Legends (19 page)

Martin whistled softly. “Hard to believe anyone could be more ruthless than the Cosa Nostra.”

“When the Soviet Union collapsed,” Benny went on, “thousands of gangs surfaced. In the beginning they ran the usual rackets, they offered the usual protection “

“What the Russians call a roof.”

“I see you’ve done your homework. The Russian word for roof is krysha. When two gangs offered their clients krysha, instead of the clients fighting each other if they had differences, the gangs did. The warfare spilled onto the streets in the early nineties. The period is referred to as the Great Moscow Mob Wars. There were something in the neighborhood of thirty thousand murders in 1993 alone. Another thirty thousand people simply disappeared. The smarter gangsters bought into legitimate businesses; the Russian Ministry of Internal

Affairs once estimated that half of all private businesses or state-owned companies, and almost all of the banks in the country, had links to organized crime. The infamous Tzvetan Ugor-Zhilov, known as the Oligarkh since he appeared on the cover of Time, began life as a small time hoodlum. When he couldn’t bribe his way out of one particularly messy muddle, he wound up serving eight years in a gulag camp. When he finally returned to his native Armenia, Gorbachev was on the scene and the Soviet Union was breaking apart at the seams. Working out of a cramped communal apartment in Yerevan, the capital of Armenia, Ugor-Zhilov started offering krysha. Soon he was running his own small bank and his krysha clients were made to understand that they would be smart to use its services. At some point the Oligarkh branched out and bought into the used-car business in Yerevan. But being a big fish in a small pond didn’t satisfy him, so he set his sights on Moscow he moved to the capital and in a matter of months became the kingpin of the used-car business there.”

“I heard all about his cornering the used-car market in Moscow. He bought out his competitors. The ones who wouldn’t be bought out wound up in the Moscow River wearing cement shoes.”

“The used-car racket was the tip of the iceberg. Look, Dante, you put your life on the line for Israel once and I’m going to return the favor. What I’m about to tell you isn’t public knowledge even the Sixth Chief Directorate of the KGB, which was supposed to be keeping tabs on the Oligarkh, didn’t know it. For Tzvetan Ugor-Zhilov, the used-car dealerships were merely a stepping stone to bigger and better things. Russia happens to be the world’s second largest producer of aluminum. When the Soviet system collapsed, Ugor-Zhilov branched out into the aluminum business. He somehow raised seed money I’m talking billions; his used-car dealerships were bringing in cash but not that much and to this day it’s a mystery where he got the money and used it to make lucrative deals with smelters. He did all this through a holding company in which he was a silent partner. He bought three hundred railroad freight cars and built a port facility in Siberia to off load alumina, the bauxite extract that’s the principal ingredient in aluminum. He imported the bauxite tax free from Australia, processed it at the smelters into aluminum and exported it, tax free, abroad. His profits soared. In the West aluminum brought five dollars a ton profit, in Russia it brought two hundred dollars a ton profit to the people who exported it. By the early nineties, as Yeltsin’s privatization swept across the Soviet republics in an attempt to transform Russia into a market economy, the Oligarkh presided over a secret empire with the vast profits from aluminum at its base. His holding company expanded into other raw materials steel, chrome, coal and eventually bought into factories and businesses by the hundreds. He opened banks to service the empire and launder its profits abroad. Naturally he kept the skids greased with kickbacks to people in high places. At one point there were rumors that he’d paid off Yeltsin himself, but we were never able to pin this down.” “Did the CIA’s Soviet division people know about this?” “We were the ones with assets in Moscow. We shared enough of the take with them to convince them we were sharing all of it.”

The phone rang. Benny raised it to his ear and listened. Then: “As a matter of fact, he is … He’s doing what he was doing at Kiryat Arba, trying to pick up the trail of Samat Ugor-Zhilov so his wife can get a divorce… Actually, I do believe him, yes. Let’s not forget that Dante Pippen is one of the good guys… Shalom, shalom.”

