Strategical Task-Force for

International Law and

Security, LLC ("STILAS")

("")

Wash, DC (888) 821-1141

www.stilas-security.com

Moscow

STI LAS@consultant.com

(095) 103-7257

CASE # LE-SC-0016

RESULTS REPORT

FEBRUARY 4, 2002

CAUSE OF INVESTIGATION:

Paul Simington, a former sub-contractor of Direct Info, claims that he is owed

$979.43 (50% of 15% of an order for Alcan), where he already received a total of
$3,265 cash from this project as well as other benefits. While this small sum does not
justify professional services for dispute resolution, Simington's demands have taken the
form of aggressive threats of physical bodily harm, combined with complete refusal to
discuss any facts or negotiate resolution. As a result, the case has turned into a
security investigation to neutralize threats and avoid harm to Ulsaker or economic
damage to Direct Info.
Simington's refusal to discuss any facts are evidenced by 2 e-mails. On
November 13, 2001 he wrote "If you plan to deliver MY amount, then we should meet.
If not, then we should not meet - there is no reason", and on November 19 he wrote "I
will not waste my time reviewing or arguincf with you, alone or in front of a 'third person'.
You owe me $979.43 and I expect you to pay."
In an e-mail message on December 7, 2001 at 00:45, Simington wrote "Listen
asshole -1 did not do anything with Gillette... You had better prove this allegation or
retract it ASAP. This I take very personal!! You are a fuck and better prove this Tate
or I will take you apart!!!" In a separate e-mail send at the same time, he wrote "I
strongly urge you to satisfy Gillette demand, as well as my cash demand, or I will act
accordingly - and quickly. This is my final demand." Later in telephone conversations,
Simington threatened "You better pay me the money you owe me, or I'll rip your fucking
head off!"

Under the Russian Federation Criminal Code, making threats of physical harm
in combination with demands for money consists of the crime of "extortion". Since
Simington's threats and behavior make it impossible to handle this case as a financial
or commercial dispute, STILAS recommends treating Simington as an extortionist, and
resolving the case using operative methods.
ANALYSIS OF BUSINESS / LEGAL DISPUTE:

The controlling document, consisting of the legal agreement between Direct Info
and Paul Simington for payments related to the Alcan project, is an e-mail message
dated Wednesday, October 24, 2001 at 4:52 pm from Simington to Ulsaker.
In this message, Simington explicitly agrees to the terms of Ulsaker's
calculations, thereby giving the document legal force as an agreement. Simington
states: "I do not dispute your numbers, or the justifications behind them." The terms to
which Simington agreed in this manner, from Ulsaker's part of the e-mail below this
acceptance, are: "Direct Info Commission - $1,959 (of which we should remove Alexei's
part to divide between us); Paul - $3,265".
It is important to note that the Direct Info Commission is a standard 15% of all
orders necessary for paying employees who work on the projects. From this sum, 33%
(5% of all orders) is paid to employees, and 66% (10% of the order) is paid to
consultants who work on the project. In this case, "Alexei's part" which was potentially
subject to division was only $1,306, such that Simington's potential 50% of this amount
would be only $653.
When Direct Info submitted Simington's results to the client Alcan, the client
complained that the most important information analysis - the reason they ordered the
report - related to competition, was not included, and the report required rewriting with
additional analysis. Simington wrote several contradictory e-mails expressing his
position on doing the necessary work.
On October 22 at 3:53 pm, he wrote "I can work on this from here, starting
tonight... I will complete it and then I will pass it along to you to review... This can be
done within the budget paid and does not represent any new data, and in reality - they

