Clare Bronfman [left] with her sister Sara Bronfman-Igtet.

NDNY Should Investigate Commodities Loss and Bronfman’s Fraudulent Treatment as Loan

Nxivm leader, Keith Raniere “lost” $65.6 million of the Seagram’s heiresses, Clare and Sara Bronfman’s money in the commodities market from 2005-2007.

In fact, I was fired as Nxivm’s consultant right after I uncovered this fact. This was right after I recovered $26 million for the sisters in Los Angeles real estate.

Clare Bronfman said she did not know how the commodities money was invested. She trusted Keith. She and her sister told me they knew their powerful father, Edgar Bronfman Sr., had manipulated the commodities market to make them lose their money – to hurt Keith and to drive a wedge between them and Keith.

Clare added that the World Jewish Congress and the Illuminati worked with their father to make sure Keith was stopped. Otherwise, Keith would “break the bank”. He would upset the entire world markets because he was so good at investing.

I suspected she believed what she told me.

I told her I wanted to investigate. I asked for her commodities records.

She had none.

I said, “You have nothing to show – not one receipt or record – for the $65 million you lost?  Do you even know what commodities you invested in? Such as corn or orange juice or…”

“I trust Keith. He had a plan to control much of the world’s wealth but my dad stopped it. But it worked out well because Keith learned a very valuable lesson on how secret and powerful organizations control world markets. In our next investment, Keith will use this data to correct things.”

“But your next investment after the commodities was the real estate investment in Los Angeles and, except for me, you would have lost most of your money in that also.”

“My sister and I are grateful to you for that. But that was not Keith’s fault [Keith had guided the LA real estate investment also]. I am not saying I know this for certain but I think my father manipulated the Los Angeles real estate market causing it to decline. He will do anything to stop Keith.”

I said, “Would you ask Keith to share the commodities records so I can see if your commodities broker cheated you? Maybe it was not your father, but someone else caused you to lose $65 million. You don’t even know what you invested in. I want to see actual trades so I can see if they correspond to the market. Did you really lose the money because of the trades Keith made? Did your dad adjust the markets or did someone else swindle you? How do you even know the money was actually invested in commodities?”

“I’ll ask Keith,” she said.

Within 24 hours I was fired as their consultant.

As I reflect on this, it seems that there are three possible scenarios to explain what happened to the $65.6 million.

  1. Raniere invested the Bronfman’s $65.6 million through a series of bad commodities investments and lost their money.
  2. The Bronfman sister’s father really used his immense wealth and influence to conspire with the commodities clearing houses to cause drops in prices in commodities Raniere invested in  – as Raniere claimed.
  3. Raniere stole the money.

One source told me: “It’s not hard to lose money on purpose in commodities futures. Raniere could steal millions while making it look like the Bronfmans lost the millions. Here’s how: Raniere sets up company A, and tells the girls about it.  He also sets up company B, through a different broker, and doesn’t tell anyone about it.

“He uses company A to take a losing position in the market, like a contract to deliver frozen orange juice concentrate 6 months in the future at well below expected market price.

“He then uses company B to secretly buy that contract.  In 6 months, company B demands delivery from company A.  Company A needs cash to do that.  So he asks the girls to ‘loan’ him money, so company A can deliver to company B.  Company B puts the profit in an offshore account that he has access to.

“The net result is it looks like he has lost money in the market, and has records to prove it. But actually, he just paid the money to himself and hid it offshore.

“I’m oversimplifying because if company A only contracted with company B, he could get caught.  So there could be many company Bs. Even better, company B only buys 10% of the losing market position, with other legitimate companies buying the rest. Company B gets lost in the noise.  Only 10% of the girls’ money goes into his offshore account, but that’s still plenty, and the chance of getting caught is minimal.”

Using this method, Raniere could deliberately lose the Bronfman’s money and steal as much or as little as he liked.

The record shows Bronfmans lost $65.6 million. An investigation is warranted.

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Keith Raniere (above) advised the Bronfmans to invest in the commodities futures market. He also handled the investments directly with the broker. He lost $65.6 million of their money.

Some might say, who cares if two dunces lost $65 million.

Besides, Raniere is likely to be sentenced to prison for decades and Clare Bronfman is going to prison or a couple of years.

But she might still face more charges in the NDNY.

This commodities scheme might be a fertile field to charge Sara Bronfman with racketeering.

That because the two sisters booked the loss as a “loan” to Raniere’s company First Principles – and even claimed they had earned interest on the loan so that their father would not find out about it.

I saw their records. At the time, I did not realize that they had given the money as a gift to Keith, not lent him the money.

This was an attempt on their part to defraud the IRS.

