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UNITED STATES DISTRICT COURT


SOUTHERN DISTRICT OF NEW YORK

CF 135 FLAT LLC, CF 135 WEST MEMBER


LLC and THE CHETRIT GROUP, LLC,

Interpleader Plaintiffs,

-against- 15 Civ. 5345 (AJN) (SN)

TRIADOU SPV S.A., CITY OF ALMATY, a


foreign city, and BTA BANK JSC,

Interpleader Defendants.

CITY OF ALMATY, KAZAKHSTAN and BTA


BANK JSC,

Crossclaim Plaintiffs,

-against-

MUKHTAR ABLYAZOV, VIKTOR


KHRAPUNOV, ILYAS KHRAPUNOV, and
TRIADOU SPV S.A.,

Crossclaim Defendants.

DECLARATION OF NICOLAS BOURG

I, NICOLAS BOURG, hereby declare as follows under penalty of perjury:

1. I am a Belgian national, and currently reside in Belgium, where I was born. I

attended the University of Leuven, where I studied economics. After my education I worked at

a family business, C.P. Bourg, before transitioning to work in real estate finance.

2. I was the sole director of Triadou SPV S.A. (Triadou) from its formation in

2011 by myself and Ilyas Khrapunov (Ilyas) until my termination in late 2014. As such, I

worked closely with Ilyas on all aspects of Triadous operations and management, and

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executed most of Triadous investments, including those in the United States, during that time.

Relationship with Ilyas

3. In 2006, I was involved in a real estate deal in Switzerland. As part of that

transaction, I first met Ilyas. Ilyas was attending university in Switzerland at that time, but

expressed an interest in real estate investing. In 2008-2009, I again met Ilyas in Switzerland, at

which time he proposed forming a real estate investment fund together.

4. At that time, Ilyas told me that he had access to large amounts of capital, both

through his immediate family and through his father-in-law, Mukhtar Ablyazov (Ablyazov).

Ilyas stated that his immediate and extended family were in exile from Kazakhstan after being

persecuted by that countrys government, and for that reason, they needed to keep their

finances secret and conceal their business dealings.

Formation of Triadou

5. In or about 2011, Ilyas contacted me seeking to create a real estate fund that

would be a subsidiary of an entity controlled by his family, the Swiss Development Group,

formally, SDG Capital S.A. (SDG). The real estate fund proposed by Ilyas would invest in

real estate opportunities worldwide, including in the United States.

6. At Ilyass direction, I formed a series of entities under the laws of

Luxembourg for the purpose of investing his familys funds in real estate. One of these entities

was Triadou, an investment vehicle wholly owned and controlled by SDG. SDG itself was

owned and controlled by Ilyas and his family, and used to conceal the movement and

investment of his familys money, including that of Ablyazov.

7. Triadou is a shell entity for SDG, and has no corporate presence separate from

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SDG. Triadou had no employees and no offices or headquarters. Although I was Triadous

sole director, I was paid by SDG as an independent consultant, conducted all business

meetings at SDGs offices, had an SDG e-mail address, and received all of my instructions

from Ilyas, acting as SDGs president.

8. Monthly meetings occurred in Geneva between myself, Ilyas, Peter Sztyk (an

advisor of Ilyas) and, at times, my longtime business partner, Laurent Foucher. The agenda at

each meeting was to discuss all investments of the Ablyazov-Khrapunov familys money (i.e.,

not only money invested through SDG or Triadou). At those meetings, I frequently received

directions from Ilyas regarding various business ventures, including Triadou and others that

the Ablyazov-Khrapunov family was involved in.

9. Although I was the sole director of Triadou, Ilyas was in charge of Triadous

operations and investments. I would research investment opportunities, Ilyas would select

which deals to invest in, and then he would negotiate the deal and organize payment. However,

Ilyas repeatedly informed me that the person who gave him final approval for all deals was

Ablyazov. Ilyas stated to me that he was managing a large amount of Ablyazovs money, and

for that reason, Ablyazov was the ultimate decision maker on all of Triadous investments.

According to Ilyas, he had significant freedom in the management of various investments, but

the final decisions were always received directly from Ablyazov. This arrangement was

confirmed for me on several occasions when I observed that Ilyas needed to wait for

Ablyazovs approval before authorizing a particular Triadou investment or payment.

10. Ilyas told me that he often used a company named Telford International

Limited (Telford) to move Ablyazovs funds to execute these deals. Ilyas informed me that

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Telford was an Ablyazov investment entity used to conceal and move his funds, and was

controlled by Eesh Aggerwal, a financial advisor loyal to Ablyazov.

Triadou's United States Investments

11. At Ilyass direction, I contacted Eric Elkain, whom I knew from my

professional experience to be an agent of Joseph Chetrit, a well-known real estate developer in

New York. Elkain agreed to arrange a meeting between Chetrit and Ilyas to discuss possible

investments by Ilyas in the United States.

12. In or about early 2012, Chetrit and his partner met with Ilyas and myself in

Geneva, Switzerland, to assess possible investment opportunities. At that meeting, Ilyas stated

to Chetrit that he and his extended family were political opponents of the current government

of Kazakhstan, and had to keep their business dealing covert in order to avoid worldwide

persecution from that government. Chetrit stated that he sympathized with Ilyas professed

situation, as his own family had been politically persecuted in Morocco. (I know from official

public documents that the U.S. State Department has held out the prosecution and jailing of

Chetrits father and brother as an example of Moroccos denial of fair public trials. A true and

correct copy of the State Departments Morocco Report on Human Rights Practices for 1996 is

attached as Exhibit 1).

13. The meeting was productive, and shortly thereafter Ilyas and I traveled to New

York and met with Chetrit again to discuss specific investment opportunities.

14. As a result of these discussions, Ilyas agreed to invest with Chetrit through

Triadou in a number of real estate opportunities in New York City. These included

investments in the Flatotel and the Cabrini Medical Center condominium conversion

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developments in New York City.

15. The Flatotel was a 289-room business hotel, located at 135 West 52nd St, New

York, New York. The Cabrini Medical Center hospital campus closed in 2008 and is now

comprised of several buildings containing approximately 250 condominium units. The Chetrit

Group has been executing plans to convert both properties into luxury condominiums, and

both are close to completion.

16. Chetrit held a 75% interest in the Flatotel, while 25% of the development was

owned by another developer, David Bistricer. Chetrit had created a series of limited liability

entities, including CF 135 FLAT LLC and CF 135 West Member LLC, to hold his 75%

interest in the Flatotel.

17. Chetrit offered to sell half of the Chetrit Groups 75% investment in the

Flatotel to Triadou. Under this agreement, Chetrit would manage the development of the

Flatotel while Triadou would passively invest capital. Profits would be split equally between

Triadou and Chetrit, but Triadou would be responsible for 70% of CF 135 West Member

LLCs capital obligations. It was estimated that Triadou would ultimately need to provide at

least $40 million in capital for the deal. At Ilyas direction, after he obtained Ablyazovs

approval, I agreed to this proposal. Attached as Exhibit 2 is a letter dated October 23, 2012,

from the Chetrit Group, outlining the expected terms of the investment.

18. Based on evaluations of the real estate market in New York City at that time,

Triadous interest in this transaction was estimated to ultimately be worth at least $100 million

with reimbursement of the initial investment.

19. After this deal was agreed to, Triadou began to encounter problems moving

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funds for its initial equity payments to Chetrit through ordinary banking channels in

Luxembourg.

20. Telford funded all of the money Triadou was obligated to invest in the

Flatotel. Telfords accounts were at Federal Bank of the Middle East (FBME) in Cyprus.

From Ilyas, I learned that attempts to transfer funds to from Telford to Triadou, to then be sent

to Chetrit, were unsuccessful, and that correspondent banks in Luxembourg refused to accept

funds from Telfords accounts. (I know from official public sources that the U.S. Department

of the Treasurys Financial Crimes Enforcement Network (FinCEN) subsequently imposed a

prohibition on U.S. financial institutions from opening or maintaining a correspondent account

on behalf of FBME on July 29, 2015. A true and correct copy of FinCENs July 29, 2015

announcement of that rule is attached as Exhibit 3)

21. As a result, I contacted counsel for Chetrit and proposed that the funds for

Triadous equity payments be wired directly from Telford to Chetrits escrow account held by

his counsel. Chetrits counsel agreed, and the wires were executed from Telford to Chetrits

escrow.

22. I attach as Exhibit 4 an e-mail chain between myself and Joseph Chetrit, dated

December 12, 2013, at 3:56 p.m. EST, forwarding numerous Society for Worldwide Interbank

Financial Telecommunication, or SWIFT, messages confirming that these funds were wired

directly from Telfords accounts at FBME to the escrow account held by Chetrits counsel.

23. Included at the beginning of chain is an email I received from Ilyas, using a

pseudonymous email account of his: Elvis Elvis at the email address

theuraniumguy@gmail.com. Exhibit 4, at 9.

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24. This email chain also shows Ilyas receiving these SWIFT confirmations from

Aggarwal, Ablyazovs adviser who controlled the Telford accounts. Exhibit 4, at 9.

25. I attach a compilation of these SWIFT records I received from Ilyas as

Exhibit 5.

26. Through Triadou, Ilyas also entered a second investment with Chetrit shortly

thereafter. In late 2012, Triadou agreed to invest $12 million in the Cabrini Medical Center

conversion, a joint venture between Chetrit and another private developer to convert a former

medical center in New York City into luxury condominiums.

27. Due to increasing scrutiny of Ablyazovs finances, the $12 million investment

became impossible. I discussed this obstacle with Chetrit, who agreed that Triadou would

invest half the originally-agreed amount, $6 million, until more funds became available. Again,

the funds to close this deal were transferred directly from the offshore accounts of Telford on

May 20, 2013, to accounts held by Chetrits counsel. See Ex. 5, at 7.

28. The Flatotel and Cabrini were only two of Triadous investments. Attached as

Exhibit 6 is a corporate profile and financial report of Triadou, dated November 14, 2013. This

document identifies that I was the sole director of Triadou (Ex. 6, at 3), that Telford was

responsible for funding Triadous investments (Ex. 6, at 4), and provides a summary of

Triadous investments at that time (Ex. 6, at 6).

The Sham Sale of SDG after Triadous U.S. Investments

29. In March of 2013, After Triadous investment in the Flatotel, and after

Telford began funding that investment, Ilyas purported to sell SDG to a friend of his, Philippe

Glatz.
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30. Ilyas met Glatz through their mutual involvement in a Swiss political party,

the Party Democrat Christian. Ilyas informed me that Glatz was an ideal front and the best

protection to help insulate Ilyas and his extended familys money from scrutiny by law

enforcement or financial institutions.

31. As explained above, SDG was created with the funds of the Khrapunov

extended family, members of which (including Ablyazov, and Ilyass father, Viktor

Khrapunov) I understood to be facing criminal investigations in Kazakhstan, and eventually, in

Switzerland.

32. SDG was managed by Ilyas and used to move and invest both his familys

money and that of Ablyazov. While the Flatotel deal was being negotiated, pressure on Ilyas

and his extended family began to mount as the investigations in Kazakhstan extended into

Switzerland and his extended familys assets began to be frozen or scrutinized. According to

Ilyas, it became increasingly hard for Telford to fund Triadou or SDGs investments. A sale of

SDG to Glatz was described to me by Ilyas as the solution to this increasing scrutiny on SDG.

33. At that time, Glatz was held out as the owner and President of SDG, but in

reality, Ilyas continued to run all aspects of the company, ostensibly as an external adviser to

SDG. The supposed sale of SDG to Glatz was conducted in 2013 as if it were a real

transaction, with money changing hands from Glatz to the Khrapunov family. However, Ilyas

informed me that the money paid by Glatz for SDG was itself loaned to Glatz by Ilyas, thus

creating an apparent sale, but effectively leaving the parties in the same position financially.

This sham sale of SDG to Glatz was directly in response to banks refusals to move money for

SDG, and was intended to increase SDGs investment opportunities.

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34. Consistent with Ilyas description to me of Glatz being nothing more than a

nominee, during all the years that I ran Triadou and was involved in other related entities, I

never saw Glatz in any meetings, nor did he ever come to the U.S. to participate in any

meetings. Glatz never took any role in the decision-making process and was not copied on e-

mails during this three-year period. I only met Glatz on three occasions, for approximately 10

minutes each time, and he never discussed SDGs or Triadous operations in those brief

meetings, which were purely social.

35. I observed that this sham sale to Glatz created its own issues for SDG. In one

instance, a potential investment in Porto Heli, Greece failed when a financial institution, Black

Sea Trade & Development Bank (Black Sea), declined to provide funding when its Know-

Your-Customer due diligence of SDG determined that Glatz did not have the financial

resources to actually purchase SDG, and was merely a straw purchaser, while the original

ownership and control of SDG by the Khrapunov family had not actually changed.

36. Attached as Exhibit 7 is an email chain between myself and Ilyas, dated July

16, 2013, regarding Black Seas refusal to fund SDG. Earlier in this chain is an email from

Alexey Alekseev, Black Seas Director of Banking, stating that [t]he new ultimate owner of

SDG is said to be Mr. Philippe Glatz. Greencos S.A., the company through which Mr. Glatz

acquired SDG, has a charter capital of [Swiss francs] 100,000 and its financial strength is

estimated by D&B at [Swiss francs] 90,000. How and where Greencos and Mr. Glatz found the

[Swiss francs] 10 million that was used to recapitalize SDG is unclear. I am not persuaded that

theres been any real change in the ownership of SDG. Ex. 6, at 2.

The California Action and Assignment of the Flatotel


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37. In 2014, I learned that the City of Almaty, Kazakhstan had filed an action in

the state of California against members of the Khrapunov family, seeking to seize real estate

investments the Khrapunov family owned in that state.

38. In response to this lawsuit, Ilyas directed me to begin liquidating Triadou's

assets in New York so that funds could be removed from the United States and concealed

elsewhere. Specifically, Ilyas instructed me to liquidate Triadous investment in Flatotel and

the Cabrini Medical Center as quickly as possible.

39. I contacted Chetrit, explaining that the threat of the litigation in California

required Triadou to liquidate and transfer their assets out of the United States. Chetrit offered

to repurchase Triadous interest in the Flatotel at a substantial discount from the price

originally paid by Triadou, and return the capital invested in Cabrini. By this point, based on

the state of the New York high-end real estate market and the progress of the Flatotel

development, the value of Triadous investments in the Flatotel and Cabrini had increased

substantially beyond the approximately $40 million originally invested and I estimated that

they would be worth more than $100 million.

40. In or about August of 2014, at the direction of the Ilyas, upon Ablyazovs

approval, Triadous interests in the Flatotel and Cabrini Medical Center were assigned back to

Chetrit for a price including $21 million in deferred compensation, representing a fraction of

the fair market value of the property.

41. Shortly after this assignment, I ceased to be paid by SDG, and was then

terminated from Triadou. As noted above, Triadou is merely a shell company used for masking

the investments of SDG, and thus, my termination letter came from SDG. I attach as Exhibit 8
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my termination letter from SDG.

42. Prior to my termination, I was owed significant sums by Ilyas and SDG in

connection with my work for Triadou and other SDG entities, representing both my

compensation and costs for Triadous registration under the laws of Luxembourg, which I had

personally advanced and which SDG had promised to reimburse. When I requested that SDG

reimburse these costs and pay my compensation, Ilyas stated that the money owed to me

belonged to his father-in-law, Ablyazov, and thus he could not release it. I subsequently

communicated with Ilyas, but these conversations were unpleasant and unproductive.

Funds Payable to Triadou

43. Based on my experience as Triadous director over a more than three year

period, any funds transferred for Triadous benefit would immediately be moved overseas

through a chain of other Ablyazov- or Khrapunov-controlled entities. Where Triadou has been

owed funds in the past, that money never went directly to Triadou or remained in the United

States, and was always moved directly to other entities. Two examples illustrate this practice:

44. In April of 2013, Triadou entered into a commercial real estate investment, the

purchase of the Tri-County Mall in Cincinnati, Ohio. Triadou invested approximately $29

million in the commercial property, and resold that interest at auction three months later for

approximately $40 million, after costs and commissions. Much like the Flatotel, the funds

invested in the Tri-County mall came directly from Telford, and once that interest was

liquidated, those funds did not flow to Triadou, but were instead moved to other Ablyazov-

Khrapunov entities and then out of the United States.

45. Other funds from the assignment of Triadous interest in the Flatotel have

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already been moved away from Triadou. Pursuant to the assignment, the Chetrit Entities made

a $1 million initial payment in [year] when Chetrit bought out Triadous interest in the Flatotel

development. This $1 million payment, along with $6 million for the termination of an

unrelated investment, was wired to Compagnie Privee do Conseils et dInvestissements S.A. in

Geneva, Switzerland, for the benefit of SDG, identified as a loan on behalf of Triadou SPV

S.A..

Meetings with Chetrit

46. On March 22, 2015 and March 23, 2015, I met with Joseph Chetrit in New

York, New York. I recorded discussion between Chetrit and myself at both of those meetings. I

have reviewed those recordings and can confirm the voices on those recordings are those of

myself and Joseph Chetrit. Certified transcripts of those recordings are attached as Exhibits 9

and 10. In these recordings, Chetrit and I discuss the assignment of Triadous interest in the

Flatotel to the Chetrit Entities the previous year, as well as the investigations into Ilyass

holdings and Ablyazovs imprisonment. In these recordings, Ilyas is referred to by the

pseudonym Pedro, and Ablyazov is referred to either as the Father-in-Law or the

Stepfather.

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I declare under penalty of perjury, under the laws of the United States of America, that

the foregoing is true and correct.

Executed on this 2nd day of May, 2016.

NICHOLAS BOURG

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Exhibit 1
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1996HumanRightsReport:Morocco

TheStateDepartmentwebsitebelowisapermanentelectronicarchiveofinformationreleasedonline
fromJanuary1,1997toJanuary20,2001.Pleaseseewww.state.govforcurrentmaterialfromthe
DepartmentofState.Orvisithttp://20012009.state.govforinformationfromthatperiod.Archivesites
arenotupdated,soexternallinksmaynolongerfunction.Contactuswithanyquestionsaboutfinding
information.NOTE:ExternallinkstootherInternetsitesshouldnotbeconstruedasanendorsementof
theviewscontainedtherein.

U.S.DepartmentofState

MoroccoReportonHumanRightsPracticesfor1996

ReleasedbytheBureauofDemocracy,HumanRights,andLabor,January30,1997.

MOROCCO
TheConstitutionofMoroccoprovidesforamonarchywithaparliamentandanindependentjudiciary.
Ultimateauthority,however,restswiththeKing,whomayathisdiscretionterminatethetenureofany
minister,dissolvetheParliament,andrulebydecree.ThepresentParliamentwascreatedin1993
throughatwostageprocess:222deputieswereelectedbydirectuniversalsuffrage,andanadditional
111wereselectedbylaborsyndicates,professionalorganizations,andlocalauthorities.TheCabinet
continuestobecomposedlargelyoftechnocrats.Parliamentaryelectionsareexpectedin1997,
followingtheSeptember13,1996referendumonthecreationofasecondlegislativechamber.The
referendumwasapprovedby99percentofthevote.TheGovernmentreportedthat82percentofthe
electoratevoted,althoughmostobserversbelievethisfigureisexaggerated.

Thesecurityapparatusincludesseveraloverlappingpoliceandparamilitaryorganizations.Theborder
police,thenationalsecuritypolice,andthejudicialpolicearedepartmentsoftheMinistryofInterior,
whiletheRoyalGendarmeriereportsdirectlytothePalace.Thesecurityforcescontinuedtocommit
humanrightsabuses.

Moroccohasamixedeconomybasedlargelyonagriculture,fishing,lightindustry,phosphatemining,
tourism,andremittancesfromcitizensworkingabroad.Illegalcannabisproductionisalsoasignificant
economicactivity.Whileaseriesofdebilitatingdroughtshaschallengedgenerallystrongeconomic

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growthinrecentyears,goodrainfallduringtheyearwasexpectedtocontributetoaneconomic
upswing.

TheGovernment'shumanrightsrecordremainedlargelythesameastheprecedingyear.Security
forcesoccasionallyabuseandtorturedetaineesandprisonconditionsremainharsh.TheGovernment's
anticontraband(assainissement)campaignresultedinnumerousviolationsofcitizen'shumanrights.
Allegationsofarbitraryarrestandphysicalabuseincreasedinthewakeofthiscampaign,andthe
Governmentfailedtoinvestigatethoroughlyallegationsofabusebysecurityforces.ThethenMinister
forHumanRightsresigned,citingexcessescommittedbysecurityforcesduringthiscampaign.TheKing
thenappointedtheMinisterofJusticeasMinisterofHumanRights,althoughtheMinistryofJusticeis
consideredbysometobeoneoftheprimaryobstaclestoimprovedhumanrights.

