Michael Cherney
Encyclopedia
Michael Cherney is a Uzbekistan-born Israel
i entrepreneur and industrialist. He is known for his significant role in the 1990s Aluminium in Russia, and his business ventures in Israel. He is also the founder of the Michael Cherney Foundation
and main sponsor of The Intelligence Summit
.
Uzbek SSR
in a family whose father was a book-keeper and an engineer, the oldest of three sons. At the age of fourteen, Cherney started working, as he joined his father on moonlighting jobs. After high school
, he was drafted into the Soviet Army
and attended a technical college. Later, his athletic pursuits – boxing and football – led to employment in sports administration.
In the early 1990s Cherney immigrated to Israel
but kept close ties to Bulgaria, where he had bought a leading newspaper, a top soccer team, and Bulgaria's only mobile phone company Mobiltel
. In August 2000 Bulgarian authorities denounced what they said were his ties to foreign criminal rackets and expelled him, saying he could not return to Bulgaria for 10 years.
Furthermore, the United States have "denied Cherney a visa since 1999 because of alleged ties to the Russian mafia, according to the St. Petersburg Times
.".
Cherney is wanted on an Interpol
international arrest warrant on allegations of money laundering and organised crime, but in June 2010 the Jerusalem Post reported that Cherney is preparing an application to contest it before the European Union Court of Human Rights.
, founded Trans-World Group (TWG) – the first and largest private company in Russia which produced aluminum and sold it on Western markets. Business weel reports that the brothers "were known for their rough style of doing business".
In 1994, TWG was drawn into a government inquiry into the theft of more than $100 million from Russia's central bank by a number of separate criminal groups during the early 1990s. In an article on TWG, Fortune Magazine reported: “That a theft occurred is not in dispute, nor is the fact that the Cherneys ended up with a piece of the stolen money and used it to partially fund Trans World's startup phase in 1992… The inquiry's objective was to determine whether the Cherneys knew the funds were indeed stolen”.
In an attempt to clean up its reputation and refute allegations of questionable business practices, the Reuben brothers
hired Mayer Brown & Platt, a US based law firm. Terrence Burke, an investigator employed by the law firm and former acting head of the DEA, recommended that the Reubens sever their ties with Cherney after the FBI told him that “it believed Michael himself was an organised crime figure”. As a result Michael was paid $400m “just to go away” whilst his brother Lev remained with the company.
In August 2001 a Fortune Article notes that "the prosecutor's office in Düsseldorf
notified the Reuben brothers
that it had terminated its probe into alleged money laundering, saying "I hereby confirm expressly that there is no remaining suspicion of money laundering or any other criminal actions." However, the same article states that the Kroll report "doesn't discuss an essential part of the story", nor does it "explore the complex business and financial relationships in Russia between the Reubens and Lev and Michael Chernoy."
, then an independent metals trader, won the backing of Cherney and TWG to become general manager of Sayansk aluminium plant in Siberia, which lead to formation of SibAl and a partnership between Cherney and Oleg Deripaska in this company.
, was placed on the market. Cherney put together a three-partner consortium to bid for Bulgartabac. He planned to purchase Bulgartabac by establishing the Metatabac Consortium, which was created in April 2002. Ownership was structured between three groups: the Russian firm Soyuzcontracttabac, which owned 35%, MCG Holdings, a firm owned by Cherney, which owned 35%, and another 30% held by a Cypriot
company named Metacontact Ltd.
n mobile provider Mobiltel
. Cherney bought the company together with Austrian business men Martin Schlaff
, former minster of the Austrian People's Party
Josef Taus, and financial expert Herbert Cordt. The 768 million Euro deal was financed by BAWAG P.S.K.
. In 2005 Mobiltel was sold for 1,6 billion Euros to Mobilkom Austria Group
with a huge profit of 830 million Euros. Critics found it hard to understand "why the state bought an asset for such a high price from someone who was effectively a go-between who stood to pocket a fat profit, rather than directly from the original owner of the company".
. It was discovered that they had attempted to enter the UK on false Polish
passports and they were deported back to Switzerland
.
The following day they were arrested by the Swiss police on the grounds that they had made use of false identities. Both were searched and found to be in possession of two allegedly invalid Polish driving licences. Mr Cherney gave a statement to the police in which he admitted using a Polish passport in an attempt to enter the UK (which had been successful previously). On 25th October 1994 the Swiss authorities confirmed that they would not be pressing any charges against Mr. Cherney. On 20th November 1996 the Swiss Federal Aliens Office confirmed that he was no longer subject to a prohibition order and that there was nothing to prevent his coming into Switzerland.
