Tag: Phoenix Thoroughbred

When post positions are drawn Monday for the 147^th running of the Grade 1 Kentucky Oaks, one of the leading contenders will be Grade 2 Gulfstream Park Oaks winner Crazy Beautiful, a Liam's Map filly trained by Kenny McPeek, who bought her as agent for $250,000 at the 2019 Fasig-Tipton Kentucky October Yearling Sale.

Within weeks of that sale, the man who would become Crazy Beautiful's owner – Amer Abdulaziz of Phoenix Thoroughbred III – would be identified under sworn testimony in federal court as a conspirator to launder some of the estimated $4 billion scammed from people around the globe in a cryptocurrency ponzi scheme known as OneCoin.

Dubai-based Abdulaziz was named by Konstantin Ignatov, whose sister, Ruja Ignatova, is said to be the mastermind behind OneCoin (she has disappeared but the story of her and OneCoin is told in the BBC podcast The Missing CryptoQueen). Konstanin Ignatov pleaded guilty to charges of fraud and money laundering and is now cooperating with the U.S. attorney for the Southern District of New York that is prosecuting several cases related to OneCoin.

Ignatov said that not only was the Phoenix Thoroughbred founder laundering OneCoin funds, Abdulaziz stole 100 million euros from the operation and spent the money on racehorses, according to investigative journalist Matthew Russell Lee, who reports on courtroom activities at the Southern District of New York.

Ignatov testified in the trial of attorney Mark Scott, who was convicted of money laundering and bank fraud in connection with OneCoin and like Ignatov is awaiting sentencing.

When Scott was arrested and interviewed by the FBI in September 2018, he admitted to closing a OneCoin fund in Ireland and wiring the money to a “financial adviser” in Dubai named “Amar something” who ran the Phoenix Investment Fund.

The government showed that more than 185 million euros were transferred to Phoenix between February and April 2017. In a forfeiture letter to the judge in the Mark Scott trial in which the government is seeking $393 million in funds from Scott, acting U.S. Attorney Audrey Strauss could not have been more clear in her assessment of Abdulaziz.

She wrote: “Scott subsequently transferred approximately 185,000,000 euros from the Bank of Ireland to the accounts of another one of Ruja's money launderers named Aamer Abdulaziz.”

Through an agent, Abdulaziz first starting buying high-priced horses in early 2017 at the Fasig-Tipton Florida Sale of 2-year-olds in training. By year's end he had spent more than $20 million and was building a massive worldwide portfolio of bloodstock holdings that included horses for both racing and breeding.

That spending continued into 2018 when Abdulaziz' profile was elevated beyond the insular world of bloodstock sales. Phoenix Thoroughbred struck a deal to have NFL star tight end Rob Gronkowski take part ownership of a namesake colt, Gronkowski, running in that year's Belmont Stakes won by Triple Crown winner Justify.

 

By now, nearly everyone in racing had heard of the big-spending Phoenix operation, which Abdulaziz had hailed as the “world's first regulated Thoroughbred fund” that was designed to show a profitable return to its investors. Except no one seemed to have any idea who the actual investors were or why they would put their trust in someone who was a relative unknown until he started spending tens of millions of dollars to buy horses.

The following March while in Dubai for the World Cup, British television host Nick Luck conducted an interview with Abdulaziz, who directed some comments to skeptics.

“People are always asking, 'Who are these guys? Are they serious? Are they going to be there next year?'” Abdulaziz said. “I can tell you now, on your show, we are here to stay.”

Luck responded: “The other question they always ask is, 'Where's the money coming from?'”

“It's a registered fund,” said Abdulaziz. “Transparency is very important. If anyone has any doubt we are more than happy to have them come and sit with us in our office. … There are third party regulators.”

It has since been reported that Phoenix was not regulated in Luxembourg, as Abdulaziz has said.

“Most of the people we have managed to bring to the fund so far are pension funds, insurance companies or high net worth individuals from Europe, America or Australia,” Abdulaziz told Luck. “We would like to give our investors the opportunity to come to the races, network with a lot of people, open doors for them.”

Yet those investors were never identified or seen at major racing events where Phoenix horses competed. When Crazy Beautiful won the Gulfstream Park Oaks, trainer McPeek confirmed, none of the people in the crowded winner's circle were affiliated with Phoenix Thoroughbred.

Abdulaziz told Luck in 2019 that Phoenix has a half dozen other funds, including a hospitality fund worth “about a billion dollars.” He said that he has another fund “where I have all the basketball players involved with me in the U.S.”

Since the initial revelations about Phoenix and Abdulaziz were first made in United States federal court proceedings, horse racing regulators around the world have begun to restrict the operation's activities. According to published reports, authorities in France, the United Kingdom and even his home country, the United Arab Emirates, have said Phoenix can not race horses there. Most recently, Australian authorities said they will freeze any prize money won by Phoenix out of concerns over where its funds came from. Sources have said several horse sales in Europe will no longer accept Abdulaziz' money.

No U.S. racing regulators or racetracks have yet banned Phoenix and major sales companies Fasig-Tipton and Keeneland have not said Abdulaziz and his money are not welcome.

The standard answer from these organizations is: Amer Abdulaziz has not been indicted or convicted of any crime.

And that is true. It is also true that Abdulaziz has vehemently denied any illegal activity and has threatened to take legal action against anyone who says otherwise.

It is also true that Amer Abdulaziz, who once was so prominent at American racetracks and sales grounds, has not traveled to the United States since these OneCoin money laundering revelations were made in federal court. He knows the fate that very likely awaits him. If federal charges were to be filed against Abdulaziz, there is no extradition treaty between the United Arab Emirates and the United States, so Dubai serves as a safe haven for him.

Class-action suits have been filed against OneCoin and more criminal cases are pending. This case is not going anywhere soon. Will Phoenix Thoroughbred assets get dragged into the case? That's anyone's guess.

American regulators and Thoroughbred industry businesses have been looking the other way ever since the money laundering allegations were first made against Abdulaziz and Phoenix in November 2019. It's not a good look for an industry that routinely seems to value money over ethics.

That's my view from the eighth pole.

The post View From The Eighth Pole: Ownership Of Oaks Contender Crazy Beautiful Has Horse Industry Looking The Other Way appeared first on Horse Racing News | Paulick Report.

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