Citizensdonothavetherighttochangetheirgovernment.Thejudiciaryissubjecttocorruptionand
InteriorMinistryinfluence.Theauthoritiesattimesignoredueprocessrightsandinfringeoncitizens'
privacyrights.TheGovernmentrestrictsfreedomofspeechandthepressincertainareas,andlimits
thefreedomsofassembly,association,religion,andmovement.WhiletheGovernmentgenerally
toleratespeaceful

protestsandsitins,itdoesnottoleratemarchesanddemonstrations.Onthreeoccasionsduringthe
year,includingontheeveofa1daygeneralstrikeinJuneandduringafemaletextileworkers
demonstrationinMarch,severalprotesterswereseriouslybeaten,andscoreswerearrested.
Discriminationanddomesticviolenceagainstwomenarecommon.Childlaborisaproblem,andthe
Governmenthasnotactedtoendtheplightofyounggirlswhoworkinexploitivedomesticservitude.
Unionsaresubjecttogovernmentinterference.

AlargenumberoftheallegationsofgovernmentalhumanrightsabuseinvolvetheMinistryofInterior.
TheMinistryisresponsiblefor:Thedirectionofmostsecurityforcestheconductofelections,including
cooperationwiththeUnitedNationsinareferendumontheWesternSaharatheappointmentand
trainingofmanylocalofficialstheallocationoflocalandregionalbudgetstheoversightofuniversity
campusesandthelicensingofassociationsandpoliticalparties.Lessformally,theMinistryexerts
substantialpressureonthejudicialsystem.

RESPECTFORHUMANRIGHTS

Section1.RespectfortheIntegrityofthePerson,IncludingFreedomfrom:

a.PoliticalandOtherExtrajudicialKilling

Althoughnodeathsofpersonsinpolicecustodycouldbeconclusivelyattributedtosecurityforce
brutality,therewereseveralinstancesofdeathundersuspiciouscircumstancesthatremainunresolved.
InJanuaryYahyaSalhiwasfounddeadintheOujdagendarmeriedetentioncenter.Salhihadbeen
arrested2daysearlierfortheft.OfficialsallegethatSalhicommittedsuicide.

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InFebruaryBabehaLahssendiedwhileincustodyatthegendarmeriecenterinKhemisset.Accordingto
humanrightsactivists,Lahssenwasarrestedfollowingafightwithatribalchief.Severaldaysafterthe
arrest,Lahssen'sfamilywasinformedthathehadcommittedsuicide.TheLahssenfamily'srequestfor
anautopsywasreportedlydeniedbytheCourtofFirstInstance.

InMay16yearoldAbdelhamidM'rabetdiedwhileinpolicecustodyinTangier.Pressreportsstatethat
M'rabetwasarrestedduringafightwithalocalpoliceofficer'sson.Inthecourseofthearrest,M'rabet
wasreportedlyseverelybeatenaboutthehead.Hediedshortlyafterarrivingatthepolicestation.
Tangierofficialsdetainedthearrestingofficerandlaunchedaninvestigation.Theoutcomeofthe
investigationhasnotbeenmadepublic.

HusseinElMernissiwasarrestedonJuly11anddiedthenextdayatAsfipolicestation,purportedly
takinghisownlife.TheMoroccanOrganizationforHumanRights(OMDH)hasfiledacourtaction
regardingthiscase,demandingthatasecondautopsybeperformed.

InMayJalalMohameddiedinprison.Humanrightsactivistsattributehisdeathtoofficialnegligence
(seeSection1.c.).

Humanrightsorganizationscontinuetocomplainthatsecurityforcestoooftenactwithimpunitydeaths
incustodyandotherinstancesofpotentialabusearenotthoroughlyinvestigated.Noneofthecases
outstandingfrom1995havebeenpubliclyresolved.TheseincludethedeathsincustodyofHamza
DaghdaghandMustaphaBenderweesh.However,inOctoberacourtacquittedtwopoliceofficers
accusedofthe1993torturedeathofMustaphaHamzaouiandearliercases.SinceOctoberlocalmedia
reportedfourothercasesofpersonswhodiedwhileinpolicecustody:MohamedFedaouiOmar
BouhdounSaidHammouchandRachidRami.

Detaineesclaimedthatseveralprisonersdiedduringtheyearduetoharshprisonconditionsand
inadequatemedicalcare(see1.c.).

b.Disappearance

Therewerenonewcasesofdisappearanceduringtheyear.Thiscontrastswith1995whentherewere
reportsofover20.However,thepracticeoftheforceddisappearanceofindividualswhoopposedthe
Governmentanditspoliciesdatesbackseveraldecades.Manyofthosewhodisappearedwere
membersofthemilitarywhowereimplicatedinattemptstooverthrowtheGovernmentin1971and
1972.OtherswereSahrawisorMoroccanswhochallengedtheGovernment'sclaimtotheWestern
Saharaorothergovernmentpolicies.Manyofthosewhodisappearedwereheldinsecretdetention
camps.Tothisday,hundredsofSaharanandMoroccanfamiliesdonothaveanyinformationabouttheir
missingrelatives,manyofwhomhavebeenmissingover20years.

TheGovernmentcontinuestodenythatithasanyknowledgeofthewhereaboutsofthosestillmissing.
Inrecentyearsithasquietlyreleasedseveralhundredpersonswhohaddisappeared,includingabout

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300inJune1991,butnoexplanationfortheirincarcerationhaseverbeenprovided.Localhumanrights
monitorshaveconcludedthatmanyothersdiedwhileatthenotoriousTazmamartPrison,whichhas
sincebeenclosed.TheGovernmenthasacknowledged34ofthesedeathsandhasprovideddeath
certificatestothefamiliesofallbut1ofthe34whodied.

OMDHandotherhumanrightsorganizationscontinuedtopursuetheissueofunresolved
disappearances.OMDHreportsthatitseffortstomeetwiththeMinisterofJusticeandHumanRightsto
discussthisissuehavebeenunsuccessful.

TherewerenodevelopmentsinthedisappearanceofAbdullahSherrouq,astudent,whowasreportedly
detainedbysecurityservicesonJune22,1981.After15years,hisfamilyhasstillbeenunabletolearn
anythingofhiswhereaboutsorhisfate,despiteappealsbyAmnestyInternational.

AgrouprepresentingTazmamartprisonsurvivorsandthefamiliesofpersonswhodisappeared
continuestocallforanaccountingofunresolvedcases,compensationtofamiliesofthosewho
disappeared,properburialofvictims'remains,andprosecutionofresponsibleofficials.TheGovernment
hasnotrespondedtotheirdemands.

TheGovernmentcontinuedtopayasmallmonthlystipendtothe28formerprisonerswhosurvived18
to20yearsinsolitaryconfinementatTazmamaartprisonwithouthealthcareorsanitaryfacilities.The
28areformermilitarymenwhohadbeenarrestedinconnectionwiththefailedcoupattemptsin1971
and1972.Aftertheirrelease,theGovernmentprohibitedthemfromspeakingoutpubliclyabouttheir
detention.Inexchange,theGovernmentgavethe28assurancesthatitwouldhelpthemfindjobsand
reintegratethemintosociety.

c.TortureandOtherCruel,Inhuman,orDegradingTreatmentorPunishment

MoroccoratifiedtheU.N.ConventionagainstTorturein1993.TheGovernmentclaimsthattheuseof
torturehasbeendiscontinued,butnewspapersandothersourcesindicatethatsecurityforcesstillabuse
andtorturedetainees.Thefactthatdetaineesarenotallowedtohavecontactwithfamilyorlawyers
duringthefirst48hoursofincarceration(seeSection1.d.)increasesthelikelihoodoftortureandabuse.

Accordingtolocalhumanrightsadvocates,oneoftheproblemsindocumentingtortureandabuseis
thatautopsiesarenotroutine.Theyareonlycarriedoutattherequestofthestateprosecutorandatthe
orderofajudge.Thelackofautopsiesindicatesthatfollowupinvestigationsintodeathsincustodyare
inadequate.

InJuneOMDHissuedareportchargingthattortureisstillprevalent.OMDHofficialsattributethe
phenomenontoofficials'attemptstoelicitinformationfromdetaineesintheanticontrabandand
antinarcoticscampaigns.Inaddition,thereportchargesthatallegationsofabusearefrequentlynot
investigated,andthatofficialsoftenactwithimpunity.

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InJanuarythepressandhumanrightsorganizationsreportedeyewitnessaccountsthatthosearrested
duringtheGovernment'santicontrabandcampaignweresubjectedtophysicalabuseandtortureduring
interrogation.Therewerealsoreportsofdueprocessviolationsandirregularitiesinthecourseoftheir
trials(seeSection1.e.).Governmentofficialshavedeniedthatanyabusesoccurred.

InAprildefendantsarrestedduringagovernmentantinarcoticscrackdownchargedthattheyhadbeen
subjectedtoabusewhileinpolicecustody.Theyalsoallegedthattheirsignedconfessionshadbeen
obtainedthroughpolicepressureandcoercion.

Althoughprisonconditionsremainharsh,theyhavereportedlyimprovedinrecentyears,dueinpartto
reformsundertakenatthesuggestionoftheRoyalConsultativeCouncilofHumanRights.Nonetheless,
crediblereportsindicatethatharshtreatmentandconditionscontinue,withstatesecurityprisonersmore
likelytobevictimized.OnOctober24,detaineesatKenitracentralprisonsentanopenlettercountering
theGovernment'sassertionsthattheprisonsarebeingreformedanddetailingthepoorconditionsat
Kenitra.Theprisoners,mostlypoliticalandIslamistdetainees,allegedthattheprisonlacksthemost
basicneeds,includingventilationandmedicalcare.Theletterstatesthatsevenprisonersdiedthisyear
andallegedmedicalneglect.Causesofdeathrangedfromcancerandtuberculosistoinjuriessustained
throughphysicalassault.InMayJalaalMohamed,aprisoneratElJadidaCivilPrison,diedwhile
unloadingasupplytruck.Mohamedreportedlysufferedfromheartandotherhealthproblems.Human
rightsactivistschargethathisdeathwasduetothenegligenceofprisonofficials.

TheGovernmentdoesnotgenerallypermitprisonvisitsbyhumanrightsmonitors.Notableexceptions
occurredinFebruaryandMarch1995,whenhumanrightsmonitors,alongwithseveraljournalistsand
aninvestigatingcommission,visitedprisonsinTangiers,Mohammedia,ElJadida,Casablanca,and
KhenifrafollowingaprisonriotinKhenifra.

d.ArbitraryArrest,Detention,orExile

Legalprovisionsfordueprocesshavebeenrevisedextensivelyinrecentyears,althoughreports
indicatethattheauthortiessometimesignoredthem(seeSection1.c.).Althoughpoliceusuallymake
arrestsinpublic,theydonotalwaysidentifythemselvesanddonotalwaysobtainwarrants.
Incommunicado(gardeavue)detentionislimitedto48hours,withone24hourextensionallowedat
theprosecutor'sdiscretion.Instatesecuritycases,thegardeavueperiodis96hoursthismayalsobe
extendedbytheprosecutor.Itisduringthis

initialperiod,whendefendantsaredeniedaccesstocounsel,thattheaccusedisinterrogatedandabuse
ismostlikelytooccur.Somemembersofthesecurityforces,longaccustomedtoindefiniteprecharge
accesstodetainees,continuetoresistthenewrules.

Lawyersarenotalwaysinformedofthedateofarrest,andthusareunabletomonitorcompliancewith
thegardeavuedetentionlimits.Whilethelawprovidesforalimitedsystemofbail,itisrarelyused.
Defendantsare,however,sometimesreleasedontheirownrecognizance.Thelawdoesnotprovidefor
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habeascorpusoritsequivalent.Underaseparatecodeofmilitaryjustice,militaryauthoritiesmaydetain
membersofthemilitarywithoutwarrantsorpublictrial.

Althoughtheaccusedaregenerallybroughttotrialwithin

2months,prosecutorsmayorderuptofive2monthextensionsofpretrialdetention.Thus,anaccused
personcanbekeptinpretrialdetentionforupto1year.

Therearenoknowninstancesofenforcedexile,althoughanumberofdissidentsliveabroadinself
imposedexile.Theirnumberhasbeensteadilydiminishing,however,asmanyreturnedtoMorocco
followingabroadbasedamnestydecreeissuedbytheGovernmentin1994.

InMayMamounBalghitiAlaouireturnedtoMoroccoafter

30yearsofexileinSyria.Alaouiwasadissidentinthe1960'swhowasforcedtofleethecountry.He
waslatertriedandsentencedtodeathinabsentia.Hewasincludedintheglobalroyalpardonissuedby
theKingin1994.

ManyhumanrightsgroupsconsiderAbrahamSerfatytobeaMoroccanexile.Amemberofthe(now
defunct)CommunistPartyandasupporterofSaharanindependence,Serfatywasreleasedin1991
after17yearsinprison.Uponhisrelease,theGovernmentdeclaredthatSerfatywasaBrazilianrather
thanaMoroccancitizenbecausehisfatherwasanaturalizedMoroccancitizenoriginallyfromBrazil.
BasedonthisSerfatywasexpelledfromMorocco.Thisdecisionhasbeenwidelycriticizedbyhuman
rightsgroups.InJulySerfaty'swifewasstoppedattheCasablancaairportandprohibitedfromentering
thecountry.

e.DenialofFairPublicTrial

TheConstitutionprovidesforanindependentjudiciary,butallcourtsaresubjecttoextrajudicial
pressures,includingbriberyandgovernmentinfluence.

Therearethreelevelsinthecourtsystem,courtsoffirstinstance,theappealsCourt,andtheSupreme
Court.WhileintheorythereisasinglecourtsystemundertheMinistryof

Justice,twoothercourtsalsooperate:theSpecialCourtofJusticethathandlescasesofcivilservants
implicatedincorruptionandtheMilitaryTribunalforcasesinvolvingmilitarypersonnelandoncertain
occasionsmatterspertainingtostatesecurity,althoughstatesecurityalsofallswithinthejurisdictionof
regularcourtsystem.

Althoughthereisasinglecourtsystemformostnonmilitarymatters,familyissuessuchasmarriage,
divorce,childsupportandcustody,andinheritanceareadjudicatedbyjudgestrainedinIslamiclaw,or
Shari'a.Judgesconsideringcriminalcasesorcasesinnonfamilyareasofcivillawaregenerallytrained
intheFrenchlegaltradition.AlljudgestrainedinrecentyearsaregraduatesoftheNationalInstitutefor
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JudicialStudies,wheretheyundergo2yearsofstudyheavilyfocusedonhumanrightsandtheruleof
law.Itisnotnecessarytobealawyertobecomeajudgeandthemajorityofjudgesarenotlawyers.

Ingeneraldetaineesarearraignedbeforeacourtoffirstinstance.Iftheinfractionisminorandnot
contested,thejudgemayorderthedefendantreleasedorimposealightsentence.Ifaninvestigationis
required,thejudgemayreleasedefendantsontheirownrecognizance.Casesareoftenadjudicatedon
thebasisofconfessions,someofwhichareobtainedunderduress,accordingtoreliablesources.

Allcourtsaresubjecttoextrajudicialpressures.Salariesforbothjudgesandtheirstaffsareextremely
modestasaresult,pettybriberyhasbecomearoutinecostofcourtbusiness.Inmanycourts,
especiallyinminorcriminalcases,defendantsortheirfamiliespaybribestocourtofficersandjudgesto
secureafavorabledisposition.

Amoresubtlecorruptionderivesfromthejudiciary'srelationshipwiththeMinistryofInterior.Judges
workcloselywiththeMinistry'snetworkoflocalofficials,orcaids,whoserveasmembersofthejudicial
policeandoftenassumepersonalresponsibilityforthequestioningofcriminaldetainees.Theyalso
frequentlypreparethewrittensummaryofanarrestandsubsequentinterrogation.Thesummaryis
admissibleincourtandmaybetheonlyevidenceintroducedattrial,effectivelyrenderingitan
instructionpassedfromthecaid'sofficetothecourt.Crediblesourcesreportthatjudgeswhohopefor
highersalariesandcareeradvancementfollowthecaid'sguidanceclosely.

Thelawdoesnotdistinguishpoliticalandsecuritycasesfromcommoncriminalcases.Inseriousstate
securitycases,communicationsbetweentheMinistryofInteriorandthecourtaremoredirect.Atthe
Government'sdiscretion,suchcasesmaybebroughtbeforeaspeciallyconstitutedmilitarytribunal,
whichissubservienttootherbranchesoftheGovernment,notablythemilitaryandtheMinistryof
Interior.

Asidefromexternalpressures,thecourtsystemisalsosubjecttoresourceconstraints.Consequently,
criminaldefendantschargedwithlessseriousoffensesoftenreceiveonlycursoryhearings,withjudges
relyingonpolicereportstorenderdecisions.AlthoughtheGovernmentprovidesanattorneyatpublic
expenseforseriouscrimes(i.e.,whentheoffensecarriesamaximumsentenceofover5years),
appointedattorneysoftenprovideinadequaterepresentation.

InJanuarytheOMDHchargedthatdefendantsarrestedintheanticontrabandcrackdownweredenied
accesstoattorneysduringinterrogationandthatdefendantswerenotallowedtosubmitevidence(some
ofwhichinvestigatorshadearlierrequestedtheypresent)tocounterchargesagainstthem(seeSection
1.c.).Later,theattorneysfornineofthedefendantswalkedoutofcourtinprotestafterchargingthat
theyhadnotbeengivenenoughtimetostudythecaseagainsttheirclients.Oneofthemoreextreme
examplesinvolvedthetrialofDavidandSimonChetrit,fatherandsonimporters,whowerepronounced
guiltyat3:30AMafterthedefenseteamhadspentmorethan17hoursinthecourtroomwithoutarest
orfoodbreak,andwererepeatedlydeniedanopportunitytopresentadefense.TheChetritswereeach

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sentencedto5years'imprisonmentandreceivedoneofthelargestfinesofanyofthoseconvicted
duringthecampaignonchargesofimportingcontrabandandbribingcustomsofficials.Amongthose
criticizingthewayinwhichtheanticontrabandcampaignwasconductedwasHumanRightsMinister
MohamedZiane.Ziane'soutspokendisapprovalofthecampaignledtohisresignationfromtheMinistry
inJanuary,andthehumanrightsportfoliowasassumedbytheMinisterofJustice.However,some
observersconsidertheMinistryofJusticetobeamajorobstacletoanimprovedhumanrightsrecord.
Althoughtheirmissionsarenotcompletelyincompatible,combiningtheMinistryofJusticeandthe
MinistryofHumanRightsportfoliosdoesnotadvancethestatedobjectiveoftheGovernmentandthe
Kingtoprotectandpromotehumanrights.

TheMoroccanOrganizationofHumanRights(OMDH)estimatesthattherearesome60political
prisoners,ofwhich50areIslamistsandtheremainderareleftists.Amongthe50allegedIslamistsare
16membersofthe"Groupof26."Threeofthisgroupwereconvictedofarmssmugglingin1986,but
theotherswereapparentlyarrestedforIslamistactivities.Internationalhumanrightsgroupsestimateof
thenumberofpersonsinprisonforadvocatingindependencefortheWesternSaharavaryfromnoneto
700.

f.ArbitraryInterferencewithPrivacy,Family,Home,orCorrespondence

TheConstitutionstatesthatthehomeisinviolableandthatnosearchorinvestigationmaytakeplace
withoutasearchwarrant.Thelawstipulatesthatasearchwarrantmaybeissuedbyaprosecutoron
goodcause.Nonetheless,duringtheGovernment'srecentanticontrabandcampaignseveralbusinesses
andplacesofresidencewereenteredwithouttherequisitesearchwarrant.

Governmentsecurityservicesmonitorcertainpersonsandorganizations,bothforeignandMoroccan
andgovernmentinformersmonitoractivitiesonuniversitycampuses.

Section2.RespectforCivilLiberties,Including:

a.FreedomofSpeechandPress

AlthoughtheConstitutionprovidesforfreedomofexpression,theGovernmentseriouslyrestrictspress
freedomincertainareas.

TheGovernmentownstheofficialpressagency,MaghrebArabPress,andtheArabicdailyAlAnbaa.A
1958decreegrantstheGovernmenttheauthoritytoregisterandlicensedomesticnewspapersand
journals.Authoritiescanusethelicensingprocesstopreventthepublicationofmaterialsthatthey
believecrossthethresholdoftolerabledissent.Offendingpublicationsmaybedeclaredadangerto
statesecurity,seized,andthepublisher'slicensesuspendedandequipmentdestroyed.TheMinistryof
Interiorcancontrolforeignpublicationsbycollecting"banned"publicationsaftertheyhavebeen
distributed.Ingeneral,however,theGovernmentdoesnotemployextrememeasuressincethemedia
regularlyengageinselfcensorshiptoavoidtheGovernment'sattentionandpossiblesanctions.

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ThePressCodeempowerstheMinisterofInteriortoconfiscatepublicationsthatarejudgedoffensiveby
theGovernment.UndertheCodethePrimeMinistermayordertheindefinitesuspensionofa
publication.OnNovember19,theGovernmentformallybannedtheArabiclanguageweeklyAlUsbuAl
SahfiWa'lSiyassi,anddeclaredalldistributionofthisweeklyillegal.Thepolicenoticebanningthepaper
offerednojustification,butcrediblesourcesconfirmthattheMinisterofInteriorandthePrimeMinister
werebothangeredbyaseriesofarticlesonthe"businessactivities"oftheMoroccanelite,including
theirsons.Thepublisherwaswarnedseveralweeksearlierto"layoffpeoplewhoworkcloselywiththe
King."TheMoroccanPressSyndicateandaMoroccanhumanrightsorganizationarefilingacourtcase
inanefforttorescindtheGovernment'sdecision.

