This is the story of a budding romance, but not the kind that starts with a chance encounter and ends with a happily-ever-after.
This one involves backbiting and an FBI undercover sting.
It began in the fall of 2012. Emile Bouari was dining with his girlfriend, a fitness model named Kim Milko, at a high-end restaurant in Las Vegas. Their relationship had been tumultuous, fraught with infidelity and disagreements. Milko wanted to marry, but Bouari, who was separated from his second wife at the time, struggled with commitment. To him, going to court to sign marriage papers meant he’d have to return for divorce proceedings yet again if the relationship didn’t last.
Bouari and Milko had split up a few times. During an off period, Milko said she struck up a flirtation with a local lawyer and former federal prosecutor named Paul Padda, who had a reputation in Las Vegas as a successful, available bachelor. Padda was tall with a coif of thick, jet-black hair that glimmered with gel. He and Milko had hung out in groups and shared two solo meetings, by her account: one for lunch and another for drinks. Their physical contact had been limited to kissing and affectionate touching, according to Milko, but when she reconciled with Bouari, she told Padda that their dalliance had to end. By the fall of 2012, it had been weeks since Milko had seen Padda.
What happened next on that fall evening in Las Vegas is disputed.
In separate interviews with The Intercept, Bouari and Milko said Padda approached their table. He pointed his finger at Bouari and said, “I fucked your woman and she loved it,” according to Bouari and Milko. Milko said she suspected Padda was trying to instigate a conflict with Bouari by suggesting they’d had sex, when in fact they had not.
Padda describes this as the fanciful invention of two people who hold a grudge against him. He denies having had such a relationship with Milko and maintains that the incident at the restaurant never occurred.
Either way, a feud was born between Bouari and Padda. Defamatory statements about Padda soon popped up on a website called Ripoff Report. The comments, posted anonymously, described Padda as “a real sleaze bag” and “a terrible attorney” who “has defended pedophiles.” In January 2014, Padda filed a defamation lawsuit over the statements, first naming “John Does” as defendants and later narrowing in on Bouari and Milko after he received subpoenaed records from their internet service provider.
Three months after Padda filed his lawsuit, an FBI informant wearing a wire showed up at a weight-loss clinic that Bouari ran in Las Vegas. It was one of the opening moves in an FBI investigation code-named Operation Bo-Tox. The sting was run by FBI Special Agent Charles Ro, whom Padda acknowledges he knows in “a professional capacity.” Padda would not describe what, if any, conversations he had with Ro about Bouari’s case, citing “ongoing criminal proceedings.”
Bouari’s lawyer, Mont E. Tanner, would later suggest in court that there was an important backstory to the FBI sting. “This case originated with sort of a love triangle with [Bouari,] co-defendant Kim Milko, and former U.S. Assistant Attorney Paul Padda,” Tanner said during a detention hearing. Padda says this is nonsense.
For nearly two years, as part of Operation Bo-Tox, an FBI undercover agent and an informant sidled up to Bouari, seeking to expose what the FBI appeared to suspect was a network of small-business owners willing to launder money. But for all its efforts, the FBI could nab only Bouari, Milko, and a friend of theirs, who all together laundered $590,000 and collected $52,900 in fees.
The questions surrounding Bouari’s case do not involve whether he and his girlfriend laundered money — it is clear that they did — but rather, why the FBI pursued such low-level operators in the first place.
Padda became a central figure in the FBI sting. The undercover agent and the informant would try repeatedly to persuade Bouari, who was angered by the defamation lawsuit filed against him, to commission a hit on Padda.
But this case is about much more than a feud with a local lawyer. Operation Bo-Tox is indicative of the FBI’s increasing willingness to rely on aggressive sting tactics, first designed to be used against violent criminals and sophisticated organized crime networks, to target potential white-collar criminals, including those, like Bouari, who were not known to be committing significant offenses until the FBI put together an elaborate trap to make their crimes possible.
He came to the United States as a student in the 1990s to attend Boston University, receiving a master’s degree in international relations in 1996. He worked sales jobs after college, and got married, separated, and eventually divorced. After the 9/11 attacks, the newly single Bouari enlisted in the U.S. Army. “I wanted to go get them,” he said of the Al Qaeda attackers. He went through basic training in 2003 and spent three years in the Army, walking a quick path to U.S. citizenship under an executive order signed in 2002 by President George W. Bush that rewarded noncitizens who served in the armed forces after 9/11.
Bouari’s last posting in the Army was in Las Vegas, and he settled there after being discharged. He met the woman who would become his second wife, Carol Ann Chaney, and together they built a business around helping people lose weight. He and Chaney, who did not return calls seeking comment, operated a chain of weight-loss clinics throughout the U.S. and sold franchises to other entrepreneurs.
Customers received 500-calorie daily diet plans and injections of B12 and human chorionic gonadotropin, or HCG, a hormone produced naturally by pregnant women that Bouari and his staff peddled as a wonder drug they said could help clients slim down fast without muscle deterioration. HCG is not approved by the U.S. Food and Drug Administration for weight loss, and the so-called HCG diet, widely promoted by weight-loss businesses in the United States, is a controversial treatment whose efficacy is not supported by medical research.
