When reporters combed through the Panama Papers last year, they recognized a familiar name cropping up: the FL Group, a now-defunct Icelandic bank that in 2013 had been accused in a lawsuit of developing a scheme, ultimately never realized, to avoid $250 million in taxes on a $2 billion investment in real estate projects, many of them tied to President Donald Trump.

The bank began as a holding company for two airlines based in the little Nordic nation, Flugfélag Íslands and Loftleiðir—hence the name—until 2005, when it became its own financial institution with a surprisingly large number of Russian clients. After that, the firm became the leading equity fund in Iceland, according to James S. Henry, a former chief economist at McKinsey & Co. and a reporter for the Panama Papers’ Icelandic working group.

FL Group was one of a number of Icelandic banks with surprisingly deep ties to the Russian billionaire class ascendant in the wake of the dissolution of the Soviet system, according to Henry. The wealth of the post-USSR oligarch class was so directly tied to the Icelandic economy, in fact, that Russian president Vladimir Putin offered $5.4 billion to bail out Iceland’s banks during the global financial crisis, though the deal never went through.

The Icelandic bank managed to seal a 2007 deal to invest $50 million with the developer Bayrock Group, a firm run by two men convicted of stock fraud in the 1990’s, Felix Sater and Salvatore Lauria, alongside a former Soviet official named Tevfik Arif. A former finance director at Bayrock, Jody Kriss, sued the company in 2010 for allegedly misrepresenting Sater’s role—though the complaint remained sealed by the court until 2016. In an interview with Bloomberg, Kriss said another Icelandic bank called offering a counter investment to FL Group’s proposed $50 million, and Sater and Arif told him to stick with that firm because it was “closer to Putin.”

The $50 million payment was unusual, to say the least. According to Kriss’s complaint, FL Group bought 62 percent of the profits from four Bayrock properties, which was the developer’s entire stake. Those properties were a development called Waterpointe on a blighted 20-acre property in Whitestone, New York that Bayrock had agreed to detoxify; Trump SoHo; a Trump tower in Phoenix, Arizona; and the Trump Merrimac in Ft. Lauderdale, Florida. The deal would have left FL Group with profits from the four properties, but structured the investment as a loan. That way, the firm could avoid taxes on the dividends and call them “contingent interest,” a process Henry described as “asset stripping.” That process is so complex, and the offshore finance rules so arcane, that all Henry would say was that it “has been illegal.” It’s a deal Trump would have had to sign off on.

Kriss charged in his lawsuit that the deal was illegal, and that both Bayrock and FL Group were fully cognizant of that fact. The suit alleged that Bayrock and FL Group also colluded to keep the deal secret from the other firms that worked with Bayrock on its various projects, and agreed to pursue as much as $2 billion more in future projects. From the lawsuit:

The exchange was part of a larger deal whereby FL became Bayrock’s new partner. The new partners agreed to work together on the existing Four Projects and on so much of $2,000,000,000 worth of new projects as they might “agreed to agree” to develop together. All this was to the exclusion of Plaintiffs and other minority members in the Subs, who should have shared the millions of dollars of the $50,000,000 and a share of the new projects.

The small size of the Icelandic economy means that most people who work in the financial sector in that country know each other. Björgólfur Thor Björgólfsson, the wealthiest man in Iceland, claimed FL had been infiltrated and taken over by pro-Russian interests, Henry noted. “He ended up owning about 30% of FL Group, and he claimed it had been taken over by hostile people who were channelling Russian money through it,” he recalled.

Another bank owned in large part by FL, Kaupthing, had made loans to Alexander Shnaider, the Russian-Canadian billionaire who financed the failed Trump tower in Toronto, which he used to buy a yacht. It also had other wealthy Russians on the books, among them Smirnoff Vodka magnate Yuri Shefler.

Ultimately, Bayrock never got that $2 billion. The global financial crisis, which eventually sunk both Kaupthing and FL Group, exposed the banks to scrutiny by regulators and law enforcement officers who aren’t usually privy to the inner workings of the financial system without a search warrant. Now that the companies had to declare bankruptcy, they had to open their books; almost as soon as they did, though, the loan books were shut.

“All three [major Icelandic] banks had three big private banking arms and they were based in Luxembourg,” Henry explained. “When the banks failed, Luxembourg authorities went in and immediately nationalized the subsidiaries of the Icelandic banks and then they were immediately resold and privatized.” Putin, whose concern for the Icelandic economy was also concern for exposed Russian oligarchs, immediately became less enthusiastic about his offer of a bailout, said Henry, who’d spoken to people who tried to negotiate the loan.

Of the three projects Bayrock planned with Trump and that FL Group allegedly wanted a cut of, the Phoenix development was completely scuttled and the Ft. Lauderdale hotel-condo went on to lose the Trump name. But the Trump SoHo was built and emblazoned with the name of the man who went on to the presidency.

In his complaint, Kriss contended that “a confidential source” said Bayrock was already awash in funds from “cash accounts at a chromium refinery in Kazakhstan” belonging to the family of Bayrock principal Tevfik Arif and that the firm was concealing the source of the cash. Among financiers like these, both the suit and Henry contend, the FL Group was right at home.

This post has been updated