On January 15, just five days before Donald Trump vacated the White House, the U.S. Treasury informed Israel billionaire Dan Gertler that it was substantially easing the sanctions it had imposed on him for allegedly conducting corrupt business deals in the Democratic Republic of the Congo.
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Gertler’s lawyers were informed of this in a private letter. According to the letter, the sanctions imposed on Gertler starting in December 2017 would officially remain in place, but would be effectively suspended for a year. The sanctions had barred Gertler from conducting any business in U.S. dollars.
Working on Gertler’s behalf were attorney Alan Dershowitz, who had defended Trump during his first impeachment proceeding, and former FBI director Louis Freeh. Dershowitz and Freeh were both formally registered to lobby the U.S. government on the Israeli’s behalf.
Gertler was not the only person represented by Dershowitz, and it was not the only piece of good news the controversial lawyer got as Trump was clearing his desk. Of the 143 clemency requests the former president signed just before Biden’s inauguration, Dershowitz was involved in five of them, according to NBC News.
In December 2017, the U.S. Treasury imposed harsh sanctions on Gertler, as well as one of his business partners and fourteen companies associated with him. The order, which was expanded in mid-2018 to include additional companies, argued that Gertler had, “exploited his close ties” with former D.R.C. President Joseph Kabila to arrange corrupt mining transactions. The decision said that Gertler had “acted for or on behalf of Kabila, helping Kabila organize offshore leasing companies.” The loss to the local economy as a result of Gertler’s deals was $1.3 billion from 2010 to 2012 alone, the U.S. estimated.
The sanctions forbade U.S. companies from doing business with him, and banned financial institutions outside the United States from working with him in dollars. Practically speaking, the sanctions were much broader, because most banks refuse to do any business at all with people on the U.S. sanctions list. In Gertler’s case, banks in Israel and elsewhere periodically rejected payments originating with his companies even if they were in euros, because of the legal risks of accepting the funds.
It’s unclear how much effect the last minute White House move will have in reality. The fact that Gertler’s name officially remains on the sanctions list could make banks assume that providing services to him would violate their risk management policy.
The temporary license granted to Gertler was based on “information dated December 3, 2020, submitted on behalf of Mr. Dan Gertler to the Office of Foreign Assets Control.” It does not go in the specifics of the information provided, but according to a U.S.-based legal expert familiar with this kind of proceedings, examining a request for sanctions relief or suspension in six weeks is inordinarily fast. According to the source, the urgency stemmed from the change of government.
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The license is valid until January 31, 2022, and is conditional on the full compliance of Gertner and his business partners with the law. The sanctions will take effect again after the expiration date, unless the license is extended. In the meanwhile, it “may be revoked or modified at any time,” the letter issuing the license said.
In July 2020, The Marker published an investigation detailing the behavior of Gertler and his associates after sanctions were imposed in 2017. Realized in collaboration with Bloomberg, Le Monde, the Paris-based Platform to Protect Whistleblowers in Africa (PPLAAF) and Global Witness, the ‘Congo Files’ revealed that unusual deposits had been made at the Afriland Bank in Congolese capital Kinshasa, by people associated with Gertler. The sums, which reached millions of dollars and euros, were deposited while many international banks rejected transactions originating from the Israeli tycoon's businesses.
Welcoming the issuance of the license, Boaz Ben Zur, Dan Gertler’s attorney, said that “an orderly and fact-based process took place with the Office of Foreign Assets Control, after which it was decided to trust Dan Gertler and remove all sanctions for a certain period. We welcome this step.”
Disclosure: Dan Gertler has sued TheMarker for the sum of 9 million shekels (around $2.25 million), following the ‘Congo Files’ investigation. The newspaper continues to stand behind the story. Read the full report here.