ThePressCodeempowerstheGovernmenttocensornewspapersdirectlybyorderingthemnotto
reportonspecificitemsorevents.Inmostinstances,governmentcontrolofthemediagenerallyis
exercisedthroughdirectivesand"guidance"fromtheMinistryoftheInterior.Nonetheless,the
Governmentgenerallytoleratessatiricalandoftenstingingeditorialsintheoppositionparties'dailies.
However,bothlawandtraditionprohibitcriticismonthreetopics:themonarchy,Morocco'sclaimtothe
WesternSahara,andthesanctityofIslam.

Thereweresomenotableinstancesofcensorshipduringtheyear.TheGovernmentcontinuesits
November1995banonJeuneAfrique,whichhadpublishedanarticledescribingtheKing'shealthand
itsimpactonthepoliticalscene.SinceOctoberJeuneAfriquehasbeendistributed,buthasperhapsnot
coincidentallyrecentlyrefrainedfrompublishinganynegativestoriesabouttheroyalfamily.

InJanuarytheOADPdaily,Anoual,wasseizedtwicebylocalauthoritiesinCasablanca.Noreasonwas
givenfortheseizure.AlsoinJanuary,theweeklymagazineMarocHebdowassuedfordefamationat
therequestofthePrimeMinister.MarocHebdohadreprintedselectionsfromareportbytheEuropean
ObservatoireGeopolitiqueDesDroguesimplicatinghighlevelMoroccanofficialsindrugtrafficking.

InFebruarycomedianAhmedSnoussi(alsoknownasBziz)wasprohibitedfromperformingin
Casablanca.Bziz,Morocco'sbestknownpoliticalsatirist,hasbeenbannedfromtelevisionappearances
forthepast5years.InAprilthegovernmentownedtelevisionstationdismisseditseditorinchiefafter
sheparticipatedinaseminarontheroleofjournalisminthedemocraticprocessandtheprotectionof
humanrights.Thedismissalwasseverelycriticizedbypressandhumanrightsgroups.

TheGovernmentownstheonlytelevisionstationwhosebroadcastscanbereceivednationwidewithout
decoderorsatellitedishantennas.TheGovernmentpurchasedamajoritysharein2M,thecountry's
soleprivatestation,whichcanbereceivedinmosturbanareaswiththerentalofaninexpensive
decoder.TheostensiblereasonfortheGovernment'sactionwastosave2Mfrombankruptcythe
Governmentnowowns68percentof2MstockandtheMinisterofInformationbyvirtueofhsiposition
hasbecomethechairmanoftheboard.Dishantennasareavailableonthemarketandpermitfree
accesstoavarietyofforeignbroadcasts.ResidentsofthenorthcanreceiveSpanishbroadcastswith
standardantennas.TheGovernmentdoesnotimpedethereceptionofforeignbroadcasts.

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Theuniversitiesenjoyrelativeacademicfreedominmostareas.

b.FreedomofPeacefulAssemblyandAssociation

AlthoughtheConstitutionprovidesforfreedomofassemblyandassociation,thelawalsopermitsthe
Governmenttosuppressevenpeacefuldemonstrationsandmassgatherings.Mostconferencesand
demonstrationsrequirethepriorauthorizationoftheMinistryofInterior,ostensiblyforsecurityreasons.

InJanuarymembersoftheAssociationofUnemployedUniversityGraduates,anunofficialorganization
notsanctionedbytheGovernment,beganasitininfrontoftheMinistryofEducationtoprotesthigh
unemploymentandgovernmentinaction.TherewaslittleofficialreactionuntilMarch,whensecurity
forcesdispersedthegroup,allegedlyinjuring

14persons.

TheunemployedgraduatesresumedtheirsitininMay.Forseveralweeks,policebarricadedthe
buildingwheretheyouthswereassembled,preventingthemfromleavingasagrouptodemonstratein
thestreets.Occasionallythepoliceandtheunemployedgraduatesclashed,mostnotablyonMay24
whentheprotesterstriedtomarchoutofthebuildingthattheywereoccupying.Policeblockedtheirexit
andinjuredsome

60demonstrators.OnJune4,ontheeveofanationwidegeneralstrike,policebeatandinjured
numerousdemonstrators,includinghumoristBziz,whohadgonetothesitintoexpresshissupportfor
theunemployedgraduates.ThesitincontinueduntillateJune,whenthegraduatesvoluntarilyreturned
totheirhomes.

Therighttoformorganizationsislimited.Undera1958decree,personswishingtocreatean
organizationmustobtaintheapprovaloftheMinistryofInteriorbeforeholdingmeetings.Inpracticethe
Ministryusesthisrequirementtopreventpersonssuspectedofadvocatingcausesopposedbythe
Governmentfromforminglegalorganizations.Islamistandleftistgroupshavethegreatestdifficultyin
obtainingofficialapproval,althoughthereareover20activeIslamistgroups.TheGovernmenthas
prohibitedmembershipintwo,JusticeandCharityandJama'aIslamia,duetotheirperceived
antimonarchyrhetoric.PoliticalpartiesmustalsobeapprovedbytheMinistryofInterior,whichusesthis
powertocontrolparticipationinthepoliticalprocess.

OnJanuary9,agroupofuniversityprofessors,lawyers,andjournalistsformedanassociation,called
TransparencyMaroc,dedicatedtofightingcorruptionatalllevels.Thisorganizationisalsonot
sanctionedbytheGovernment.Transparencyisoperating,butalwaysinconcertwithother
organizationsthatarerecognizedbytheGovernment.

c.FreedomofReligion

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AlthoughtheConstitutionprovidesforfreedomofworship,onlyIslam,Christianity,andJudaismare
toleratedinpractice.

Islamistheofficialreligion.NinetyninepercentofMoroccansareSunniMuslims,andtheKingbearsthe
titleCommanderoftheFaithful.TheJewishcommunityofapproximately6,000isallowedtopracticeits
faith,asisthesomewhatlargerforeignChristiancommunity.TheBaha'icommunityof150to200
peoplehasbeenforbiddentomeetorholdcommunalactivitiessince1983.

IslamiclawandtraditioncallsforstrictpunishmentofanyMuslimwhoconvertstoanotherfaith.Any
attempttoinduceaMuslimtoconvertissimilarlyillegal.Foreignmissionarieseitherlimittheir
proselytizingtononMuslimsorconducttheirworkquietly.

TheMinistryofIslamicAffairsmonitorsFridaymosquesermonsandtheKoranicschoolstoensurethe
teachingofapproveddoctrine.TheauthoritiessometimessuppresstheactivitiesofIslamists,but
generallytolerateactivitieslimitedtothepropagationofIslam,education,andcharity.Securityforces
commonlyclosemosquestothepublicshortlyafterFridayservicestopreventuseofthepremisesfor
unauthorizedpoliticalactivity.

d.FreedomofMovementWithintheCountry,ForeignTravel,Emigration,andRepatriation

AlthoughtheConstitutionprovidesforfreedomofmovement,inpracticesecurityforcessetup
checkpointsthroughoutthecountryandstoptrafficatwill.Insomeregionsthecheckpointshavebeen
maintainedinthesameplacesforyears,creatingwhatsomecharacterizeasinternalfrontiers.Reports
persistthatpoliceusethesecheckpointstodemandmonetarypayments.IntheMoroccanadministered
portionoftheWesternSahara,movementisrestrictedinareasregardedasmilitarilysensitive.

TheMinistryofInteriorrestrictsfreedomtotraveloutsideMoroccoincertaincircumstances.OMDH,a
humanrightsgroup,hascompiledalistofindividualswhohavereportedlybeendeniedpassports.In
addition,allcivilservantsmustobtainwrittenpermissionfromtheirministriestoleavethecountry.

InJuneMariaOufkir,whohadspent14yearsunderhousearrest,wasabletoleaveMoroccoand
emigratetoFrance.OufkiristhedaughterofMohamedOufkir,ageneralandInteriorMinisterduringthe
1960'swhowasimplicatedinthe1971coupattemptagainstKingHassan.Oufkirdiedunder

mysteriouscircumstancesin1972.Hisfamilyspentthefollowing14yearsunderhousearrest.Although
theywerenominallyreleasedin1986,theOufkirfamilyremainedbarredfromtravelingoutsideMorocco
untilMariaOufkir'smovetoFrance.Whileherflighthasbeendescribedasanescape,sourcesreport
thattheOufkirswereissuedpassportsshortlybeforeherdeparture,anditisacknowledgedthatshe
departedwithatleastthetacitconsentoftheGovernment.

Moroccansmaynotrenouncetheircitizenship,buttheKingretainsthepowerrarelyusedtorevokeit.
TensofthousandsofMoroccansholdmorethanonecitizenshipandtravelonpassportsfromtwoor

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morecountries.WhileinMorocco,theyareregardedasMoroccancitizens.Asaresult,theGovernment
hassometimesrefusedtorecognizetherightofforeignembassiestoactonbehalfofdualnationalsor
eventobeinformedoftheirarrestandimprisonment.Dualnationalssometimescomplainofharassment
byimmigrationinspectors.

TheGovernmentwelcomesvoluntaryrepatriationofJewswhohaveemigrated.MoroccanJewish
emigres,includingthosewithIsraelicitizenship,freelyvisitMorocco.TheGovernmentalsoencourages
thereturnofSahrawiswhohavedepartedMoroccoduetotheconflictintheWesternSaharaprovided
theyrecognizetheGovernment'sclaimtotheregion.TheGovernmentdoesnotpermitSaharan
nationalistswhohavebeenreleasedfromprisontoliveinthedisputedterritory.TheGovernment
cooperateswiththeU.N.HighCommissionerforRefugees(UNHCR)andotherhumanitarian
organizationsinassistingrefugees.Therewerenoreportsofforcedexpulsionofanyonehavingavalid
claimtorefugeestatus.WhileMoroccohasfromtimetotimeprovidedpoliticalasylumtoindividuals,the
issueoffirstasylumhasneverarisen.

Section3.RespectforPoliticalRights:TheRightofCitizenstoChangeTheirGovernment

Constitutionalprovisionsnotwithstanding,inpracticecitizensdonothavetherighttochangetheir
nationalgovernmentbydemocraticmeans.TheKing,asHeadofState,appointsthePrimeMinister,
whoisthetitularheadofgovernment.TheParliamenthasthetheoreticalauthoritytoeffectchangein
thesystemofgovernment,buthasneverexercisedit.Moreover,theConstitutionmaynotbechanged
withouttheKing'sapproval.TheMinistryofInteriorappointstheprovincialgovernorsandlocalcaids.
Municipalcouncilsareelected.

Constitutionalchangesin1992authorizedthePrimeMinistertonominateallgovernmentministers,but
theKinghasthepowertoreplaceanyministeratwill.AnysignificantsurrenderofpowerfromtheCrown
tothePrimeMinister'sofficewasfurther

dilutedwhentheKingtransferredtotheSecretariesGeneral,whoserveattheKing'spleasure,manyof
thepowerspreviouslyvestedintheministers.

Moroccohasaunicamerallegislature,twothirdsdirectlyelected,andanotherthirdindirectlyselectedby
variouslaborandprofessionalorganizations.ElevenpartieshavemembersinParliament.The
oppositionpartieshaveconsistentlyurgedthatallmembersofParliamentbedirectlyelectedbythe
people.Instead,theKingproposedcreatingabicamerallegislature,wherebyallmembersofthelower
chamberwouldbedirectlyelectedbythepeopleandallmembersofthesecondchamberindirectly
selected.OnSeptember13,areferendumwasheldinwhichvotersapprovedaconstitutional
amendmentcreatingthisbicameralparliament.Thereferendumwasapprovedby99percentofthe
vote.TheGovernmentreportedthat82percentoftheelectoratevoted,althoughmostobserversbelieve
thisfigureisexaggerated.Therewerenorestrictionsontheelectorateandtherewerenoserious
accusationsoffraud.Allegationsoffraudduringthe1993electionsarestillpendingbeforetheSupreme

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Court.

Womenareunderrepresentedingovernmentandpolitics.Therearenofemaleministers,andthereare
onlytwowomenamongthe333membersofParliament.

Section4.GovernmentalAttitudeRegardingInternationalandNongovernmentalInvestigationof
AllegedViolationsofHumanRights

Therearethreeofficiallyrecognizednongovernmentalhumanrightsgroups:TheMoroccanHuman
RightsOrganization,theMoroccanLeaguefortheDefenseofHumanRights(LMDH),andtheMoroccan
HumanRightsAssociation(AMDH).Afourthgroup,theCommitteefortheDefenseofHumanRights
(CDDH),wasformedin1992byformerAMDHmembers.

TheRoyalConsultativeCouncilonHumanRights(CCDH),anadvisorybodytotheKing,existsin
sometimesuneasycoordinationwiththeMinistryofHumanRights,whichwasestablishedbyParliament.
Whiletheircommonmissionprovokedanadversarialrelationshipinthepast,aclearerdivisionofroles
hasemerged,withtheCCDHissuingadviceonmatterssuchasprisonreform,andtheMinistryof
HumanRightsexercisingaprincipallyexecutiverole.

AmnestyInternational(AI)haslocalchaptersinRabat,Casablanca,andMarrakech.Thesechapters
participateinAIinternationallettercampaignsoutsideMorocco.

Section5.DiscriminationBasedonRace,Sex,Religion,Disability,Language,orSocialStatus

AlthoughtheConstitutionstatesthatallcitizensareequal,nonMuslimsandwomenfacediscrimination
inthelawandtraditionalpractice.

Women

Thelawandsocialpracticeconcerningviolenceagainstwomenreflectstheimportancesocietyplaces
onthehonorofthefamily.TheCriminalCodeincludesseverepunishmentformenconvictedofrapeor
violatingawomanoragirl.Thedefendantsinsuchcasesbeartheburdenofprovingtheirinnocence.
However,sexualassaultsoftengounreportedbecauseofthestigmaattachedtothelossofvirginity.A
rapistmaybeofferedtheopportunitytomarryhisvictiminordertopreservethehonorofthevictim's
family.Thelawismorelenienttowardmenwithrespecttocrimescommittedagainsttheirwivesfor
example,alightsentenceorreprimandmaybeaccordedamanwhohasmurderedhiswifeafter
catchingherintheactofadultery.

Spousalviolenceiscommon.Althoughabatteredwifehastherighttocomplaintothepolice,asa
practicalmattershewoulddosoonlyifpreparedtobringcriminalcharges.

Womensuffervariousformsoflegalandculturaldiscrimination.Thecivillawstatusofwomenis
governedbytheMoudouwana,orCodeofPersonalStatus,whichisbasedonIslamiclaw.Althoughthe
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Document 142-1 Filed 05/12/16 Page 15 of 20
Moudouwanawasreformedin1993,women'sgroupsstillcomplainofunequaltreatment,particularly
underthelawsgoverningmarriageanddivorce.

Inordertomarry,awomanisgenerallyrequiredtoobtainthepermissionofher"tuteur,"orlegal
guardian,usuallyherfather.Exceptinunusualcircumstances,onlyifherfatherisdeceasedmaysheact
asherown"tuteur."

Itisfareasierforamantodivorcehiswifethanforawomentodivorceherhusband.Ratherthanasking
foradivorce,amanmaysimplyrepudiatehiswife.Underthe1993reformstotheMoudouwana,a
woman'spresenceincourtisrequiredinorderforherhusbandtodivorceher,althoughwomen'sgroups
reportthatthislawisfrequentlyignored.Thedivorcecanbefinalizedevenoverthewoman'sobjections,
althoughinsuchcasesthecourtgrantsherunspecifiedallowancerights.

Awomanseekingadivorcehasseveralalternatives.Shemayofferherhusbandmoneytoagreetoa
divorce(knownasaKhol'adivorce).Thehusbandmustagreetothedivorceandisallowedtospecify
theamountthathewillbepaidwithout

limit.Accordingtowomen'sgroups,manymenpressuretheirwivestopursuethiskindofdivorce.A
womanmayalsofileforajudicialdivorceifherhusbandchoosestotakeasecondwife,ifshehasbeen
abandonedbyherhusband,orifsheisavictimofphysicalabuse.However,divorceproceduresin
thesecasesarelengthyandcomplicated.Forexample,whilephysicalabuseisalegalgroundfor
divorce,thecourtwillonlygrantitifthewomancanprovidetwowitnessestotheabuse.Evenmedical
certificatesarenotsufficient.Ifthecourtfindsagainstthewoman,sheisreturnedtoherhusband's
home.Consequently,fewwomenreportabusetotheauthorities.

UndertheCriminalCode,womenaregenerallyaccordedthesametreatmentasmen,butthisisnotthe
caseforfamilyandestatelaw,whichisbasedontheMalikiteschoolofIslamiclaw.Underthislaw,
womeninheritonlyhalfasmuchasmaleheirs.Moreover,evenwherethelawguaranteesequalstatus,
culturalnormsoftenpreventawomanfromexercisingthoserights.Whenawomeninheritsproperty,for
example,malerelativesmaypressurehertorelinquishherinterest.

Whilemanywelleducatedwomenpursuecareersinlaw,medicine,education,andgovernmentservice,
fewmakeittothetopechelonsoftheirprofessions.Womencompriseapproximately

35percentoftheworkforce,withthemajorityintheindustrial,service,andteachingsectors.The
illiteracyrateforwomenis78percent,comparedwith51percentformen.Womeninruralareassuffer
mostfrominequality.Ruralwomenperformmosthardphysicallabor,andtheliteracyrateinthe
countrysideissignificantlylowerforwomenthanformen.Girlsaremuchlesslikelytobesenttoschool
thanareboys.Womenwhodoearnsecondaryschooldiplomas,however,haveequalaccessto
universityeducation.

Children

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TheGovernmenthastakenlittleactiontoendchildlabor(seeSection6.d.).Younggirlsinparticularare
exploitedasdomesticservants.Someorphanagesareknowingaccomplicestothepracticeofadoptive
servitude,inwhichfamiliesadoptyounggirlswhoperformthedutiesofdomesticservantsintheirnew
homes.Crediblereportsofphysicalabusearewidespread.Thepracticeisoftenrationalizedasabetter
alternativetokeepingthegirlsinorphanages.Thispracticeissociallyaccepted,attractslittlecriticism
andisunregulatedbytheGovernment.

Anotherproblemfacingorphansofbothsexesislackofcivilstatus.Normally,menareregisteredat
localgovernmentofficestheirwivesandunmarriedchildrenareincludedinthisregistration,which
conferscivilstatus.Civilstatusisnecessarytoobtainabirthcertificate,passport,ormarriagelicense.If
afatherdoesnotregisterhischild,thechildiswithoutcivilstatusandthebenefitsofcitizenship.Itis
possibleforanindividualtoselfregister,buttheprocessislongandcumbersome.

PeoplewithDisabilities

Ahighincidenceofdisablingdisease,especiallypolio,hasproducedalargepopulationofdisabled
persons.WhiletheMinistryofSocialAffairscontendsthattheGovernmentendeavorstointegratethe
disabledintosociety,inpracticethisisleftlargelytoprivatecharities.However,evencharitablespecial
educationprogramsarepricedbeyondthereachofmostfamilies.Typically,disabledpersonssurviveby
begging.TheGovernmentcontinuedapilottrainingprogramfortheblindsponsoredinpartbya
memberoftheroyalfamily.Therearenolawsmandatingphysicalchangestobuildingstofacilitate
accessbythedisabled.

National/Racial/EthnicMinorities

TheConstitutionaffirms,andtheGovernmentrespects,thelegalequalityofallcitizens.Theofficial
languageisArabic.BothFrenchandArabicareusedinthenewsmediaandeducationalinstitution.
ScienceandtechnicalcoursesaretaughtinFrench,therebyeliminatingthelarge,monolingualArabic
speakingpopulationfromtheseprograms.Educationalreformsinthepastdecadehavestressedthe
useofArabicinsecondaryschools.Failuretosimilarlytransformtheuniversitysystemhaseffectively
disqualifiedmanystudentsfromhighereducationinlucrativefields.Thisisespecialytrueamongthe
poor,forwhomFrenchtrainingisnotalwaysaffordable.

Some60percentofthepopulationclaimBerberheritage.BerberculturalgroupscontendthatBerber
traditionsandthethreeremainingBerberlanguagesarerapidlybeinglost.Theirrepeatedrequeststo
theKingtopermittheteachingofBerberlanguagesintheschoolsledtoaroyaldecreeauthorizingthe
necessarycurriculumchanges,althoughnochangeshaveyetoccurred.

