On a warm summer evening last year, Lev Parnas stepped aboard a private cruise around New York Harbour for a gathering of some of Rudy Giuliani's closest friends.
Passengers sipped wine and cocktails while they sailed past the Statue of Liberty, singing along as another guest, entertainer Joe Piscopo, belted out Theme from New York, New York. Giuliani, a personal lawyer to US president Donald Trump, relaxed on the open deck in a bright blue polo shirt as the sun set over Lower Manhattan, a video of the event shows.
The August 2018 cruise, won in a charity auction, came at a pivotal moment in Giuliani's relationship with Parnas and his associate Igor Fruman, both Soviet-born businessmen from Florida who were among the newest entrants to his circle. Parnas had recently struck up a friendship with Giuliani while recruiting him for a business deal, but now they were on the verge of something bigger: teaming to unearth damaging information on Trump's political rivals.
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In the coming months, Parnas and Fruman helped Giuliani carry out a shadow diplomacy campaign, sweeping them into a chain of events that has led to the impeachment of a president for the third time in US history. As the impeachment began moving last Wednesday from the House of Representatives to the Senate, the story of their work together was a reminder that the case against the president is more than just a political battle in Washington.
It is about the allure of presidential power and the people who drew near to it as they sought political influence or financial gain.
The goal of the campaign, according to witnesses in the impeachment hearings and a reconstructed transcript of Trump's call with the Ukrainian president, was for Ukraine to pursue two investigations that could benefit Trump politically. One dealt with former vice president Joe Biden and his son Hunter Biden; the other centred on claims that Ukrainians meddled in the 2016 US presidential election, including a debunked theory that Ukraine – and not Russia – stole Democratic emails.
Private dinners
Parnas and Fruman had chased riches from one venture to another, with no footing in government or diplomacy. But in a trajectory emblematic of the Trump era, they emerged from obscurity to play a crucial role in the pressure campaign through a tangle of transactional relationships and overlapping interests.
First, the men bought or wheedled their way into private dinners with Trump and access to his inauguration celebration, where they could find a circle of Republican donors to invest in and advise their own business endeavours. Then, after Parnas secured Giuliani’s help for one of his business ventures in a half-million-dollar deal, Giuliani saw that they had something else to offer him: the ability to make connections in Ukraine. And so they landed at the fulcrum of an international effort that could both aid the president and anchor their future fortunes.
Parnas, now 47, was a perennial pitchman who exuded sincerity, an aspiring entrepreneur with a history of debts and aborted business ideas. He drove a Ferrari and wooed new sources of capital with boasts of ties to important people.
Fruman, a 53-year-old who spoke a mix of Russian and choppy English, had more direct links to Ukraine: He invested in a sprawl of businesses there that were once worth millions of dollars – nightspots, a beach club, a dealership selling Jaguars that was part-owned by a local politician – as well as a New York-based import-export company.
But in a sign that his fortunes had started to change, Fruman funded the men’s entry into Republican circles by refinancing a condominium in Sunny Isles, a South Florida enclave of Russian émigrés.
Together, they became ubiquitous in the Republican donor set, known simply as "Lev and Igor", a duo seemingly ripped from a movie script. This account is based on interviews with more than three dozen people in the United States and Ukraine and a review of photographs, credit card transactions, internal memos, and US and Ukrainian court documents and corporate filings.
While Parnas's Instagram posts show appearances at Republican fundraisers and Giuliani's birthday party in a Yankee Stadium owner's box, it was in private meetings at BLT Prime, the steakhouse at the Trump International Hotel in Washington, where he and Fruman became unlikely agents of the Ukrainian initiative.
Parnas did most of the talking, but Fruman’s Ukrainian ties were critical. Two people familiar with the matter said Fruman helped arrange an initial meeting between Giuliani and a Ukrainian prosecutor who claimed to have damaging information about targets of Trump.
“For what they did, they did a very good job,” Giuliani said in an interview last week. He recalled telling an associate, “They were perfect. They did everything I wanted, and they never got involved in asking questions.”
Illegal lobbying
Ultimately, none of their connections could save them. Parnas and Fruman were arrested in October on campaign finance charges brought by Manhattan federal prosecutors. Prosecutors are now investigating whether Giuliani engaged in illegal lobbying on behalf of Ukrainian interests.
Parnas and Fruman have pleaded not guilty, and Giuliani has denied wrongdoing. The president has disavowed knowing Fruman or Parnas, and Parnas, feeling betrayed, has broken with Giuliani and supplied information to Congress about his work for him and Trump. Giuliani has played down the men's role in his efforts, saying it was limited to setting up meetings.
