Case 1:18-cr-00602-WHP Document 48 Filed 07/18/19 Page 1 of 2 U.S. Department of Justice [Type text] United States Attorney Southern District of New York The Silvio J. Mollo Building One Saint Andrew’s Plaza New York, New York 10007 July 18, 2019 BY ECF The Honorable William H. Pauley III United States District Judge Southern District of New York 500 Pearl Street New York, NY 10007 Re: United States v. Michael Cohen, 18 Cr. 602 (WHP) Dear Judge Pauley: Pursuant to the Court’s February 7, March 18, and July 17, 2019 orders, the Government attaches redacted copies of the search warrant materials that were the subject of these orders, as well as a redacted copy of the Government’s July 15, 2019 status letter. An index of the attached documents is provided below: Exhibit 1 – 18 Mag. 2969. April 8, 2018 application, affidavit, and search warrants for four premises and two cellular phones associated with Michael Cohen. Exhibit 2 – 18 Mag. 2698. April 9, 2018 application, affidavit, and search warrant for a hotel room associated with Michael Cohen. Exhibit 3 – 18 Mag. 1696. February 28, 2018 affidavit and search warrants for email accounts used by Michael Cohen and three other individuals. Exhibit 4 – 18 Mag. 1697. February 28, 2018 application, affidavit, and search warrant for a device containing the results of three prior search warrants of email accounts used by Michael Cohen. Exhibit 5 – 18 Mag. 2877. April 5, 2018 affidavit and search warrant for out of jurisdiction attachments from email search warrant included in Exhibit 3. Exhibit 6 – 18 Mag. 2958. April 7, 2018 application, affidavit and search warrant for three devices containing the results of prior search warrants of email and iCloud accounts used by Michael Cohen. Exhibit 7 – 18 Mag. 2957. April 7, 2018 application, affidavit and search warrant for cellphone location information for two cellular phones used by Michael Cohen. Case 1:18-cr-00602-WHP Document 48 Filed 07/18/19 Page 2 of 2 Page 2 Exhibit 8 – 18 Mag. 2974. April 8, 2018 affidavit and search warrant for cellphone location information for two cellular phones used by Michael Cohen. Exhibit 9 – Government’s July 15, 2019 status letter. Respectfully submitted, AUDREY STRAUSS Attorney for the United States, Acting Under Authority Conferred by 28 U.S.C. § 515 By: __________________________ Thomas McKay / Nicolas Roos Assistant United States Attorneys (212) 637-2200 cc: Counsel of Record (by ECF) Case 1:18-cr-00602-WHP Document 48-1 Filed 07/18/19 Page 1 of 269 AO 106 (Rev. 06/09) Application for a Search Warrant UNITED STATES DISTRICT COURT for the Southern District ofNew York In the Matter of the Search of (Briefly describe theproperty to be searched or identify the person by name and address) Four Premises and Two Electronic Devices, See Attached Affidavit and Riders ) l cliSMAG 2969 APPLICATION FOR A SEARCH WARRANT under I, a federal law enforcement officer or an attorney for the government, request a search watTant and state the or describe person the (identify property or person following the on that believe to reason have I th.11t _ _ __ penalty of perjury - -------T:e-r-s ~--R::-id -:: --:it-a-nd v::=a--1d m=prf~ITP'P~JJir:ii~w'cf~v~(g'Jfr~~1t-6evices, See Attached A-= _ _ _r_n _u_th_e located in the ___ · S_o , there is now concealed (identify the ____ District of _ _ _ _ _N_e_w_Y_o_r_k person or describe the property to be seized): PLEASE SEE ATTACHED AFFIDAVIT AND RIDERS. The basis for the search under Fed. R. Crim. P. 41(c) is (check one or more): iefevidence of a crime; iefcontraband, fruits of crime, or other items illegally possessed; r,Jproperty designed for use, intended for use, or used in committing a crime; 0 a person to be arrested or a person who is unlawfully restrained. The search is related to a violation of: Code Section 18 u.s.c.s 371, 1005, 1014, 1343 and 1344, and 52 USC 30116 and 30109 Offense Description Conspiracy,false bank entries, false statements to a financial institution, wire fraud, bank fraud, and illegal campaign contributions The application is based on these facts: PLEASE SEE ATTACHED AFFIDAVIT AND RIDER. ~ Continued on the attached sheet. ) is requested _ _ days (give exact ending date if more than 30 days: ___ 0 Delayed notice of under 18 U.S.C. § 3103a, the basis of which is set forth on the attached sheet. I ,tjtle 'ctr.d. Prinfe,dha;he (-_ i '. { ·, Sworn to before me and signed in my presence. Date: / ~ ~ City and state: JVkk: 14/ \;'_': I _I I I I -,, / :. ·£/' , /~'./,'·,' 1 ' y_ , ~ - ,__ /{ ~ , - I ' ._, --2..._ ~ , ' --:V -:l .. ;,-_7Judge's sign(ltJ.Jre', · .-· ~ :l-t/ '('i) y ,,j2 le. r. Ii/ ,,,;. , f;..t-·fr } ,., ----=---- 04/08/2018 - \ { _.• ·. ) '. '/, . •.• . \: _:.•Ii \' ; ' ' , ·~...,~---<--_ _ __- _.. 