; under Israeli law, MKs are not allowed to receive any payment beyond their salary. One claim is that Cherney paid a company called Path to the East large amounts of money between the years 1999 and 2006, and that these sums were then allegedly passed on to Lieberman as a bribe. Other allegations concern a company called M.L.1, founded by Lieberman's daughter Michal when she was 21. These allegations concern money transferred to M.L.1 from unknown sources outside Israel; the money was later allegedly used for paying salaries to Avigdor and Michal Lieberman.
In April 2007, Israeli police questioned Avigdor Lieberman, Israel’s Deputy Prime Minister, on suspicions of illegally financing his 2001 electoral campaign. According to the police, in May 2001, three months after Lieberman was appointed Minister of Infrastructure in Ariel Sharon
's Cabinet, approximately $500,000 was transferred to the bank accounts of Lieberman associates through Cyprus
. This money could be traced back to Cherney. Cherney's attorney, Yaakov Weinroth, said the money was transferred by his client “for a totally transparent, legal wine deal”.
In May 2011, Haaretz
reported that the Israeli Attorney General had issued a draft indictment against Avigdor Lieberman for fraud and money laundering, including allegations against Cherny. A second Haaretz
article detailing the draft indictment reported that a company owned by Cherney had paid $500,000 to a company owned by Avigdor Lieberman in May 2001. It added that: "Prosecutors say Lieberman then used his government posts to try to restore Chernoy's Israeli passport, which he had been stripped of in 1999, and to assist him in other personal matters."
, a charge he denies. Cherney allegedly arranged to have Israeli businessman Gad Zeevi purchase 20% of the Israeli telecom in December 1999 from Cable and Wireless for 630 million dollar, of which 500 million came from new bank loans backed by Cherney. The court case dragged on for nine years and finally in 2009 the Tel-Aviv District Judge Oded Mudrik suggested to the Prosecution to settle with Cherney since the Judge did not see any criminal intent or wrongdoing in Cherney's loan to Zeevi.
, Spanish authorities sought Cherney in connection to ‘Operation Avispa’, a 2005 investigation that had resulted in the arrest of several prominent Russian mafia figures. The investigators believe that Cherney managed several Spanish businesses, registered in Alicante and Levante, used by the mafia for money laundering of 4 million euros.
In May 2009, Spain's Supreme Court
issued a detention order against Cherney. Along with his business partners Oleg Deripaska (head of RusAl) and Iskander Makhmudov
(head of UGMK), Cherney is suspected of laundering money. The Spanish authorities claim they succeeded in tracing the organization's complicated money laundering track, including Deripaska's, Makhmudov's and Cherney's alleged participation. As a result, Interpol
issued an international arrest warrant against Cherney.
against Yehoshua Vita, a former senior Tax Authority official, and Yaakov Weinroth, Mr. Cherney’s attorney.
According to the indictment Weinroth made a number of payments to Vita, and in exchange Vita provided favours for Weinroth’s clients, including Cherney and Arkady Gaydamak. Vita was charged with accepting bribes from Weinroth, who in turn was charged with money laundering and making illegal payments to Vita. During a hearing at the Tel Aviv District Court in January 2010, it was alleged that Vita allowed tax breaks on $2 billion for Cherney, and $1 billion for Arkady Gaydamak.
Clarke J wrote: "Mr Cherney has produced a substantial body of evidence in support of his innocence consisting of an affidavit from Dr Vladimir Ovchnisky, who was assistant to the First Deputy of the Minister of the Interior between 1992 and 1995; assistant to the Minister of the Interior of Russia from 1995 to October 1997; and from October 1997 to July 1999 Chief of the National Central Bureau of Interpol of the Russian Federation, and an author of books on organised crime, two of which are used as textbooks for schools of enforcement agencies. In it he states “with absolute certainty” that Mr Cherney has no criminal record, has never been declared as wanted in or out of Russia, and that law enforcement agencies “do not have any legally valid information proving his implication in organized crime”.
Mr Justice Clarke referred to an affidavit from Colonel Glushenkov, who was from 1992 to 2000 the Senior Investigator for Cases of Extraordinary Importance for the Office of Investigating Organised Criminal Activities. In the course of an investigation into alleged fraud he examined Mr Cherney’s business activities and confirmed the legitimacy of Mr Cherney’s business with aluminium companies and found no indication of the commission of any crime. An affidavit of Mr Yuri Skuratov, who was between October 1995 and April 1999 the Attorney General of the Russian Federation. He states that throughout that period he did not receive any information to the effect that Mr Cherney had been convicted for crimes committed in the USSR or the Russian Federation nor were there any criminal proceedings instituted against him by law enforcement agencies in Russia.
Several letters between 2000 and 2004 from relevant authorities attesting to the absence of any criminal cases against him.