In court last week, a federal prosecutor argued that Parnas's bail should be revoked and he should be returned to jail, citing "a pattern of misleading the government". They cited, in part, his financial ties to Dmitry Firtash, a Ukrainian energy tycoon who has been charged with bribery in the United States. A lawyer for Parnas, Joseph Bondy, disputed the government's contention and cited "his vocal willingness to stand up and to tell the truth".
Fruman has not spoken publicly since his arrest, and his lawyer, Todd Blanche, declined to comment. Giuliani said in the interview that their legal teams entered into an agreement about two months allowing them to share information.
"It's so strange how Igor became part of this scandal," said Gennady Medvedev, who owned an Asian-themed restaurant in Kiev, Ukraine, called Buddha-Bar, with Fruman and others. "If a person takes enough pictures next to famous people, he will start to believe he is an important man himself."
Meeting Trump
The first time Parnas spoke with Trump, he wanted to make a personal connection. It was October 2015, and Trump was clinging to first place in the Republican presidential primary campaign. Parnas and his 16-year-old son drove from their home in Boca Raton, Florida, to Trump National Doral Miami, a resort and golf club, for a raucous campaign rally, according to Bondy.
Before the rally, Parnas shook hands with Trump and told him of a long-ago connection to his family. As a young man in Brooklyn, he had sold co-op apartments built by Trump's father, prompting the men to joke that Parnas's son might one day work for Trump.
It was a brief but exhilarating encounter for someone who had arrived in the United States from Ukraine at age 4. His family started out poor in Brooklyn’s Brighton Beach neighbourhood. Parnas’s father died when he was 11, and his mother worked long shifts at a salon. At 15, he left school. He sold property before working for years as a stockbroker and eventually moving to Boca Raton, Florida, in 1995.
Over nearly two decades, he created or became an officer in at least 20 companies. One was a publicly traded technology penny stock called EdgeTech International Inc. Arty Dozortsev, a liquor distributor who knew Parnas from Brooklyn and said he lost $20,000 on EdgeTech, recalled his pulling up in a Rolls-Royce wearing diamonds and an expensive watch, "looking like he's worth a million bucks".
After the money from his ventures dried up, Parnas would pawn his jewellery and look for a new deal. By 2012, he had teamed with David Correia, a former golf pro, and they created a startup called Fraud Guarantee, intended to offer an insurance-like product to protect investors against scams. They worked on the idea, on and off, for the next seven years but never got it off the ground.
The pair had been sued over more than $27,000 in unpaid rent on their suite in a Boca Raton office park. Not long after that, a federal judge in New York ordered Parnas to pay $510,000 to a man who had pursued him for years over a soured movie deal. But Parnas did not behave like a man running from debts when he heard, in September 2016, of a Trump fundraiser near his home.
Crucial introduction
One night at Lique, a Miami lounge where Soviet émigrés gathered, Parnas learned that a construction magnate, Robert Pereira, wanted to host a fundraising dinner for Trump. The event would be at Le Palais Royal, the gilded mansion Pereira had modelled after the Palace of Versailles.
“I know so many wealthy people,” Parnas exclaimed, offering to recruit contributors, according to a person who heard the comment. But the dinner coincided with the close of Yom Kippur, the Jewish day of atonement, and Parnas did not bring any donors.
He gave $50,000 to attend. Trump and Giuliani were there, and Parnas met Brian Ballard, an influential Florida lobbyist close to Trump. The introduction to Ballard was brief but crucial: Parnas had gained a key to Trump World.
He built a relationship with Ballard, promising to introduce him to potential international lobbying clients. Soon after the fundraiser, Parnas flew with Pereira to watch Trump debate Hillary Clinton in Las Vegas. On election day, they flew together again to attend Trump's victory celebration in Midtown Manhattan. (Ballard and Pereira have not been accused.)
After Trump’s victory, Parnas advanced deeper into the president’s circle. He spent New Year’s Eve at Mar-a-Lago, where video footage shows him standing next to Trump. When the time came for Trump’s inauguration, Parnas secured a pricey attendee package at no cost, thanks to his connections in Florida Republican fundraising circles. The passes gave Parnas entry to a black-tie inaugural ball and, on the eve of the swearing-in, a candlelight dinner in Union Station.
Fruman, a longtime acquaintance of Parnas, joined the entourage, two people familiar with the festivities said. Parnas brought his wife and two of his sons to Washington. After years of living from boom to bust, he had never had such proximity to wealth and power. The possibilities were staggering.
Expensive watches
For the two men, the rest of 2017 did not live up to the promise that Trump's inauguration seemed to portend. Fruman was going through a divorce. Born in Belarus before moving to Ukraine, he emigrated to the United States in his 20s and later became a citizen. But most of his financial dealings remained in Ukraine, where he was active in Odessa, a Black Sea port.