InJuneanumberofBerberassociationsissuedacommuniquepetitioningtheGovernmenttorecognize
theirlanguage,Amzaghi,asanofficiallanguageandtoacknowledgetheAmzaghicultureasapartof
Moroccansociety.TheGovernmentthusfarhasmadenoresponsetothepetition.

http://19972001.state.gov/www/global/human_rights/1996_hrp_report/morocco.html 15/19
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Document 142-1 Filed 05/12/16 Page 17 of 20
Section6.WorkerRights

a.TheRightofAssociation

Althoughworkersarefreetoestablishandjointradeunions,theunionsthemselvesarenotcompletely
freefromgovernmentinterference.PerhapshalfamillionofMorocco's9millionworkersareunionized
in17tradeunionfederations.Threefederationsdominatethelaborscene:theUnionMarocainde
Travail(UMT),theConfederationDemocratiquedeTravail(CDT),andtheUnionGeneraledes
TravailleursMarocains(UGTM).TheUMThasnopoliticalaffiliation,buttheCDTisaffiliatedwiththe
SocialistUnionofPopularForces,andtheUGTMtotheIstiqlalParty.

InpracticetheMinistryofInteriorisbelievedtohaveinformantswithintheunionswhomonitorunion
activitiesandtheelectionofofficers.Sometimesunionofficersaresubjecttogovernmentpressure.
Unionleadershipdoesnotalwaysupholdtherightsofmemberstoselecttheirownleaders.Therehas
beennocaseoftherankandfilevotingoutitscurrentleadershipandreplacingitwithanother.

Workershavetherighttostrikeanddoso.Workstoppagesarenormallyintendedtoadvertise
grievancesandlast48to72hoursorless.Secondaryschoolteachersanduniversityprofessorsheld
severalstrikesthroughouttheyearandtherewereanumberoflimiteddurationstrikesinthephosphate,
banking,andhealthcaresectors,andattheportofCasablanca.

OnJune5,theCDTandUGTMlaborfederationsjoinedforcestostagea24hourgeneralstrike
throughoutMoroccotoprotestperceivedgovernmentindifferencetotheeconomicandsocialsituation
oftheworkers.Thestrikewasrelativelyquietandviolencefreeexceptinaneighborhoodofthe
northerncityofTangier,wheretherewassporadicviolenceinvolvingteenagersandyoungadults,rather
thanunionactivists.TheUMTdidnotparticipateinthestrikeand,overall,anestimated50to60percent
ofshopsandfactoriesnationwideclosedincompliancewiththecalltostrike.

UMTunionistsatayeastproductioncompanyinCasablancabeganastrikeinFebruary,when
managementfiredaunionrepresentative.Thestrikecontinuesastheplantownerreceivedpermission
toimportyeasttomakeupforshortagesinthemarket.

Unionsbelongtoregionallabororganizationsandmaintaintieswithinternationaltradesecretariats.

b.TheRighttoOrganizeandBargainCollectively

Therighttoorganizeandbargaincollectivelyisimpliedintheconstitutionalprovisionsontherightto
strikeandtherighttojoinorganizations.Tradeunionfederationscompete

amongthemselvestoorganizeworkers.Anygroupofeightworkersmayorganizeaunionandaworker
maychangeunionaffiliationeasily.Aworksitemaycontainseveralindependentlocalsorlocalsaffiliated
withmorethanonelaborfederation.

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IngeneraltheGovernmentensurestheobservanceoflaborlawsinlargercompaniesandinthepublic
sector.Intheinformaleconomy,andinthetextileandhandicraftsindustries,boththeGovernmentand
managementroutinelyignorelaborlawsandregulations.Asapracticalmatter,unionshavenojudicial
recoursetoobligetheGovernmenttoenforcelaborlawsandregulations.

Thelawsgoverningcollectivebargainingareinadequate.Collectivebargaininghasbeenalong
standingtraditioninsomepartsoftheeconomysuchastheindustrialsector,especiallyheavyindustry,
butthepracticehasnotspreadtoothersectorssuchastheserviceandinformalsectors.Thewages
andconditionsofemploymentofunionizedworkersaregenerallysetindiscussionsbetweenemployer
andworkerrepresentatives.However,wagesforthevastmajorityofworkersareunilaterallysetby
employers.

Employerswishingtodismissworkersarerequiredbylawtonotifytheprovincialgovernorthroughthe
laborinspector'soffice.Incaseswhereemployersplantoreplacedismissedworkers,agovernment
laborinspectorprovidesreplacementsandmediatesthecasesofworkerswhoprotesttheirdismissal.
Anyworkerdismissedforcommittingaseriousinfractionofworkrulesisentitledbylawtoacourt
hearing.

Thereisnolawspecificallyprohibitingantiuniondiscrimination.Employerscommonlydismissworkers
forunionactivitiesregardedasthreateningtoemployerinterests.Thecourtshavetheauthorityto
reinstatesuchworkers,butareunabletoensurethatemployerspaydamagesandbackpay.

MinistryofLaborinspectorsserveasinvestigatorsandconciliatorsinlabordisputes,buttheyarefewin
numberanddonothavetheresourcestoinvestigateallcases.Unionshaveincreasinglyresortedto
litigationtoresolvelabordisputes.

ThelaborlawappliesequallytothesmallTangierexportzone.Theproportionofunionizedworkersin
theexportzoneisaboutthesameasintherestoftheeconomy.

c.ProhibitionofForcedorCompulsoryLabor

ForcedorcompulsorylaborisprohibitedbytheInternationalLaborOrganization's(ILO)Convention29,
whichwasadoptedbyroyaldecree.Whenauthoritiesbecomeawareofinstancesof

forcedlabor,courtsenforcethedecree.However,inpractice,theGovernmentlackstheresourcesto
inspectallplacesofworktoensurethatforcedlaborisnotbeingused.

d.MinimumAgeforEmploymentofChildren

Abuseofthechildlaborlawsiscommon.Thelawprohibitstheemploymentorapprenticeshipofany
childunder12yearsofage.Educationiscompulsoryforchildrenbetweentheagesof7and13years.
Specialregulationscovertheemploymentofchildrenbetweentheagesof12and16years.Inpractice,

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childrenareoftenapprenticedbeforeage12,particularlyinthehandicraftindustry.Theuseofminorsis
commonintherugmakingindustryandalsoexiststosomeextentinthetextileandleathergoods
industries.Childrenarealsoemployedinformallyasdomesticsandusuallyreceivelittleornowages.
Safetyandhealthconditionsaswellaswagesinenterprisesemployingchildrenareoftensubstandard.

MinistryofLaborinspectorsareresponsibleforenforcingchildlaborregulations,whicharegenerally
wellobservedintheindustrialized,unionizedsectoroftheeconomy.However,theinspectorsarenot
authorizedtomonitortheconditionsofdomesticservants.

e.AcceptableConditionsofWork

TheJune5generalstrikeledtonegotiationsamongtheGovernment,themanufacturers'association,
andthelaborconfederationsoverincreasingtheminimumwageandimprovinghealthbenefits,social
benefits,andhousing.InAugustallthreepartiesagreedtoa10percentincreaseintheminimumwage
retroactivetoJuly1,raisingittoapproximately$193(1,661dirhams)permonthintheindustrialized
sectorandtoapproximately$9.41(80.96dirhams)perdayforagriculturalworkers.Neitherprovidesa
decentstandardoflivingforaworkerandfamilyevenwithgovernmentsubsidiesforfood,dieselfuel,
andpublictransportation.Inmanycases,severalfamilymemberscombinetheirincometosupportthe
family.Mostworkersintheindustrialsectorearnmorethantheminimumwage.Theyaregenerallypaid
between13and16monthssalary,includingbonuses,eachyear.

Theminimumwageisnotenforcedeffectivelyintheinformalandhandicraftsectors,andeventhe
Governmentpayslessthantheminimumwagetoworkersatthelowestcivilservicegrades.Toincrease
employmentopportunitiesforrecentgraduates,theGovernmentallowsfirmstohirethemforalimited
periodatlessthantheminimumwage.

Thelawprovidesfora48hourmaximumworkweekwithnomorethan10hoursinanysingleday,
premiumpayforovertime,paidpublicandannualholidays,andminimumconditionsforhealth

andsafety,includingaprohibitiononnightworkforwomenandminors.Aswithotherregulationsand
laws,thesearenotuniversallyobservedintheinformalsector.

Occupationalhealthandsafetystandardsarerudimentary,exceptforaprohibitionontheemployment
ofwomenincertaindangerousoccupations.Laborinspectorsendeavortomonitorworkingconditions
andaccidents,butlacksufficientresources.Whileworkers,inprinciple,havetherighttoremove
themselvesfromworksituationsthatendangerhealthandsafetywithoutjeopardizingtheircontinued
employment,therewerenoreportsofanyinstancesinwhichaworkerattemptedtoexercisethisright.

[endofdocument]

http://19972001.state.gov/www/global/human_rights/1996_hrp_report/morocco.html 18/19
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Document 142-1 Filed 05/12/16 Page 20 of 20

Returnto1996HumanRightsPracticesreporthomepage.
ReturntoDOSFANhomepage.
ThisisanofficialU.S.GovernmentsourceforinformationontheWWW.InclusionofnonU.S.
Governmentlinksdoesnotimplyendorsementofcontents.

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Case 1:15-cv-05345-AJN-KHP Document 142-2 Filed 05/12/16 Page 1 of 6

Exhibit 2
Case 1:15-cv-05345-AJN-KHP Document 142-2 Filed 05/12/16 Page 2 of 6
Case 1:15-cv-05345-AJN-KHP Document 142-2 Filed 05/12/16 Page 3 of 6
Case 1:15-cv-05345-AJN-KHP Document 142-2 Filed 05/12/16 Page 4 of 6
Case 1:15-cv-05345-AJN-KHP Document 142-2 Filed 05/12/16 Page 5 of 6
Case 1:15-cv-05345-AJN-KHP Document 142-2 Filed 05/12/16 Page 6 of 6
Case 1:15-cv-05345-AJN-KHP Document 142-3 Filed 05/12/16 Page 1 of 2

Exhibit 3
5/2/2016 FinCENIssuesFinalRuleImposingaProhibitionontheOpeningorMaintainingofCorrespondentAccountsfor,oronBehalfof,FBMEBankLtd.
Case 1:15-cv-05345-AJN-KHP Document 142-3 Filed 05/12/16 Page 2 of 2

TovieworprintPDFcontent,downloadthefreeAdobeAcrobatReader.

FinCENIssuesFinalRuleImposingaProhibitiononthe
OpeningorMaintainingofCorrespondentAccountsfor,or
onBehalfof,FBMEBankLtd.
OnJuly29,2015,FinCENpublishedintheFederalRegisteraFinalRuleimposinga
prohibitiononU.S.financialinstitutionsfromopeningormaintainingacorrespondent
accountfor,oronbehalfof,FBMEBankLtd.(FBME)underthefifthspecialmeasureof
Section311oftheUSAPATRIOTAct,withaneffectivedateofAugust28,2015.OnAugust
27,2015,theUnitedStatesDistrictCourtfortheDistrictofColumbiagrantedFBMEsmotion
forapreliminaryinjunctionandenjoinedtheFinalRulefromtakingeffect.OnNovember6,
2015,thecourtgrantedFinCENsmotionforvoluntaryremandtoallowforfurtherrulemaking
proceedings.OnNovember27,2015,FinCENpublishedintheFederalRegisteraNoticeto
reopentheFinalRulefor60daystosolicitadditionalcommentinconnectionwiththe
rulemaking,particularlywithrespecttotheunclassified,nonprotecteddocumentsthat
supportedtherulemaking,andwhetheranyalternativestotheprohibitionontheopeningor
maintainingofcorrespondentaccountsforFBMEwouldeffectivelymitigatethemoney
launderingandterroristfinancingriskassociatedwithFBME.FinCENalsomadeavailable
forcommentonwww.regulations.govtheunclassified,nonprotectedmaterialthatFinCEN
consideredandintendedtorelyuponduringtherulemakingproceeding.

Afterreopeningthecommentperiod,FinCENconsideredallofthespecialmeasures
availabletoitunderSection311,aswellasconditionsratherthanaprohibitionunderthe
fifthspecialmeasure,andconcludedthataprohibitionunderthefifthspecialmeasureisthe
appropriatechoice.Accordingly,FinCENisissuingafinalruleimposingaprohibitionon
U.S.financialinstitutionsfromopeningormaintainingacorrespondentaccountfor,oron
behalfof,FBMEinplaceoftherulepublishedonJuly29,2015.FinCENsimpositionofa
prohibitionunderthefifthspecialmeasurewillguardagainsttheinternationalmoney
launderingandterroristfinancingrisksthatFBMEposestotheU.S.financialsystem.This
rulewilltakeeffect120daysfromthedateofpublicationintheFederalRegister.

https://www.fincen.gov/news_room/other/html/20160325.html 1/1
Case 1:15-cv-05345-AJN-KHP Document 142-4 Filed 05/12/16 Page 1 of 11

Exhibit 4
Pagel of 10
Case 1:15-cv-05345-AJN-KHP Document 142-4 Filed 05/12/16 Page 2 of 11
Subj: FW: Swifts
Date: 12/12/2013 3:56:55 P.M. Eastern Standard Time
From: nb@sdg-if.com
To: jochetrit@aol.com

Nicolas Bourg

Chief Executive Officer


SDG Investment Fund

De : Kevin M eyer <km@sdg-if.com>


Date : j eudi, 12 decembre 2013 18:45
A: Nicolas Bourg <nb@sdg-if.com>
Objet : Sw ifts

Voici plein de documents issus de votre boite d'envoi

Kevin Meyer

SDG Investment Fund


20, Rue Philippe-Plantamour
1201 Geneve

M +41 78 637 52 49
T +41 22 545 03 51

The information contained in this communication is fully confidential and intended for the named recipient(s) only. In case you are not an intended recipient, you
are hereby (a) strictly forbidden from copying, distributing this email or taking any further action relating to it, and (b) kindly requested to notify the sender and
delete any copies immediately. We undertake no responsibility for the accuracy, completeness and absence of virus in this communication or any of its attachment
(s). Unless otherwise stated, any views or opinions presented herein are solely those of the author. This email is intended for informational purposes only and is
not a solicitation or offer to buy or sell any participation or financial instruments.

The information contained in this communication is fully confidential and intended for the named recipient(s) only. In case you are not an intended recipient, you
are hereby (a) strictly forbidden from copying, distributing this email or taking any further action relating to ii, and (b) kindly requested to notify the sender and
delete any copies immediately. We undertake no responsibility for the accuracy, completeness and absence of virus in this communication or any of its attachment
(s). Unless otherwise stated, any views or opinions presented herein are solely those of the author. This email is intended for informational purposes only and is
not a solicitation or offer to buy or sell any participation or financial instruments.

-----Original Message-----
Fro m: jgraff <j graff@ssglaw.com>
To: Kevin Meyer <k.meye r@sdg.ch>
CC: Nicolas Bourg <nb@sdg.ch>
Subject : RE: Flatote l: Telfo rd equity payments
Date: Thu, 28 Feb 2013 18:06:02 +0100

The following wires have been received from Telford:


1. $10,500,051.25 on November 9,2012
2. $2,625,053.01 on January 22, 2013
3. $15,925,102.16 on February 13, 2013
4. $175,101.32 on February 19, 2013

The time and date of Closing has not yet been set. In all likelihood it will not be a sit down Closing. I will keep you posted.

From: Kevin Meyer [mailto:k.meyer@sdg.ch]

Thursday, D ecember 12, 2013 AOL: JOCHETRIT


Page 2 of IO
Case 1:15-cv-05345-AJN-KHP Document 142-4 Filed 05/12/16 Page 3 of 11
Sent: Thursday, February 28, 2013 9:48 AM
To: jgraff
Cc: Nicolas Bourg
Subject: RE: Flatotel: Telford equity payments

Dear Mr. Graff,

Could I please also ask you for the details regarding the Flatotel deal's closing (time, date, place, attend ing people,
... )?

Thank you very much in advance for your help.

Regards,

Kevin Meyer

SDG Investment Fund


20, Rue Phillipe-Plantamour
1201 Geneve

M +41 78 637 52 49
T +41 22 545 03 51

From: Kevin Meyer


Sent: jeudi 28 tevrier 2013 13:58
To: 'jgraff@ssglaw.com'
Cc: Nicolas Bourg
Subject: Flatotel : Telford equity payments

Dear Mr. Graff,

My name is Kevin Meyer, and I work with Mr. Bourg on the Flatotel deal.

Could you please send us a formal confi rmation of the reception the two last equity payments done by Telford?

Best regards,

Kevin Meyer

SDG Investment Fund


20, Rue Phill ipe-Plantamour
1201 Geneve

M +41 78 637 52 49
T +41 22 545 03 51

-----Original Message-----
From: Nicolas Bourg <nb@sdg-if.com>
To: Arnie Herz <arnie@arnieherz.com>, Felix <felix@regency.net>
Subject: Fw: Swift
Date: Tue, 21 May 2013 07:41:23 +0200

Nicolas Bourg

Thursday, December 12, 20 13 AOL: JOCHETRIT


Page 3of10
Case 1:15-cv-05345-AJN-KHP Document 142-4 Filed 05/12/16 Page 4 of 11
Chief Executive Officer
SDG Investment Fund

From: Nicolas Bourg


Sent: Monday, May 20, 2013 5:55:29 PM
To: jochetrit@aol.com
Cc: Eric Elkain
Subject: Swift

Sa Jut Jo,

Je te prie de trouver la copie du swift pour l'envoi des usd 6 ~illions pour Cabrini.

{ 1:F01FBMECY2NAXXX1111111111}
{2:1103BKTRUS33XXXXN}
{4:
:20:NICOPSD131400016
:23B:CRED
:32A: 130520USD6000189,25
:33B:USD6000189,25
:50K:/CY4511501001402320USDCACC001
TELFORD INTERNATIONAL LIMITED
PO BOX 487922
DUBAI, UNITED ARAB EMIRATES
:57 A:CITIUS33
:59:/61768742
SUKENIK SEGAL and GRAFF
ATTORNEY TRUST IOLA ACCOUNT
:70:as per loan agreement
:71A:OUR
-}
Amities,

Nicolas

Nicolas Bourg

Chief Executive Officer


SDG Investment Fund

-----Original Message-----
From: Nicolas Bourg <nb@sdg-if.com>
To: Felix SATER <felix@regency.net>
Subject: swift code
Date: Wed, 24 Apr 2013 17:59:26 +0200

{1:FOIFBMECY2NAXXX1111111111}

{2:1103BKTRUS33XXXXN}

Thursday, December 12, 2013 AOL: JOCHETRIT


Case 1:15-cv-05345-AJN-KHP Document 142-4 Filed 05/12/16 Page 5 of 11 Page 4of10

{4:

:20:NICOPSD131140081

:23B:CRED

:32A: 130424USD2800045,23

:33B:USD2800045,23

:50K:/CY4511501001402320USDCACC001

TELFORD INTERNATIONAL LIMITED

PO BOX 487922

DUBAI, UNITED ARAB EMIRATES

:57A:CITIUS33

:59:/37301114

Kramer levin Naftalis and Frankel

LLP Attorney Escrow Account

FOA Reetika Agarwal (212) 559-6299

:70:ABA No. 021000089

:71A:OUR

-}

Nicolas Bourg

Chief Executive Officer


SDG Investment Fund

----Original Message-----
From: Nico las Bourg <nb@sdg-if.com>
To: Cha rki Jean-Charles <jcc@iota.eu.com>
CC: Halm Alexandre <ah@iota.eu.com>
Subject: Re: swift
Date: Tue, 16 Apr 2013 20:49:08 +0200

Thursday, December 12, 2013 AOL: JOCHETRIT


Page 5of10
Case 1:15-cv-05345-AJN-KHP Document 142-4 Filed 05/12/16 Page 6 of 11
Aujourd'hui.
Bien a toi.