When Benny had hung up, Martin said, “Thanks for that.” “If I didn’t believe it, you wouldn’t be sitting here. Where was I? Okay. A certain number of Russian mafiosi were Jewish. When the mob wars broke out in Moscow in 1993, Israel became a safe haven for some of them. Here they were far away from the day to day mayhem. Even some of the gangsters who weren’t Jewish came to Israel under our Law of Return they concocted new identities claiming a Jewish mother or a Jewish grandmother and slipped into Israel along with the seven hundred and fifty thousand Russian Jews who came here in the nineties. As new immigrants, the gangsters were able to bring in large sums of money without anybody asking where it came from. When our Shabak people finally wised up to the danger, we tapped their phones, we infiltrated their entourages, all the time looking for evidence that the Russians were engaged in criminal activities here. But they were careful to keep a low profile. They didn’t spit where they ate, as the saying goes. We used to joke that they wouldn’t cross an intersection on a yellow light. Using Israeli banks as conduits, they continued their illegal activities, but always abroad. They smuggled uranium yellow cake out of Nigeria and sold it to the highest bidder. They bought into the diamond business, smuggling uncut stones out of Russia to Amsterdam. They could get you a diesel submarine in mint condition for a mere five-and-a-half million dollars, not counting a crew of Baltic sailors to run it that was extra. They sold Soviet surplus tanks with or without ammunition, jeeps, half-tracks, portable bridges to cross rivers, anti-aircraft missiles, radars of all sizes and shapes. Payments had to be in U.S. or Swiss currency deposited in numbered accounts in Geneva, delivery guaranteed within thirty days of the payment being received. All contracts were concluded with corporate affiliates in Liechtenstein.”

“Why Liechtenstein?”

Benny bared his teeth. “They have strict banking secrecy laws.”

“Uh-huh.”

“The Oligarkh’s brother was one of those who immigrated to Israel. His name was Akim Ugor-Zhilov. One fine day in 1993 he turned up at Ben-Gurion airport with a wife and three young children in tow, claiming that he had a Jewish grandmother and had, in any case, converted to Judaism; naturally he had affidavits to prove all this. He has a livid scar over one eye. Claims he was wounded in Afghanistan, though there is no evidence he ever served in the Soviet army. He installed himself in a heavily guarded villa in Caesarea surrounded by a high electrified wall and staffed by Armenians who served in the army and knew how to use weapons. The Russian speakers in the Mossad called them chelovek nastroeniia “moody people.” One minute Akim would scream insults at the Armenians who worked for him, the next he would be purring like a cat and bragging about his business prowess. Besides the fortress in Caesarea, he has a duplex in London’s Cadogan Place and a house on the Grande Corniche above Nice.”

“How did he make ends meet in Israel?”

“He brought in something like fifty million dollars over the years and invested it in government bonds, which earn six or seven percent interest, tax free. He also has a piece of a newspaper delivery service, a hotel in Eilat, half a dozen gas stations around Haifa.”

“Where does Samat fit into this picture?”

“Akim and Tzvetan Ugor-Zhilov are brothers. It turns out there was a third brother, name of Zurab. He was a medical doctor, a member of the Armenian Communist Party and married to a Jewish woman. When Tzvetan was convicted of shaking down local merchants and sent to Siberia, his brother Zurab was arrested as an enemy of the people under the Soviet system relatives of criminals usually suffered the same fate as the criminal. Zurab wound up in a Siberian gulag and died there of scarlet fever.”

“What happened to Zurab’s wife?”

“After the arrest of her husband, we lost all trace of her. She vanished from the face of the earth. The two brothers, Tzvetan and Zurab, had been very close, which explains, in part at least, why Tzvetan loathed the Soviet system: He blamed the communists for his brother’s death. Zurab left behind him a son named Samat.”

“Which makes Samat the Oligarkb’s and Akim’s nephew.”