30';L,017-(the"September-201'7 -Financial-Staten1ent11.) ____ - --- - --- - =--~ --- o. Like the May 2017 Financial Statement, the September 2017 Financial Statement e, that included a cover letter from Jeffrey Oetzel, Cohen's accountant, stating, in sum and substanc accuracy the information in the statement came from Cohen, and that Oetzel had not confirmed its assets of or completeness. The September 2017 Financial Statement stated that Cohen had total Notably, $33,430,000, total liabilities of $45,630,000, and a negative net worth of $12,200,000.13 Statement unlike Cohen's May 2017 Financial Statement, the September 2017 Financial Financial represented to Sterling that Cohen had a negative net worth. The September 2017 000 in Statement indicated that Cohen's assets were comprised of $1,250,000 in cash, $17,630, ), closely held companies (including the taxi medallion entities and his real estate holdings 14 the first $3,200,000 in real estate investments, and his $11,000,000 personal residence (which, for in Based on my review of Cohen's financial statements, I know that this further decline assets assets can be explained primarily by reported depreciation in the value of Cohen's real estate and medallion investments. 14 Notably , the September 2017 Financial Statement valued each of Cohen's thirty-two New than the York taxi medallions at approximately $180,187.50, which was considerably less sheet. term $650,000 valuation ascribed to each medallion in the Cohen--13 19 2017 .08.02 I --- I 1 I l l • I I Case 1:18-cr-00602-WHP Document 48-1 Filed 07/18/19 Page 20 of 269 time, he indicated was held by a trust). 15 The September 2017 Financial Statement included assets and liabilities not held in Cohen's name, such as various entities associated with his taxi medallions and some of his real estate investment entities. p. From my participation in an interview with Sterling Employee-2, and my review of records maintained by Sterling, I have also learned that around the time Cohen provided Sterling with these financial statements-i.e., in or around September 2017-Cohen stopped paying ~ -t0-Sterling-Employee- -- - -- ---Acc0rding "lu-an-payments -on-his·taxi-medallion -loansaltogethe1';---'mcmtl1lY 2, Cohen informed Sterling, in sum and substance, that he had insufficient funds to pay the monthly principal and interest payments on his medallion loans. By in or about December 2017, Sterling and Melrose had not been paid approximately $276,937.92 in monthly principal and interest - f§ --'-- t •i f~ I payments on the medallion loans. Based on Cohen's financial condition as conveyed in the September 2017 Financial Statement, and his delinquency in making payments to Sterling, among other things, the bank's credit underwriting committee determined (and memorialized in a December 2017 memorandum) that the Cohen-'- that is, that - transaction was favorable for the bank would be a better borrower than Cohen. q. On or about December 26, 2017, Sterling sent Cohen a demand letter requesting the immediate receipt of past-due loan payments. The demand letter was addressed to Cohen at Subject Premises-I. On December 29, 2017, Sterling sent Cohen a letter stating that he was in default under the loans between Sterling and Cohen's medallion corporations. The notice of default was addressed to Cohen at Subject Premises- I. Cohen did not make an ilmnediate payment on the loans, but instead sent an e-mail to Sterling Employee-I on or about January 24, 2018, I on my review of property records maintained by the City of New York, and my participation in an interview with Getzel, I know that in 2015, Cohen transferred his residence to a trust. He did not disclose that transaction to Getzel or Sterling until in or about September 2017. 15 Based 20 2017.08 .02 I Ir ' Case 1:18-cr-00602-WHP Document 48-1 Filed 07/18/19 Page 21 of 269 transaction, Cohen would "bring all stating that during the closing of the Cohen• payments up to date as well as deposit the payoff differential." Cohen also requested by email on January 24, 2018, that at the closing of the Cohen- ' transaction, Sterling provide a letter stating that all of Cohen's debts have been satisfied and that Cohen's personal guarantees of the medallion loans had been terminated. transaction, however, did not close. On or about January r . The Cohen-- -------------- ----:29;-2ot8;-th-e- '-attorney -emailed -attomeys-for-Sterling --and-stated-that~at -this -time :-- - - - - ---;!J there is no deal with Michael Cohen. Some of the numbers have changed and we are not prepared iii tr I ff to go forward." I ii s. Based on my participation in the interview with Sterling Employee-2 and my ; I foal fell apart, review of records maintained by Sterling, I know that after the Cohen- Sterling assigned Cohen's loans to Sterling Employee-3, who specializes in collecting on defaulting loans. From my participation in an interview with Sterling Employee-3, my review of telephone call notes taken by Sterling Employee-3, and my review of telephone records, I lmow that Sterling Employee-3 spoke several times to Cohen on or about January 30, 2018 about paying