Nicolas Bourg

Chief Executive Officer


SDG Investment Fund

From: Charki Jean-Charles


Sent: Tuesday, April 16, 2013 7:29:11 PM
To: Nicolas Bourg
Cc: Halm Alexandre
Subject: RE: swift

Tu as la date de valeur? c'est pour detendre les lawyers qui sont en stress total comme tu as pule voir

From: Nicolas Bourg [mailto:nb@sdg-if.com]


Sent: mardi 16 avril 2013 19:25
To: Charki Jean-Charles
Subject: swift

{1:F01FBMECY2NAXXX11111l1111}

{2:1103BKTRUS33XXXXN}

{4:

:20:NICOPSD131060020

:23B:CRED

:32A:l30416USD390056,29

:33B:USD390056,29

:50K:/CY4511501001402320USDCACC001

TELFORD INTERNATIONAL LIMITED

PO BOX 487922

DUBAI, UNITED ARAB EMIRATES

:56A:MRMDUS33

:57A:CCFRFRPP

Thursday, December 12, 2013 AOL: JOCHETRIT


Page 6of10
Case 1:15-cv-05345-AJN-KHP Document 142-4 Filed 05/12/16 Page 7 of 11
:59:/FR7630056000390039004012516

IOTA SASU

Paris, France

:70:payment for invoice 0042013

:71A:OUR

-}

-----Original Message-----
From: Nicolas Bourg <nb@sdg-if.com>
To: "eric.elkain@gmail.com" <eric.elkain@gmail.com>, Eric Elkain
<eric@elkain.com>
Subject: Copy of the Swift
Date: Mon, 8 Apr 2013 15:43:40 +0200

{1:F01FBMECY2NAXXX1111111111}

{2:I 103BKTRUS33XXXXN}

{4:

:20:NICOPSD 130930140

:23B:CRED

:32A: 130408USD5660256,77

:33B:USD5660256,77

:50K:/CY4511501001402320USDCACCOO 1

TELFORD INTERNATIONAL LIMITED

PO BOX 487922

DUBAI, UNITED ARAB EMIRATES

Thursday, December 12, 2013 AOL: JOCHETRIT


Page 7of10
Case 1:15-cv-05345-AJN-KHP Document 142-4 Filed 05/12/16 Page 8 of 11
:57A:CITIUS33

:59:/61768742

SUKENIK SEGAL and GRAFF

ATTORNEY TRUST IOLA ACCOUNT

:70:ABA NO. 021-0000-89

:71A:OUR

-}

-----Original Message-----
From: Nicolas Bou rg
<IMCEAEX-
_O=SDG_OU=EXCHANGE+20ADMINISTRATIVE+20GROUP+20+28FYDI BOHF23SPDLT+29_CN=RECI PIENTS_CN=NB @eurprd04.prod.outlo
ok.com >
To: "eric.elkain@gmail.com " <eric.elkain@gmail.com>, "jochetrit@aol.com"
<jochetrit@aol.com>
Su bject : Swift copy
Date: Thu, 14 Feb 2013 09:18:26 +0100

Dear All,

Please fi nd th e copy of the swift:

{l :F01FBMECY2NAXXX1111111111}

{2:Il 03BKTRUS33XXXXN}

{4:

:20:NICOPSD130440 11 5

:23B:CRED

:32A: 130213USD 15925 102, 16

:33B:USD15925102,16

:50K:/CY4511501001402320USDCACC001

TELFORD INTERNATIONAL LIMITED

Thursday, December 12, 2013 AOL: JOCHETRIT


Case 1:15-cv-05345-AJN-KHP Document 142-4 Filed 05/12/16 Page 9 of 11 Page 8of10

PO BOX 487922

DUBAI, UNITED ARAB EMIRATES

:57A:CITIUS33

:59:/61768742

SUKENIK SEGAL and GRAFF

ATTORNEY TRUST IOLA ACCOUNT

:70:amendment to the loan agreement

dated 07 Nov 12

:71A:OUR

-}

Have a goof day

Nicolas

Nicolas Bourg

SWISS DEVELOPMENT GROUP


20 Rue Philippe-Plantamour
1201 Geneve Switzerland

M +41 78 888 31 75
T +4122545 03 00

www.sdg.ch

-----Original Message-----
From : Nicolas Bourg
<IMCEAEX-
_O=SDG_OU=EXCHANGE+20ADMINISTRATIVE+20GROUP+20+28FYDIBOHF23SPDLT+29_ CN=RECIPIENTS_CN=NB@eurprd04.prod.outlo
ok.com>
To: '"jochetrit@aol.com'" <jochetrit@aol.com>
Subject: Fw: Fwd: Electronic SWIFT copy
Date: Wed, 23 Jan 2013 09:06 :13 +0100

Nicolas Bourg
Swiss Development Group
+41 78 888 31 75

Thursday, December 12, 2013 AOL: JOCHETRIT


Page 9of10
Case 1:15-cv-05345-AJN-KHP Document 142-4 Filed 05/12/16 Page 10 of 11

-----Original Message-----
From: elvis elvis <theuraniumguy@gmail.com>
To: Nicolas Bourg
Sent: Wed Jan 23 08:54:34 2013
Subject: Fwd : Electronic SWIFT copy

---------- Forwarded message----------


From: Eesh Aggarwal
Date: Wednesday, January 23, 2013
Subject: Electronic SWIFT copy

Hi

Our client advised us to send the below copy of the electronic swift confirming the transfer to the US lawyers executed yesterday, 22-
January-2013.

{l:F01FBMECY2NAXXX1111111111}

{2 :1103BKTRUS33XXXXN}

{4:

:20:NICOPSD130220087

:23B:CRED

:32A:130122USD2625053,01

:33B:USD2625053,01

:50K:/CY4511501001402320USDCACC001

TELFORD INTERNATIONAL LIMITED

PO BOX 487922

DUBAI, UNITED ARAB EMIRATES

:57A:CITIUS33

:59:/61768742

SU KENIK SEGAL an d GRAFF

Thursday, December 12, 2013 AOL: JOCHETRIT


Page 10of 10
Case 1:15-cv-05345-AJN-KHP Document 142-4 Filed 05/12/16 Page 11 of 11

ATTORNEY TRUST IOLA ACCOUNT

:70:ABA NO. 021-0000-89

:71A:OUR

-}

Regards

Eesh Aggarwal

For and on behalf of

Azure ConsultantsJLT

Thursday, December 12, 20 13 AOL: JOCHETRIT


Case 1:15-cv-05345-AJN-KHP Document 142-5 Filed 05/12/16 Page 1 of 6

Exhibit 5
Case 1:15-cv-05345-AJN-KHP Document 142-5 Filed 05/12/16 Page 2 of 6

22/05/13-19:19:13 OPSPRTOUT-4838-172970 1

---------------- ----- Instance Type and TranslD.l.ssi on - -------------


Notification (Transmission) of Original sent to SWIFT (ACK)
Network Delivery Status Network Ack
Priority/Delivery Normal
Message Input Reference 1920 130522FBMECY2NAXXX0999601752
--------------------------- Message He ade r - - --- --- - ---------- ------
Swif~ Input : FIN 103 Single Customer Credt Transfer
Sender FBMECY2NXXX
FBME BANK LTD
NICOSIA CY
Receiver BKTRUS33XXX
DEUTSCHE BANK TRUST COMPANY AMERICAS
NEW YORK,NY US
Message Text ---- - --------------- - ----- -
20 : Sender's Reference
NICOPSD131420130
23B: Bank Operation Code
CRED
32A: Val Dte/Curr/Interbnk Settld Amt
Date : 22 May 2013
Currency : USO (US DOLLAR)
Amount #28.000.000 , #
33B: Currency/Instructed Amount
Currency : USD (US DOLLAR)
Amount #28 . 000.000 , #
SOK : Ordering Customer- Name & Address
/CY451150 1001402320USDCACC001
TELFORD I NTERNATIONAL LIMITED
PO BOX 487922
DUBAI, UNITED ARAB EMIRATES
570 : Account With Inst -Name & Addr
//FW021000089
CITIBANK N. A
153 EAST 53 STREET
NEW YORK NY 10022
59: Beneficiar y Customer- Name & Addr
/37301114
KRAMER LEVIN NAFTALIS AND FRANKEL
LLP
ATTORNEY ESCROW ACCOUNT
70: Remittance I nformation
ATTN: REETIKA AGARWAL
212 559-6299
71A : Details of Charges
OUR
Message Trailer
{CHK:32B197A99EOF}
PKI Signature : MAC- Equivalent
--- - ---------------- - ------- Interv e ntions ------ --- ----------------
Cacego r y Network Report
Creation Time 22/05/13 19:18:58
Application SWIFT Incerface
Operator SYSTEM
Text
( l : F21FBMECY2NAXXX0999601752 } {4 :{ 177:1305221920}{451:0 }}
Case 1:15-cv-05345-AJN-KHP Document 142-5 Filed 05/12/16 Page 3 of 6

Received by josh graft

1. $10,500,051.25 on November 9,2012


2. $2,625,053.01 on January 22, 2013
{I :F01FBMECY2NAXXX1111111111}
{2:1103BKTRUS33XXXXN}
{4:
:20:NICOPSD 130220087
:23B:CRED
:32A:130122USD2625053,01
:33B:USD2625053,01
:50K:/CY4511501001402320USDCACC001
TELFORD INTERNATIONAL LIMITED
PO BOX 487922
DUBAI, UNITED ARAB EMIRATES
:57A:CITIUS33
:59:/61768742
SUKENIK SEGAL and GRAFF
ATTORNEY TRUST IOLA ACCOUNT
:70:ABA NO. 021-0000-89
:71A:OUR

3. $15,925,102.16 on February 13, 2013


{1:F01FBMECY2NAXXX1111111111}
{2:1103BKTRUS33XXXXN}
{4:
:20:NICOPSD130440115
:23B:CRED
:32A: 13021JUSDI5925102,16
:33B: USD 15925102, 16
:50K:/CY4511501001402320USDCACC001
TELFORD INTERNATIONAL LIMITED
PO BOX 487922

DUBAI, UNITED ARAB EMIRATES


:57A:CITIUS33
:59:/61768742
SUKENIK SEGAL and GRAFF
ATTORNEY TRUST IOLA ACCOUNT
:70:amendment to the loan agreement
Case 1:15-cv-05345-AJN-KHP Document 142-5 Filed 05/12/16 Page 4 of 6

dated 07 Nov 12
:71A:OUR

4. $175,101.32 on February 19, 2013

Other Received by Graff:

5. $5,660,256.77 on April 13, 2013


1:F01FBMECY2NAXXX1111111l11}
{2:1103BKTRUS33XXXXN}
{4:
:20:NICOPSD130930140
:23B:CRED
:32A: 130408USD5660256,77
:33B :USD5660256,77
:50K:/CY451 1501001402320USDCACC001
TELFORD INTERNATIONAL LIMITED
PO BOX 487922
DUBAI, UNITED ARAB EMIRATES
:57A:CITIUS33
:59:/61768742
SUKENIK SEGAL and GRAFF
ATTORNEY TRUST IOLA ACCOUNT
:70:ABA NO. 021-0000-89
:71A:OUR

6. $390,056.29 on April 16, 2013


{ 1:F01FBMECY2NAXXX1111111ll1}
{2:1103BKTRUS33XXXXN}
{4:
:20:NICOPSD 131060020
:23B:CRED
:32A: 130416USD390056,29
:33B: USD3 90056,29
:50K:/CY4511501001402320USDCACC001
TELFORD INTERNATIONAL LIMITED
PO BOX 487922
DUBAI, UNITED ARAB EMIRATES
:56A:MRMDUS33
:57A:CCFRFRPP
Case 1:15-cv-05345-AJN-KHP Document 142-5 Filed 05/12/16 Page 5 of 6

:59:/FR7630056000390039004012516
IOTA SASU
Paris, France
:70:payment for invoice 0042013
:7 1A:OUR

I think was first sent to Kramer Levin: First payment to Kramer bounced, second to Graff here below

7. $6,000,189.25 on May 20, 2013 (Cabrini)


SWIFT:
{l:F01FBMECY2NAXXX1111111111}
{2:1103BKTRUS33XXXXN}
{4:
:20:NICOPSD131400016
:23B:CRED
:32A:l30520USD6000189,25
:33B: USD6000189,25
:50K:/CY4511501001402320USDCACC001
TELFORD INTERNATIONAL LIMITED
PO BOX 487922
DUBAI, UNITED ARAB EMIRATES
:57A:CITIUS33
:59:/61768742
SU KENIK SEGAL and GRAFF
ATIORNEY TRUST IOLA ACCOUNT
:70:as per loan agreement
:71A:OUR

Tricounty money:
8. $2'800'045.23 on April 24, 2013
9. { 1:F01FBMECY2NAXXX1111111111}
10. {2:I103BKTRUS33XXXXN}
11. {4:
12. :20:NICOPSD131140081
13. :23B:CRED
:32A: 130424USD2800045,23
:33B:USD2800045,23
:50K:/CY4511501001402320USDCACCOO 1
Case 1:15-cv-05345-AJN-KHP Document 142-5 Filed 05/12/16 Page 6 of 6

TELFORD INTERNATIONAL LIMITED


PO BOX 487922
DUBAI, UNITED ARAB EMIRATES
:57A:CITIUS33
:59:/37301114
Kramer levin Naftalis and Frankel
LLP Attorney Escrow Account
FOA Reetika Agarwal (212) 559-6299
:70:ABA No. 021000089
:71A:OUR

14. $28,000,000.00 on May 22, 2013


Case 1:15-cv-05345-AJN-KHP Document 142-6 Filed 05/12/16 Page 1 of 19

Exhibit 6
Case 1:15-cv-05345-AJN-KHP Document 142-6 Filed 05/12/16 Page 2 of 19
Case 1:15-cv-05345-AJN-KHP Document 142-6 Filed 05/12/16 Page 3 of 19
Case 1:15-cv-05345-AJN-KHP Document 142-6 Filed 05/12/16 Page 4 of 19
Case 1:15-cv-05345-AJN-KHP Document 142-6 Filed 05/12/16 Page 5 of 19
Case 1:15-cv-05345-AJN-KHP Document 142-6 Filed 05/12/16 Page 6 of 19
Case 1:15-cv-05345-AJN-KHP Document 142-6 Filed 05/12/16 Page 7 of 19
Case 1:15-cv-05345-AJN-KHP Document 142-6 Filed 05/12/16 Page 8 of 19
Case 1:15-cv-05345-AJN-KHP Document 142-6 Filed 05/12/16 Page 9 of 19
Case 1:15-cv-05345-AJN-KHP Document 142-6 Filed 05/12/16 Page 10 of 19
Case 1:15-cv-05345-AJN-KHP Document 142-6 Filed 05/12/16 Page 11 of 19
Case 1:15-cv-05345-AJN-KHP Document 142-6 Filed 05/12/16 Page 12 of 19
Case 1:15-cv-05345-AJN-KHP Document 142-6 Filed 05/12/16 Page 13 of 19
Case 1:15-cv-05345-AJN-KHP Document 142-6 Filed 05/12/16 Page 14 of 19
Case 1:15-cv-05345-AJN-KHP Document 142-6 Filed 05/12/16 Page 15 of 19
Case 1:15-cv-05345-AJN-KHP Document 142-6 Filed 05/12/16 Page 16 of 19
Case 1:15-cv-05345-AJN-KHP Document 142-6 Filed 05/12/16 Page 17 of 19
Case 1:15-cv-05345-AJN-KHP Document 142-6 Filed 05/12/16 Page 18 of 19
Case 1:15-cv-05345-AJN-KHP Document 142-6 Filed 05/12/16 Page 19 of 19
Case 1:15-cv-05345-AJN-KHP Document 142-7 Filed 05/12/16 Page 1 of 7

Exhibit 7
Case 1:15-cv-05345-AJN-KHP Document 142-7 Filed 05/12/16 Page 2 of 7

Le 16.07.13 17:10, Iliyas Khrapunov <IKhrapunov@sdg.ch> a crit :

>>
>> SDG Investment Fund
>>
>>
>>
>>
Case 1:15-cv-05345-AJN-KHP Document 142-7 Filed 05/12/16 Page 3 of 7

Case 1:15-cv-05345-AJN-KHP Document 142-7 Filed 05/12/16 Page 4 of 7

>>> Dear Michael,


>>>
>>> Following our conversation of today, I am forwarding you SDG
>>>consolidated financial statements:
>>>
>>> 1) SDG has negative equity of CHF 28.5 million. To get involved in a
>>>project finance deal with a sponsor that is technically insolvent
>>>would not be prudent.
>>> 2) Please see Note 2. Scope of Consolidation of the auditor's report
>>>that lists subsidiaries that were used for consolidation. If you
>>>compare this list with the companies mentioned in the attached
>>>newspaper article, you will find many similaries. The new ultimate
>>>owner of SDG is said to be Mr. Philippe Glatz. Greencos S.A., the
>>>company through which Mr. Glatz acquired SDG, has a charter capital
>>>of CHF 100,000 and its financial strength is estimated by D&B at CHF
>>>90,000. How and where Greencos and Mr. Glatz found the CHF 10
>>>million that was used to recapitalize SDG is unclear. I am not
>>>persuaded that there's been any real change in the ownership of SDG.
>>>
>>> Based on the above, I cannot return the project to our pipeline.
>>>
>>> I will be away from the office next week but you could always call
>>> my mobile.
>>>
>>> Regards,
>>>
>>> Alexey
>>>
>>>
>>> -----Original Message-----
>>> From: Kevin Meyer [mailto:km@sdg-if.com]
>>> Sent: Wednesday, June 19, 2013 8:56 PM
>>> To: Alexey Alekseev
>>> Cc: Cesare Cerrito
>>> Subject: Financial Report SDG Capital
>>>
>>> Dear Mr. Alekseev,
>>>
>>> As requested, please find attached the YE12 financial reports for
>>> SDG Capital, the Swiss entity holding the Luxembourg SPV Porto Heli.
>>>
>>> As you might notice, the reported losses of the Group represent a
>>> significant amount. Nevertheless, this amount is not representative
>>> of the activity of SDG Capital for the following reasons:
>>>
Case 1:15-cv-05345-AJN-KHP Document 142-7 Filed 05/12/16 Page 5 of 7

>>> - Due to the accounting methods used (Swiss GAAP), the Group's
>>> activities is mainly driven by capitalized assets - indeed, the real
>>> estate activity is reflected in the asset segment of the balance
>>> sheet;
>>>
>>> - Reported losses are mainly linked to elements which can't be
>>> activated due to the accounting principles at hand (e.g. marketing
>>>expenses, VAT, Opex) and off-balance-sheet elements - indeed, the
>>>sales already completed on the Du Parc Hotel project are not yet
>>>reflected in the accounts, the Swiss system requiring the official
>>>notary acquisition report to be executed before the sale can be
>>>accounted for.
>>>
>>> - Finally, the market value of the assets is not presented in the
>>> financial statements. Each asset is reported at cost, and does not
>>> represent the actual current value of the assets.
>>>
>>> For all the above reasons, you will understand that the financial
>>> statements presented in attachment do not convey a representative
>>> portrait of the accounts, as could be the case had international
>>> accounting standards been used.
>>>
>>> Please do not hesitate to contact me or Mr Cerrito (CFO, cc'd) if
>>> you have any question.
>>>
>>> Regards,
>>>
>>> Kevin Meyer
>>>
>>> SDG Investment Fund
>>> 20, Rue Philippe-Plantamour
>>> 1201 Genve
>>>
>>> M +41 78 637 52 49
>>> T +41 22 545 03 51
>>>
>>> The information contained in this communication is fully
>>>confidential and intended for the named recipient(s) only. In case
>>>you are not an intended recipient, you are hereby (a) strictly
>>>forbidden from copying, distributing this email or taking any
>>>further action relating to it, and
>>> (b) kindly requested to notify the sender and delete any copies
>>>immediately. We undertake no responsibility for the accuracy,
>>>completeness and absence of virus in this communication or any of its
>>>attachment(s). Unless otherwise stated, any views or opinions
Case 1:15-cv-05345-AJN-KHP Document 142-7 Filed 05/12/16 Page 6 of 7

>>>presented herein are solely those of the author. This email is


>>>intended for informational purposes only and is not a solicitation
>>>or offer to buy or sell any participation or financial instruments.
>>> *** eSafe scanned this email for malicious content ***
>>> *** IMPORTANT: Do not open attachments from unrecognized senders
>>>***
>>>
>>>*********************************************************************
>>>***
>>>**
>>> ********************
>>> IMPORTANT: The contents of this email and any attachments are
>>>confidential. They are intended for the named recipient(s) only.
>>> If you have received this email in error, please notify the system
>>>manager or the sender immediately and do not disclose the contents to
>>>anyone or make copies thereof.
>>> *** eSafe scanned this email for viruses, vandals, and malicious
>>>content.
>>> ***
>>>
>>>*********************************************************************
>>>***
>>>**
>>> ********************
>>> The information contained in this communication is fully
>>>confidential and intended for the named recipient(s) only. In case
>>>you are not an intended recipient, you are hereby (a) strictly
>>>forbidden from copying, distributing this email or taking any
>>>further action relating to it, and
>>> (b) kindly requested to notify the sender and delete any copies
>>>immediately. We undertake no responsibility for the accuracy,
>>>completeness and absence of virus in this communication or any of its
>>>attachment(s). Unless otherwise stated, any views or opinions
>>>presented herein are solely those of the author. This email is
>>>intended for informational purposes only and is not a solicitation
>>>or offer to buy or sell any participation or financial instruments.
>>
>> The information contained in this communication is fully confidential
>>and intended for the named recipient(s) only. In case you are not an
>>intended recipient, you are hereby (a) strictly forbidden from
>>copying, distributing this email or taking any further action relating
>>to it, and
>>(b) kindly requested to notify the sender and delete any copies
>>immediately. We undertake no responsibility for the accuracy,
>>completeness and absence of virus in this communication or any of its
Case 1:15-cv-05345-AJN-KHP Document 142-7 Filed 05/12/16 Page 7 of 7

>>attachment(s). Unless otherwise stated, any views or opinions


>>presented herein are solely those of the author. This email is
>>intended for informational purposes only and is not a solicitation or
>>offer to buy or sell any participation or financial instruments.
Case 1:15-cv-05345-AJN-KHP Document 142-8 Filed 05/12/16 Page 1 of 2

Exhibit 8
Case 1:15-cv-05345-AJN-KHP Document 142-8 Filed 05/12/16 Page 2 of 2
Case 1:15-cv-05345-AJN-KHP Document 142-9 Filed 05/12/16 Page 1 of 24

Exhibit 9
Case 1:15-cv-05345-AJN-KHP Document 142-9 Filed 05/12/16 Page 2 of 24

TRANSLATION OF FILE: 2015-03-22_11-03-30_144.wav

Date of Translation: June 30, 2015

--

Nicholas Boeck [spelling unclear]: Um, its 11 am... 22 of March in New York City, Manhattan, 5th
Avenue between, um, 38th and 37th Street. On the Landmark Hotel. Meeting with Joe Chetrit and of
course myself, Nicholas Boeck.