“It’s just a theory; it’s never been proven,” Hossein Farsad, a doctor who worked at Bouari’s Florida clinics, said of the benefits of HCG injections during calorie deprivation. “They’d give me a piece of paper that would say this is the regimen: low-calorie diet, HCG injections, and B12 injections. … It was all business.”
The commercial weight-loss industry in the United States operates mainly in the gray area between legitimate medical services and snake oil sales, and Bouari did little to counter common assumptions that the industry is shady. In August 2013, six franchisees from several states sued Bouari, Chaney, and their companies, alleging, among other things, that the couple provided false revenue numbers and lied about owning trademarks and proprietary techniques. (The plaintiffs won a $6.7 million default judgment against one of Bouari’s companies in January 2016.) Bouari was also accused by a former employee in Miami of not paying wages, in a case that was ultimately dismissed, and has a civil judgment against him in Las Vegas for owing more than $17,000 to a printing and marketing company. He’s in debt to the IRS as well for back taxes.
Bouari was an unprincipled businessman who’d been accused of ripping people off and leaving a trail of unpaid bills. But it would take an FBI informant with a similar history of shady business practices to get him to launder money.
According to the FBI file, Bouari’s first ex-wife told federal agents in September and October 2001 that Bouari belonged to a Christian militia and had killed 17 people for $300. He was also involved in credit card fraud and child pornography, according to information the FBI attributed to the ex-wife, who was not named in the file.
But Bouari’s first ex-wife tells a different story. The woman, who asked not to be named because of privacy concerns, confirmed that she had talked to the FBI about Bouari after agents approached her in the days following the 9/11 attacks. She told them about Bouari and their marriage, but says she never said anything about Bouari killing anyone or being involved in credit card fraud, child pornography, or any other crimes. “All of that information is completely made up,” she said. “It’s all wrong.”
The FBI’s file on Bouari picks up again on March 6, 2014, when Michel Benamar, a short Moroccan man with gray hair and a potbelly, rolled up to the bureau’s Las Vegas office. A fast talker, Benamar was in a deep financial hole. He had a $2.8 million civil judgment against him in Alabama for failing to pay back loans related to a vending machine business in Egypt, and he was paying $645 per month toward $11,412 in restitution for writing four bad checks to casinos — charges that had led to his arrest as a fugitive while he was trying to a board a flight to Paris just seven months earlier.
Ro, the special agent, took the meeting with Benamar, according to the FBI files. Benamar told Ro, as well as a Las Vegas Metropolitan Police detective who sat in on the conversation, that he had gone to Bouari’s weight-loss clinic and inquired about making an investment. Bouari had said he was “willing to launder money for his/her investors,” Benamar told the FBI, according to the report that Ro wrote following the meeting. Benamar also alleged that Bouari had embezzled $1 million from a business partner, though he couldn’t provide the name of the person who had purportedly been fleeced.
Although agents could not corroborate Benamar’s claims, FBI supervisors in the Las Vegas office approved Operation Bo-Tox, an undercover sting whose name was a reference to the toxin, normally spelled without a hyphen, used in a cosmetic procedure to reduce wrinkles. The FBI files described Operation Bo-Tox as an investigation of a “Middle Eastern criminal enterprise,” though Bouari’s business and alleged crimes had no connections to the Middle East other than that he had family roots in Lebanon. As part of Operation Bo-Tox, the FBI enrolled Benamar into the bureau’s informant program, making him one of more than 15,000 registered informants. The FBI’s plan was to have Benamar introduce Bouari to an FBI undercover agent posing as a disreputable businessman in need of a discreet partner to launder money.
The FBI’s Las Vegas office was establishing a swashbuckling reputation for aggressive tactics that pushed the bounds of, and sometimes clearly violated, constitutional protections.
Undercover stings, in which an agent or informant offers suspected criminals the opportunity to commit offenses, are staples of FBI investigations. In the last 15 years, the FBI has focused its stings on suspected terrorists, trying to find dangerous Al Qaeda or ISIS sympathizers before they commit violence in the U.S. In many of these cases, the FBI’s tactics, including providing encouragement and fake weapons, raise questions about whether agents are creating terrorists in order to catch them. The FBI also uses stings for a wide variety of serious crimes, including those involving drugs, murders for hire, the Mafia, and gangs.
FBI stings aren’t exclusive to violent and organized crime, either. The bureau has come to rely on stings in white-collar criminal investigations as well. Perhaps the most famous of these cases was Abscam, an operation in the late 1970s and early 1980s in which FBI agents posed as wealthy Arabs interested in bribing elected officials for political favors. The sting resulted in the convictions of 30 elected officials, including six congressmen and one senator. At the time, some members of Congress criticized the FBI’s tactics in Abscam, accusing agents of having created crimes out of whole cloth. Rep. Don Edwards, a California Democrat, held House subcommittee hearings to scrutinize the operation. “Stings and scams have to be handled with great care and there has to be either law or strict regulations that accompany them to protect the rights of people,” Edwards told the Associated Press in 1982.