, a Russian billionaire who owns the huge Russian aluminum company, RusAl, in the Commercial Court of London's High Court. Cherney sought a Court declaration affirming that Deripaska holds 20% of the RusAl shares on behalf of Cherney or damages for breach of Deripaska's agreement to dispose of the shares and to account to Cherney for the proceeds. The claims are based on a written agreement between the two businessmen that was signed in a London hotel room in March 2001. Deripaska denies that Cherney owns shares and said in an affidavit that his relationship with Cherney was one of a businessman being extorted by a crime boss. After the 2001 meeting, Deripaska paid Cherney $250 million.
As of December 2006 RusAl was in the final stages of negotiating a takeover of domestic rival SuAl and the aluminum assets of Glencore
, a major Swiss commodities trader, which could create a new company valued at up to $30 billion. According to this estimate, Cherney's 20 percent stake in RusAl could be worth as much as $3 billion. On July 3, 2008, a British judge ruled that Cherney had the right to sue Deripaska for $4 billion (£2 billion). High Court Justice Christopher Clarke ruled that Cherney might be assassinated or held on trumped-up charges if he tried to bring the case in Russia.
At a June 2011 case management conference, the judge deferred a decision on whether Cherney would be allowed to give evidence by video link from Israel rather than appear in person as an outstanding Interpol arrest warrant means he would be detained if he traveled to the UK. In late July 2011, the High Court ruled that Cherney may give evidence at the trial by video link from Israel and set trial for April 2012.
Court handed down its first verdict in the case of illegal eavesdropping on Cherney. Aviv Mor, a private investigator
was found guilty of illegally gathering information of personal nature - in particular, tapping the phones of Cherney and sentenced to a plea bargain
ed result which handed down a 14-month sentence to Mor. Part of the sentence will be in the form of community service
and the rest will be a suspended sentence
. The District attorney
's office stated in court that the cases of other suspects in the illegal data collection case "are at an advanced stage and close to indictment
." In February 2008 Cheney filed a suit in a Tel Aviv court that alleged the illegal spying was commissioned by a Russian citizen, Alexei Drobashenko who at the time was the head of the External Relations department at Basic Element, a financial and industrial group that belongs to Oleg Deripaska
. Cherney claimed that it was this Russian oligarch , acting through Drobashenko, who had hired Eskin, Pridan and Mor. In his claim Mr. Cherney accused a group of 10 plotters, including Oleg Deripaska, Alexei Drobashenko and the already sentenced Aviv Mor, of illegal wiretapping, hacking the computers of his charity fund, publishing slanderous articles, and harassing him with insulting graffities and leaflets.
until he sold his shares in June 2009 following a Managing Board decision to raise capitalization.
Israel
The State of Israel is a parliamentary republic located in the Middle East, along the eastern shore of the Mediterranean Sea...
i entrepreneur and industrialist. He is known for his significant role in the 1990s Aluminium in Russia, and his business ventures in Israel. He is also the founder of the Michael Cherney Foundation
Michael Cherney Foundation
The Michael Cherney Foundation is a charitable foundation created by Michael Cherney, a Russian-born Israeli entrepreneur .Cherney defines the mission of the foundation as to help democratic nations in their war on terrorism and assist fellow émigrés to Israel from Russia and other post-Soviet...
and main sponsor of The Intelligence Summit
The Intelligence Summit
The Intelligence Summit is an annual conference run principally by John Loftus and funded an organization he controls, the Intelligence and Homeland Security Educational Center ....
.
Biography
Cherney grew up in TashkentTashkent
Tashkent is the capital of Uzbekistan and of the Tashkent Province. The officially registered population of the city in 2008 was about 2.2 million. Unofficial sources estimate the actual population may be as much as 4.45 million.-Early Islamic History:...
Uzbek SSR
Uzbek SSR
The Uzbek Soviet Socialist Republic , also known as the Uzbek SSR for short, was one of the republics of the Soviet Union since its creation in 1924...
in a family whose father was a book-keeper and an engineer, the oldest of three sons. At the age of fourteen, Cherney started working, as he joined his father on moonlighting jobs. After high school
High school
High school is a term used in parts of the English speaking world to describe institutions which provide all or part of secondary education. The term is often incorporated into the name of such institutions....
, he was drafted into the Soviet Army
Soviet Army
The Soviet Army is the name given to the main part of the Armed Forces of the Soviet Union between 1946 and 1992. Previously, it had been known as the Red Army. Informally, Армия referred to all the MOD armed forces, except, in some cases, the Soviet Navy.This article covers the Soviet Ground...
and attended a technical college. Later, his athletic pursuits – boxing and football – led to employment in sports administration.
