Israeli billionaire Beny Steinmetz — the embattled diamond mogul who has been a silent backer of New York real estate — will be tried by Swiss prosecutors for allegedly bribing officials to win a lucrative mining contract in Guinea.
Prosecutors who have been investigating the case for more than six years said Steinmetz and his mining company, Beny Steinmetz Group Resources (BSGR), used Swiss bank accounts in part to bribe officials and land the mining contract in 2008, according to BBC. Steinmetz and BSGR have denied the charges.
In 2016, Steinmetz was briefly detained in Israel over the allegations. Last year, Steinmetz and BSGR settled with Guinean authorities in exchange for giving up the mining rights.
In addition to his mining activities, Steinmetz has been an important background figure in New York real estate, where sources said he’s funded major developers through offshore LLCs.
Over the years, sources have linked Steinmetz to several deals with Ziel Feldman’s HFZ Capital Group, including the developer’s ultra-luxury condo project at 76 Eleventh Avenue, where units on StreetEasy are asking between $2.35 million and $14.5 million. HFZ paid $870 million for the site in 2015 and landed a $1.25 billion construction loan from the Children’s Investment Fund plus $300 million from Chinese investors through the EB-5 program. Sources said Steinmetz was also a backer — a claim that HFZ “vigorously” denied.
(Steinmetz’s nephew, Raz, helped Kushner Companies’ acquire $190 million of Greenwich VIllage property in 2012 and 2013, an investigation by Bloomberg and the New York Times found.)
More recently, the Wall Street Journal reported Beny Steinmetz, reported backer of Chrysler Building owner and HFZ, to be tried in Guinean bribery scandal that Steinmetz backed Rene Benko, the founder of Austria’s largest private real estate company, which teamed up with Aby Rosen’s RFR to buy the Chrysler building for $150 million.
Benko’s Signa Holding GmbH controls $9.5 billion worth of property, according to Real Capital Analytics. And it was his connection to majority owner Abu Dhabi Investment Council that ultimately led to the deal.
According to the Journal, Steinmetz backed Benko’s acquisition of properties in Karstadt, Germany, in 2012.
Separately, another Signa backer was Falcon Private Bank, which has been tied to the 1MDB scandal — through which Malaysian development funds were used to purchase luxury Manhattan condos and a stake in the Park Lane hotel.
Signa told the Journal that both investors were reputable when they came to the table. The company separated “immediately” when legal and reputational issues came to light.
[BBC] — E.B. Solomont