The criticism didn’t stick, and the courts later rejected arguments that the Abscam defendants had been entrapped. Bolstered by their success, FBI agents pursued white-collar criminals more aggressively with stings, targeting brokers of stolen computer equipment, stock traders, and medical equipment salespeople, among many others. The undercover operations would usually come with code names rooted in the FBI’s ham-handed institutional humor. Operation Greylord, a reference to the wigs British judges wear in the courtroom, caught 17 judges and dozens of other public officials in Chicago taking bribes. Operation Wooden Nickel, which exposed rigged trades in the foreign currency exchange markets, was a reference to the antiquated American adage about being on the lookout for scams: “Don’t take any wooden nickels.”
Following the Abscam model, the FBI initially used white-collar stings to catch corrupt public officials or crooks with many victims. But in recent years, the FBI has increasingly turned these tactics against people who were neither public officials nor known criminals involved in large syndicates. As with terrorism stings, the FBI began to target Americans who might not have had the opportunity to commit crimes if not for the bureau’s instigation. Recent examples include a California real estate agent who laundered $550,000 for an undercover FBI agent posing as a drug dealer; a Florida lawyer who laundered more than $141,000 from an undercover agent who claimed to be involved in fraudulent stock sales; and a Nevada man who used bitcoin to help an undercover agent launder $14,500 that purportedly came from selling hash oil.
Whether the FBI should have targeted Bouari, given that the only information agents had to suggest that he wanted to launder money came from an unsolicited informant, is debatable.
At the time, the FBI’s Las Vegas office was establishing a swashbuckling reputation for aggressive investigative tactics that pushed the bounds of, and sometimes clearly violated, constitutional protections. In 2014, for example, agents investigating an online bookie at Caesars Palace cut the casino’s internet connection and then posed as repairmen to enter the bookie’s hotel room without a warrant, prompting a judge to throw out the evidence they collected. Following the armed standoff between agents with the Bureau of Land Management and rancher Cliven Bundy, the FBI in Las Vegas assembled a fake documentary crew to interview Bundy and his supporters in an effort to collect evidence surreptitiously. Bundy’s prosecution ended in a mistrial, and the Reporters Committee for Freedom of the Press filed a lawsuit in 2017 to force the Justice Department to release records related to the FBI’s controversial practice of posing as journalists. The litigation over the FBI records is ongoing.
Officials at FBI headquarters and the Las Vegas office declined to comment for this article.
With Operation Bo-Tox approved, Special Agent Ro sent Benamar to Bouari’s weight-loss clinic to help set the stage for the introduction of an undercover agent. These first meetings were not recorded, but an FBI report indicated that Benamar told Bouari that he had an associate who made money from drugs and prostitution and needed help laundering the proceeds.
It was just before noon on April 14, 2014, when Benamar entered Bouari’s clinic wearing a hidden recording device for the first time, according to evidence in the case. The men greeted each other in French and kissed on the cheek. Bouari, limping from a recent injury at the gym, boasted that his business was expanding. “Michel, so many people losing weight. Business is going great,” he said in English.
Benamar quickly changed the subject, zeroing in on the real purpose of his visit. “My guy is coming next week and he’s going to take you to dinner,” Benamar told Bouari. His “guy” would want to ask Bouari a question, Benamar warned: “Do you know where the money comes from?”
“That’s fine, but why do I have to know?” Bouari replied. “I don’t have to know. It’s better if I don’t know, no?”
“How he makes the money is up to him.”
“He want to know who the person he is dealing with,” Benamar answered in his heavily accented English. “He wants to know that at least you know the money is from gambling — I mean, prostitution and ecstasy and stuff like that.”
“How he makes the money is up to him.”
“So, I just want you to know,” Benamar said.
“As long as I have nothing to do with that, it’s fine.”
That Bouari knew the money was said to come from drugs and prostitution was critical to the FBI’s investigation, because the charges federal prosecutors would later bring alleged that the money laundering was intended to conceal “unlawful activity.” If the FBI couldn’t show that Bouari knew the underlying activity was illegal, their case would fall apart.
Six weeks later, Benamar returned to Bouari’s clinic with the FBI’s undercover agent, Dennis Lao. A slight, goateed man, Lao wore a body camera and carried $50,000 in cash. Bouari was waiting with a money-counting machine. Their deal was that Bouari would collect a small fee before writing checks to various FBI front companies with names like English Financial Services and Mendez Movers. As Bouari wrote his first check for $46,000, Lao leaned in with a question.
“You got the funds, right?” the agent asked, referring to money in Bouari’s bank account. Money launderers often hoard cash and make deposits over time in increments of less than $10,000 — an illegal practice known as structuring that prevents banks from filing currency transaction reports with the Treasury Department. Lao, aware that Bouari was unlikely to deposit all the cash right away, wanted to make sure the check wouldn’t bounce.
“Guaranteed,” Bouari answered. He told Lao he could help “diversify for you,” by introducing him to other business owners who could launder money. Bouari mentioned his younger brother, Ghassan, who operated weight-loss clinics in Miami and Philadelphia, and his girlfriend, Milko. Lao encouraged these referrals, telling Bouari he’d be rewarded with a small cut of every transaction.