are right. Timing to complete is a couple of days." The next day, October 23 at 4:50
pm, he wrote "How Bruno chooses to 'finalize the document for the presentation to the
executives concerned / interested at Alcan' is not our problem or our business. If we
are recruited for this it has to be at an extra cost." On October 25 at 1:57 am, he wrote
"I have started to edit the summary... I consider that there is some time to accomplish
this (at least another 24-36 hours), so I am quitting for the night and will start again in
the afternoon." On October 29 at 2:12 am, he wrote "I have been struggling with this
edit of the executive summary and I am coming up empty... I cannot play with this any
longer and reluctantly pass it off to you."
As a result of Simington's failed attempt and subsequent refusal to deliver
suitable final results on the Alcan project, Direct Info was forced to pay Alexei's share
of the Direct Info commissions - $1,306 - to other employees to complete the work
required by the client. As a result, this part was no longer subject to nor available for
distribution between Simington and Ulsaker.
Additional facts influences the calculations of recommended results. *The first
fact is that Direct Info purchased a desk from Ikea for the benefit of Simington, which
was shipped to Simington's home office on Krasnayapresnaya on July 4, 2001, in the
amount of $442.94. The second fact is that Direct Info gave Simington the benefit of
a credit loan of $5,000 during approximately 3 months from August 22 to November 16.
If a standard interest rate of 16% APR for credit cards is applied, then the interest
benefit to Simington was $66.67 per month, totaling $200.01. (Although the loan could
arguably be an "advance" on payments which are not subject to interest, or may have
been given under explicit promise for consideration as "interest free" under a separate
agreement. But if there is no documentary evidence to the contrary, then the interest
value should be considered against a claim for an undocumented alleged debt.)
The logical conclusion is that if the facts are interpreted such that Simington is
at fault for additional expenses on the Alcan project for failure of performance, then
Direct Info does not owe any additional payment to Simington, and Simington owes
Direct Info $442.94 for the desk received plus $200.01 interest on the loan, totaling
$642.95.

If the facts are interpreted such that Simington is not at fault and substantially
performed, and Direct Info was wrong to pay Alexei's share to other consultants for
additional work, then Direct Info owes Simington 50% of Alexei's 10% (not 15%) share
of the order at $653, minus the desk for $442.94, minus the $200.01 interest on the
loan, totaling $10.05.
ANALYSIS OF POTENTIAL SECURITY THREAT:

Paul Charles Simington, born on November 9,1953 in Boston, Massachusetts,

USA, has been present on the territory of the Russian Federation on a permanent basis
since 1991, and is well oriented and acclimated with excellent knowledge of Russia and
its culture.
According to inside information from highly sensitive sources in the US,
Simington came to Russia in 1991 as an employee of a special Russian Organized
% Crime Division of the US Department of Justice, which included employees of the FBI,
ATF and Department of State. According to Russian counterinteliigence sources,
during performance of his assignments for the US Department of Justice, Simington
had frequent meetings with representatives of Russian organized crime groups. While
strong or long-term relations with Russian organized crime leaders have not been
detected, it is believed that Simington maintains relations on a reserve or last-resort
contact basis, such that he has access to Russian organized crime structures if and
when needed or desired.
Simington's work for the US government in Russia was reportedly short-lived.
After working at the US Embassy in Moscow during 1991-1992, he married a Russian
woman named Svetlana, which in the persisting Cold War climate of the time caused
him to fall into disfavor at the Embassy, and resulted in his being released from service.
This event has characterized Simington's psychology to the present day, resulting in
great frustration trying to maintain or restore the high-profile and status of his previous
promising security career.
Simington began actively engaging in private business activities in 1993. His
sole vehicle for business activities is a limited liability company registered in
Massachusetts, named "DragonHeart, Ltd.", which is an active enterprise in the sense

that it is still used as the legal entity for his personal business dealings. Simington
frequently travels on business trips to CIS countries such as Ukraine, Kazakstan and
Uzbekistan. His security business is based upon personal and private contacts with
the managers of private security enterprises and detective agencies, and the main
partners are the groups "Oskord" and "Alpha". The individual managers of these 2
groups - former employees of law enforcement bodies FSB, MVD and special forces
GRU - provide "cover" for Simington's activities in the security and investigative
industry. According to some sources, Simington is believed to have connections
among active officials of the FSB, MVD and GRU, as well as the Federal Tax Police.
During 1998-1999, Simington was Chairman of the Security Committee of the
American Chamber of Commerce. Working in AmCham, he had diverse opportunities
to develop a clientele for his own personal business. During this period he actively
maintained contacts with representatives of Western companies in Russia, assisting
them in resolving security problems of foreign businessmen as well as their businesses
and companies. Beyond work according to this profile, Simington has not engaged in
any other noticeable activities.
Investigation of Simington's political activities revealed contacts with State Duma
Deputy Mr. Gudkov, although recently they have had almost no contacts or
discussions. He does not have a circle of "friends", but merely arms-length relations
with business partners, who do not have any significant influence over his behavior or
business activities. No connections or contacts with corrupt employees of law
enforcement or governmental agencies have been detected or established.
Information indicates that Simington is currently experiencing difficulties with
retaining and developing his clientele, resulting in financial pressures which aggravate
the psychological career-related pressures. While his wife Svetlana does have a
substantial salary from a Western company which could be used as "muscle" resources
in the event of a conflict, available information is that Simington does not personally
have access to those funds, which are kept in a separate bank account only in his
wife's name, and which are withdrawn only personally by Svetlana for mutually
approved family and living type expenses.
Simington is a martial arts fanatic, and practices and trains in karate regularly