“Samat was taken under uncle Tzvetan’s wing when he returned from Siberia; the Oligarkh, who had no children of his own, became a surrogate father to him. In the post-Stalinist Soviet Union, and especially after Gorbachev came on the scene, the fact that Samat’s father had died in Siberia counted for him instead of against him. Samat was admitted to the elite Forestry Institute, the not-so-secret home of the Soviet space program, where he studied computer science. Later he earned a doctorate from the State Planning Agency’s Higher Economic School. His computer skills must have attracted the attention of the KGB because the next thing we know he was working for the Sixth Chief Directorate, where he learned all there was to know about money laundering schemes and offshore banks. When the Oligarkh, offering krysha and starting out in the used-car business in Armenia, decided to go into the banking business to service his expanding empire, he turned to his nephew. Samat quit the KGB and opened the first bank for Tzvetan Ugor-Zhilov in Yerevan. And it was Samat, with a reputation of something of a genius when it came to juggling accounts and obscuring currency trails, who created the money laundering scheme under which dozens of millions of dollars were siphoned off abroad and then squirreled away in offshore banks and shell holding companies. The Oligarktis holding companies are rumored to have financial interests in a Spanish insurance company, a French hotel chain, a Swiss real estate consortium, a German movie theater chain. Thanks to Samat’s sleight of hand, the threads that linked these accounts were untraceable God knows our people tried. So for that matter did your CIA. Samat’s impenetrable labyrinth of banks stretches from France to Germany to Monaco to Liechtenstein to Switzerland to the Bahamas and the Cayman Islands, not to mention Vanuatu in the South Pacific, the Isle of Man, the British Virgin Islands, Panama, Prague, Western Samoa all of them suspected of being involved in laundering the Oligarkh’s considerable riches. He eventually opened bank accounts in North America, where a third of his empires aluminum was marketed. There were shells within shells within shells. Working out of the Oligarkh’s isolated dacha in a village half an hour from Moscow along the Moscow-Petersburg highway, Samat was constantly shifting assets from one shell to another. Wire transfers between banks, some of which consist of nothing more than a single room and a computer on some remote island, are the easiest way to move large amounts of money one billion in one-hundred-dollar bills weighs something like eleven tons. And it was said that the Oligarkh’s banker never committed anything to paper; the entire structure of his uncle’s offshore holdings was in his head.”

“Which was why it became urgent to get him out of Russia when the mob war heated up,” Martin guessed.

“Precisely. We didn’t figure out the connection between Samat and the second of his two uncles, Akim, until one of our teams watching Akim’s villa at Caesarea caught them on film Akim emerged from the villa and embraced Samat as he got out of his Honda, at which point we started looking into the identity of this new immigrant who had paid in cash when he bought a split-level home in Kiryat Arba.”

Benny offered Martin a refill and, when he shook his head no, he poured himself a short one and downed it in one gulp. It was almost as if the recounting of the story had sapped his energy.

Martin said, “Samat’s wife mentioned that he once dropped her on the dunes in Caeserea while he went to see someone. Now I know whom he saw.”

Benny’s pot-luck supper consisted of cold dishes he’d brought back in a doggie bag from an Arab restaurant in Abu Gosh and a bottle of red wine from the Golan. Martin, who didn’t eat meat, made do with the vegetable dishes. Later, Benny broke out a bottle of fifteen year-old French cognac and carefully poured some into two snifters. “There was an office bash when I retired last year,” he explained. “This was one of my going away presents, along with a jockstrap medal for long and loyal service.”

“How many years?”

“Forty two.”

“Could Israel have survived without the Mossad?” Martin asked.

“Of course. We got as much wrong as we got right. We messed up badly in seventy-three we told Golda Meir that the Egyptians wouldn’t be ready to wage war for at least ten years. A few weeks later they swarmed across the Suez canal and overran our Bar Lev fortresses stretched along the Israeli side of the waterway.”

“What went wrong?” Martin asked.

“I suppose the same thing that went wrong in the middle and late eighties when your CIA failed to predict the breakup of the Soviet empire and the demise of the communist system. Looking in from the outside, which is what I do these days, I can see that intelligence services are fatally flawed. They’re self-tasking they define the threats and then try to neutralize them. Threats that don’t get defined slip through the mesh and suddenly turn up as full-blown disasters, at which point those who are outside the intelligence community start yapping about how we’ve been asleep on the job. We haven’t been asleep. We’ve just been defining it differently.”

“They say a camel is a horse designed by committee,” Martin said. “For my money, the CIA is an intelligence agency designed by the same committee.”

Benny shrugged. “For me, Dante, it all comes down to that dead dog at the side of the road in Lebanon, the one that exploded and decapitated my son. If we had been doing the job we were paid to do, we would have anticipated the dead dog filled with PETN, and identified the terrorist behind it. I have trouble … I have trouble getting past that reality.” Benny climbed heavily to his feet. “I think I’ll turn in now, if you don’t mind. The bed’s made in the room next to the downstairs bathroom. Sleep well.”