In the early 1990s Cherney immigrated to Israel
Israel
The State of Israel is a parliamentary republic located in the Middle East, along the eastern shore of the Mediterranean Sea...
but kept close ties to Bulgaria, where he had bought a leading newspaper, a top soccer team, and Bulgaria's only mobile phone company Mobiltel
Mobiltel
Mobiltel , commonly known as M-Tel , is the first and largest GSM mobile phone operator in Bulgaria. M-Tel was founded in March 1994 by Mr...
. In August 2000 Bulgarian authorities denounced what they said were his ties to foreign criminal rackets and expelled him, saying he could not return to Bulgaria for 10 years.
Furthermore, the United States have "denied Cherney a visa since 1999 because of alleged ties to the Russian mafia, according to the St. Petersburg Times
St. Petersburg Times (Russia)
The St. Petersburg Times is a weekly, English-language newspaper based in St. Petersburg, Russia. It serves the expatriate community, tourists, and Russians interested in an international perspective on local and world affairs...
.".
Cherney is wanted on an Interpol
Interpol
Interpol, whose full name is the International Criminal Police Organization – INTERPOL, is an organization facilitating international police cooperation...
international arrest warrant on allegations of money laundering and organised crime, but in June 2010 the Jerusalem Post reported that Cherney is preparing an application to contest it before the European Union Court of Human Rights.
TWG and founding of Russian Aluminum Industry
Cherney, together with his brother Lev Cherney and UK metals traders David and Simon ReubenDavid and Simon Reuben
David and Simon Reuben are well known British businessmen and philanthropists. In the Forbes magazine List of billionaires 2011, ranking of the wealthiest people in the UK, the brothers were placed second with an estimated fortune of £5.5 billion...
, founded Trans-World Group (TWG) – the first and largest private company in Russia which produced aluminum and sold it on Western markets. Business weel reports that the brothers "were known for their rough style of doing business".
In 1994, TWG was drawn into a government inquiry into the theft of more than $100 million from Russia's central bank by a number of separate criminal groups during the early 1990s. In an article on TWG, Fortune Magazine reported: “That a theft occurred is not in dispute, nor is the fact that the Cherneys ended up with a piece of the stolen money and used it to partially fund Trans World's startup phase in 1992… The inquiry's objective was to determine whether the Cherneys knew the funds were indeed stolen”.
In an attempt to clean up its reputation and refute allegations of questionable business practices, the Reuben brothers
Reuben Brothers
Reuben Brothers is a privately held company wholly owned by David and Simon Reuben. Based in Switzerland, Reuben Brothers has various departments in countries including the United Kingdom. Its main activities are in real estate, private equity, and venture capitalism...
hired Mayer Brown & Platt, a US based law firm. Terrence Burke, an investigator employed by the law firm and former acting head of the DEA, recommended that the Reubens sever their ties with Cherney after the FBI told him that “it believed Michael himself was an organised crime figure”. As a result Michael was paid $400m “just to go away” whilst his brother Lev remained with the company.
In August 2001 a Fortune Article notes that "the prosecutor's office in Düsseldorf
Düsseldorf
Düsseldorf is the capital city of the German state of North Rhine-Westphalia and centre of the Rhine-Ruhr metropolitan region.Düsseldorf is an important international business and financial centre and renowned for its fashion and trade fairs. Located centrally within the European Megalopolis, the...
notified the Reuben brothers
Reuben Brothers
Reuben Brothers is a privately held company wholly owned by David and Simon Reuben. Based in Switzerland, Reuben Brothers has various departments in countries including the United Kingdom. Its main activities are in real estate, private equity, and venture capitalism...
that it had terminated its probe into alleged money laundering, saying "I hereby confirm expressly that there is no remaining suspicion of money laundering or any other criminal actions." However, the same article states that the Kroll report "doesn't discuss an essential part of the story", nor does it "explore the complex business and financial relationships in Russia between the Reubens and Lev and Michael Chernoy."
SuAl and Partnership with Oleg Deripaska
According to the Financial Times, in 1994, Oleg DeripaskaOleg Deripaska
Oleg Vladimirovich Deripaska is the Russian Chief executive officer of Basic Element company and a member of the Board of Directors and CEO of United Company RUSAL, a Russian aluminium industry company...
, then an independent metals trader, won the backing of Cherney and TWG to become general manager of Sayansk aluminium plant in Siberia, which lead to formation of SibAl and a partnership between Cherney and Oleg Deripaska in this company.
BulgarTabac
In 2002, 80% of the capital in the Bulgarian State-owned tobacco company, BulgartabacBulgartabac
Bulgartabac Holding Group AD or simply Bulgartabac is a Bulgarian tobacco holding company. Established in 1947 and based in the capital Sofia, it includes 11 joint-stock subsidiary companies in the tobacco-growing regions of the country....
