The Florida case involving WAB revealed who owns JSC Airline Burundaiavia: three oligarchs from Kazakhstan who have faced corruption allegations in various places.
Patokh Chodiev, Alijan Ibragimov, and Alexander Machkevich — known in their home country as “the trio” — were the founders of the Eurasian Natural Resources Corporation (ENRC). Britain’s Serious Fraud Office has been investigating ENRC since 2013, probing allegations that the company paid bribes to secure “substantial mineral assets” in the Democratic Republic of Congo. ENRC has counter-sued to regain $93 million in legal fees, alleging that its own lawyer colluded with the Serious Fraud Office to concoct the case.
In 2011, prosecutors in Belgium dropped criminal charges against the trio in return for the men paying a fine to settle the long-running case with no admission of guilt. The trio had been accused of laundering about $55 million in commissions from a Belgian engineering firm. That case reportedly prompted Swiss and U.S. authorities to look into related offshore bank accounts linked to Kazakh officials, but no indictments were made.
The Eurasian Resources Group, which bought ENRC in 2013, did not respond to a request for comment.
The trio are best known as investors in the Bayrock Group, which was listed as a "strategic partners" in the now infamous Trump SoHo hotel.
In 2017, the Marshals Service twice hired Monarch to transport people in the witness protection program and the Justice Prisoner and Alien Transportation System, which moves prisoners around the country.
Gary Kalman of Transparency International said the fact that Monarch was able to transport protected witnesses, despite the dubious backgrounds of its former owners, shows the need for more thorough checks on companies that are awarded public contracts.
“Common sense says that contracts should be clearly vetted before going to entities with a history of criminal affiliation, but there is no legal mandate that we check,” he said. “That is a significant gap in the law, and this story is a prime example of how such a gap might be dangerously exploited.”
The Marshals declined to comment, saying the GSA was responsible for vetting the company. Monarch’s spokesperson said the company was audited by the GSA as a vendor in 2013 and won its contracts “with full transparency and open competition.”
The GSA did not reply to a request for comment.
Between January and April 2016, Monarch’s director of operations, chief pilot, and maintenance director all quit. A pilot who spoke to OCCRP anonymously said employees resigned after Monarch stopped paying them, and the airline struggled to find replacements.
In May that year, the airline requested the FAA remove its only aircraft from its “Operation Specifications,” a legal designation that allowed it to run commercial operations like private chartered flights. Without any planes that met FAA requirements, or key staff members to run them, its air carrier certificate was revoked in February 2018.
But Monarch is still authorized to broker charter flights with other FAA-certified air carriers.
Analysis of public documents found U.S. authorities have awarded Monarch more than 120 contracts over the past eight years, totalling more than $6 million. The airline is still making flights under an open-ended 10-year contract awarded in 2014.
The bulk of Monarch’s contracts were with the DoD and involved transporting fuel to Har Keren in Israel, where the U.S. military has a mountaintop radar facility known as Site 512. Those gigs took place between 2012 — the last year Golubchik and Trincher were known to be involved in the company — and 2015.
Seto Bagdoyan, director for audit services at the U.S. Government Accountability Office’s (GAO) Forensic Audits & Investigative Service, said the lack of transparency in contracting structures presents a risk to the government.
“A recent GAO report … flagged a number of fraud and national-security risks to DoD acquisition posed by contractor ownership structures that may not be fully transparent,” he said. “While GAO didn’t specifically focus on background checks, this could be an important aspect of DoD’s assessment of its various controls.”
In addition to U.S. federal contracts, the Monarch Air Group lists international clients including the United Nations World Food Program, and Canada’s Department of National Defence. Most recently, David Gitman boasted in a travel publication of Monarch’s “great synergy” with U.S. embassies to bring home citizens stranded in Latin America due to the COVID-19 crisis.
In the 12 years since Slavin welcomed new investors, his small air cargo company has grown from a struggling start up, with just one route to the Bahamas, into a global operation. But even though he has not been able to “share in the prosperity,” he said he is not bitter.
“I am done reliving this chapter of my life that I closed 10 years ago,” Slavin said.