A promotional brochure from about a decade ago identified him as the head of a residential property and retail company in Ukraine, Otrada Luxury Group. Real estate records suggest the business focused on residential properties and hotels. One featured a nightclub called Mafia Rave. Medvedev, his former partner in Buddha-Bar, said Fruman also owned luxury watch and high-end fashion shops. He gave other businessmen expensive watches as presents and mingled in post-Soviet nouveau riche circles.
“He never was a big businessman, but in the early days, everybody had to impress everybody,” Medvedev said. Successes were mixed with failures. Fruman sold his stake in the restaurant after the global financial crisis, according to his former partner.
A canned milk and baby food factory that he had co-owned and that had employed about 800 people went bankrupt in 2010. Last year, during a divorce hearing, Fruman said his business had “become worse and worse” and he had lost an important coffee distribution contract. Fruman told the judge he had earned about $336,000 in salary from his company in each of the two previous years. His wife’s lawyer questioned whether he had disclosed all his income.
In late 2017, Fruman connected with Parnas, who was struggling after a falling-out with Ballard and prospective business partners with whom he had explored property deals. Parnas and Fruman developed a plan to create a company that would ship liquefied natural gas to Ukraine. To do so, they needed help from US energy executives, some of whom were big Trump donors. The men decided to make political contributions, giving them access to events filled with people who might invest and provide expertise.
In February 2018, Fruman gave $2,700 to the Trump Victory committee, and he and Parnas attended a fundraiser at Mar-a-Lago for Protect the House, a committee supporting Republican candidates in the midterm elections. They ultimately committed to donating to Protect the House and giving $1 million to a pro-Trump super political action – or fundraising – committee, America First Action.
But they were short on cash. So in spring 2018, Fruman borrowed against one of his condos to make their biggest contribution yet: $325,000 to America First Action, in the name of their newly created energy company, Global Energy Producers.
Although they didn’t fulfil all of their promised donations, Parnas and Fruman attended some 10 Republican events.
‘Presidential Cheeseburger’
In late April 2018, their expedition into Republican politics brought them to Trump directly, at a private dinner in a two-level luxury suite in his Washington hotel. Mingling with the likes of Jack Nicklaus III, the grandson of the Hall of Fame golfer, Parnas and Fruman awaited the arrival of Trump.
When the president entered the room with his son Donald Trump Jr, the dozen or so guests showered them with applause, a video shows. As they ate, the conversation veered to Ukraine.
Over a dinner of the "Presidential Cheeseburger" and wedge salad, Parnas relayed a rumour that Marie Yovanovitch, then the US ambassador to Ukraine, was criticising the president – an unsubstantiated claim that Yovanovitch has denied.
The exchange foreshadowed the role that Parnas and Fruman would come to play in Trump's Ukrainian campaign. Less than two weeks later, Parnas met with another critic of Yovanovitch, Republican Congressman Pete Sessions, from Texas, in his Washington office. Parnas, who had recently met Sessions at a fundraiser, showed him a map of a crucial pipeline related to their gas venture, a photograph shows.
By the end of the meeting, though, the topic had shifted to Yovanovitch, and Parnas reiterated what he had heard. After the meeting, Sessions wrote a letter to secretary of state Mike Pompeo, saying that Yovanovitch had spoken disdainfully of the Trump administration and suggested her removal. Sessions, who lost his House re-election bid last year, has previously said he wrote the letter independently of Parnas and Fruman, after speaking to congressional colleagues.
Federal prosecutors contend in the indictment against Parnas that he was not just making small talk but sought to oust Yovanovitch “at the request of one or more Ukrainian government officials”, which could be a violation of federal laws that require Americans to register with the justice department when lobbying for foreign political interests.
The indictment did not name any Ukrainian officials. The men have not been charged with anything related to Yovanovitch, but prosecutors have said that additional charges are likely, at least for Parnas.
When the State Department declined to act on Yovanovitch, Sessions handed Parnas a copy of his letter, a person familiar with the exchange said. The congressman scribbled his name in capital letters across the back of the envelope and wrote "Mr President" across the front, photographs show. Sessions "has no memory of" the exchange, a person close to the former congressman said.
Parnas approached the president a few days later during an America First Action donor retreat at the Trump International Hotel. A photograph of the event shows Trump, next to Parnas, tucking an envelope into his own breast pocket. It is unclear whether it was the same envelope, and the White House did not respond to a request for comment.
Enter Giuliani
In mid-July, Parnas returned to the Trump Hotel to recruit a new ally: Giuliani. Parnas, who arranged for the introduction through a Miami lawyer who went to school with Giuliani, hoped to enlist him as an endorser and adviser for his passion project, Fraud Guarantee. After Parnas made his pitch, the men agreed to a deal with an initial payment of $500,000.