, was placed on the market. Cherney put together a three-partner consortium to bid for Bulgartabac. He planned to purchase Bulgartabac by establishing the Metatabac Consortium, which was created in April 2002. Ownership was structured between three groups: the Russian firm Soyuzcontracttabac, which owned 35%, MCG Holdings, a firm owned by Cherney, which owned 35%, and another 30% held by a Cypriot
Cyprus
Cyprus , officially the Republic of Cyprus , is a Eurasian island country, member of the European Union, in the Eastern Mediterranean, east of Greece, south of Turkey, west of Syria and north of Egypt. It is the third largest island in the Mediterranean Sea.The earliest known human activity on the...
company named Metacontact Ltd.
Mobiltel
In 2002 Cherney was involved in the selling-on of the BulgariaBulgaria
Bulgaria , officially the Republic of Bulgaria , is a parliamentary democracy within a unitary constitutional republic in Southeast Europe. The country borders Romania to the north, Serbia and Macedonia to the west, Greece and Turkey to the south, as well as the Black Sea to the east...
n mobile provider Mobiltel
Mobiltel
Mobiltel , commonly known as M-Tel , is the first and largest GSM mobile phone operator in Bulgaria. M-Tel was founded in March 1994 by Mr...
. Cherney bought the company together with Austrian business men Martin Schlaff
Martin Schlaff
Martin Schlaff is an Austrian entrepreneur who was occupied in trade with East Germany before the German reunification. According to the German parliament's investigations, Schlaff was an unofficial employee of the Stasi...
, former minster of the Austrian People's Party
Austrian People's Party
The Austrian People's Party is a Christian democratic and conservative political party in Austria. A successor to the Christian Social Party of the late 19th and early 20th centuries, it is similar to the Christian Democratic Union of Germany in terms of ideology...
Josef Taus, and financial expert Herbert Cordt. The 768 million Euro deal was financed by BAWAG P.S.K.
BAWAG P.S.K.
BAWAG P.S.K. Bank für Arbeit und Wirtschaft und Österreichische Postsparkasse Aktiengesellschaft is the fourth largest bank in Austria...
. In 2005 Mobiltel was sold for 1,6 billion Euros to Mobilkom Austria Group
Mobilkom Austria
Mobilkom Austria is a major Austrian mobile network operator. It has been operating commercially since 1994 and in testing since 1992.One of the most well-known commercial brand is A1 in Austria.The Mobilkom Austria group also owns:...
with a huge profit of 830 million Euros. Critics found it hard to understand "why the state bought an asset for such a high price from someone who was effectively a go-between who stood to pocket a fat profit, rather than directly from the original owner of the company".
The Intelligence Summit
Cherney is the founder and primary sponsor of the Intelligence Summit. In February 2006, The New York Sun reported that John Deutch and James Woolsey had resigned from the Intelligence Summit's board of advisers after receiving information that the conference's primary sponsor, Cherney, had "alleged ties to the Russian mafia".Invalid passport
On 21st May 1994 Mr Cherney and his future wife were detained by immigration officers on arrival in Heathrow from GenevaGeneva
Geneva In the national languages of Switzerland the city is known as Genf , Ginevra and Genevra is the second-most-populous city in Switzerland and is the most populous city of Romandie, the French-speaking part of Switzerland...
. It was discovered that they had attempted to enter the UK on false Polish
Poland
Poland , officially the Republic of Poland , is a country in Central Europe bordered by Germany to the west; the Czech Republic and Slovakia to the south; Ukraine, Belarus and Lithuania to the east; and the Baltic Sea and Kaliningrad Oblast, a Russian exclave, to the north...
passports and they were deported back to Switzerland
Switzerland
Switzerland name of one of the Swiss cantons. ; ; ; or ), in its full name the Swiss Confederation , is a federal republic consisting of 26 cantons, with Bern as the seat of the federal authorities. The country is situated in Western Europe,Or Central Europe depending on the definition....
.
The following day they were arrested by the Swiss police on the grounds that they had made use of false identities. Both were searched and found to be in possession of two allegedly invalid Polish driving licences. Mr Cherney gave a statement to the police in which he admitted using a Polish passport in an attempt to enter the UK (which had been successful previously). On 25th October 1994 the Swiss authorities confirmed that they would not be pressing any charges against Mr. Cherney. On 20th November 1996 the Swiss Federal Aliens Office confirmed that he was no longer subject to a prohibition order and that there was nothing to prevent his coming into Switzerland.
Alleged illegal payments to Avigdor Lieberman
Cherney is a close friend of Avigdor Lieberman who allegedly received millions of shekels from various entrepreneurs, including Mr Cherney, while serving as member of KnessetKnesset
The Knesset is the unicameral legislature of Israel, located in Givat Ram, Jerusalem.-Role in Israeli Government :The legislative branch of the Israeli government, the Knesset passes all laws, elects the President and Prime Minister , approves the cabinet, and supervises the work of the government...
