Felix Sater was almost certainly Source E of the Steele dossier

Politico reports today that Felix Sater will be interviewed tomorrow behind closed doors by the House Intelligence Committee. To judge from that article, it does not appear that the committee will be asking any questions that might concern the Steele dossier.

However, we do know that Department of Justice Inspector General Michael Horowitz has completed his investigation of the Carter Page FISA warrants, and it is almost certain that Christopher Steele was interviewed by Horowitz or investigators and lawyers working for him as part of that investigation. (The latest word is that Steele agreed to be interviewed, but insisted that the interview take place in London.)

Eventually, more information will come out about the Steele dossier as an outcome of Bill Barr’s “investigation of the investigators,” all of which I expect to be fully exculpatory for Steele and for the officials in the FBI and DOJ who took the work Steele reported in his dossier seriously. Given all the attention that the Steele dossier is receiving in connection with Carter Page’s FISA warrant, the identity of Source E of the Steele dossier will almost certainly be revealed directly or indirectly, sooner or later.

I give below compelling reasons for identifying Source E of Steele’s memo #095 with Felix Sater. Here is a passage from that explosive memo:

Keep in mind in reading this passage that there is no reason to think that Steele was referring to a criminal conspiracy as defined it U.S. law. It is much more likely that the reference was to “collusion” in the ordinary, non-legal sense of the word, and of course Mueller did find plenty of evidence of that — especially with regard to MANAFORT.

Who is Source E of that memo? Here are the reasons for thinking that it has to have been one Felix Sater.

The revelation about Steele’s sourcing in the Corn-Isikoff book Russian Roulette

From the day I first read read the Steele “dossier” (the very day that it was published by BuzzFeed) I had questions about the kinds of sources and intermediaries that Steele was able to use, particularly for the early memos.

Steele, as all of us soon learned, had retired from his job as an agent for British military intelligence (MI6) and its Moscow desk in 2009. All the journalistic writing about Steele then proceeded on the assumption that it was these old contacts from his Moscow days who conveyed to Steele what the sources were saying about Russian interference in the election and Trump campaign collusion with it.

This seemed questionable to me — even a bit weird. How I wondered, could an old Russia hand who had not been in Russia since 2009 have gotten an extraordinarily intimate, inside view of an American political campaign using Russian sources in faraway Moscow?

Over time, in a series of long threads, I came to the conclusion that, particularly in the early memos, which deal largely with American sources close to the campaign, both Steele’s sources and his informants must have been American. And it turns out that this was right, for in Russian Roulette, which was published in March of this year, we learn (from Glenn Simpson of Fusion GPS) that Steele used as his principal informant a “Russian émigré living in the West who travelled frequently to Moscow and was acquainted with well-informed Russian professionals and officials” [Russian Roulette, p. 167). Steele called this individual the “collector.” Corn and Isikoff refer to him as Steele’s “undercover operative.”

We do not learn from the book where in the West the collector lived. Since Steele is based in London, and there is a lot of work in London for people like Steele who work in business intelligence and who investigate Russian oligarchs who park a lot of their money there, it would be natural to suppose that the “Russian émigré living in the West” Steele used as his principal intermediary lives there, too. But I believe this would be mistaken. New York City (and the Trump Organization in particular!) is the other major center in the West for Russian money laundering. And what makes New York City the more likely of the two leading alternatives is the language that Steele repeatedly uses like: “speaking to a trusted compatriot.”

He uses this phrase, not only in connection with sources like A and B (a Russian Foreign Ministry figure and a former top level Russian intelligence officer still active inside the Kremlin) but also in connection with the American sources D and E. For example, in memo #095, Steele says: “Speaking in confidence to a compatriot in late July 2016, Source E, an ethnic Russian associate of Republican US presidential candidate…”. The sources cited in the early memos who are close to the campaign are clearly Americans, and since they spoke, directly or indirectly, “in confidence” to Steele’s undercover operative, it is likely that the person they were speaking to “in confidence” — the collector — was based in New York City and not London.

Who were Steele’s American sources — especially Sources D and E?

The dossier’s American sources are described in terms like “a close associate of Trump who had organized and managed his recent trips to Moscow”; an “ethnic Russian close associate of US presidential candidate Donald Trump;” a “Russian émigré figure close to Trump’s campaign;” an “émigré associate of Trump”; and an “ethnic Russian associate of Trump who is also a Trump campaign insider.”

It is helpful to think of this in terms of intersecting Venn diagrams. The two principal American sources we are talking about, D and E, must have been Russian ethnics who live in NYC. Now the set of NYC residents who are Russian ethnics is quite large, but the intersection we are talking about — Russian ethnics etc. who were close enough to Trump, the Trump Organization, and the Trump campaign to have served as the collector’s sources — is exceedingly small. In fact, it is so small that enterprising journalists who have worked hard to identify the American sources in the dossier have come up with only three individuals who could plausibly fit the bill: Boris Epstheyn, Sergei Millian, and Felix Sater.

Nowadays, the field can be narrowed even further. My research on Epstheyn, which I reported in a thread on 29 Nov 2017, shows that the identification of Source E with Epstheyn must be dismissed. Since Sergei Millian is disclosed in Russian Roulette (again, by Glenn Simpson) to be Source D of the dossier, Sergei Millian must be excluded as a candidate for Source E as well. By process of elimination, then, Source E must be Felix Sater.