Rather than making Keith liable for a huge gift tax [in the millions] as regards the $65 million, the Bronfman’s actually paid tax on non-existent [phantom] interest [Keith did not pay any interest to them].

Yet the Bronfman’s actually claimed they received something like $200,000 per year from their “loan” of $65 million to First Principles.

Clare told me that she had to make it look good for her father and the trustees – so she showed they were making $200,000 per year in income. They really weren’t. It was a lie.

At the time, I thought it was just a foolish lie – their paying income tax on income they were not actually receiving.  It was only later that I realized that they conspired with Keith so that he could evade as much as $10 million in gift taxes. They knew he had no plans to pay them back.

While the statute of limitations may have expired on the tax fraud aspect of this, it could, I suspect, be included as a predicate act in new racketeering charges that can include Sara Bronfman.

Since Sara has considerable assets that could be seized – and she played one of the greatest roles in the racketeering enterprise – she could be a worthy target for the DOJ NDNY.

Stay tuned.

 

About the author

Frank Parlato

Frank Report’s founder and lead writer Frank Parlato is one of the internet’s most decorated investigative journalists. His writing and investigations have helped expose major criminal organizations and scandals.

Frank’s work has been cited in major publications all over the world, including The New York Times, New York Post, The Daily Mail, VICE News, CNN, Rolling Stone, and more.

He is also the publisher and editor-in-chief of Artvoice, The Niagara Falls Reporter, Front Page and the South Buffalo News.

27 Comments

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  • Can someone let Clare Bronfman know I’m selling some magic beans for $30 mil. Guaranteed to get rid of her troubles.

    Seriously though, what turnip truck did she fall out of? Or is she with an iq of about 60.

  • Nope, none of that. Having worked for Morgan Stanley for 20 yrs…

    This is what happened. A speculator can leverage 10 ~1. So 10mm can invest a 100mm.

    So what happens when those trades turn against you. You’re in deep trouble.

  • This is an answer to Heidi’s post.

    I highly doubt that any churning happened.

    Investing for high net worth people doesn’t involve ‘churning’. Brokers have an incentive not to churn when the amount invested is that high, since the structure of the trading agreement doesn’t allow churning.

    Also, Keith’s specific trading scheme wouldn’t have given the brokers carte blanche to churn at their leisure, so I doubt very much that actually happened.

    I don’t know how the full $65 million was handled, nor do I care.

    However, based on her postings here, I do know that a $1.5 Million loan was given to Keith (by Barb Bouchey) where she claimed that he owed her that money after he lost it while trading in the market.

    Based on her postings here, I can surmise that Barb’s $1.5 Million loan to Keith was not accounted for in accordance with IRS guidelines because the IRS never knew that Keith had received $1.5 million in loan proceeds and controlled that money. The IRS never received 1099’s showing that Keith owned those banking/trading accounts. That’s not kosher.

    If anybody in America walks into a bank or brokerage firm and opens an account for $50, they’ll have to supply their own SSN for IRS reporting. It’s not optional.

    Can you explain how Barb could be his financial advisor for years — while personally loaning him $1.5 million — yet she never transferred any of that money to an account bearing Keith’s own SSN?

    She never sent the IRS a single 1099 bearing Keith’s SSN for any of Keith’s accounts/investments which she supposedly handled over the years.

    Keith was the invisible man but he could not have done this alone for so many years.

    • I’m not here to quibble with your banal bullshit Bangkookery. You admit you know as little as I do about “how the 65M was handled” but unlike me you admit you “really don’t care.”

      I care bc I know, I lived the backstory of Keith Raniere’s madness which was/is intimately intertwined with living and deceased members of my own family and, unfortunately, continues to effect my life and that of some of my relatives in Clifton Park, New York (mostly) due to NXIVM’s relentless harassment of us and meddling in our family dynamics from near and far. That’s how, like most cults and MLM Ponzi schemes, they work over their “clients.”

      That’s how NX set-up the Bronfman’s — pitting the girls and their mother against their father and brothers, even had them competing with one another and others for Keith’s attentions, etc.

      There is a larger context for everything and sometimes it’s worth making mention of for anyone interested in preventing, avoiding or learning from this tragedy.

      Brokers churn fees on a daily basis — it’s their bread & butter, their motivation to face those mosh pits and phone banks — bull or bear market; win, lose or draw for their often hapless “clients” and Goldman Sachs is one of the worst offenders.

      IMHO, their leverage over the Bronfman accounts may also help explain why Raniere wasn’t stopped cold when it became clear to at least a few regulators who duly issued warnings that someone of very high net worth was getting played in the commodities market.

      I mean, c’mon, when my true “genius” brother — whom Keith attempted to imitate — used a similar corny formula while trading for E.F. Hutton from his own office at the age of 15 — to ‘unintentionally’ bilk a few Arab princes out of far less millions, the FBI was knocking on our door in short order!

