Saturday, May 25, 2019
Readers of the blog might be interested in the upcoming Third Global White Collar Crime Institute, which will occur in Prague, Czech Republic on June 27-28, 2019. The Global Institute is a unique ABA Criminal Justice Section conference opportunity structured to bring together experts in the field of international white collar crime to meet and discuss cutting edge issues in a new corner of globe. The experience, therefore, offers not only insights into the latest developments in the field, but the chance to interact and network with colleagues and expand your presence in new regions of the world.
The Third Global Institute will begin with a “Meet the Enforcers” panel featuring Matthew Miner (Deputy Assistant Attorney General of the United States, U.S. Department of Justice), Matthew Wagstaff (Head of the Bribery and Corruption Division, Serious Fraud Office), and Pavel Zeman (Prosecutor General of the Czech Republic). On the second day of the Global Institute, we will also welcome Dr. Adrian Jung, who serves as Special Counsel on “Internal Investigations” to the German Federal Ministry of Justice. Dr. Jung is drafting legislation for Germany regarding corporate criminal liability and internal investigations that has the potential of changing the corporate criminal enforcement landscape in Europe. Other panels during the conference will include Lessons Learned from the VW Internal Investigation, Data Privacy and GDPR, Extradition and Red Notices, Global Anti-Corruption Trends, and Changes in Enforcement After Brexit.
For those interested in attending, there is more information about the Global Institute on the conference webpage, including a full agenda of the program and the registration form. I hope to see many of you in Prague next month.
Sunday, March 24, 2019
One needs to give credit to AG Barr for his quick release of a preliminary statement (see here - Download AG March 24 2019 Letter to House and Senate Judiciary Committees) concerning the Report of Special Counsel Mueller, which is titled, Report on the Investigation into Russian Interference in the 2016 Presidential Election. But one also needs to read this four-page statement carefully, because the public needs to grasp all of what is being said and what is not being said here.
- AG Barr's Summary notes the extensiveness of this investigation ("employed 19 lawyers who were assisted by a team of approximately 40 FBI agents, intelligence analysts, forensic accountants, and other profession staff. The Special Counsel issued more than 2,800 subpoenas, executed nearly 500 search warrants, obtained more than 230 orders for communication records, issued almost 50 orders authorizing use of pen registers, made 13 requests to foreign governments for evidence, and interviewed approximately 500 witnesses.")
- AG Barr's Summary does not provide the same specificity in telling the public the number of indictments and convictions of individual and entities in connection with his investigation, instead saying "all of which have been publicly disclosed." Well that number does seem pretty important, as this investigation had so far 7 guilty pleas, 27 people indicted, and 37 indictments with some of the cases still ongoing.
- AG Barr's Summary says that "The Report does not recommend any further indictments, nor did the Special Counsel obtain any sealed indictments that have yet to be made public."
- AG Barr's Summary does not say how many matters were turned over to other federal or state offices, perhaps because there was criminality that did not pertain to Russian Interference in the 2016 Presidential Election. Although it does say that "During the course of his investigation, the Special Counsel also referred several matters to other offices for further action."
- We now know for certain that the Investigation had two parts, or at least the Report does: Russian Interference in the 2016 US Presidential Election and Obstruction of Justice.
- AG Barr's Summary confirms that there were Russian efforts to influence our 2016 US election. AG Barr's Summary states that - "The report outlines the Russian effort to influence the election and documents crimes committed by persons associated with the Russian government in connection with these efforts." This is an important statement that needs both executive and legislative follow-up. How will we be assuring that future efforts by another country do not undermine our election? And even if they "did not establish that members of the Trump Campaign conspired or coordinated with the Russian government in its election interference activities," do we know if the results of the election were accurate?
- AG Barr's Summary confirms "that Russian government actors successfully hacked into computers and obtained emails from persons affiliated with the Clinton campaign and Democratic Party organizations, and publicly disseminated those materials through various intermediaries, including WikiLeaks." Again, did we have a fair election? What is the appropriate remedy? What will happen in future elections to preclude such activity?
- On Part II - Obstruction of Justice - AG Barr's Summary states that "the Special Counsel considered whether to evaluate the conduct under Department standards governing prosecution and declination decisions but ultimately determined not to make a traditional prosecutorial judgment." Barr's Summary says that "[i]nstead, for each of the relevant actions investigated, the report sets out evidence on both sides of the question and leaves unresolved what the Special Counsel views as 'difficult issues' of law and fact concerning whether the President's actions and intent could be viewed as obstruction." So it does sound like the President was a "subject" as opposed to "witness" of this investigation.