; under Israeli law, MKs are not allowed to receive any payment beyond their salary. One claim is that Cherney paid a company called Path to the East large amounts of money between the years 1999 and 2006, and that these sums were then allegedly passed on to Lieberman as a bribe. Other allegations concern a company called M.L.1, founded by Lieberman's daughter Michal when she was 21. These allegations concern money transferred to M.L.1 from unknown sources outside Israel; the money was later allegedly used for paying salaries to Avigdor and Michal Lieberman.
In April 2007, Israeli police questioned Avigdor Lieberman, Israel’s Deputy Prime Minister, on suspicions of illegally financing his 2001 electoral campaign. According to the police, in May 2001, three months after Lieberman was appointed Minister of Infrastructure in Ariel Sharon
Ariel Sharon
Ariel Sharon is an Israeli statesman and retired general, who served as Israel’s 11th Prime Minister. He has been in a permanent vegetative state since suffering a stroke on 4 January 2006....
's Cabinet, approximately $500,000 was transferred to the bank accounts of Lieberman associates through Cyprus
Cyprus
Cyprus , officially the Republic of Cyprus , is a Eurasian island country, member of the European Union, in the Eastern Mediterranean, east of Greece, south of Turkey, west of Syria and north of Egypt. It is the third largest island in the Mediterranean Sea.The earliest known human activity on the...
. This money could be traced back to Cherney. Cherney's attorney, Yaakov Weinroth, said the money was transferred by his client “for a totally transparent, legal wine deal”.
In May 2011, Haaretz
Haaretz
Haaretz is Israel's oldest daily newspaper. It was founded in 1918 and is now published in both Hebrew and English in Berliner format. The English edition is published and sold together with the International Herald Tribune. Both Hebrew and English editions can be read on the Internet...
reported that the Israeli Attorney General had issued a draft indictment against Avigdor Lieberman for fraud and money laundering, including allegations against Cherny. A second Haaretz
Haaretz
Haaretz is Israel's oldest daily newspaper. It was founded in 1918 and is now published in both Hebrew and English in Berliner format. The English edition is published and sold together with the International Herald Tribune. Both Hebrew and English editions can be read on the Internet...
article detailing the draft indictment reported that a company owned by Cherney had paid $500,000 to a company owned by Avigdor Lieberman in May 2001. It added that: "Prosecutors say Lieberman then used his government posts to try to restore Chernoy's Israeli passport, which he had been stripped of in 1999, and to assist him in other personal matters."
Bezeq affair
In 2001 Cherney was accused of concealing an attempt to purchase the Israeli state-owned telecom company BezeqBezeq
Bezeq, the Israeli company for communications, is a telecommunications provider in Israel.Until the mid-first decade of the 21st century when it was owned by the Israeli government, Bezeq had a monopoly on landline telephony and Internet access infrastructure...
, a charge he denies. Cherney allegedly arranged to have Israeli businessman Gad Zeevi purchase 20% of the Israeli telecom in December 1999 from Cable and Wireless for 630 million dollar, of which 500 million came from new bank loans backed by Cherney. The court case dragged on for nine years and finally in 2009 the Tel-Aviv District Judge Oded Mudrik suggested to the Prosecution to settle with Cherney since the Judge did not see any criminal intent or wrongdoing in Cherney's loan to Zeevi.
Spanish allegations and attempted arrest in the United Kingdom
According to sources cited in the Spanish daily El MundoEl Mundo (Spain)
El Mundo is the second largest printed and the largest digital daily newspaper in Spain and one of the newspapers of record in that country, with a daily circulation topping 300,000 readers for the printed edition and 24 million unique web visitors per month for the...
, Spanish authorities sought Cherney in connection to ‘Operation Avispa’, a 2005 investigation that had resulted in the arrest of several prominent Russian mafia figures. The investigators believe that Cherney managed several Spanish businesses, registered in Alicante and Levante, used by the mafia for money laundering of 4 million euros.
In May 2009, Spain's Supreme Court
Supreme Court of Spain
The Supreme Court of Spain is the highest court in Spain for all matters not pertaining to the Spanish Constitution. The court which meets in the Convent of the Salesas Reales in Madrid, consists of a president and an indeterminate number of magistrates appointed to the five chambers of the...
issued a detention order against Cherney. Along with his business partners Oleg Deripaska (head of RusAl) and Iskander Makhmudov
Iskander Makhmudov
Iskander Makhmudov is an Uzbek businessman based in Russia.- Overview :Iskander one of the most mysterious Uzbek businessmen. He was born in Bukhara, lived in Tashkent and graduated from the local university with a degree in Oriental studies. He then worked in different Soviet military...