Another four months passed, and in late September 2014, at Bouari’s suggestion, Milko, who, in addition to fitness modeling, ran a small aesthetician practice, agreed to meet with Lao and Benamar at an outside table at a Las Vegas Starbucks.
“Are you comfortable doing business with us?” Lao asked Milko, describing how he operated “high-end massage parlors” for men traveling from Asia. “I just want to make sure that you’re comfortable in that,” he added.
“Oh, I am comfortable with that,” Milko answered.
“Obviously these guys don’t come in charging a ‘full service’ to a credit card,” Lao said, emphasizing the prostitution angle of his supposed massage business. “Everything is cash — that’s why.”
As Milko and Lao talked, a young woman approached. The conversation was picked up by Lao’s recording equipment. “Kim?” the woman said. She was someone Milko knew socially, Milko told The Intercept. “Now I work for Paul Padda,” the woman told Milko.
“Oh, you do?” Milko said. “Well, good to see you.”
After the woman walked away, Lao turned to Milko. “Can you handle 25?” he asked, referring to $25,000.
“Yeah,” she responded.
“OK, I’ll give you eight points for it,” Lao said, referring to the percentage that Milko could take as a fee.
Asked about this meeting later, Milko chuckled. “It’s really weird that someone who worked for Paul Padda came up to me just as I started talking to the FBI,” she told The Intercept.
“I’ve always had that entrepreneurial bug and I wanted to start my own practice,” Padda said in a video interview posted on his YouTube channel. As a private attorney, Padda has been successful by most measures. His law practice is inside a building west of the Strip that bears his name, in large black letters, on two sides. In 2017, he received national attention for representing Korean restaurant owners who were being shaken down by an Immigration and Customs Enforcement agent — a “classic tale of abuse of power,” as Padda told the Washington Post — and for winning a $160 million verdict against the Cosmopolitan casino and its nightclub after a manager and security guards there beat a customer so brutally that he suffered a traumatic brain injury.
Padda markets himself as a well-connected lawyer with ties to Las Vegas law enforcement. His website shows associations with Jason Hahn, a former Las Vegas Metropolitan Police detective, and Charles Bevan, a former FBI agent. Hahn and Bevan have worked with Padda as investigators. The three men have connections to FBI agents involved in the undercover sting that targeted Bouari. They are listed along with Charles Ro, the FBI case agent on Operation Bo-Tox, and Dean Phillips, who was the FBI’s supervisory special agent in Las Vegas when Operation Bo-Tox began, as advisers to the International Organization of Asian Crime Investigators & Specialists, a nonprofit organization that hosts an annual conference on transnational crime and terrorism. While Padda acknowledged that he agreed to do legal work for the International Organization of Asian Crime Investigators & Specialists, he said he has never participated in any of the organization’s meetings or events and was not aware that he was listed as an adviser along with the FBI’s Ro.
Despite his professional network’s ties to local and federal law enforcement, Padda portrays himself as a champion of the underdog. “We have a system in this country where you as a person — you really can hold the government or a large corporation accountable,” Padda says in an advertisement for his law firm. “I decided to become a private-sector lawyer and start my own law practice because I wanted to be an advocate for folks who were going up against large insurance companies or other corporate interests that had unlimited resources.”
Padda is a prominent figure in Las Vegas, particularly in its legal and South Asian communities. His firm sponsored this year’s Indian Food and Cultural Festival and advertises on Vegas Desi, a community news website.
Padda’s availability on the local dating market is well enough established that when he sat down with Charlotte Evans, a former local television news anchor in Las Vegas, for an interview on the online talk show “Vegas Lawyer Magazine,” Evans started off with a reference to Padda’s personal life.
“You are single,” she said. “People have come up and said, asked, ‘How single are you?’ I don’t even know that answer. We don’t have to go there.”
“But you have the best hair of any attorney I’ve seen,” Evans added, referring to Padda’s gelled bouffant.
“Well, thank you,” Padda said modestly. “I appreciate that.”
Padda declined to be interviewed for this story. In response to a list of questions from The Intercept, Padda’s attorney, Ryan J. Stonerock, wrote that Padda’s defamation lawsuit against Bouari and Milko raises questions about their credibility. The lawsuit ended in June with a default judgment against Bouari and Milko.
“Given their history with Mr. Padda, Mr. Bouari and Ms. Milko have substantial motive to fabricate information regarding Mr. Padda in an effort to have The Intercept publish a story that they will then use to aid their defense in the criminal case,” wrote Stonerock, who belongs to the law firm of Charles Harder, the lawyer who represented former wrestler and reality TV star Hulk Hogan in an invasion of privacy lawsuit that bankrupted the online media company Gawker. More recently, Harder’s law firm has represented President Donald Trump, presidential aide and son-in-law Jared Kushner, and first lady Melania Trump.