Correia, Parnas’s partner in the venture, notified the company’s investors of the good news, proclaiming in a letter that Giuliani was “willing to put his name and reputation on the line” for Fraud Guarantee and to “open doors”.
Parnas and Giuliani also struck up a friendship. By August 2018, Parnas was cruising around Manhattan on the boat ride with Giuliani and his friends. A month later, Giuliani brought them to his yearly dinner marking the anniversary of the September 11th attacks. Last year, Parnas named Giuliani the godfather of his newborn son.
“I happen to like him,” Giuliani said in the interview this week. “I’m not walking away from the fact that I consider them friends,” he said of Parnas and Fruman.
By early this year, their relationship had turned to a more pressing matter for Giuliani: Ukraine and, later, the Bidens' work there. In the interview last week, Giuliani credited Fruman and Parnas with arranging a meeting he had with Viktor Shokin, Ukraine's former top prosecutor who had been ousted amid accusations, including from former vice president Biden, of overlooking corruption.
Shokin could not get a visa to come to the United States, so he and Giuliani spoke over Skype. In their January 23rd call, Shokin said he had been pushed out for investigating Hunter Biden and payments he had received as a board member of a Ukrainian gas company, according to a memo summarising the conversation.
Within days of the Skype call, Giuliani met in person with Shokin’s successor, Yuriy Lutsenko. This meeting came about in part through Fruman’s connection to a regional Ukrainian prosecutor he knew from Odessa, according to two people with knowledge of the arrangements.
The regional prosecutor had travelled with Lutsenko to New York, where they met with Giuliani as well as Parnas and Fruman. In conversations over two days, Lutsenko called Giuliani’s attention to payments from the gas company to Hunter Biden.
Ukraine meetings
Federal prosecutors in Manhattan, in a court hearing last month, called Fruman “politically connected” in Ukraine, but the extent of his ties was unclear. Lutsenko and the regional prosecutor declined to comment.
Now it was time for Parnas and Fruman to hit the ground in Ukraine. In February, they set off to Warsaw, Poland, where they met with Lutsenko, who in turn could help arrange meetings with Ukrainian officials. Giuliani said that he had dinner with Lutsenko in Warsaw but that it was a purely social event. Afterward, Giuliani returned home, but Parnas and Fruman went on to Kiev.
At one point during their travels, Giuliani agreed to serve as a lawyer for Parnas and Fruman. And during their trips to Ukraine, Lutsenko helped Parnas and Fruman make contact with powerful Ukrainians. They met with Ukraine's president at the time, Petro Poroshenko. And they sipped coffee with a close aide to his successor, Volodymyr Zelenskiy.
But some of what happened is a matter of dispute. According to Parnas’s lawyer, his client offered a White House meeting to Poroshenko if he announced an investigation into the Bidens. A spokeswoman for Poroshenko said he “hasn’t conducted any kind of negotiations with Fruman and Parnas”.
Parnas's lawyer also said that his client told the Zelenskiy aide that without such an announcement, the United States would withhold financial assistance and vice president Mike Pence would stay home from the Ukrainian inauguration.
Pence ultimately did not attend, and Trump later froze nearly $400 million in military aid. Fruman’s lawyers and Giuliani have denied that any quid pro quo was offered. Trump has denied improperly withholding aid. After Trump’s suspension of the military aid and his July 25th call asking Zelenskiy to investigate the Bidens, a whistleblower’s complaint about the president’s conduct began to shine a light on Parnas and Fruman.
Arrested
House Democrats soon told the men they would be seeking documents and testimony. Parnas travelled to the Cape Cod home of John Dowd, a lawyer close to the president whom Giuliani had helped line up to represent Parnas and Fruman in the impeachment inquiry.
A few days later, Parnas and Fruman had lunch with Giuliani in Washington. They were at Dulles International Airport that night when FBI agents arrested them. Their $325,000 contribution to America First Action, federal prosecutors in New York alleged, had been illegally routed through Global Energy Producers, a company without any income. Correia, whose lawyers declined to comment, was also indicted. All have pleaded not guilty.
At the White House, Trump told reporters he did not know Parnas or Fruman. Parnas, at a detention centre in Virginia, soon concluded that Trump was abandoning him. Parnas's last moment in Trump's world came when Dowd and another lawyer, Kevin Downing, went to see him in jail. During their visit, Parnas grew angry at what he perceived as the president's betrayal, and he fired the lawyers in a tirade of expletives, according to people with knowledge of the episode.
The lawyers left, and Parnas began to consider his next move. – New York Times