(head of UGMK), Cherney is suspected of laundering money. The Spanish authorities claim they succeeded in tracing the organization's complicated money laundering track, including Deripaska's, Makhmudov's and Cherney's alleged participation. As a result, Interpol
Interpol
Interpol, whose full name is the International Criminal Police Organization – INTERPOL, is an organization facilitating international police cooperation...
issued an international arrest warrant against Cherney.
Yaakov Weinroth
In December 2009 an indictment was issued by prosecutors in Tel AvivTel Aviv
Tel Aviv , officially Tel Aviv-Yafo , is the second most populous city in Israel, with a population of 404,400 on a land area of . The city is located on the Israeli Mediterranean coastline in west-central Israel. It is the largest and most populous city in the metropolitan area of Gush Dan, with...
against Yehoshua Vita, a former senior Tax Authority official, and Yaakov Weinroth, Mr. Cherney’s attorney.
According to the indictment Weinroth made a number of payments to Vita, and in exchange Vita provided favours for Weinroth’s clients, including Cherney and Arkady Gaydamak. Vita was charged with accepting bribes from Weinroth, who in turn was charged with money laundering and making illegal payments to Vita. During a hearing at the Tel Aviv District Court in January 2010, it was alleged that Vita allowed tax breaks on $2 billion for Cherney, and $1 billion for Arkady Gaydamak.
English High Court judgment
On May 1st, 2008 Mr Justice Christopher Clarke in the English High Court defended Mr Cherney's reputation in a judgment.Clarke J wrote: "Mr Cherney has produced a substantial body of evidence in support of his innocence consisting of an affidavit from Dr Vladimir Ovchnisky, who was assistant to the First Deputy of the Minister of the Interior between 1992 and 1995; assistant to the Minister of the Interior of Russia from 1995 to October 1997; and from October 1997 to July 1999 Chief of the National Central Bureau of Interpol of the Russian Federation, and an author of books on organised crime, two of which are used as textbooks for schools of enforcement agencies. In it he states “with absolute certainty” that Mr Cherney has no criminal record, has never been declared as wanted in or out of Russia, and that law enforcement agencies “do not have any legally valid information proving his implication in organized crime”.
Mr Justice Clarke referred to an affidavit from Colonel Glushenkov, who was from 1992 to 2000 the Senior Investigator for Cases of Extraordinary Importance for the Office of Investigating Organised Criminal Activities. In the course of an investigation into alleged fraud he examined Mr Cherney’s business activities and confirmed the legitimacy of Mr Cherney’s business with aluminium companies and found no indication of the commission of any crime. An affidavit of Mr Yuri Skuratov, who was between October 1995 and April 1999 the Attorney General of the Russian Federation. He states that throughout that period he did not receive any information to the effect that Mr Cherney had been convicted for crimes committed in the USSR or the Russian Federation nor were there any criminal proceedings instituted against him by law enforcement agencies in Russia.
Several letters between 2000 and 2004 from relevant authorities attesting to the absence of any criminal cases against him.
Swiss Compensation for Baseless Allegations
On May 13, 2010 the Swiss Court awarded Cherney a compensation of 30,000 Swiss francs for unfounded suspicions of his links to the "Russian Mafia". The Swiss court ruled that Cherney be financially compensated for moral damages to him and his family caused by the investigation which dragged from 1996 till 2007. After the Swiss court's 2008 ruling that Cherney was not linked to organized crime, he decided to sue for moral damages. According to a Swiss law, this compensation could not exceed the amount of 10,000 francs. Exceptions are made in cases where courts discern "special circumstances". According to the court's latest verdict, this was the case with Cherney, especially since the investigation had unduly dragged out for eleven years.Attempted murder
In 1995 two purported Israeli hit men were prosecuted for what the police said was a $100,000 contract for Cherney's murder. According to the New York Times, "The apparent murder plot was linked at the time to a wave of killings in the aluminum industry in the former Soviet Union, the center of a complex web of global dealings by Mr. Chernoy and his younger brother". The Times also quoted anonymous Israeli police sources linking Cherney to the Russian underworld and international money-laundering schemes, which was not a crime in Israel until 2000. Cherney denied the charges.Lawsuit against Oleg Deripaska
On November 24, 2006, Cherney filed a suit against Oleg DeripaskaOleg Deripaska
Oleg Vladimirovich Deripaska is the Russian Chief executive officer of Basic Element company and a member of the Board of Directors and CEO of United Company RUSAL, a Russian aluminium industry company...