    • Poor little Retard boy, still having nightmares over Heidi? Amazing how we have so much simple minded obssesive individuals here in the comments section. Hey man, go take a beer and have fun, yes, it s not a rumour, there is a life outside!

  • I don’t think Raniere is actually clever and foresightful enough, financially, to pull off something like that. And, if he had planned that well, then he’d be sitting enjoying himself in some haven that has no extradition treaty with the US, not in jail.

      • I think he was convicted on eight counts with the same child, Scott. Even so, there will probably be more victims and it seems there were older females grooming the child. Sounds familiar. Salerno adopted the name Taipan. I completely agree that his sentence is ludicrous. Sentencing is no better in the UK.

        • Yes, I misread the story. And I agree, one year for each f*cking session isn’t nearly enough, and he probably did it many more times than just eight. How much time do you think he will actually spend in prison?

  • Goldman Sachs knows where at least some portion of the money went — to their brokers churning fees on those day trades. Regulators noticed — how do you miss $65M? — and issued just a wee, little “warning.”

  • Oh, I just wanted to add one thing to my previous post…

    Frank, you’re an asshole and an enemy of free speech. 🙂

  • The broker or financial advisor who facilitated these transactions on Keith’s behalf would largely be on the hook — along with Keith too obviously — for ‘obfuscating’ or ‘hiding’ Keith’s involvement in these transactions (i.e., keeping Keith’s SSN omitted from financial records that the IRS would require to be kept).

    Sorry Frank, but Keith’s Social Security Number was purposely kept hidden from every investment account, shell company and bank account that he had CONTROL over. The IRS won’t just stop with investigating Keith, they’ll want to know WHO helped him to keep his SSN hidden.

    Keith didn’t have the power to do that all by himself.

    If a person ‘owns’ or ‘controls’ an account or asset, the company/trader/banker who acts on behalf of that person must disclose the client’s true SSN on various documents and/or 1099’s for the IRS.

    Frank, you have no clue about this stuff. Your financial knowledge is akin to a retard opening a lemonade stand.

    I’m guessing that you wish to protect this person and will likely not even approve this post, since you’re quite adept at trying to hide certain facts which might cast a negative light on one of your ‘favored’ people.

    But rest assured Frank, if you promote an investigation into Keith’s financial transactions then the IRS is gonna investigate the person who facilitated Keith’s many trading accounts, assets and bank accounts (which failed to list Keith as the true person who owned them, in violation of IRS rules).

    You can’t stop that, Frank. So why try to hide it? 🙂

    • Frank may want to add his own response but after reviewing my notes and records on this matter, I can tell you that all the commodities trades were done under the name and FEIN of First Principles, Inc. And all the money that was used to cover the losses for those trades also came from accounts that were in that company’s name. So, no problems there for the broker who handled the trades.

      The real problem is that the company ended up with $65 million of capital losses – and no capital gains that those capital losses could be used against. Thus, all that Nancy Salzman, the owner of First Principles, Inc., could do is deduct whatever the maximum capital loss was back then (I think it was $3,000 per year or something like that).

      In addition to filing false tax returns that included interest income they never earned, it’s possible that Clare and Sara eventually wrote off the “loan” as a bad debt debt. That would be another prosecutable tax fraud.

    • Bangkok stop reading the bold text boilerplate jargon at the top of financial investment compan websites and repeating it like parrot.

  • “It’s not hard to lose money on purpose in commodities “

    It’s not hard to lose money by accident either. This is risky business.

    I think he just lost it all .

    • I have to agree. Frank claims she took second fiddle to Clare, but come on. Ok, right. Does anyone believe that bs? Dear lord, of course Nan would do anything to have Clare feel important to take advantage of the situation; Clare continues to support Nan and the Porters (and others).

      It is like saying Nan that didn’t have a clue about the sexual preferences and behaviors of Keith or know Lauren was involved with Keith.. Lies, lies.

  • I believe that what Sara really fears is a full investigation of her ties to Allison Mack, Kim Constable and Rose Laura Junco.
    Sara can always claim to be a victim of Raniere’s financial skulduggery in the commodities trades.
    But an investigation into this cabal of NXIVM pimpstresses would reveal some deep dark secrets about the Rainbow Cultural Garden and other nefarious activities of NXIVM and its top leadership.

About Frank Parlato

About Frank Parlato

Frank Parlato is an investigative journalist.

His work has been cited in major publications all over the world, including The New York Times, The Daily Mail, VICE News, CNN, Fox News, Rolling Stone, People Magazine, and more.

Frank Report is dedicated to Frank's investigative journalism and the pursuit of truth.

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