- AG Barr's Summary does not say that evaluating the evidence is typically the job of the jury, after a determination has been made that there is probable cause to indict. Instead AG Barr restates Mueller's Report that "while this report does not conclude that the President committed a crime, it also does not exonerate him." AG Barr goes on to say that he and Rod Rosenstein have made the decision "that the evidence developed during the Special Counsel's investigation is not sufficient to establish that the President committed an obstruction-of-justice offense."
- In many ways it is good to see that a "short-cut offense" of obstruction of justice will not be used (see my article here), but one has to wonder about the defendants who have been charged with obstruction of justice. It will be important for everyone to know what has been declined here so that everyone can understand the DOJ's standard for evaluating obstruction. Isn't it always stated that "intent can be inferred from the circumstances" in letting juries make those decisions? But it is also good to see DOJ taking a hard line in not prosecuting uncertain cases - it is hopeful that all US Attorneys will follow this lead with the obstruction cases they are currently handling. Having the full Report will provide this important transparency.
- I leave for another day a discussion of AG Barr's decision to extract 6(e) grand jury material from the report prior to its release.
Thursday, December 6, 2018
The latest filing by Special Prosecutor Mueller is very telling as to the status of the investigation. Michael Flynn pleaded guilty on Dec. 1, 2017, to making false statements to FBI agents, in violation of 18 U.S.C. 1001. In anticipation of sentencing on December 18th, the government filed its Memorandum in Aid of Sentencing, along with a heavily redacted Addendum. Some thoughts:
1. The fact that Flynn plead to a Section 1001 violation hurts Mueller's future cases if they decide to use him to testify against others in those cases. Pleading to a section 1001 charge is admitting that the individual gave a false, material statement, knowingly and willfully, within the executive, legislative, or judicial branch of the government. The opening cross-examination questions for such a witness might be - 1) You are a convicted felon? 2) And you were convicted for a crime of lying? 3) And you lied to the FBI?
2. But three things are noteworthy here - 1) the charge is false statements and not perjury - if it had been perjury then the cross-examination would go on about lying under oath and be dragged out for many more questions than the three previous ones; 2) prosecutors do not get to choose their witnesses and if they can provide an explanation for the lie (e.g. pressure or duress) it stings less; and 3) if you can back up the individual's testimony with other evidence then the false statement charge is less problematic. It seems likely here that there are documents, emails, or other evidence to support whatever Flynn may be saying.
3. Using a "shortcut offense" like section 1001 is typically not good since it takes away from the actual wrongdoing and society never sees the underlying conduct. Deterrence is best achieved when the actual criminality is disclosed and punished. (see White Collar Shortcuts here). But that is not the case here. Here Flynn is likely a source providing information for other investigations that can have charges beyond shortcut offenses. For one, Mueller did not use a shortcut in his charging of cybercrimes against Russians (see here). So using false statements here is again justified.
4. 19 interviews - WOW. That is significant. One doesn't meet 19 times and get nothing.
5. This is an ongoing investigation. Investigations in white collar cases take time. This investigation is certainly not finished -- one need only look at the number of redactions in the Addendum to reach this conclusion.
6. That the substantial assistance provided extends beyond the special counsel. Part A says "XXX Criminal Investigation" and Part B says "The Special Counsel's Office's Investigation" and then appears to have three separate subsections - with one subsection completely redacted. So one could conclude that the special counsel has 3 investigations that Flynn has been useful for, and that someone else perhaps is using him.
7. Mueller has yet again maintained secrecy, and there have been no leaks. This is impressive. It is also impressive that Mueller is speaking only through court papers and not providing any additional information.
8. It may be frustrating to many that more information has not been released, but in time it is likely we will know more. We need to be patient and trust someone who is clearly upholding the highest of ethical values.
Thursday, November 29, 2018
News media are reporting that Deutsche Bank has been raided by German prosecutors. (see BBC here), (see NYTimes here). A money laundering investigation is what is being reported. Deutsche Bank stated that "[i] is true that the police are currently conducting an investigation at a number of our offices in Germany. The investigation has to do with the Panama Papers case. More details will be communicated as soon as these become known. We are cooperating fully with the authorities." (Tweet @ Deutsche Bank). They also have stated that "[a]s far as we are concerned, we have already provided the authorities with all the relevant information regarding Panama Papers." So if Deutsche Bank provided everything, why is there a raid?