[pause and walking in/out of room]

Nicholas: Hes downstairs, Im going to go get him, alright? Hold the table for 2 minutes.

Female Voice 1: [unclear]

Nicholas: Yes... As you wish. No, no. Go ahead, go on. You keep holding the table.

Female Server 1: No, there is no reserving the table, sir.

Nicholas: No, I come back. I need the table because I have a meeting with another person.

Female Server 1: No, I have to close because theyre starting brunch service. So Im leaving and another
server is staying.

Female Voice1: So its possible to keep the table?

Female Server 1: Yes.

Female Voice: Did you do the thing?

Nicholas: Guess theres no point in staying here, then? Um... bye.

Waiter: Take care.

Nicholas: Um [clearing throat]

[walking sounds]

Nicholas: Yeah. Kiss.

[walking sounds]

Nicholas: Doing well.

Joe: Still not tired?

Nicholas: No, still not tired! Ha ha! [laughter] Im well, and how are you?

Joe: [unclear] its good.

Nicholas: It was a few years back, no?

Joe: Yes.

File: 2015-03-22_11-03-30_144.wav Page 1 of 22


Date of Translation: June 30, 2015
Case 1:15-cv-05345-AJN-KHP Document 142-9 Filed 05/12/16 Page 3 of 24

Nicholas: It was Cetel years ago, no?

Joe: Yes. [unclear speech pattern]

Nicholas: Oh yeah? They argued right? Whats the story? Its not the people from Cetel [unclear] that
didnt agree and then...

Joe: No. Its another hotel... Whats it called... Lander... Landers... yes.

Nicholas: Yes, thats right!

Joe: These are people coming out of Chicago.

Nicholas: OK.

Joe: They sold something in Chicago.

Nicholas: Ah, so its an American chain...

Joe: [inaudible]

Nicholas: Ah yes, this one? Ah yes.

Joe: They had exact plans made. They had plans [inaudible]. We were supposed to build, they came. It
was another Italian group.

Nicholas: Oh really. But when it opened, wasnt it Cetel?

Joe: Yes, it was Cetel [inaudible]

Nicholas: So they basically sold the business then?

Joe: Yes

Nicholas: Once it was built And are there still apartments here?

Joe:

Nicholas: Ah, how much is it?

Joe: [inaudible] I dont know. It must be 2500 per foot I think. At the beginning, it was something like 1300
[unclear] So, everythings good? The kids?

Nicholas: Yeah, everythings fine.

Joe: Moving on to the second phase?

Nicholas: Yeah it didnt go well with Virginie because... of a lot of problems, difficulties, and... We
werent able to save things [the relationship]. She was never happy. Never, never happy, you see. You
could say that. I did what I could, in any case. But uh... With the problems we had, with Elias, etc. I went
through some difficult times. And it wasnt

Joe: Are you done now?

Nicholas: With whom? With her? No, its still under way She wants to live in Paris.

File: 2015-03-22_11-03-30_144.wav Page 2 of 22


Date of Translation: June 30, 2015
Case 1:15-cv-05345-AJN-KHP Document 142-9 Filed 05/12/16 Page 4 of 24

Joe: Huh?

Nicholas: She wants to live in Paris.

Joe: [inaudible]

Nicholas: Well, shes French, but uh... For me, I dont like that too much for my son, you see? Paris isnt
for a small child like that, you see? I dont know...

Joe: So now she lives in Paris?

Nicholas: Not yet

Joe: And youre between Switzerland and...

Nicholas: Im closing Switzerland. Im leaving Switzerland.

Joe: Youre leaving. To go where?

Nicholas: I dont know. Brussels, I still have my home in Brussels. Maybe New York.

Joe: What?

Nicholas: Maybe New York.

Joe: It was a difficult year.

Nicholas: What?

Joe: It was a difficult year. Many things all at once, huh?

Nicholas: Yes, its been a difficult year! Well, listen... uh, I have.... how should I say for them for Elias,
it hit him hard. Since the stepfather is still in prison they underestimated their enemies... they realized
for business it was impossible, they had funds transferred, etc., it was [unclear]...

Joe: And is Pedro in Switzerland?

Nicholas: Yeah, he hasnt moved.

Joe: He cant

Nicholas: Well, hes being sought by Interpol.

Joe: Pedro himself?

Nicholas: Yes, Pedro. He is, well, not being sought by Interpol but he is on their list. But he has, um, a
deal with Switzerland. With the investigating judge in Switzerland. So he cant leave Switzerland. So,
its

Joe: Coming at you from all sides

Nicholas: Well, for us anyway, I mean, I dont really know anymore, because Im no longer involved in
those problems with him. Its been a long while now.

File: 2015-03-22_11-03-30_144.wav Page 3 of 22


Date of Translation: June 30, 2015
Case 1:15-cv-05345-AJN-KHP Document 142-9 Filed 05/12/16 Page 5 of 24

Joe: You mean [inaudible]

Nicholas: But its not that. Its that he took...you had met one of them. You know, uh...Yasik, do you
remember, the Ukrainian? Alexander Yasik. He showed up at your office a long time ago. He was
Ukrainian. Anyway, he is in charge of his office now.

Waiter: What can I get you?

Nicholas: Ill take, uh, do you have sparkling water? What do you have?

Waiter: Uh, we have Badoit.

Joe: Badoit is great with, uh, lime.

Waiter: With lime, certainly.

Joe: Ill have Diet Coke.

Waiter: Diet Coke. Of course.

Nicholas: No. So, he has his office which now only takes care of his political affairs and getting his father-
in-law out and all that. And he also has two guys who work for him and who are by his side non-stop, one
Russian and one Ukrainian. One of whom I briefly introduced you to.

Joe: What about the attorney who was [working] for the father-in-law?

Nicholas: Oh, yeah, yeah, Peter. Peter, well he, uh, see, Ill explain the story to you, um, he had to do
something with Nille [spelling unclear], you know, its actually going well. 50 percent is mine, 50% is
Laurents.

Joe: In Africa?

Nicholas: Yes, in Africa. For the Telecom Hub. And basically we had problems with the Telecom deal, we
couldnt close, but we just recovered an asset from that deal. There were 2 telephone companies.
Remember? One in CAR and one in Burundi. We managed to recover Burundi last week.

Joe: [unclear]

Nicholas: Um, I mean, the Central African one. The small one. We didnt put money into it. So, were still
continuing with this venture. Many things are happening, namely in Saudi Arabia. Actually I came here
now because I have been officially mandated to find opportunities in New York by the Saudis, the Saudi
family. So well see Ive looked into 2-3 things. Anyway. We had a deal with Elias. He had loaned part
of the funds, these loans were supposed to be converted to ownership for [unclear, possibly: Peter or the
hospital]. But the conditions werent acceptable for us. And so, he is denouncing us for those loans

Joe: [inaudible] You must have crazy lawyer fees

Nicholas: Yes, yes, of course. So he is denouncing those loans and we are no longer on friendly terms.
That was his choice!

Waiter: Hello.

Nicholas: Thats why

Joe: What about the hotels in Greece?

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Nicholas: Well, the hotel in Greece is done

Joe: Is it Aman right?

Nicholas: No, no. Well, no. The chain? No, thats the brand. You see the brand... the brand, doesnt
have any real estate associated with it.

Joe: No, but he bought the chain.

Nicholas: Yes, he bought the chain but there isnt much real estate in this.

Joe: 19 properties.

Nicholas: What? 19? Therere 19 management licenses but they dont own the 19 hotels.

Joe: Its 19 and 11.

Nicholas: What? Yeah, what his name?

Joe: The Russian guy.

Nicholas: Yeah, he was dating Naomi Campbell.

Joe: Who?

Nicholas: He was dating Naomi Campbell. She was his

Joe: Ah yes, right. There are two Russian guys, him and the other.

Nicholas: Yeah. Anyway, I know who I mean But I myself knew Lauren Zeca [unclear]. I think they have
some properties, like in Thailand....

Joe: Its either 11 and 19, or 19 and 11.

Nicholas: What, they have 11?

Joe: Yes, 11 or 19 properties and the rest is management.

Nicholas: Yeah, that sounds about right. Anyway, the guy Im talking about is in management, theyre not
owners. And our deal, with me, was to purchase shares of that business. We didnt do it, of course, for
the same reasons. But we do own 75% of Nikki Beach Hotel. I mean, when I say we own, I mean SDG
and [unclear, possibly: the bank].

Joe: [inaudible questioning]

Nicholas: Its the Dolphin Fund you know it. You met Miltos. He does a great job.

Joe: Yeah?

Nicholas: It opened last year and its going well. Its Nikki Beach... Its the Nikki Beach residences and the
Hotel. But now in Greece with the new Prime Minister... uh... well see how things go. Anyway, listen. Eric
called me a few days ago to say hello and he told me he had surgery.

Joe: Hes making noise

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Nicholas: Yeah, hes making noise, haha.

Joe: Hes not easy

Nicholas: And, huh, he asked me where I was. I said New York. He said, well you should see Joe, etc.
So, I said no problem.

Joe: So now you [inaudible] or are they going to give you proxy?

Nicholas: No, no. I, uh... we have a mandate with them, so to speak, for two things. One of the first things
is that we are putting together a humanitarian foundation with them for Central Africa because its a
country at war. And uh, that has been signed. In all, were global at a sum of 350 million for the
humanitarian foundation. As for us, we are in charge of the humanitarian foundation. And this has allowed
me to be in it with them. Now they have a minimum investment budget of 500 million. Everywhere. They
dont even look at figures below that. Now they asked me to... I explained to them in New York, because
they saw that in the track records there were deals made here with you... they are not, well, they are
present here in New York but not like Qatar, not like [unclear] and now, with all thats going on and
happening with Syria and Iraq and all that, theyve really become closer to the United States and it has
become more legitimate to invest here in the United States. That was not necessarily the case a few
years ago. So thats why

Joe: What do they want to do? They want to build or buy?

Nicholas: Both.

Joe: Prices are high. Prices at purchase are high.

Nicholas: Its certain, the economy is strong. The prices are high but there is always a way.

Joe: Are they using dollars or euros?

Nicholas: Dollars.

Joe: Haha.

Nicholas: Thats fortunate, huh?

Joe: What do you see your role as?

Nicholas: So uh, no uh, I had distanced myself from the markets but now I see that there are a lot of huge
projects under way. Things that are super luxurious and really huge. So Im starting to look into it.
Manhattan I think may be tricky. Prices are very high and there are many new projects that are going to
hit the market. But I think there are some interesting things in the Bronx. I saw you were doing something
there. I think theres potential there. Big projects.

Joe: [inaudible questions]

Nicholas: Yes. I think thats where its going to happen. At the capital gains level.

Joe: Its going to happen. But its different. Its not like Manhattan. In Manhattan, people buy land at 1100
dollars. I dont know how they do it.

Nicholas: The plot. Per foot? Land incidence?

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Joe: Its too much.

Nicholas: All they need is a good lesson.

Joe: Thats when people are not working with their own money.

Nicholas: With [unclear, possibly: SoFa] I remember we were at 1700. Everything included. On Flat.

Joe: Actually a little less. But we made a common sense mistake.

Nicholas: Where?

Joe: There, at Flat. We spent more than what the product could yield. [inaudible] Because of the ceilings,
prices didnt go up as expected. But it was good work.

Nicholas: What about sales?

Joe: With sales, we are at 170 million roughly.

Nicholas: Whats the percentage? Based on surface.

Joe: About 40-45.

Nicholas: Percent? Oh, thats good.

Joe: Whats good is that we didnt open [unclear] so that helped We are thinking of delivering the
apartments in June or July. So we are going to issue an occupancy certificate in different parts. But, yeah,
were working, were moving ahead. All the projects you know of are making headway.

Nicholas: Cabrini too?

Joe: [inaudible] I dont know if theyre open.

Nicholas: Yeah, I think theyre open.

Joe: Weve started the demo [demolition?]

Nicholas: So youre not selling the project. Youre keeping it. Because, no matter what, the price is going
up.

Joe: Yeah, and that project is costing, um, 1050-1100 dollars.

Nicholas: Right. Well, with Flats we were at about 1100. Something like that.

Joe: Yeah, maybe a bit more. 1350.

Nicholas: And this one is 1050. What about Chambers?

Joe: With Chambers, they are working on a model.

Nicholas: That was also a good price per...

Joe: 780-800 dollars.

Nicholas: Thats good.

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Joe: Thats why. I want to do exclusively construction, all the projects you saw are underway.
Everywhere. In Florida.

Nicholas: Theyre building now?

Joe: In Florida we just completed a big project. We are aiming at July-August for sales. Miami River.

Nicholas: Yeah, yeah, I know what youre talking about. Close to Brickell. Those two towers. Or rather 3
towers.

Joe: 2 for sure. Maybe 3 or 4. Were waiting for the confirmation.

Nicholas: Beautiful! And do you think Miami will continue to go up?

Joe: Prices are high, too. But it depends. For example, we just bought a plot in Port [unclear] in Fort
Lauderdale [unclear]. Were trying to change it. Because you can build a hotel, but were trying to see if
we can build apartments. A lot of construction going on.

Nicholas: Well, thats good. I heard you sold the tower in Chicago.

Joe: Yeah. Its not done. They havent paid us yet.

Nicholas: And its good? Its a good deal.

Joe: About that. You know, if you with whats his name The guy who now has the debt.

Nicholas: The debt?

Joe: Glatz?

Nicholas: Ah yes.

Joe: I sent him the figures. I was expecting a reply. To see if we can pay it in a lump sum. And maybe we
can reduce it a little. Or if he wants You know we have to know the story behind it to understand whats
going on [piano]. Today, for example, do you know how much it is for Flat?

Nicholas: No

Joe: 100 million.

Nicholas: In equity? With Clippers as well?

Joe: Everyone. 100 million. I was going to suggest. I dont know if you want to try something out.
[inaudible] Even there is no deal, I will pay. I mean, Glatz has done nothing wrong. He is a good guy.

Nicholas: Haha. They are they are clients right? Do you want to go upstairs? Lets go upstairs. Well be
more comfortable. [inaudible]

Nicholas to waiter: Can I have the check? Yeah, its open.

[Music and piano]

Nicholas: Thank you. Haha. Thats fun; theyre rehearsing for their musical. Lets go there, it will be
quieter.

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[conversation continues inaudible]

Nicholas: You know Jacques Chirac right? He always used to say: Trouble comes in packs.

Joe: Its exponential.

Nicholas: Yeah, and it hits you all at the same time. Haha.

Nicholas to hotel staff: Hello. Im back, may I have the same table?

Nicholas: This will be quieter. We can sit here or there.

Waitress: Once its available you can move back.

Nicholas: OK. We will be more comfortable here. So, you were saying

Joe: Yes. It will be done one way or the other. But Id rather make a friendly arrangement. Because I think
we can do things with this guy in the future as well.

Nicholas: Look, I have no idea. You know, since Halloween, when we last saw each other, they kicked
me out of Triado without telling me anything. I found out through Diane Artall. That was not an elegant
move. Since then, they have asked to negotiate with you. So the question is I know the deal, since I
signed it myself. Today, its 21 million plus 12% with 4 million as a minimum guarantee. Or something like
that. If the question is, can I figure out how to significantly reduce the price, do I know how to do that? The
answer is yes, I know how.

Joe: How much are you thinking? So we can pay everyone. You, them

Nicholas: I think we can get to what you were hoping. Meaning between 10 and 15.

Joe: Not going to happen.

Nicholas: I think so. Listen

Joe: Between 10 and 15

Nicholas: Where do you stand now? With the proposal?

Joe: The guy doesnt want to talk.

Nicholas: Yeah, hes beating around the bush.

Joe: Hes saying give me the payments and then well discuss how much. I said, I want to pay you in one
go. I can pay you. Even if that means Because for every deal he has to be alone. Because I made a
mistake on that deal and for reasons we already know the deal fell through. So that puts you in a difficult
position. You cant undermine one deal to save another.

Nicholas: No

Joe: So now I can What do you suggest? Do you want me to come to Switzerland? I want to settle this,
I dont want to pick fights with anyone.

Nicholas: OK

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Joe: If we start fighting then

Nicholas: I can handle a fight; Im already in it anyway. And I didnt provoke it. It was not me. Im just
suffering it. As I said, Im suffering it. Im willing to do things, Im willing to help you, and I think I can. But
before that, I would like you to pay me what you owe me.

Joe: I will pay everything in one go. If you want, you can draft a contract under your name. Everything.

Nicholas: OK, lets draft a contract then. So there are no problems.

Joe: I want to solve this. Especially since you are thinking of coming here to the States. There will be
other opportunities. Youre not 95 years old.

Nicholas: Thats for sure

Joe: You have a life ahead of you. As I said. As I told Eric. I want to solve both not problemsboth
situations at the same time. With you, its clear, we know the price.

Nicholas to waiter: Yes we will have drinks. A Diet Coke please. And sparkling water. With lime. Thank
you.

Joe: If you have the means to solve this, we can draft a document. No problem. I am willing to solve this
any other way too. If you want, I can come over there. If you want to talk to

Nicholas: Let me explain. I feel things [meaning, probably: I have good intuition]. Where do we stand
today? There was, on the one hand, the commission, you have already paid 400. You still owe 600. So I
would like to know when

Joe: I want to pay it off in a lump sum. Because I cant not solve that problem with them. It goes hand in
hand. I want to solve these issues together.

Nicholas: OK um. The problem I have today is that I am forced to take a position. Either Im working for
you, so to speak

Joe: As far as Im concerned, it wont take much time. Im not going to drag this out for 10 years. I dont
want it to drag on for 10 years and I dont want to keep paying lawyer fees and I dont want to fight. The
way things are today, Im not trying to dig up their shit. I could easily say tomorrow: lets draft the papers.
But Im not going to do that. I want to call the guy I work with and I want him to say: I dont want an
affidavit. Even if it means sending a lawyer there to interview him.

Nicholas: Right.

Joe: Well, its There are many different points. But I dont want that. I want to solve this. I know that
sometimes one door closes and another one opens. Thats life. But first of all, I want to pay you what I
owe. And solve the other issue at same time. You tell me. Lay out the plan, we can draw up the
paperwork. If you want, I can call the lawyer, if hes here, I dont know if hes around. I can call him in,
well work on a document and then you go to work. Thats it.

Nicholas: Yeah, about that. Since were talking. We had a deal together. Now they are causing trouble
there, too.

Joe: What?

Nicholas: Yeah, on another issue. They are asking me to justify. You know, in the contract it says 6
million deduction for China and Belgium.

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Joe: Yes.

Nicholas: Im not giving it. But I will have to. Because in the procedure, they will ask me to prove that Joe
Chetrit has invested that sum. Thats why we had a deal on that difference. You see?

Joe: Ive put in 4. 4,500

Nicholas: 4,200.

Joe: Yeah, 4,200. Whatever.

Nicholas: So there is a 1.8 gap.

Joe: Thats not a gap. Its the deal we had made. Based on the figures you had given me, with Simba and
all that, it was worth more. So based on that, you had given me this money with a return. That sum was
invested. Same here with the money Im giving you here. Nothing is guaranteed. Its paid in capital.

Nicholas: Yeah but thats not what Eric had told me, you see. Eric told me: obtain that difference worth 6
[and I did] and I will pay you the difference myself.

Joe: No way. Take 6 and give back 1 800? Impossible.

Nicholas: Yes. Thats what he told me. Call Eric. Thats what he told me.

Joe: Impossible. 801 million?

Nicholas: Youre making a good deal.

Joe: How is that a good deal? I want a good deal. Show me how thats a good deal.

Nicholas: Wait the good deal was that Cabrini put in 28.5 plus 6. Total equity.

Joe: Yes, go ahead.

Nicholas: So 28.5 plus 6 thats um, 34.5. Total Cabrini with [unclear, other name]. Lets say 35. To this
day, you have taken Um, there is 21 left.

Joe: 21 on the books.

Nicholas: Thats it. Thats not a bad deal.

Joe: How?

Nicholas: Because you didnt pay for the equity. It was free. You bought back at a discount.

Joe: I didnt buy back at a discount.

Nicholas: Yes you did.

Joe: How much did they put in? 28, right?

Nicholas: Yeah, 28.5. Flat. And you bought back at 21.

Joe: But I paid with my 6. I paid with no, my 4.5.

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Nicholas: Yes, with the 4. The 4. Anyway, there is a big discount.

Joe: Yes, I paid with that money. That went for Cabrini. And you, I think it was not even a million, it was
800 thousand.

Nicholas: What?

Joe: The commission. I dont remember.

Nicholas: No, no, it was a million. I can send you the invoice.

Joe: yes, thats why it was a million or 800 thousand. But it wasnt twice. You cant get 800 on the
money I put down.

Nicholas: No, thats not it. There was a 1 million commission for the deal. And then, in the negotiations,
we had agreed on a discount figure of 6 million for China and Belgium. We were in your office and we
said: We will fine-tune it based on what was actually spent, on what I actually spent.

Joe: That was never part of the discussions. It was a total amount to be paid. And even today, if
something needs to be paid, we can reach an agreement. Were not going to start punching each other in
the face.

Nicholas: Haha.