In light of Michael Cohen’s statements to George Stephanopoulos in an interview on 14 Dec 2018, however, I think we should at least consider the possibility that Michael Cohen is the Source E of the dossier.

Was Michael Cohen the Source E of the dossier?

In retrospect, it is not entirely clear why no one who discussed the dossier — including me — seems to have considered that Michael Cohen might be the Source E of the dossier. After all, Cohen is a Russian ethnic, and he was much closer to Trump and to the Trump Organization and the Trump campaign than any other “Russian ethnic,” including Felix Sater.

In fact, if Sater was Source E of the dossier, much of the intelligence that he spilled, either directly or indirectly, to Steele’s collector must have come from others who were actually in the campaign. Sater acknowledged as much in an interview with a Russian newspaper nine days after the election (Google translation):

Q: And what did you have to do with the election campaign?
Sater: Nothing.
Q: But you seem to be aware of it.
Sater: Well, I talked with the team, with people.

For sure, one of the individuals Sater talked to during the campaign was Michael Cohen, his lifelong buddy who was also his partner in the Trump Tower Moscow project during the campaign. So, whereas Sater could only have been an indirect (though extremely good) source for Steele’s collector, Cohen would have been a direct source.

That said, I continue to believe that Sater was Source E of the dossier, for three reasons.

First, unlike those who are actually described as sources in the dossier, Cohen is described as a major protagonist on whom Steele’s sources reported. Furthermore, Michael Cohen is actually named in the dossier; those who are described as sources are not. Steele, clearly, was loathe to identify individuals he used as sources. If he did so in Cohen’s case, Cohen would be a singular exception.

Another reason for thinking that Cohen was not Source E of the dossier is found in the first memo (#080), in the part that contains the “golden showers” allegation. There Steele’s collector says that Source E was told about the golden showers incident by Source D.

This makes it unlikely (though not impossible) that Source E was Cohen. That is because we now know that Source D was Sergei Millian. (We also know that MIllian was in Moscow during the Miss Universe pageant; Sater and Cohen were not.) But Millian does not seem to have had close relations with Cohen. In fact, it appears likely that Millian really had no relationship with Cohen at all.

Cohen has called Millian a “phony,” and in January of last year, Cohen told ABC News:

“I’ve never met the guy … I have spoken to him twice. The first time, he was proposing to do something. He’s in real estate. I told him we have no interest. Second time he called me, I asked him not to call me anymore.”

On the other hand, it is quite plausible that Millian and Sater know each other — and probably fairly well. ABC News asked Millian about Sater in a July 2016 interview:

ABC NEWS: And what about Felix Sater? Do you know Felix — who is connected with Sapir I guess in some way? You don’t know him at all?

SERGEI MILLIAN: Unh-uh

ABC NEWS: He’s one of the advisors for Trump. Who else…

SERGEI MILLIAN: Because my advisor, he’s best friend of Tamir. He’s regretfully he passed away. But he was one [of] his best friends. So that’s how [sic] are connected.

The Millian-Sater connection through a friend of Tamir Sapir is significant.

Tamir Sapir was a co-funder of Trump Soho. Trump Soho was the major project of the Bayrock Group, for which Sater was executive director. The Tamir Sapir connection makes it likely that Millian and Sater do know each other — and probably fairly well. This, in turn, makes it likely that Millian (Source D) conveyed the allegation about the “golden showers” incident to Sater, not Cohen, making it likely that Sater is Source E of the dossier.

(Here’s a pic of Sater with Tamir Sapir):

The third reason, which is important though not dispositive, comes from some reporting about the Mueller investigation. A British paper, reporting that Mueller’s team had met with Steele, strongly implied that Felix Sater is Source E of the dossier.

CNN was the first American media outlet (5 Oct 2017) to report that Mueller’s team had met with Steele. NBC News, citing a source “close to the ex-spy,” reported the same on the following day. The NBC article reported that the Mueller team had “traveled” to interview Steele. The CNN article reported that the interview had taken place that summer.

The first article mentioning the meeting, however, appeared in the British paper The Independent on 27 Sept 2017. That article provided details that are not found in the CNN and NBC articles.

The article in The Independent — entitled “Trump-Russia investigators close in on sources named in explosive dossier” — says: “It has been reported that ‘Source D’ and ‘Source E,’ may be the same person, and that that person might be Sergei Millian.” (The reference is to a 29 March 2017 article in WaPo by Helderman and Hamburger.) But we know now that Millian was Source D, and the very notion that Source D and Source E are the same person makes no sense at all if you read the memos at all carefully.

The author of the Independent article, Kim Sengupta, is dismissive of the WaPo article (at least so far as Source E is concerned), but he takes very seriously the idea that Source E is Felix Sater. “But some with inside knowledge of the Steele report say that one of the ‘sources’ could be Felix Sater,” he says. Sengupta, the Defence and Security Correspondent for The Independent, lives and works in London, and probably has Christopher Steele as one of his sources. So “some with inside knowledge of the Steele report” could very well be a reference to Steele himself.

So there it is. Who do you think was the critical Source E of the Steele dossier?

Unless Steele made it all up out of whole cloth — which he certainly didn’t do — it had to be somebody, and it’s an important question.

I report, you decide.