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Special masters eyed for Cohen probe all have RE fraud experience

One former judge could be selected to weed through seized records to determine existence of attorney-client privilege

From left: Frank Maas, Michael Cohen, Theodore Katz and James C Francis IV (Credit: Getty Images)
From left: Frank Maas, Michael Cohen, Theodore Katz and James C Francis IV (Credit: Getty Images)

Following the raid of Trump attorney Michael Cohen’s hotel room on April 9, prosecutors in Manhattan have been making the case for internal control over the review of the records they seized, which were taken in connection with an investigation of Cohen and his personal business dealings.

Cohen, who joined the Trump Organization in 2006 and remained Donald Trump’s personal attorney after he was elected president, has been under criminal investigation for months, the Justice Department revealed last week.

Cohen’s attorneys asked Judge Kimba Wood to employ a “special master” to preside over the seized records and determine if their usage in the investigation would violate attorney-client privilege laws. Prosecutors have insisted that no special master is necessary, given what they see as Cohen’s weak arguments that he has any real clients apart from President Trump. But in the event that Wood appoints a special master anyway, prosecutors have recommended three judges for the post, all of whom, it turns out, have experience with cases involving fraud or money laundering in real estate.

The lawyers, however, are being chosen for their expertise in electronic discovery and attorney-client privilege. They would simply make determinations as to whether certain records can be viewed and would not participate as investigators.

Frank Maas, a former federal judge in the Southern District of New York, assisted in a 2016 case brought by Preet Bharara against Rockwell Gajwani, the CEO of Manhattan real estate firm Trevi Retail, who pleaded guilty to charges of tax evasion and embezzling $1.6 million from his real estate business. (The company is now known as Hubb NYC.)

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Another recommended special master, retired federal judge James C Francis IV, assisted the bench as a magistrate judge during the 2017 prosecution of Robert Guzman, a Bronx man accused of running an apartment search scam that charged customers to view apartments but then never showed them. Francis was also involved in a $100 million Russian money laundering case in 2013 that alleged the laundering of illicit funds into American real estate via Cyprus shell companies.

The third recommended special master, former federal judge Theodore Katz, did pre-trial work on two civil cases involving some of New York real estate’s biggest names. A decade ago, pre-trial, Katz supervised a $750 million lawsuit brought by investor Leslie Dick against Donald Trump, Sheldon Solow, Harry Macklowe, George Soros, Conseco, Vornado Realty Trust and other plaintiffs, accusing the latter parties of participating in a money laundering and bid-rigging scheme in their own hunts to buy the General Motors Building in Midtown. (Trump and Conseco had sold the building to Macklowe in 2003 and Dick’s suit was eventually dismissed.)

The other civil case Katz supervised also involved Sheldon Solow, who sued Conseco and Macklowe over the sale of the GM building. Solow eventually dropped his suit.

Cohen did not immediately respond to a request for comment. His attorneys previously submitted their own choices for special master. They include Bart Schwartz, who previously worked under Rudolph Giuliani when he was a U.S. attorney. Giuliani announced Thursday he is joining President Trump’s legal team at the White House.

The investigation into Cohen, which includes possible concealment and suspected fraud, began on a referral of information from Special Counsel Robert Mueller’s office. Mueller is investigating potential collusion between the Trump campaign and Russian nationals in the 2016 presidential election, but the Trump real estate empire has come into increasing focus. Among the items of reported interest are emails to Cohen from Trump Soho co-developer Felix Sater, in which Sater discussed the development of a Trump Tower in Moscow and says he will get Russia President Vladimir Putin to help get Trump elected. “Our boy can become president of the USA and we can engineer it,” Sater wrote in a 2015 email to Cohen. “I will get all of Putin’s team to buy in on this, I will manage this process.”

Last Friday, after prosecutors rejected Cohen’s initial attempts to protect his records from their scrutiny, Cohen was spotted puffing on cigars with real estate investor Rotem Rosen and Deutsche Bank executive Jerry Rotonda.

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