Joe: If you think there is a way

Nicholas: I would like you to talk to Eric. Because Im in

Joe: I can talk to Eric as much as you want.

Nicholas: Hes the one who told me. I remember, I was in Geneva.

Joe: Its impossible that I owe you 1.8 million. That would mean I put all the money and you collect the
profits. Thats not logical.

Nicholas: No, no. You bought back the others shares.

Joe: No, but I paid what they had invested in shares. If you collect what you say from 4.2 to 6 million and
their shares, I would basically get the money I put in back if we follow your logic. Saint Barts and the
other one gave my money back. I give back what I owe, 28 and I still have to pay 21. So you want me to
pay you 2 commissions?

Nicholas: No, because the first one is part of what they redeemed for St. Barts and Belgium, thats in
excess.

Joe: So 4.2, and you are saying 6. OK

Nicholas: The discount youre getting is 6 and you put in 4.2.

Joe: So I give you that sum?

Nicholas: Yeah. That was it. They are the ones paying me.

Joe: Wow, you are the most expensive lawyer in the world.

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Nicholas: Haha, I have to. I need to

Joe: So what youre saying is that

Nicholas: They paid you 6 to reimburse you and you gave 4.2. So there is a 1.8 discrepancy.

Joe: And for the Flat, I pay what they put in.

Nicholas: No. No

Joe: See, it makes no sense.

Nicholas: No, you get an additional discount.

Joe: Where?

Nicholas: Well, youre paying 21 for Flat.

Joe: No.

Nicholas: Yes, you are. Lets add up the numbers.

Joe: Its simple. Its 28 total. I sent 6.

Nicholas: Right. No, there was Cabrini in the deal too. So Cabrinis 6 million.

Joe: Plus my St. Barts money.

Nicholas: Wait, wait.

Joe: So I put in 6 plus 6, thats 12. Lets forget about how much you get for a moment. 6 plus 6, thats 12
million.

Nicholas: Whats the 6 plus 6?

Joe: I gave them St. Barts. Thats how I call it. It was worth 6 million with China. I gave them another 6
million, thats 12. Theres 21 left.

Nicholas: No!

Joe: Plus your percentage.

Nicholas: Thats not how it works. In the discussions we had 28.5 million I think for Flat and 6 for Cabrini.

Joe: How much is that?

Nicholas: Thats 34.5.

Joe: How much is left to pay?

Nicholas: 21

Joe: 21 plus profit. Plus 12.

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Nicholas: That we dont know. Were talking equity.

Joe: Plus profit. So I gave from 21 to 28 in cash. And I gave, in addition, my shares

Nicholas: From 34.5 to 21.

Joe: Yeah, how much is that?

Nicholas: 13

Joe: I paid 13

Nicholas: No, you didnt pay 13.

Joe: I gave my St. Barts shares. And I wired the funds.

Nicholas: No, yes, but thats not how it works. Wait. Forget about the wire. Lets imagine you hadnt paid
anything. Look at the deal.

Joe: The deal we had was 34.

Nicholas: Yes.

Joe: Minus 6. Minus the 6 of St. Barts.

Nicholas: Its 34.5 minus 6.

Joe: They had put 34. 6 from Cabrini equals 6 from St. Barts. OK? How much is left? 28. 28. How much
is left today? 21. So I paid 7.

Nicholas: You paid 7 But didnt you have an additional discount on top of the 6?

Joe: What 6?

Nicholas: On top of the 6 for St. Barts, there was an additional discount.

Joe: I dont think so

Nicholas: Yes, yes. There was 2 or 3 million that were removed.

Joe: We have to read the documents

Nicholas: No, Im positive.

Joe: Its easy, its black on white. Although we havent really done any black with these people.

Nicholas: Ha. But I guarantee you. There was

Joe: You cant say that, Nicholas. Listen I know I know you are in a difficult position but there is no
need to add things. On the 4 million, I had given you 800. 800 or a million, I dont remember; and I dont
even remember how much I sent you. 400 or 500.

Nicholas: 400.

Joe: I take it as it is. Theres something remaining but thats linked with paying off

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Nicholas: But, but

Joe: This is why now, thank God, you are here. I want to sort this out with you. I dont want to fight with
you and I dont want to fight with them. I want to do this is a friendly way. Its a small world. And
sometimes, the best relationships are those that are a little bumpy at the start.

Nicholas: Yeah

Joe: Im not here out of animosity. Im here to create. I want to solve this. If there is a way. Tonight, if you
want, Ill come with you to Switzerland. In the name of peace, Id rather pay 1000 times than have one
fight.

Nicholas: Yes, yes. But I dont even want to pay before, I want to be reassured.

Joe: No problem. No problem. Whats logical is logical. We have documents.

Nicholas: OK, Joe, so lets sort out this issue. Because I dont want to have those problems with them. I
want to make money out of it to defend myself. Its that St. Barts discount, as you call it. I had a formal
agreement from Eric, whom you spoke to on the phone, that stated that the difference

Joe: Impossible. It doesnt make sense.

Nicholas: I swear on my childrens lives.

Joe: I dont want, I dont want children [involved] [inaudible]

Nicholas: This is formal. Its Eric.

Joe: There are documents. We spoke and then we did the documents. Its not logical. Out of 4,200. Even
if I count interest. Interest over 3 or 4 years.

Nicholas: No, but you got a discount of 4 million in addition to that.

Joe: I dont know what the discount was, I cant tell. But its easy to find out. The figures are there.

Nicholas: Yes, I saw in the contract. There are figures. Of course.

Joe: Im not trying to hide things from you. Firstly. Secondly, if there is a way to solve this, Im open to
hearing your ideas. We will come up with a system. Thats all.

Nicholas: I just want to sort out this St. Barts issue with Eric or without Eric, I dont know, because Im
going to get in trouble with this. Theyre going to confront me. Because, you know what they think?
Theyre telling me: Show us that Mr. Chetrit invested 6 million in St. Barts.

Joe: No. Thats no right. We did not invest 6 million. Its the same as the profit I owe Flat. Same thing with
the profit I got on St. Barts. Thats normal. Its very expensive. There are no earnings.

Nicholas: The contract states that is was redeeming the investment.

Joe: Plus profit.

Nicholas: Not plus profit. Thats why theyre after me.

Joe: I dont know which document you have. I cant tell you, I have to check. Thats the truth.

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Nicholas: OK, look at...

Joe: I should have prepared all the documents, but its easy, all it takes is a phone call. But, um, that was
the deal. If thats what they want to do, I dont want to fight. I want them to tell me so I can freeze
everything, Ill look into all the details and they will get the money in 8 or 9 years. No problem.

Nicholas: You know thats what they started doing with you. They told you about the St. Barts and China
story?

Joe: No

Nicholas: They didnt tell you about that? They didnt ask you questions about that?

Joe: Who?

Nicholas: Glatz. Or some Petr Kraztnof who sent you a request.

Joe: No. Oh, yes, yes. I think they sent but it hasnt taken place yet.

Nicholas: There you are. Im telling you, these guys are a real pain. That guy Elias shows no appreciation
for all that Ive done for him. He is

[inaudible side conversation with other person. See you later].

Nicholas: As I said, Im not very forgiving with them. I know a lot and I can get a very big discount on the
deal. Very big.

Joe: So tell me. And based on that well pay. No problem.

Nicholas: Yeah. Thats fine but I want a guarantee before. You see?

Joe: Were not going to pay them until everyone has paid

Nicholas: No Well draw up a document.

Joe: Tell me your ideas, and well draw up a document.

Nicholas: Huh, huh.

Joe: Tomorrow you tell me what we have hand in hand and I will take care of it immediately. I dont want
to

Nicholas: What proposal did you make to Glatz?

Joe: Last proposal I made, I had told him 15. 16.

Nicholas: 16 plus 12. Percent.

Joe: Um, wait. Let me see if I can find Whats his email? Glatz?

Nicholas: Yeah, Glatz. G-L-A-T-Z.

Joe: Whats his first name?

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Nicholas: Filip. G-L-A-T-Z. Filip. Want me to look?

Joe: Last time I sent it to him, on March 4th, he wanted to see figures, I sent it to Glatz. Last time the
lawyer spoke to [inaudible]

People laughing in the background.

Nicholas: How are your kids?

[inaudible]

Nicholas: It was just to see where you position yourself.

Joe: I just told him like that. I think I had told him 16. Ill send 5 now and 3 weeks later

Nicholas: In 3 weeks? And Is there an upside?

Joe: Um, to be discussed.

Nicholas: Right. OK.

Joe: If there is a way. We can maybe see if the lawyer is here.

Nicholas: What can I do?

Joe: Hes right next door.

Nicholas: But, um, to ask him what?

Joe: To see if we have received

Nicholas: Ah, its

Joe on the phone to lawyer: Hi Joe, are you in the office? Ah ok. Remember the last offer we made to
Glatz? Triado, Germany. Yes, thanks. He will check right now.

Joe to Nicholas: But if you really need something. Do you have a card?

Nicholas: Yes, I have a card. Im sure I have a card. But, as I said, this time, it was indeed hard for me. I
was waiting to receive your payment and I didnt get paid.

Joe: But I couldnt pay you. I have nothing. I have nothing in my hands.

Nicholas: I know But that was for signing the first deal.

Joe: No

Nicholas: Yes, it was.

Joe: It covered the Triado deal for Flats.

Nicholas: Right. For Flats. We struck a deal. A first payment was made and then you paid nothing else.
To renegotiate a new deal.

Joe: No, there is nothing to renegotiate. No deal was made. Why are we here otherwise?

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Nicholas: Well, yes, there was a contract that was signed at Artalls. Remember, they went to the judge.

Joe: Yes, OK. I know.

Nicholas: So? That means there was a deal.

Joe: Yeah, we negotiated but we didnt pay.

Nicholas: Right. We didnt pay.

Joe: So it has to be parallel. The two deals have to be parallel.

Nicholas: Ill agree with that if I can be reassured with a piece of paper. I dont want to be put in that
position again. Because the way I saw things, the commission would be paid when we signed the first
deal. The deal with Diane Artall, you know, that we signed when we bought back the Flat shares. I was
entitled to

Joe: You got something.

Nicholas: Yes, I received 400 thousand.

Joe: No, you also received

Nicholas: What did I get?

Joe: At purchase, you also got something.

Nicholas: At the time of purchase? No. It was, um

Joe: You did, Im 100% sure. You got something at purchase.100 thousand percent sure.

Nicholas: Oh, yeah

Joe: When we bought the deal, you got paid. And that was to re-buy

Nicholas: No, no. I didnt receive anything. It was, um, Eric who got

Joe: No you got something. You received something for each deal that we made. [inaudible] In that
deal you were paid 100.

Nicholas: I will check my accounts but

Joe: Its easy to check.

Nicholas: Of course, of course.

Joe: There was no briefcase.

Nicholas: No, haha, its all transfers.

Joe: So its easy. Im sure. Its what I gave at closing. Thats the first thing. Secondly, if there is a way to
solve this, we can do both. Two birds with one stone. I told you that last time. If there is something you
can do quickly, we can proceed immediately.

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Nicholas: Yeah.

Joe: You stay one day. Or Ill come with you one day. Whatever you want.

Nicholas: Yeah. What is Glatz saying?

Joe: Glatz? He said send me that first and then we can work it out. I said, I want to pay it all in one go, I
want to pay you now. Ill pay you know and then For the 5-6 million. You can put everything in escrow
and three weeks after youll get the rest.

Nicholas: And, um, there was a court decision for the next payment?

Joe: There are lawyers following the case. I dont want even with the ruling, [inaudible] I dont want to
create tensions [inaudible] I know what to say. I dont want to Its not my style to use a tape or
something, you know.

Nicholas: Of course. Indeed, it would mean risking a lot for little.

Joe: And there is no risk. I can block the funds. Even if [inaudible] life insurance. I can do that. I can do
that. Even with the company, I could say where is [unclear] there was a lot I could do, but I didnt, I let it
go. I still hope we can solve this this week. For you and for them. If you want to make a call, we can talk
tomorrow morning. Whatever works.

Nicholas: Yes, I have to make a call now um. What I suggest is that I send you the document proposal
for the payment of the balance.

Joe: Attached to the Triado payment.

Nicholas: If you want.

Joe: Thats easy. But whats the Triado idea?

Nicholas: As soon as we sign, I will let you know. Anyway you were planning to pay this commission
when exiting Triado. The balance. Anyway, Im not asking for anything right now, all I want is a guarantee.

Joe: Thats um If there is a way to solve both issues quickly

Nicholas: Yeah.

Joe: What do you have in mind with them? Did you speak with someone? Did you talk to Glatz?

Nicholas: Yeah. I still have good contacts in Switzerland. So, there is Glatz, there is um

Joe: But what did they buy? I didnt get the whole operation. When they bought Triado. What did they
buy? They bought the hotel in Switzerland. They bought this and that

Nicholas: Nah, they didnt buy anything. We dont have [unclear]. The way things went down, as you
know, with the stepfather being in prison and all. The little one started to panic. So he sold SDG, and
within the SDG group, SDG Capital, there was Triado, there was Greece, there was [unclear]. All that was
in SPG in Luxembourg. I was the president of all these SPGs and it was supposed to be integrated into
the Real Estate Fund. But, when he panicked with the situation, he liquidated everything. So SDG Capital
was bought out by Philip Glatz. But I mean, they are friends. They, um, talk to each other almost every
day. So, you can draw whatever conclusions you want to draw. And for the balance, they asked me to
negotiate with you at the time of the exit. It is, of course, against my own interests. I did it at the time out
of loyalty. Let me remind you that when you entered the fund, based on the statutes, you paid me 20% of

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profits and a 2% management fee. So youre taking all that away from me. Thats why Im bugging you
with these commissions and stuff, but I lost a lot of money because of him. And thats it. That was his
angle, I played along. I said, OK, my Elias, my friend, I will help you. And what I get in return is him
denouncing the loans with Nille in Luxembourg. So, now, basically there is no reason for me to help him.

Joe: How do you think you are going to solve this? You will see him tomorrow. Or the day after.

Nicholas: Yeah, No, well I have to 2 or 3 things to say to him. [unclear] You know, Im the most decent
and loyal person when you respect me. You know I took risks for that person, I took risks for everyone
and thats how they thank me. Wait, so they kicked me out of Triado without any notice. The lawyer just
told me, dont come to the office anymore, you are no longer the president. I was on my way there. See
their manners?

Joe: That hurts.

Nicholas: Thats their manners. Its a lack of respect. And I was there for them.

Joe: 24/7.

Nicholas: And all the deals I secured were great deals. Flat was a great deal. Carboni was a super deal,
even if didnt progress.

Joe: [unclear]

Nicholas: Yes, everything. Everything. I didnt deserve this, see? So now, I have just drawn the
conclusions I had to draw and Ill do what I think is best. Because, you know, its been a year and a half, I
have zero income out of all that business. So, they dont give a shit that I have my family in Belgium and
stuff. I have kids, private schools. Thankfully, I had some savings. But

[phone rings]

Nicholas: Its because they are paired with the iPhone. Im on iCloud. So if you call the American one or
the Belgian one, they both ring because theyre linked with iCloud.

Joe: So whats the plan?

Nicholas: So the plan is that I will speak to my lawyer here.

Joe: Who is it?

Nicholas: Its Gil. Its a lady. I have a new one.

Joe: Here?

Nicholas: Yeah, shes in New York.

Joe: Why did you hire a lawyer here? Why? Here in New York, for them.

Nicholas: No, thats my personal lawyer, who takes care of my business here with the Saudis. I cant use
Artall anymore. So I will call her and I will send you a proposal for the commission, and if you agree, once
its signed, Ill tell you what I want to do with the deal.

Joe: You will call her now? Today or tomorrow? And Glatz. If we can solve it quickly. You just have to
explain Id rather fold 1000 times than have a fight. Because if we have a fight I know what I owe,
there is a maximum, but for them it may cost 10 times more.

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Nicholas: Of course. What do think? I have everything I need, and they are stupid because I have nothing
to lose. Theyre all under Interpol surveillance and allI mean thats just a lack of respect. You can be
harsh in business and all, but when you treat someone like they treated me when I gave everything for
him, its not good.

Joe: Its not good. So you got it. I want to solve this and turn the page.

Nicholas: OK. Ill send it to you. Yeah, its one page anyway.

Joe: Ill look at the page we had. Are you leaving tonight or are you staying?

Nicholas: It depends on what she tells me. But maybe Ill leave tonight. Yeah, Ill leave tonight.

Joe: You can see tomorrow. You tell me. I can get on a plane and come to Switzerland, no problem. And
now. Now, prices are high.

Nicholas: Yeah, you have to buy elsewhere.

Joe: Even there, what I bought today, I can sell for double the price.

Nicholas: Maybe we can make exit deals. What they want is yield.

Joe: Maybe

Nicholas: You build, Ill buy right after.

Joe: I dont know, with people from the Middle East, it takes a lot of time, it tires you.

Nicholas: Because now we have a relationship based on trust. They just paid 100 million for the
humanitarian foundation. This is a big service, they are initiating peace between Catholics and Muslims,
thanks to this foundation. You know theres a civil war in CAR, Catholics against Muslims. And these are
Muslims setting up a foundation aimed at helping the country and facilitating peace between the two
communities. And they need stuff like that.

Joe: Getting into politics

Nicholas: I know, its a brain bender. I never got involved in politics. It so happens that I had a partner
who got into politics and I was not his employee, I was his partner. He had a deal, he came up to me and
said: set up an investment fund, I will find equity. You know if equity comes from banks, its the bank that
has to do all the work. Then I realized we were going further. Its not about not working in politics. You
can do that. But then things got complicated, the stepfather went to jail because he fled London to avoid
being tried, which was totally stupid. I mean, you know the story.

Joe to someone on the phone: Hello, hi. Because. OK, Ill call you back.

Nicholas: 5 and 12 in 3 weeks and no upside. Let me see OK. Thank you, Joe.

Joe: You know theres a saying in English that goes: What doesnt make you, breaks you.

Nicholas: Yeah, yeah.

Joe: It hit you right between the eyes.

Nicholas: As you say, Im not weaker.

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Joe: There is a cost, but what can you do? So, send me an email and let me know. If I have to come, Ill
come, even for 24 hours, I can do it.

Nicholas: Its beautiful again. It was snowing two days ago.

Joe: Its colder. If you need anything, any help in New York let me know.

Nicholas: Thank you. So, well sort this out.

Joe: Yes. Quickly. Alright, then, have a good trip. And be brave.

Nicholas: Thanks.

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TRANSLATION CERTIFICATION

I, Leonardo Duran, General Manager of Language Services for and on behalf of Magna
Legal Services, hereby certify that the audio recording named 2015-03-22_11-03-
30_144 was translated from French to English by a professional translator competent in
both French and English to render such a translation, and that to the best of my knowledge,
ability, and belief this translation is a true, accurate, and complete translation of the original
French audio recording.

__________________________________
Leonardo Duran

_________________________________
May 2, 2016

Date

Magna Legal Services


Language Services Division
1635 Market Street | 7 Penn Center, 8th Floor | Philadelphia, PA 19103
Phone: 866-624-6221 x 303 | Fax: 866-579-0819
Email: LanguageServices@magnals.com | Web: www.magnals.com
Case 1:15-cv-05345-AJN-KHP Document 142-10 Filed 05/12/16 Page 1 of 19

Exhibit 10
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TRANSLATION OF FILE: 2015-03-23_13-50-26_100.wav

Date of Translation: June 30, 2015

--

Nicholas: Its the 23 of March, Im meeting with Joe Chetrit at the offices of Chetrit Group on
7th Avenue between 38th and 37th Streets, number 512.

[filler; background noise]

[walking noises]

[muffled female voices]

How are you?

Female 1: How are you?

Female 1: Hows everything?

Nicholas: Good! Good.

Female 1: Good? Good. OK.

Nicholas: Uh, Ill go.

Female 1: [unclear]

Joe: No, Joe.

Female 1: Ah, Joe! I just forgot your name!

Nicholas: Nicholas.

Female 1: Nicholas, ah!

Female: [unclear]

Nicholas: No. Four days ago.

[background noise/static/heels and walking]

Nicholas: Mm hm.

Nicholas: Hi. How are you? Im good and you?

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Male 1: How are you?

Female 2: You can wait here [unclear], be right here. OK?

Nicholas: OK. Thank you... ah [sighing].

Nicholas: Hello, thank you!

Female 3: [unclear]

Nicholas: Yeah...

Female 3: Inaudible.

Nicholas: OK, no problem!

[zipper noise]

[long pause; background noise]

[bell noise]

[female voices in background]

[footsteps in background]

[car horns outside office]

[phone text/email sounds]

[background sound]

[background static and phone ring tone]

[background street noise, voices]

[doors]

Joe: Did you have something?

Nicholas: No, thats alright. Im good... Hmm

Joe: I was downstairs at the bottom of the hotel.

Nicholas: How are you?

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Joe: I sent you quite a few messages.

Nicholas: I only just got them. It took some time to come through.

Joe: Ah, yes.

Nicholas: Ah, yeah.

Joe: How are you doing?

Nicholas: How are you?

Nicholas: Me, Im good.

Nicholas: Um...