down and/or restructuring Cohen's outstanding taxi medallion loans. On the calls, which in total lasted more than an hour, Cohen stated in sum and substance that he did not have more than $1,250,000 to pay toward the medallion loans. On the call, in the course ofreviewing the failed transaction, Sterling Employee-3 questioned Cohen about the price rvasto have paid for each medallion, and whether there was a side agreement between Cohen and t. . Cohen denied that there was any side agreement with On or about January 31, 2018, Cohen emailed Sterling Employee-3 and proposed paying $500,000 to bring the loans current and $750,000 to bring the principal balance to 21 2017.08.02 I I Case 1:18-cr-00602-WHP Document 48-1 Filed 07/18/19 Page 22 of 269 $20,500,000. Cohen also suggested revised monthly interest payment amounts. The signature On or block on the email indicated that Cohen's address was the address for Subject Premises-2. sum and about January 31, 2018, Sterling Employee-3 responded to Cohen and stated, in down the substance, that Cohen would need to pay the entirety of the overdue payments and pay 00), principal balance of the loan to $20,000,000 (in total, a payment of approximately $1,750,0 and would need to make larger monthly interest payments. - - ----~·u:--anor-abourFel5ruary -t;-2018; Cohen-emailed-Sterling-Employee--3-and-proposed-------- waive "[p ]ayment of $1.250m which ALL can be used to pay down principal, if [Sterling] will original.) past due amounts," but stated "I do NOT have more than the $1.250m." (Emphasis in to post Cohen also stated, in sum and substance, that he had insufficient financial resources indicated additional collateral or pre-fund monthly payments. The signature block on the email in an that Cohen's address was the address for Subject Premises-2. Based on my participation has interview with Sterling Employee-3, I have learned that since January 30, 2018, Sterling about continued to renegotiate the medallion loans with Cohen based on Cohen's representations Sterling his current financial position. In particular, according to Sterling Employee-3, Cohen and t to have an agreement in principal to restructure Cohen's loans based in part of Cohen's agreemen become make a principal payment of approximately $750,000, to make a payment of $500,000 to monthly current on interest payments, and to post $192,000 in cash collateral for his future payments on the loan. Cohen also agreed to pledge an interest he had in a property. Sterling to him, Employee-3 has stated that had Cohen indicated he had more than $1,250,000 available amount Sterling would have, among other things, negotiated for a larger reduction to the principal of the loan. 22 2017.08.02 Case 1:18-cr-00602-WHP Document 48-1 Filed 07/18/19 Page 23 of 269 (ii) Cohen Made Material Misrepresentations About His Finances to Banks Cohen Concealed from Sterling and Melrose Cash Derived from Consulting Work 17. As set f011h in detail below, despite multiple written and oral representations by Cohen to Sterling (and, by extension, Melrose 16) that he had insufficient funds to pay down the principal balance of the medallion loans, make monthly interest payments, or pay past-due amounts, it appears that between 2016 and the present, Cohen opened and maintained bank _receivecl.millions__oLdollars,jA_ _ __ - - - -- - aGGounts-at - First-Republic-Bank - (-'-=Eirst-Republic::.),-ancLthen _ _ __ I [ consulting payments in these accounts, which he did not disclose to Sterling. Cohen set up these accounts and received these funds during the very period in which he made disclosures to Sterling about his personal finances (including his assets and liabilities) and his ability to make payments on the medallion loans. In these disclosures to Sterling-and accounts by his accountant-Cohen despite being asked about these bank misled the bank by claiming he had insufficient liquidity to satisfy his obligations or meet the bank's demands, while withholding information about these ongoing revenue streams and liquid financial assets at First Republic. 18. Specifically, based on my review of documents and bank records produced pursuant to a subpoena by First Republic, and my participation in and review of reports of interviews with a First Republic sales manager (''First Republic Employee-I") and a First Republic senior managing director ("First Republic Employee-2"), I have learned, among other things, the following: 16Based on my review of a report of an interview conducted with an employee of Melrose, I have learned that, pursuant to the pa11icipation agreement between Sterling and Melrose, Cohen's financial statements and other records in Sterling's possession were forwarded to Melrose so that Melrose could make a determination as to whether to approve of the Cohen- 'transaction. Based on my review of reports of interviews with Melrose employees, I also know ansaction. that Cohen called employees at Melrose