In an email to The Intercept, Padda wrote: “Respectfully, I doubt your publication would be devoting the time to writing about Bouari unless the goal was to portray him as some kind of victim. To be honest, I am very surprised with all the stories of perceived injustices in the criminal justice system that your publication would choose to focus upon Bouari’s case. It’s actually pretty amazing in my opinion.”
Operation Bo-Tox continued unabated into October 2014. Bouari and Milko had by then laundered $295,000 for Lao, the undercover agent. FBI reports indicated that Bouari and Milko also introduced Lao and Benamar to a friend, Mary Green, a massage therapist who allegedly laundered $25,000. (Green declined to comment for this story.)
In an attempt to be helpful, Milko then invited Lao and Benamar to have dinner with her and her friend, a fellow fitness model named Natalie, at a restaurant in the Cosmopolitan casino in October 2014. Milko had suggested to Lao that Natalie might be interested in laundering money as well. The FBI files indicate that agents did not know her last name, let alone whether she had a history that suggested she might be likely to commit a crime, before agreeing to the meeting.
As the dinner began, Benamar wasn’t focused on the business at hand. Instead, he pushed up next to Natalie and kept Lao from talking to her. Furious, Lao went outside to call Ro.
“I am fucking pissed. That fucking Michel’s not professional,” Lao told Ro, the conversation memorialized by his hidden recording equipment.
“OK, here’s the deal, that fuck! OK?” Lao continued. “That girl that Kim brought, OK? She is smoking hot, OK? But he’s fucking trying to get up on her! He’s fucking having these private conversations, OK? This should be like a group conversation! This fuck! … Dude, it was set up so that I was going to sit next to her. He moved it so that he sits next to her. I’m thinking, ‘I don’t need to fucking get Kim anymore. … She’s good to go! I need to get this girl!’ This guy — if he wants to fuck her on the side, I’m cool with that, but don’t waste my, don’t waste my —”
Ro cut Lao off, but what he said can’t be heard on the recording. “All right,” Lao said, calmer. He walked back into the restaurant.
About an hour later, after Milko and Natalie had left the table, Lao lit into Benamar. “You have a separate conversation with her, knowing that’s not how we do it,” Lao said.
“What you want? You tell me!” Benamar said.
“I understand she’s hot, OK?” Lao said.
“And so fucking horny,” Benamar replied.
“Listen, listen. It’s kinda too late now. Whatever you do, it’s OK, but I do wanna [say] next time, no matter how hot, work is work — it’s work!”
“I know, but, Dennis, she is all over me.”
“I know. And honestly, I don’t care what you do with her. I really don’t. At this point we just continue what you’re doing. It’s fine, OK?”
“OK, what you wanna do? What you wanna talk about?”
“It’s too late!” Lao yelled at Benamar.
Natalie never again appeared in the FBI sting. The FBI report about that evening did not document how Benamar screwed up the operation. Instead, Ro wrote in his report that “no pertinent information was obtained.”
The FBI informant allegedly ran his own private sideline scams on the weight-loss entrepreneur.
Ro did not respond to a list of questions emailed to the FBI’s Las Vegas office, where he works. Lao did not respond to questions sent to his email address at East Los Angeles College, where he teaches criminal justice.
How much the FBI knew then about the degree to which Benamar was working his own angles, feeding both his sexual desires and his pocketbook, is unclear. Throughout his relationship with Bouari, Benamar allegedly ran his own private sideline scams on the weight-loss entrepreneur. According to text messages and emails between the two, Benamar gave Bouari Social Security numbers to sell to Lao — those numbers turned out to be no good, FBI reports show — and Bouari gave Benamar $25,000 for a diamond that Bouari later came to believe was fake. Bouari’s lawyer submitted evidence of these claims to the U.S. Attorney’s Office in Las Vegas. In a recent court filing, federal prosecutors acknowledged that “the government is looking into those accusations to determine if they are accurate.”
There is a long history of FBI informants committing crimes. In some cases, FBI agents permit crimes to happen in order to further investigations or protect valuable informants. According to a document obtained in 2013 by USA Today, the FBI allowed informants to commit, without consequence, 5,600 crimes in 2011 alone. In other cases, the FBI is caught by surprise when informants break the law. A Massachusetts informant’s criminal behavior came to the FBI’s attention when he showed up unwittingly in a sting operation to buy heroin. In Florida, an informant was running wire fraud scams while working a counterterrorism sting, putting federal prosecutors in the awkward position of having to prosecute the informant and his sting targets simultaneously in separate cases.
Paul Padda’s name surfaced in Operation Bo-Tox in March 2015. According to an FBI report, Bouari called Benamar and, in an unrecorded conversation, explained that he was worried about Padda’s lawsuit regarding the comments on Ripoff Report. Padda first filed the lawsuit in Arizona, where Ripoff Report’s parent company is based. Bouari wanted to have Padda abducted and roughed up to convince him to drop the lawsuit, Bouari allegedly told Benamar. For his part, Bouari alleges that Benamar was the one who suggested they find a way to send a bloody message to Padda.
