US likely to undo Israeli billionaire’s sanctions reprieve

The Biden administration is expected to reverse an 11th-hour move by the Trump administration to temporarily ease sanctions on Israeli billionaire Dan Gertler following an uproar among U.S. lawmakers and government officials left out of the decision-making process, two people familiar with the matter said.

The U.S. sanctioned Gertler, 47, and his companies in 2017 for allegedly corrupt mining and oil deals in the Democratic Republic of Congo. But in his final days in office, President Donald Trump’s Treasury secretary, Steven Mnuchin, issued a license which, while not lifting the sanctions against Gertler, exempted his business activities from them until Jan. 31, 2022.

Treasury Secretary Janet Yellen is reviewing the issue, and it’s not clear whether she’s made a final decision, according to the people, who asked not to be identified discussing private deliberations.

The Trump administration decision surprised some State Department officials, and the license came under scrutiny almost immediately when the Biden administration took over.

Defense attorney Alan Dershowitz, whom Gertler hired to help him get removed from the sanctions list, said he hoped his legal team would get a chance to explain why the license was justified. Dershowitz defended Trump in his 2020 Senate impeachment trial.

“We’ve spent an enormous amount of time and effort putting in place safeguards and compliance” for Gertler, Dershowitz said in an interview. “We’d certainly like an opportunity to present that to the authorities before any precipitous decision is made to revoke a license.”

Congressional Concern

Democrats in Congress urged Yellen this week to undo the Trump administration move. They included Representatives Karen Bass and Gregory Meeks of the House Foreign Affairs Committee, and three Democratic senators who called for an investigation into how the license was issued.

“We urge you to investigate any payments or transfers that may have taken place under this license, as well as any loopholes in the sanctions that were allowing Gertler to circumvent enforcement by setting up new companies,” Senators Cory Booker, Dick Durbin and Ben Cardin wrote in a Feb. 1 letter to Yellen.

Baruch Weiss, another lawyer representing Gertler, said in a letter to Yellen on Friday that the lawmakers’ letters “appear to rest upon an incomplete understanding of the facts and circumstances that led to OFAC’s issuance of the license, as well as an inaccurate portrayal of Mr. Gertler’s conduct since the imposition of the sanctions.”

Weiss requested a meeting with Yellen before she makes a decision, to make the case that the determination to give a license to Gertler was correct, and to “demonstrate that his future philanthropic and business affairs will comport with OFAC’s expectations.” OFAC is the Treasury’s Office of Foreign Assets Control.

‘Beyond Surprised’

At the time of Gertler’s sanctioning, the Treasury said he worked as a middleman between multinational companies and the Congolese state and on behalf of former President Joseph Kabila. The State Department’s Africa bureau was opposed to the decision to ease the sanctions against him.

“We were beyond surprised,” Tibor Nagy, assistant secretary of state for African affairs under Trump, said in a phone interview. “As a matter of fact, most people were thinking that maybe the sanctions would be strengthened.”

Decisions regarding sanctions typically involve consultations with multiple agencies and officials, coordinated by the National Security Council, and can take months, according to J. Peter Pham, who served as the Trump administration’s special envoy to the Great Lakes region of central Africa.

Both Pham and Nagy said they weren’t consulted on issuing the license, with Pham adding that the speed of the Treasury Department’s move caught many people off guard.

However, senior officials at the State Department in Washington were aware of the license for Gertler before it was issued, and an inter-agency process was conducted, according to two people familiar with the matter who spoke on the condition of anonymity.

Yellen’s spokesman declined to provide an explanation for the license, and Mnuchin, who led the agency at the time of the its issuance, declined to comment.

A Gertler spokesman said Friday he couldn’t be reached during the Jewish Sabbath. In a statement earlier in the week, a spokesman said Gertler had been issued a license based on his commitment to follow all conditions set by law and OFAC.

The spokesman said that “moving forward, transparency and accountability will be the foundation of business operations, and Mr. Gertler will work hand-in-hand with law enforcement, civil society and international organizations to guarantee this.”

A State Department official declined to comment on interagency discussions. The Treasury Department also declined to comment.