and actively. His rank or level was not established, although his proficiency is believed
to be high and suitable for practical or combat use.
Suspicions regarding Simington's contacts with former Direct Info clients were
investigated, in particular relating to the company "Gillette". While several
correspondence documents were identified and located, no confirmation of breaches
of business ethics or client stealing were found. In particular, in each of the limited
cases where Simington discussed his relations with Gillette with Russian security
partners who fulfill his orders, he showed people both his e-mail correspondence with
Gillette together with e-mail correspondence with Tate Ulsaker, openly and actively
representing Gillette as a client of Direct tnfo. No indications of attempts to prepare
any partners for soliciting or fulfilling orders from Gillette nor Oriflame were detected.
The only correspondence found between Simington and Gillette was one letter written
to individual representatives of former clients with whom Simington had personal
relations, and the e-mails contained purely personal themes, and no attempts to draw
away clients nor interfere with Direct Info's client relations.
Investigation of ethics and business practices did not uncover or reveal any
indications that Simington engaged in such practices as exceeding authority, stealing
clients, embezzlement, nor breaches of confidentiality related to his work on a
contractual basis. To the contrary, his reputation among many key businessmen and
several government officials (who have knowledge of Simington through limited
professional business relations, but do not have any personal or partnership relations
with him) is positive, indicating general reliability, honesty and good reputation in
business and political circles.
Filed operatives reported credible information that the primary cause of the
present business dispute and its aggressive tone from Simington, is the issue that the
accusations of "client stealing", combined with Simington's financial and psychological
pressures and concerns about his status, reputation and diminishing client base,
triggered a highly agitated reaction by Simington, of both a defensive and offensive
nature. For many related reasons, this was the primary cause and basis for pursuing
the perceived business debt. Considering that investigation revealed that there is no
objective basis for asserting client stealing, this has been identified as a recommended
issue for diplomatic compromise in resolving the business dispute.

The conclusion resulting from the above analysis is that Simington has the
potential to present physical security threats and commercial security threats, but is
most likely not to do so. The most important factor is that while he does in fact have
substantial connections, including some mid-level organized crime figures and even
political figures, and his own individual partners in the security business, he lacks any
integrated "cover" or "inner circle" with any degree of reliability, interdependence or
loyalty. From this position, any aggressive actions which could cause a security threat
would require out-of-pocket expenses over one thousand dollars for any particular step.
Such funds are not readily available to the subject, and exceed the amount of alleged
disputes. The fact that Simington does in fact possess significant political connections,
and cannot afford to lose those arms-length relations, also indicated that he is not likely
to risk his reputation or business capabilities in Russia by engaging in unethical
commercial interference, unless provoked.
Accordingly, the primary strategical recommendation for resolution of this case
is to recognize that the subject is potentially highly dangerous, and should not be
provoked. An anti-inflammatory tone and diplomatic approach to conflict resolution is
necessary, despite the fact that the subject's aggressive style does not indicate
receptiveness to business-level talks or negotiations. Operative work has already been
performed by STILAS agents to prepare the subject for a final resolution, one based
upon a strong legal position of Direct Info, tempered by a moral compromise in the form
of backing down on the inflammatory accusations of "client stealing".

Strategical Task-Force for

International Law and

Security, LLC ("STILAS")

("")

Wash, DC (888) 821 -1141

www.stilas-security.com

Moscow

STILAS@consultant.com

(095) 103-7257

LE-SC-0016

4 , 2002

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