Whatever the truth, Lao and Benamar joined Bouari for lunch at a Las Vegas restaurant on March 3, 2015. Bouari told the men that he was considering moving to Miami, where his brother, Ghassan, lived; he suggested it would be easier to launder money there. “Miami is different,” Bouari said.
That’s when Lao mentioned that Benamar had told him that Bouari was having trouble with a local lawyer. Lao expressed concern. “It’s in everybody’s best interest that you are protected because you’re doing business with us,” Lao said.
“You need to be protected,” Benamar added. “Whoever messes with you, you have to know you will be protected. We want to protect you.”
Bouari, who boasted that he knew Hezbollah agents who could be hired to murder people, made it clear that he didn’t want Padda killed, maybe just hurt. “I do need someone to come in and beat him up one day,” Bouari said.
“Just kind of teach him a lesson,” Lao said.
“Yes, teach him a lesson,” Bouari responded.
“Maybe put him in a wheelchair for a little time,” Lao added.
But Bouari, who told The Intercept that he mentioned Hezbollah only to sound like a tough guy and win their respect, declined that day to commit to a plan to have Padda harmed.
After Bouari left the restaurant, Lao acknowledged to Benamar that they did what they could to get him to agree to a plot to harm Padda. “You pushed it,” Lao said. “You pushed it.”
“Make sure you tell him that, you know,” Benamar said, appearing to refer to FBI agent Ro.
The next month, on April 27, 2015, Bouari met Lao and Benamar in a Las Vegas hotel room. A hidden camera captured Bouari hugging Lao, who wore jeans and a polo shirt, as he entered the room. Benamar, also in jeans, had a pair of reading glasses perched on his nose.
The agent said he gave the woman $80 after having sex with her, but he said the money was for her sick father, not payment for prostitution.
“Hey, boss,” Bouari said.
“You’ve been very hard to get a hold of,” Lao said.
“So much going on, man,” Bouari answered, explaining that he was packing up to move to Miami. Bouari pulled a money counter from his backpack and began to run Lao’s $500 bundles of cash through the machine. There were 100 bundles that day.
As Bouari counted the money, Benamar inquired once again if Bouari wanted something done to Padda. “So, you have a problem with a lawyer serving you or something like that?” Benamar asked.
“Oh, yeah, that’s the guy — I got the case dismissed,” Bouari answered.
“What’s the deal with the guy?” Benamar asked.
“Nothing,” Bouari said. “I got the case dismissed out of Arizona. Now he’s trying to serve me here, and he can’t find me, and the whole case has collapsed. I’m not worried about it.”
After the lawsuit was dismissed in Arizona, Padda filed a complaint in Las Vegas against Bouari and Milko, alleging that they were responsible for the defamatory statements. Padda’s lawsuit alleged that Bouari had not only made defamatory comments about him, but also about other lawyers (“crook,” “shyster,” and “liar” were among the insults). Padda also accused Bouari of saying awful things about his ex-wife Chaney’s daughter, describing her on Ripoff Report as a “crystal meth addict and a hooker.”
Once Padda filed his lawsuit in Las Vegas, Bouari stopped going to his clinic in an effort to avoid getting served with the new lawsuit. If he couldn’t be found, Bouari figured, he would be immune from Padda’s litigation. That’s why there was no longer any need to have Padda beat up, Bouari told the undercover agent and informant.
“So whatcha want us to do about it?” Benamar asked him.
“Nothing,” Bouari said indifferently, continuing to feed money into the counter. “He’s no longer a threat.”
At this point, the FBI was more than a year into its undercover sting. Bouari and his girlfriend were the primary targets, but the FBI agents struggled to find more people who would launder money. Besides Milko and Green, none of the people Bouari had introduced to the undercover agent and informant had agreed to take part in the scheme, raising questions about how threatening a “Middle Eastern criminal enterprise” this really was.
The FBI reports documenting Lao and Benamar’s attempts to find more potential money launderers are comical. Many of the meetings came over expensive dinners on the Strip, all paid for with FBI funds. They approached an aesthetician, a former radio ad salesman who had once marketed erectile dysfunction remedies, a real estate agent who boasted of selling more than 100 houses a year. There was even talk of a big lead — a pothead named Robbie in West Virginia whose trust fund totaled more than $300 million. Robbie was said to be good friends with former first lady Michelle Obama, according to the FBI reports.
Agents had no reason to suspect any of these people were predisposed to commit financial crimes. Being among Bouari’s contacts was all it took for the FBI to try to draw them into its undercover operation.
Aimlessness and an unprofessional informant weren’t the only problems plaguing Operation Bo-Tox. Ro had a reputation in the FBI for milking undercover stings.
In 2010, Ro and Lao were assigned to the FBI’s office outside Los Angeles to investigate Asian organized crime. Together, Ro and Lao traveled to the Philippines, where Ro posed as a broker for Mexican drug cartels interested in importing weapons and Lao as Ro’s bodyguard. Their sting operation grabbed headlines when the FBI arrested three Filipinos for transporting weapons to the U.S., including assault rifles and grenade and mortar launchers.
