EXCLUSIVE: Taxi mogul who borrowed millions from Michael Cohen swears it wasn’t for his weed business

A legal-weed startup in Nevada that’s been dogged by reports of links to President Trump’s personal attorney, Michael Cohen, is denying any connection to the embattled lawyer, VICE News has learned.

Chicago taxi mogul Semyon “Sam” Shtayner, 63, and his wife reportedly borrowed $26 million in recent years from Cohen and his father-in-law, Fima Shusterman — just as Shtayner was launching a legal weed venture in Henderson, Nevada.

“Michael Cohen is not now nor has he ever been a ‘business associate’ of mine,” Shtayner writes in a document sent to Henderson city officials and obtained by VICE News. “Like a bank loans money to borrowers, he simply loaned me money years ago.”

Founded in 2016, Shtayner’s Cannaboss LLC took a majority stake in a Nevada-based firm with licenses to grow cannabis and produce marijuana-infused edibles and smokable pot, according to local and state records reviewed by VICE News. The company has been busily setting up a 31,642-square-foot cultivation and production facility just 20 minutes from the Las Vegas strip.

But in April, his plan hit a snag: Press reports emerged, citing public records, that Shtayner and his wife, Yasya, borrowed millions from Cohen and Shusterman, with installments made as recently as March. CNN reported that Shtayner and his wife were also identified in the search warrant the FBI used to raid Cohen’s office and hotel room in April, apparently due to their connection with Cohen through his investments in the Chicago taxi industry.

Alarmed by the bad press surrounding one of their new local businesses, officials in the city of Henderson sent Shtayner an urgent request for information. Specifically, they wanted to know if Cohen was secretly behind the legal weed venture.

Shtayner swears that Cohen has nothing to do with the business in a two-page response sent to officials in Henderson and provided to VICE News through the city’s public document disclosure procedure.

While he acknowledges borrowing money from Cohen and Shusterman, he claims the loans are older and much smaller than press reports have claimed, and weren’t used to launch his weed venture.

In his declaration to the city, Shtayner, a Ukrainian immigrant like Shusterman, whose family-owned business still manages 10 of Cohen’s taxi medallions in Chicago, distances himself from the president’s attorney. Neither Cohen nor Shtayner responded to requests for comment.

Instead, in the face of questions that could potentially derail his new multimillion-dollar venture, he presents himself as a beleaguered businessman attempting to exit the troubled taxi industry and make a fresh start in legal weed.

“Due to recent media stories, I am aware that Cohen may be under federal investigation,” Shtayner writes. “I am not under any investigation. I have never been convicted, indicted, or pleaded to any felony or a lesser offense other than traffic tickets, as my criminal background check shows. I have NO criminal record.”

Shtayner doesn’t address the CNN report about appearing in the search warrant specifically. Nicholas Biase, a spokesperson for the U.S. Attorney’s office in the Southern District of New York, which is investigating Cohen, declined to comment to VICE News for this story.

But Shtayner complains bitterly of the press coverage he and his family have received thanks to his association with Cohen.

“No one can enjoy being the subject of unsupported, erroneous, personal attacks, and I am of no exception,” he writes. “Regrettably, this has been a very unfortunate experience for my family and me. There are no news articles that allege any wrongdoing by me; simply put, because I have not engaged in any wrongdoing.”

The constant media coverage has grown so troubling, Shtayner says, that the Chicago Medallion Management Company, or CMMC, which is owned by his wife and son, may soon cut its ties with Cohen completely.

“In fact, due to unwanted media attention, I understand the CMMC may be terminating its management of Cohen’s medallions,” Shtayner writes.

While Shtayner denies using funds borrowed from Cohen or Shusterman to launch his marijuana venture, he doesn’t provide the city with a clear explanation of how he’s covering those costs.

Getting a business like his up and running is likely to cost several million dollars, according to Nevada cannabis industry experts who spoke to VICE News. And because marijuana remains illegal at the federal level, banks won’t lend to weed startups.

Shtayner maintains he simply used his own money.

“I did not finance my investment in the Marijuana Facilities with loans,” he wrote. “I used my personal funds to finance the project.”

Yet while saying he has the cash he needs, Shtayner’s statement also paints a portrait of a businessman whose vast Chicago taxi empire is under enormous financial strain.

In the document, Shtayner says he’s jumping into the marijuana industry because his taxi business has been undermined by the likes of Uber, Lyft, and other ride-hailing companies. Those newcomers have hammered his industry and decimated the value of taxi medallions, once-valuable licenses to drive a cab that used to be seen as secure and lucrative investments.

The price of medallions in major American cities has plummeted since hitting a peak just a few years ago. In Chicago, taxi medallions soared from $70,000 in 2007 to about $357,000 a pop in late 2013 — right before Uber hit the scene. In April 2017, a Chicago medallion sold for just a tenth of that figure, or $35,000, according to USA Today.

Shtayner wrote in the document that this precipitous decline explains both why he’s transitioning into the marijuana industry, and, effectively, why old loans from Cohen and Shusterman appear to be much more recent than they really are: new paperwork was filed on old debts during the process of changing the collateral.

Because the value of the medallions has fallen so much, Shtayner says his wife swapped out the collateral on the debts from taxi medallions to real estate.

A spokesperson for the Cook County Recorder of Deeds, which holds documents relating to the loans made by Shusterman to Shtayner’s wife, declined to comment to VICE News on Shtayner’s explanation for why the records make the loans appear more recent.

“The Shusterman and Cohen loans were received years ago and have nothing to do with my Marijuana Facilities,” Shtayner writes. “Due to the downturn in the value of taxi medallions, my wife recently changed the collateral on the loans, substituting real property for taxi medallions. Schusterman and Cohen have not lent any additional money.”