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April 11, 2010
Sanction-busting Investigation Could Threaten Nets Deal, Atlantic Yards
Runnin' Scared
Rep. Bill Pascrell Jr. (D-NJ) tells the Post that he's requesting a Treasury Department investigation to see if Mikhail Prokhorov, the russian investor who's trying to buy stakes in both the Nets and the planned Nets Arena in Brooklyn, has violated Bush-era sanctions against doing business with associates of Robert Mugabe and his government in Zimbabwe. Prokhorov's Onexim Group, which has offices in the United States, holds a 50% stake in Renaissance Capital, which has extensive holdings in Zimbabwe.
This is not good news for Bruce Ratner, who is depending on Prokhorov's investment to get his Atlantic Yards project built.
Related coverage...
Gothamist, New Nyets Owner May Have Done Business With Mugabe
Mikhail Prokhorov's plan to buy the New Jersey Nets may be put on hold as officials look into his possible Zimbabwean holdings. Rep. Bill Pascrell Jr. of the Ways and Mean Committee will look into whether Prokhorov's companies in Zimbabwe violate rules that forbid American citizens, companies, and subsidiaries from doing business with President Robert Mugabe, known for his frequent human rights violations.
...Prokhorov's Renaissance Capital investment bank has interests in various Zimbabwean companies and banks, and was the financial sponsor of an economic forum in Zimbabwe, which is a violation of the sanctions.
...These violations could cause a block on the Nets deal, which could mean trouble for the Atlantic Yards project, which has already been delayed by eminent-domain lawsuits.
The Huffington Post, The NBA's Dirty Partner
With an estimated worth of $13 billion, Prokhorov is currently the richest man in Russia. But there are nice ways to get a billion dollars and there are not nice ways to get a billion dollars. One classic not so nice way is you deal with people nobody else will deal with. Like, for instance, Zimbabwe's president Robert Mugabe.
...One could argue that if Prokhorov wants to profit by doing business with Mugabe, well, that's his business. Unless he wants to do business here in the United States. where it happens to be illegal. The United States slapped sanctions on Zimbabwe in 2003. In 2008, sanctions were further strengthened by that old softie on human rights, President George W. Bush.
So, Mugabe must be pretty bad. But how bad?
Last year, Mugabe was rated the worst dictator in the world by Parade magazine (not exactly a left leaning bleeding heart publication.) His government denies voters their rights, brutalizes the opposition, censors the press, abuses women, inducts children into the army, and criminalizes homosexuality. His regime has a record of torturing students, journalists, even Americans. His country is recognized as one of the global leaders in the trafficking of human lives for forced labor and sexual exploitation. His nation is a place where human rights activists disappear forever.
Shorter answer: Mugabe is very bad.
...Ironically, one of the reasons the U.S. government finally cracked down on Mugabe was because of his regime's habit of "government backed land grabs." It seems the Russian oligarch might actually find this kind of behavior attractive, since the Atlantic Yards project he's investing in here is the worst government backed land grab to hit New York since they buried Robert Moses.
NBC Sports, Prokhorov guilty of skirting sanctions?
American businesses and their associates are prohibited from dealing with the repressive, widely condemned regime of Zimbabwe's president Robert Mugabe. Pascrell notes that the proposed Atlantic Yards project in Brooklyn is "financed partly by the taxpayer," and this inquiry (if it happens) could seriously complicate what had been a smooth vetting process.
NBA FanHouse, Despite New Concerns, NBA Maintains Comfort With Prokhorov's Finances
The NBA hasn't directly responded to Pascrell's charge its investigation of Prokhorov -- compulsory with every change in team ownership -- was "disgusting." In a statement given to The Post Saturday and reiterated to FanHouse Sunday, a league spokesman defended the background check, calling it "very extensive and stringent" and reiterating that nothing disclosed caused the NBA pause in its recommendation of approval to the other 29 team owners. Prokhorov needs 23 of 29 votes to be approved by the league.
When asked Sunday by FanHouse whether Pascrell had asked the league to re-open its investigation of Prokhorov or deny Prokhorov's ownership bid outright, NBA officials declined to comment. The NBA also declined to answer questions on who ran the background check, whether the background check for Prokhorov was undertaken with any more depth than those used for previous ownership bids, or whether the league planned to re-open its investigation.
Fox Sports, Nets ownership deal may be in trouble
Battle of Brooklyn via Kickstarter, It ain't over till it's over
We are continuing to make progress on our cut.
Meanwhile...... things are not looking good for the project.
Posted by eric at April 11, 2010 10:29 PM