But Richard Goff, an investigator for the Federal Public Defender’s office, traveled to the Philippines, where witnesses told him that the undercover agents, including Ro, spent money on alcohol and sex at a club called Area 51, which reportedly employed underage prostitutes. The FBI disclosed in records submitted to the court that agents had spent $14,500 in eight days in the Philippines. The expenditures were labeled “entertainment and cocktail (tips included)” and included $3,000 for a single evening at one strip club.
In a court filing, John Littrell, a deputy federal public defender, accused Ro of misconduct, writing: “In order to induce the defendants to participate, an undercover agent spent thousands of taxpayer dollars on prostitutes for himself and for the defendants. Many of these prostitutes were likely minors.”
The agents involved submitted sworn affidavits denying the claims. Marc Napolitano, one of the FBI agents who worked with Ro and Lao on the case, admitted during court testimony that he had sex with an employee of a club in the Philippines. Napolitano said he gave the woman $80 after having sex with her, but he said the money was for her sick father, not payment for prostitution.
Sen. Charles E. Grassley, an Iowa Republican who has oversight of the FBI as a member of the Senate Judiciary Committee, scolded the bureau in a September 2012 letter. “If true, this story raises serious questions about the behavior of this agent and the FBI’s knowledge of this matter,” Grassley wrote.
By the spring of 2015, Operation Bo-Tox had largely petered out. Bouari, partly in his continuing attempt to dodge Padda’s new lawsuit in Las Vegas, had moved to Miami. The whole sting might have ended there, but it didn’t. Instead, Ro and Lao expanded Operation Bo-Tox, winning approval for two trips to Miami to see if any of Bouari’s Florida contacts might be willing to move some money. Both Miami trips would morph into excuses for Lao and the informant to party in ways reminiscent of the sting in the Philippines.
In Miami, Bouari introduced Lao and Benamar to his younger brother, Ghassan, who had recently had a child with his Turkish wife. Shorter than Emile, with a baby face and touch of naivete, Ghassan looked up to his brother. But Bouari had warned the FBI agent and the informant that his brother wasn’t a likely player. “He is not like me; he just follows me,” Bouari said. “He doesn’t have money, so he can’t drive a Porsche or a Range Rover to meet these people. He can’t do these things.”
“I think it’s a strip lounge. I’m not even sure if it’s a full strip club, OK?”
That didn’t stop Lao and Benamar from investigating Ghassan or partying with him. When Bouari wouldn’t go out one night in Miami, Lao and Benamar lobbied Ghassan to take them to a strip club. There was no clear investigative reason to go, though the FBI report, whose author isn’t specified, noted that “Ghassan said that it may be a good idea to go to strip clubs and talk to the strippers.” Ro, meanwhile, seemed concerned that the excursion was unjustified and Operation Bo-Tox was headed off the rails. As Lao and Benamar followed Ghassan in a separate car, Ro called them.
“Yeah, go ahead. I’m on a speaker with Dennis,” Benamar said.
“Wait, wait, wait. Do not put me on speaker,” Ro said, presumably because he was aware that Lao and Benamar were wearing recording devices. “I want to talk on the telephone.”
Ro appeared to express concern that they were going to a strip club. “Strip lounge,” Benamar said. He then handed the phone to Lao, who also downplayed their destination.
“I think it’s a strip lounge,” Lao said. “I’m not even sure if it’s a full strip club, OK? It’s a club, but he said that it’s more —”
Ro interrupted, but his response can’t be heard on the recording.
“I think he said Russian,” Lao answered, seeming to refer to the possibility that Russians in Florida would be interested in laundering money. But neither Bouari nor his brother introduced Lao and Benamar to anyone in Miami interested in moving money. The FBI reports do not indicate that they ever met a Russian in Florida. Yet that didn’t stop the partying and locker room banter over drinks on the FBI’s dime. As Lao and Benamar explored bars and clubs throughout Miami, their recording devices captured hours of questionable chatter.
“You ever fuck a black girl?” Benamar asked Lao at one point.
“I could have in high school, but no, in college, she wasn’t very pretty,” Lao answered. “She liked me because I played basketball. I might be born picky.” He then laughed at his own joke. “Fuck, yeah, I’m going to have a good time tonight,” Lao added. “I’m going to drop some money.”
“There you go,” Benamar said. “Now you’re talking.”
For much of Lao and Benamar’s time in Miami, neither Bouari nor his brother was with them. One evening, when Ghassan hadn’t arrived as expected and Lao and Benamar wanted to go to Miami Beach’s Fontainebleau hotel, where they had reserved a table at the exclusive and expensive LIV nightclub, they schemed about how to justify their solo outing to Ro. “If [Ghassan] cancels, we will just tell Chuck [Ro] that he will meet us at the club,” Lao told Benamar.
Another time, the undercover agent and informant stayed on at a strip club after Emile Bouari had gone home. Ghassan, who told The Intercept that he did not spend much time with Lao and Benamar after his brother left the club, can’t be heard on the recordings after this point. Lao seemed to recognize that they were no longer justified in staying. “We gotta get some information from these girls so we can tell Chuck something,” Lao said, laughing.
“Oh, Dennis,” Benamar said. “I love it.”