, a Russian billionaire who owns the huge Russian aluminum company, RusAl, in the Commercial Court of London's High Court. Cherney sought a Court declaration affirming that Deripaska holds 20% of the RusAl shares on behalf of Cherney or damages for breach of Deripaska's agreement to dispose of the shares and to account to Cherney for the proceeds. The claims are based on a written agreement between the two businessmen that was signed in a London hotel room in March 2001. Deripaska denies that Cherney owns shares and said in an affidavit that his relationship with Cherney was one of a businessman being extorted by a crime boss. After the 2001 meeting, Deripaska paid Cherney $250 million.
As of December 2006 RusAl was in the final stages of negotiating a takeover of domestic rival SuAl and the aluminum assets of Glencore
Glencore
Glencore International plc is a multinational mining and commodities trading company headquartered in Baar, Switzerland and with its registered office in Saint Helier, Jersey...
, a major Swiss commodities trader, which could create a new company valued at up to $30 billion. According to this estimate, Cherney's 20 percent stake in RusAl could be worth as much as $3 billion. On July 3, 2008, a British judge ruled that Cherney had the right to sue Deripaska for $4 billion (£2 billion). High Court Justice Christopher Clarke ruled that Cherney might be assassinated or held on trumped-up charges if he tried to bring the case in Russia.
At a June 2011 case management conference, the judge deferred a decision on whether Cherney would be allowed to give evidence by video link from Israel rather than appear in person as an outstanding Interpol arrest warrant means he would be detained if he traveled to the UK. In late July 2011, the High Court ruled that Cherney may give evidence at the trial by video link from Israel and set trial for April 2012.
Illegal wiretaps
On January 13, 2010 a Tel AvivTel Aviv
Tel Aviv , officially Tel Aviv-Yafo , is the second most populous city in Israel, with a population of 404,400 on a land area of . The city is located on the Israeli Mediterranean coastline in west-central Israel. It is the largest and most populous city in the metropolitan area of Gush Dan, with...
Court handed down its first verdict in the case of illegal eavesdropping on Cherney. Aviv Mor, a private investigator
Private investigator
A private investigator , private detective or inquiry agent, is a person who can be hired by individuals or groups to undertake investigatory law services. Private detectives/investigators often work for attorneys in civil cases. Many work for insurance companies to investigate suspicious claims...
was found guilty of illegally gathering information of personal nature - in particular, tapping the phones of Cherney and sentenced to a plea bargain
Plea bargain
A plea bargain is an agreement in a criminal case whereby the prosecutor offers the defendant the opportunity to plead guilty, usually to a lesser charge or to the original criminal charge with a recommendation of a lighter than the maximum sentence.A plea bargain allows criminal defendants to...
ed result which handed down a 14-month sentence to Mor. Part of the sentence will be in the form of community service
Community service
Community service is donated service or activity that is performed by someone or a group of people for the benefit of the public or its institutions....
and the rest will be a suspended sentence
Suspended sentence
A suspended sentence is a legal term for a judge's delaying of a defendant's serving of a sentence after they have been found guilty, in order to allow the defendant to perform a period of probation...
. The District attorney
District attorney
In many jurisdictions in the United States, a District Attorney is an elected or appointed government official who represents the government in the prosecution of criminal offenses. The district attorney is the highest officeholder in the jurisdiction's legal department and supervises a staff of...
's office stated in court that the cases of other suspects in the illegal data collection case "are at an advanced stage and close to indictment
Indictment
An indictment , in the common-law legal system, is a formal accusation that a person has committed a crime. In jurisdictions that maintain the concept of felonies, the serious criminal offence is a felony; jurisdictions that lack the concept of felonies often use that of an indictable offence—an...
." In February 2008 Cheney filed a suit in a Tel Aviv court that alleged the illegal spying was commissioned by a Russian citizen, Alexei Drobashenko who at the time was the head of the External Relations department at Basic Element, a financial and industrial group that belongs to Oleg Deripaska
Oleg Deripaska
Oleg Vladimirovich Deripaska is the Russian Chief executive officer of Basic Element company and a member of the Board of Directors and CEO of United Company RUSAL, a Russian aluminium industry company...
. Cherney claimed that it was this Russian oligarch , acting through Drobashenko, who had hired Eskin, Pridan and Mor. In his claim Mr. Cherney accused a group of 10 plotters, including Oleg Deripaska, Alexei Drobashenko and the already sentenced Aviv Mor, of illegal wiretapping, hacking the computers of his charity fund, publishing slanderous articles, and harassing him with insulting graffities and leaflets.
Personal life
Cherney owned 20 percent of the Bulgarian football club PFC Levski SofiaPFC Levski Sofia
"Levski Sofia" redirects here. For the sports club, see Levski Sofia .PFC Levski Sofia, otherwise simply known as Levski or Levski Sofia, is a professional football club based in Sofia, Bulgaria...
until he sold his shares in June 2009 following a Managing Board decision to raise capitalization.