Joe: After our meeting yesterday I called Eric, to be on the same page, you omitted 2 or 3
things... the first thing is that you said I received a commission here, the Challe de Flat [spelling
unclear]. I didnt receive anything. Youre confusing this with Wahib Nasser. Its Wahib Nasser
whos received a commission, you told me this yesterday.

Joe: The amount?

Joe: I didnt touch anything there.

Joe: I dont know.

Nicholas: Yeah, you sent [unclear], I think that was for Nasser.

Male 1: [unclear] I sent them to you. In his name, I sent them to you.

Nicholas: What?

Joe: In his name... to his attention.

Nicholas: I think you sent that to Eric, who was [paid? unclear] to send this to Nasser.

Joe: Yeah, thats the first thing. And the second point is, I asked Eric, uh, since we discussed the
difference, uh, between the reduction of 6 million, and, uh, the amount invested in, well call it
China and Surnille. So your investment, from what I saw, was 3.2 million to Surnille directly and
1 million directly to China. You have 4.2 million. And the reduction was 6 million. On the buy-
out of, uh...

Joe: Thats not a reduction, thats the purchase of... [unclear] it was 6 million.

Joe: Yeah, and, as we have negotiated, the

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Male 1: The 6 million, it was for the, uh, [unclear]

Nicholas: No, in fact, in the deal, uh, we invested, I saw the figure, my [unclear] sent me the
exact figures. We invested, invested

Joe: You always want to be right!

Nicholas: Yes, yeah, yes, yes, so we invested 32.5 in Flat in equity and 6 million in loans for
Cabrini. This was our investment, uh, with you.

Joe: OK.

Nicholas: You, you bought back, uh, you did the buy-out for all this. You reimbursed the 6
million from our loan, Cabrini, and you bought back Flat for 22 million.

Male 2: [unclear]

Joe: Yes, 28 with Cabrini.

Nicholas: Yes. Its 28 million.

Joe: 28 that I [unclear]

Joe: Yes, yes, but with Cabrini.

Joe: Cabrini, we finished that.

Nicholas: No, no.

Male 1: Cabrini, were done with that [unclear].

Nicholas: No! No, no!

Joe: From 38 million, youre telling me 28 million?

Nicholas: I gave you a 10 million price reduction. Yes.

Joe: Yeah?

Nicholas: Well, yes!

Joe: Thats the figure... guaranteed!

Nicholas: Its, uh, yeah.

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[background sound, movements]

Joe: [unclear]

Nicholas: Ha, ha!

Joe: [unclear]

Joe: Yes, but we negotiated together!

Male2: [Inaudible]

Nicholas: What?

Male2: [Inaudible]

Joe: Cabrini, we are in agreement that Cabrini equals Chief [inaudible] equals St. Barth. Or
something like that?

Nicholas: Mm hm.

Joe: [unclear and inaudible] and what you have is not 28. Those are different things. Cabrini
equals St. Barth.

Nicholas: Yeah, yeah.

Joe: [unclear] ... Were in agreement with the price of 4 206 [four two hundred and six]. Cabrini
equals St. Barth. One equals the other. Is that right?

Nicholas: No! Yes. Thats right. Thats right. But no, the thing is, for me, during the
negotiations, thats not how it took place. There was one loan for Cabrini, that we made to you
for 6 million, which you paid back in full, which we were able to do very quickly [unclear]. Yes,
for St. Barth, too.

Joe: St. Barth, it was for St. Barth? [unclear] The thing is, is that, there was a global sum, a
global sum of 38 million, Id even say 38.5 million, that was invested between St. Barth and
Cabrini.

Joe: St. Barth and Cabrini.

Nicholas: Its 38.5 [thirty-eight and a half].

Male 1: 38.5 Cabrini, thats 25.5. So theres 32.5 left [unclear]. Is that right?

Joe: Thats right.

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Joe: [unclear]

Male 1: You took a reduction of 6 on the [unclear].

Nicholas: Yes, yes. It may have been sympathetic but we said 6.

Male 1: [unclear]

Nicholas: But if its not 6 its 4, 2 [four, two].

Male 1: [unclear] ...equals 50, then we went down to 28.

Nicholas: Then, you had a discount from 32 to 28.

Male 1: You dont know what youre saying now [unclear].

Nicholas: Yes. The numbers are the same.

Male 1: You said 32.5 [thirty-two and a half] plus, uh, 28. We paid, and whats left is 21.

Joe: 21 to be paid plus the revenue.

Nicholas: [unclear] because I dont think like that. Can I show you?

Nicholas: So we had, uh, it was, we put in 38.5 [thirty-eight and a half], both of them, both of
them, on top of that, on the top of that, there was 6 for Carroli and 32.5 [thirty-two and a half] on
the other side. OK.

Joe: We made a global deal, the 38.5 [thirty-eight and a half] became 28. [unclear]

Male 1: 6 equals 6. And uh,

Nicholas: Wait, wait!

Nicholas: Wait, but how are we going to justify this? Were going to justify this.

Joe: I invested with [unclear] Chenille and I want to collect my money.

Male 1: We were on 6 million.

Nicholas: And we had said 6 million.

Nicholas: Finally, some sums put forward in [unclear]

Male 1: [unclear comment]

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Joe: Yes, yes. If you like. But if we dont make the correlation between this and that, what Im
interested in is finding out how we arrived at this figure here.

Nicholas: At this figure...

Nicholas: So, here we are, theres 6 million, this is [unclear] one thousand. And then we had
discussions saying, Joe, Im not certain its 6 million what you put into the Island.

Joe: Yes, but I took the capital, thats what enabled me to get paid more

Nicholas: OK, but the discussion I had at the time, I dont know if you remember, Joe, it was 6,
and you said, well figure out the exact figure later, but lets take the principal, so I can
recuperate my money.

I had said 4 million 200 with three years of interest, thats 3 million 500.

Nicholas: Yes, I know.

Nicholas: But, but you know what happened, you know China, we couldnt follow that
investment.

Joe: If I knew then what I know now, [unclear], because never in my life have I done business
this way! [unclear] today were hiding things [unclear].

Nicholas: Yes, yes, I know.

Joe: ...because when you put down 98 thousand at 10 percent, thats 10 million a year!

Nicholas: But that will buy back 38 at 28!

Joe: No, it wont buy back 38 at 28...

Nicholas: Youd have to add the 4.2!

Joe: No!

[unclear]

Nicholas: So now here, there was 4.5, which was a discount.

Joe: Discount!

Joe: [unclear]

Nicholas: Yes, because now youre at 10! 10.5 and you have the difference between the 38.5 and
the 28!

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Joe: [unclear]

Nicholas: OK, so, for me, its really about the discussion. Eric confirmed it with me yesterday.
As far as the discount we made on Nille [spelling unclear], we put in 4.2 and then we took out 6.
You had an agreement to pay off the difference, to Nille, he told me, yes. This is where my
problem lies.

Joe: [unclear] Its not normal! Its not normal. Its not normal. I paid the attorneys 500,000
dollars, and you, you want 1 million!

Nicholas: But, but, yes, well, I dont know, in any case, thats the deal I had with Eric.

Joe: Yeah, yeah! Impossible! Is that why you took 800,000, who knows, 1 million dollars! I did
this for Eric out of friendship, but there is absolutely no reason for me to give you 1 million
dollars. Im taking back my money [unclear]. Its a little elegant.

Nicholas: But no!

Joe: I only give at the exit. I dont give when I enter.

Nicholas: OK. But the exit, uh, well, uh listen, I, we can analyze these things and not agree.

Joe: Im not even trying to negotiate in the sense that this is a new thing thats come from you, I
respect what you have to say, but its totally crazy. Im going to put forth 14 thousand? [unclear]

Nicholas: Call Eric then?

Joe: Im not going to call Eric, because I wrote everything down. I wrote it all down.

Joe: [unclear] I cant. I cant say things like that [unclear].

Nicholas: Then perhaps Eric didnt understand...

Joe: I dont want to put him on the spot, but... its impossible! Its like if you said, Are you, am I
doing the marathon? If someone says theyre doing the marathon, theyre lying [unclear]. Even
the 820 million dollars [unclear], so Im obligated to change everything; even the direction of the
ship.

Nicholas: Hmm.

Joe: ...and I dont want to give you more... Even my 820 million dollars, its just paper. Its only
serious because it was an understanding between friends. Theres no reason why I should,
normally. I am taking back the 400 million. Why, because theres been nothing. Nothing done,
nothing. And thats all. And, [unclear] even that I wont give it to you. Weve paid. We want to
be paid.

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Nicholas: Uh, uh...OK, OK, OK. But I, for me, wait, listen. We have, in my interpretation of this,
OK, we didnt envision that youd want out, OK, its a downside for you.

Joe: Its not.

Nicholas: Yes, but its not a ... You bought them at a lower price, the shares.

Joe: No, no, [unclear] I didnt buy them [unclear], I didnt buy them at a lower price.

Nicholas: You recuperated what you put in, Nille. In

Joe: Its normal. Otherwise you would have made me an atomic bomb here!

Nicholas: Yes, ok.

Joe: Thats all. I am regulating. Thats all. Im the nice one. Why would I put 400.5 million in
somebodys hands? I stand to lose as much as I stand to gain. Thats in Gods hands. But this has
been highway robbery, what hes done to me, that guy the tall one? The taller guy from St.
Barth? Eh, uh?

Nicholas: Ah, yes! Didier? Yes, yes!

Joe: Yes, that one!

Nicholas: We dont know! We have a case [litigation] against him. Uh

Nicholas: Yes thats theft, its theft!

Joe: St. Barth is worth money, huh?!

Nicholas: Of course its worth money!

Joe: I have a house worth 50 to 60 million dollars!

Nicholas: Of course!

Joe: Im not a little child who wants out on the wedding night!

Nicholas: No, no, no, no!

Joe: I got out of it so I could put an end to it.

Nicholas: Yeah, yeah, yeah.

Joe: The point was to end it.

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Nicholas: Yeah.

Joe: Normally, with numbers and letters, someone calls, someone pays a dollar, they deduct one-
thirtieth, one-fortieth, one-fiftieth... you could do that, too, you know? Which is normal. I want
to straighten all this out.

Nicholas: Uh huh.

Joe: And I dont care for the stories that come along with this. The drama. I dont want to be the
one making stories for others.

[inaudible background noise] ...I want to straighten things out. Because I need to defend myself
at the next stage. I tried pushing things back and pushing things back

[unclear] even if theyve won the case... [unclear] but I dont want to... because I know what
to say. But I dont want to, but I cant tell the truth, its a mistake.

Nicholas: OK, well, listen...

Joe: [Joe knocking on door and calling out] Lois! Lois!

Joe: If you have a solution, we can... Lois! [unclear] if theres a solution...

Nicholas: Im trying, Im trying so that everyone... uh

Joe: Well, listen, well take care of everything, but if you have a little something, then well
come to an agreement, but this, [unclear], like you said, so I can go back [unclear].

Nicholas: OK, well, what do you want me to tell you? Thats what Eric wants.

Joe: Thats not my concern here. Its not possible, its not logical. I want my 4 million 200. You
give me back my 4 million 200. I owe you 1 million 800 [unclear]. In what country?

Nicholas: But because you have a 4 million discount for the thing...

Joe: Ill put 1 million 200 here and give 1 million to you, and you take 800 on the 400 million.
Then, Ill keep 2 million and advance the money. Im putting 30 or 34 here...

Nicholas: But, no!

[inaudible female voice, Joe unclear]

Female Voice 2: You sent this to them [unclear]... from here to there... I think some of them
[unclear].

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[silence/mic noise]

Joe: Everything was placed in the account of Dolgave [spelling unclear], so maybe he...

Nicolas: It was him who called me [unclear]

Nicholas: [distant, unclear] ... This is, uh...

Joe: [distant, unclear]

[indistinct voices]

Joe: Looking at the...

Female Secretary: I know I had more notes from the very beginning, but thats your handwriting.

Joe: Yeah, I know those are my notes, theyre handwritten...

Joe: If you have the means to find something, well find something, and well see if we can
succeed...

Nicholas: There were some funds which were received, 2 million then 2.6 million... it was on the
1st of August...

Joe: [unclear]

Nicholas: 13th of February 2013.

Nicholas: [under breath, unclear], Ah!... So this is the totality of Triadou, where I made 64
million.

Joe: Oh!

Nicholas: Not with you, there was the theft and all that... [reviewing numbers]... We put in 39
350 into Flat, it seemed to me thats what it was. And 6 into Cabrini. If you can erase that, thats
what I get with my numbers as far as payments.

Male voice: Matt! Matt!

[rustling and shuffling]

[pause; talking far off in background; unclear]

[inaudible]

Nicholas: OK?

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Male Voice: Matt. Matt!

Joe: Ill take this number 29 2050 [unclear]

Nicholas: OK! But, so, well find out the right number but... No, there were extra 6s [sixes].
This is what I transferred to George Grasse or here... Yeah, its easy to know. Well now you see
that this makes more sense with the deal you made, because now that gives you 45 million in
investments and you bought back 28.

Joe: No!

Nicholas: No, no! Im telling you!

Nicholas: You think you made a worse deal than you made, but you made a beautiful deal.

Joe: No! I made the deal, I know exactly the deal I made, I made 4 million. 4 million is the
difference, thats it!

Nicholas: Of what?

Joe: 4 million and, and, uh...

Nicholas: There was a re-negotiation with Eric and we still made [unclear]

Joe: No. No. It never passed. 4 million and this. It was 4 million.

Nicholas: And I have my report here, so Ill find it. I dont know why I didnt find it before. And
I did this here with the bank, I found these numbers with the bank. 39 million 350, thats what I
sent for the Flat Hotel... well, look, look, the numbers!

Joe: [unclear]

Nicholas: And the contract, it was bought at 28.

Joe: No. Not at 39, impossible! There was 4. It was 32. Thirty-two five hundred, the account.
Minus 4 million, that leaves 28. Then, 28 minus 7 for the payments I made, that leaves 21. Then
on 21, theres 5 million 500. I think thats 6 there. [calculating] Twenty-two, 4 times 4, and 4
times 5, thats That was the deal. And he put in 6 which equals St. Barth.

Joe: Its 39 with Cabrini... with Cabrini.

Nicholas: Thats really not what was notated here, but OK.

Joe: Youre saying, whats his name, I dont know, the other guy there?

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Nicholas: Who?

Joe: That guy, whats his name? The boyfriend of ... [unclear]

Nicholas: Uh, Peter?

Joe: The one who built two lots?

Nicholas: Oh, yeah, Felix!

[inaudible]

Joe: [unclear]

Male Voice [Matt?]: Yes, but this was all of that.

Joe: No, but this is the money that you put in this account.

[Matt?]: Yeah, but I never, I dont know, I dont know what was said.

Joe: [unclear]

Joe: So up until now, the friendliness... [unclear]

Nicholas: Yes, well with our 30 and change... we are... [unclear]

Nicholas: You had a loan of 100?

Joe: [unclear numbers spoken]

Nicholas: 228?

Joe: 228 [unclear]

Nicholas: Ah, its 228, the lot [unclear]

Joe: Well find a way. I respect you but...

Nicholas: We definitely did put in 39 in Flat, 39 in Flat, plus 6 in Cabrini and that you bought it
all at 28; it makes for a beautiful deal.

Joe: I didnt buy it at 28, and I did my part in the deal. So its 34 and a half.

Nicholas: 34.5, OK

[inaudible]

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Nicholas: because 34 and half plus 39 makes 7.

[Sighs]

[Eric?]: Well, uh, then...

Nicholas: Eric and I worked toward the same goal.

Joe: [unclear]

Joe: If you have the means. We can find a solution to all of this.

Nicholas: Well, you know Im not trying to, uh...

Nicholas: Im not trying to be a beggar taking the crumbs. I want things to be fair and better.

Joe: Thats for sure. And now... [unclear] ...If I had done those payments, wed have nothing. If I
had done those payments.

Nicholas: No, why? No. because the commission, for what you agreed to pay, it was agreed upon
by signatureby the signature on this, the 28.

[unclear]

Secretary: You want to take a break now... [unclear] ...were closing in two or three days.

Joe: If I had made the payments... wed... [unclear] ...the rest of what I said, the parallel
payments and what we were discussing. Otherwise, last time on the 18th, you know exactly what
I said. Its the 21st now.

Nicholas: Its the 21st now!

Joe: [unclear]

Joe: Well, if I had made those payments, thered be nothing left for us to say to one another...
[unclear]

Nicholas: Yes, well... yes. My point, Joe, is to say, the 2 million. Its possibly Eric and myself
who misunderstood one another; perhaps, call Eric?

Joe: Impossible! Impossible! Im not calling anyone! When I look in the mirror [I see Joe] not
Albert!

Nicholas: I know that. I see!

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Joe: No. You can tell me Joe [unclear] as a gentleman [inaudible]. Here on this deal, I want to
reclaim my money on this deal amicably, and I know thats not possible on every deal [unclear].

Nicholas: OK, but Im in a situation where Ive got nothing to lose [unclear].

Joe: [unclear] I want to get it squared away.

Nicholas: Yeah, yeah, yeah.

Joe: I told you yesterday 5 and 12?

Nicholas: And 7!

[Inaudible]

Joe: [unclear] Ill pay what I owe, thats it!

Male Voice: Is that it? Are we done here?

Nicholas: Hmm, hmm... OK, take a look at your numbers! Its because I think I made you a
better deal than that, a better offer than this!

Joe: The only advantage was that there [unclear]

Nicholas: Even better than New Years! Ha ha. [unclear]

Joe: Even the attorneys, I could cause major problems for them!

Nicholas: And, once again, I dont really care today.

Joe: But I dont want to.

Nicholas: Yes, Im not on their side.

Joe: The lawyer [unclear], this doesnt interest me... Ill review this and [unclear] I know a guy
who takes care of everything. Im going to Israel Tuesday or Wednesday for the Easter Holiday
[unclear]

Nicholas: When is it that youre leaving?

Joe: Im leaving Tuesday night from here.

Nicholas: Tuesday for 7 or 8 days.

Nicholas: So for me, pay me the 600 million now... Once again, this bill comes out to millions...
Normally thats done by signature.

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Joe: I want to clear this up, the whole deal all at once.

Nicholas: [unclear]

Joe: [unclear] The same day I do it, its done.

Joe: Youre a business man! [unclear]

[unclear, Joes calculations]

Nicholas: OK, another proposition!

[unclear, Joes calculations]

Joe: So you have leads [investors]?

Nicholas: Of course I have leads! Go ahead! But you know Im gonna defend myself!

Joe: So there! I leave you with an initiative! [unclear] the day that I pay you, Ill pay you this and
this!

Nicholas: OK, but how do we go about it? I need money today.

Joe: [unclear answer] After this week, were done.

Nicholas: And why dont you want to pay the 600 thousand? I want to settle.

Joe: I will settle, Monday!

Nicholas: Yes, but this is what we had agreed upon in the beginning.

Joe: Yes, I think so. How did we get to this situation? [unclear]

Nicholas: I cant help it. No one can help that!

[Joe inaudible]

Nicholas: Absolutely not! Ah, Im no longer working with them! Hey, Joe, Im going to the
attorneys office and she calls me telling me, you cant come anymore because they fired you!
Youre no longer President of Triadou!

Joe: Since when is this? Who did this?

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Nicholas: Affiline Gatt [unclear spelling], do you know why he did this? Its because I said that,
the payments that Joes going to make, Im going to keep $500 thousand of it in order to pay off
the attorney expenses, yes, exactly, to pay her!

Its been over a year! Its not even her, uh... Its not even him that I called, its ILLIAS! He said,
No, no! Youre going to transfer everything, transfer everything, so much so that he didnt want
me to keep the money. I said, no! Im keeping 500 thousand to pay off the expenses. And two
hours later, she did the procedures to fire me!

Joe: [unclear answer]

Nicholas: [unclear] He has a factory; plastic components.

Joe: [unclear] Im not making any promises, but there are many things to be done.

Nicholas: So were doing this under the deposit reduction of 50-50?

[Joe unclear]

Nicholas: [To friend] the 17, he hasnt accepted yet?

Joe: [unclear]

Nicholas: No, no, no.

Joe: OK, well! [Leaving]

[sound of people leaving.]

Nicholas: [sigh and laughter]

[walking, hallway, voices]

[voices, office hallway]

[Nicholas walking]

[Office hallway voices, greetings]

Nicholas: No, no, its OK, Im walking. [unclear]

[phone dialing- elevator?]

Nicholas: Well, have a safe trip!


--

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TRANSLATION CERTIFICATION

I, Leonardo Duran, General Manager of Language Services for and on behalf of Magna
Legal Services, hereby certify that the audio recording named 2015-03-23_13-50-
26_100 was translated from French to English by a professional translator competent in
both French and English to render such a translation, and that to the best of my knowledge,
ability, and belief this translation is a true, accurate, and complete translation of the original
French audio recording.

__________________________________
Leonardo Duran

_________________________________
May 2, 2016

Date

Magna Legal Services


Language Services Division
1635 Market Street | 7 Penn Center, 8th Floor | Philadelphia, PA 19103
Phone: 866-624-6221 x 303 | Fax: 866-579-0819
Email: LanguageServices@magnals.com | Web: www.magnals.com