An hour later, one of the strippers can be heard on the recording talking to Benamar. “C’mon, babe, let’s go. Let’s go to the back,” the stripper said, referring to a private room.
Benamar seemed hesitant.
“He said that you should be your own man,” the stripper said, referring to Lao. “That’s what he told me.”
Benamar laughed. “Oh, thank you, Dennis!” he said. “Thank you!”
“I want to touch you,” the stripper said.
“You’re bad,” Benamar replied. “You’re bad.”
Less than five minutes later, he can be heard telling the stripper: “Sit on it, baby.”
“So, everything good with that fucking attorney that was giving you a hard time in Vegas?” Lao asked Bouari.
“I got the case dismissed,” Bouari said, referring to the Arizona lawsuit. “He’s so stupid, I beat him at his own game. Jackass.”
Bouari explained that he was still facing the lawsuit from Padda in Las Vegas. “He just can’t find me,” Bouari said. In this conversation, Bouari seemed to suggest that he was responsible for the defamatory comments posted online, bragging about how he worked with a company in India that spread false information. “So, these people in India, for $120 three people work 10 hours putting shit online,” Bouari said. “So, I can decimate a company.”
Benamar suggested again that they could take care of Padda. “You tell us what you want done,” he said.
“Just like break his nose. Don’t mention anything. Don’t say you need to drop the lawsuit or anything like that,” Bouari replied.
A few minutes later, Lao added, “He won’t know — but he’ll know — that you mean business, man.”
But it was all talk. Bouari didn’t commit to a plan and he didn’t provide money to pay for someone to beat up the lawyer. Instead, Lao and Benamar returned to Las Vegas, this time for good. In the months that followed, Lao texted Bouari and his brother to inquire about additional money-laundering opportunities. The Bouaris said they mostly ignored the texts until early 2016, when Bouari said that Lao told him that he was interested in investing in his weight-loss company. Lao asked Bouari to come to Las Vegas to finalize a deal. Bouari agreed and asked his brother to accompany him.
“They were trying to get me for that assault on Padda up to the very end.”
After they landed, the Bouari brothers headed to the baggage claim area, past the slot machines that dot the airport. Below neon signs advertising nearby casinos, Lao greeted Emile Bouari and pulled him aside. “If you want me to do that hit on the lawyer, I’ll do that for you,” Bouari recalled Lao saying. Bouari declined the offer again, and he and his brother were arrested.
“They were trying to get me for that assault on Padda up to the very end,” Bouari told The Intercept.
In February 2016, a federal grand jury indicted Emile and Ghassan Bouari, as well as Kim Milko and Mary Green, for money laundering. All four defendants pleaded not guilty. At a bond hearing, Emile and Ghassan Bouari were ordered to a pre-trial detention facility. Federal prosecutors alleged that Emile Bouari was a danger to Padda, given the recorded conversations about hiring someone to assault the Las Vegas lawyer. A U.S. magistrate judge described these at the time as “multiple discussions indicating more than wishful thinking.” Prosecutors also asserted that Ghassan, who is not a U.S. citizen, was a flight risk. Milko and Green, meanwhile, were granted bond, and Milko was allowed to await trial in Costa Rica, where she owns a home.
The government did not file any charges related to the supposed plot to harm Padda. But Jeff German, a Las Vegas Review-Journal reporter who has used Padda as a source in other stories, attended the detention hearing and reported on the alleged plot, writing that Bouari “wanted to take revenge.”
“I am very appreciative of the efforts of the FBI, its senior management, and Special Agent Chuck Ro, who worked tirelessly to ensure the safety of myself and others,” Padda told the newspaper. “Agent Ro is a consummate professional who cares about our community and ensuring victims are protected.”
Prosecutors dropped the charges against Ghassan Bouari in August 2017, since he wasn’t involved in any of the financial transactions. Ghassan had spent more than 18 months in detention; he has since filed a lawsuit against the U.S. government and the FBI agents involved in his case, alleging that they violated his constitutional rights.
In May, after Emile Bouari had spent more than two years in detention, a U.S. magistrate judge agreed to release him without requiring bond, following the government’s acknowledgement that Bouari had already spent more time incarcerated than he would have served had he accepted a previous plea offer. While Bouari was in jail, Padda pressed forward with his defamation lawsuit in Las Vegas against Bouari and Milko regarding the comments on Ripoff Report. Bouari and Milko did not present a defense, leading to a default judgment in June for more than $4.6 million.
During an interview with The Intercept, Bouari said he plans to appeal the defamation judgment once his criminal case is settled. He didn’t deny that he had laundered money for undercover agents. His was the type of crime that goes unnoticed every day, he said, noting: “This was minor, minor stuff.” But he said he’s not going to take a plea deal, because he wants the government to answer for how the sting started and how the agents and informant behaved.
“They got tips about Nikolas Cruz and didn’t do anything to stop him from shooting up that school in Florida,” Bouari said. “They knew nothing about the Las Vegas shooter before he killed all those people. And yet they spend all this time and money on me — for what?”
Jury selection in Bouari’s trial is scheduled to begin September 24.