regarding the Cohen--t 23 2017.08.02 • I Case 1:18-cr-00602-WHP Document 48-1 Filed 07/18/19 Page 24 of 269 a. Cohen and his wife have been customers of First Republic since approximately his own June 2011. Cohen controls several checking and loan accounts at First Republic, some in urname and others in the names of corporate entities. According to First Republic's know-yo 17 -I. customer records on Cohen, his primary physical address is the address for Subject Premises b. On or about October 26, 2016, in Manhattan, New York, Cohen opened a new l checking account at First Republic in the name of Essential Consultants LLC (the "Essentia ing-toConsultants Account")--:-Tohen was tlie only autho-rized-signatmyon-the account;~.Accord address account opening documents, the primary address for Essential Consultants LLC was the for Subject Premises-I. When Cohen opened the Essential Consultants Account, First Republic urEmployee- I conducted an in-person interview of Cohen. In response to a series of know-yo customer questions about the purpose of the account-the 18 Employee-I entered into a form -Cohen answers to which First Republic stated, in sum and substance, that he was opening g Essential Consultants as a real estate consulting company to collect fees for investment consultin States. work, and all of his consulting clients would be domestic individuals based in the United keep the Cohen also stated, in sum and substance, that his purpose in setting up the account was to revenue from his consulting business-which he said was not his main source of income-separate Cohen's from his personal finances. As set forth below, there is probable cause to believe that were statements about the intended purpose of the account and source of funds for the account not false. Specifically, as described below, the account was not intended to receive---and does Certain financial institutions are required to conduct such procedures pursuant to the Bank . Secrecy Act and its implementing regulations. See 31 U.S.C. § 5318; 31 C.F.R. § 1020.220 18 First Republic Employee- I first filled out the form on the day he interviewed Cohen, October l, First 26, 2016. On or about December 19, 2016, at the request of bank compliance personne ts. statemen Republic Employee-I updated the form to add more detail about Cohen's 24 17 2017.08.02 Case 1:18-cr-00602-WHP Document 48-1 Filed 07/18/19 Page 25 of 269 appear to have received-money in connection with real estate consulting work; in addition, the account has received substantial payments from foreign sources. c. I know from my review of First Republic bank records that were scheduled by an Cohen FBI forensic accountant that after Cohen opened the Essential Consultants Account, the received payments into that account from foreign businesses and entities that do not reflect lly, stated client profile for the residential and commercial real-estate consulting services. Specifica ------frcmimy review ohhe-Essential-eonsultants-Account-schedule-and-publiG-sources,Tknow-the----~--- following: i. Beginning on or about January 31, 2017, Cohen began receiving monthly s Nova payments of $83,333 into the Essential Consultants Account from an entity called Columbu d LLC. According to public sources, Columbus Nova is an investment management firm controlle d by Renova Group, an industrial holding company based in Zurich, Switzerland that is controlle by Russian national Viktor Vekselberg. From January 2017 to August 2017, the Essential LLC. Consultants Account received seven payments totaling $583,332.98 from Columbus Nova ii. Beginning on or about April 5, 2017, the Essential Consultants Account began receiving payments from Novartis Investments, SARL, which I believe to be the in-house is"). financial subsidiary of the Swiss pha1maceutical company Novartis International AG ("Novart wire Between April 2017 and Februaiy 2018, the Essential Consultants Account received eleven 0, payments from a Swiss bank account held in the name ofNovartis, each in the amount of$99,98 for a total of $1,099,780. iii. Beginning in or about April 2017, the Essential Consultants Account started receiving wire payments from a bank account associated with the telecommunications company to the AT&T Inc. ("AT&T"). Specifically, on or about April 14, 2017, AT&T sent $100,000 25 2017.08.02 Case 1:18-cr-00602-WHP Document 48-1 Filed 07/18/19 Page 26 of 269 the Essential Consultants Account and, from in or about June 2017 to in or about January 2018, sent Essential Consultants Account received ten $50,000 payments from AT&T. In total, AT&T $600,000 to the Essential Consultants Account. iv. On or about May 10, 2017, June 9, 2017, July 10, 2017, and November 27, 2017, the Essential Consultants Account received four deposits in the amount $150,000 (totaling was $600,000) from a bank account in South Korea. The account holder from which the money -- - . . that- -sent 1sKorea AeI·ospace IndustriesLt