Thursday, October 25, 2018
I hope you will join me and the ABA Criminal Justice Section for a spectacular White Collar Crime Town Hall on Thursday, November 1 from 3:30pm-5:00pm at the Mayflower Hotel in Washington, D.C. Due to the generosity of our sponsors, the program is free and will be followed by our Criminal Justice Section welcome reception at the hotel. You may register for the CLE on-site.
Below is a description of the White Collar Town Hall and the exemplary panelists who will discuss The Role of the Media in White Collar Criminal Investigations and the Mueller Probe.
The panelists will first examine the role of the media in these investigations generally, including the obligations/interests of the media in protecting the integrity of investigations, the tools available to prosecutors and defense attorneys to address media coverage during the investigative stage, and the tools and standards for fair trial protections due to pretrial media exposure. Then, the panel will delve into the Mueller probe specifically, addressing the media’s sources of information about the Mueller investigation, what the leaked information reveals about the investigation, the media’s impact on the Manafort trial, the Congressional role in providing investigative information to the public, and implications on other ongoing aspects of the investigation.
Moderator: Henry Asbill, BuckleySandler LLP, Washington, DC
Rebecca Ballhaus, Reporter, Wall Street Journal, DC Bureau, Washington, DC
Kevin Hall, Pulitzer Prize Winner, Chief Economics Correspondent and Sr. Investigative Reporter, McClatchy Newspapers
Michael Isikoff, Chief Investigative Correspondent, Yahoo News
Prof. Jessica Roth, Cardozo Law School, Reporter, ABA CJS Standards on Fair Trial and Public Discourse
In addition to our white collar program on Thursday evening, there will also be complimentary CLE programs at the Mayflower Hotel all day Friday. Our Friday program will begin with a keynote address on plea bargaining by Judge Jed Rakoff. This will be followed by a host of fascinating panel discussions focusing on the work of the Section and its committees. These will include:
A Fresh Look at Plea Bargaining in our Criminal Justice System
Prosecutors as Agents of Change
GITMO Twelve Years Later
Re-Entry and Innovation
What Civilians Can Learn from the Military Experience with Sexual Assault & Harassment
Enhancing Justice: Reducing Bias – Strategies for Change in the Criminal Justice System
On Friday, we will also hold our prestigious Criminal Justice Section Awards Luncheon and Address, which occurs at 12:30pm. The Address will be given by Hilarie Bass, immediate past President of the American Bar Association. Ms. Bass will discuss her work creating a new organization to address issues critical to women and minorities. These important remarks are incredibly timely given the recent launch by the Criminal Justice Section of the new Women in Criminal Justice Task Force.
Our Friday programming will be followed by our Criminal Justice Section fall reception.
The complete agenda is available on the Fall Institute website.
All CLE programming, including the White Collar Town Hall, is complimentary and participants may register on-site. Those wishing to attend the Awards Luncheon and Address should register online. The cost of the luncheon is $50. For those registering online, please note that website issues have resulted in improper pricing information being listed. The correct price should populate when you move to the checkout. If you have any difficulty registering online, please contact Regina.Ashmon@americanbar.org
Friday, September 14, 2018
Friday, July 13, 2018
Special Counsel Robert Mueller's Office has clearly been working to get to the bottom of the alleged Russian interference with U.S. elections. Today a D.C. federal grand jury handed down an Indictment against "12 Russian nationals for their alleged roles in computer hacking conspiracies aimed at interfering in the 2016 U.S. elections." The special counsel's website notes that "the indictment charges 11 of the defendants with conspiracy to commit computer crimes, eight counts of aggravated identity theft, and conspiracy to launder money. Two defendants are charged with a separate conspiracy to commit computer crimes." The Indictment is here.
There are some interesting lines in the Indictment including: "The Conspirators, posing as Guccifer 2.0, also shared stolen documents with certain individuals." It states,
"On or about August 15, 2016, the Conspirators, posing as Guccifer 2.0, received a request for stolen documents from a candidate for the U.S. Congress. The Conspirators responded using the Guccifer 2.0 persona and sent the candidate stolen documents related to the candidate's opponent."
The indictment speaks about how "[t]he conspirators, posing as Guccifer 2.0, also communicated with U.S. persons about the release of stolen documents." It notes how the conspirators "wrote to a person who was in regular contact with senior members of the presidential campaign of Donald J. Trump ..."
The Indictment states that "[i]n order to expand their interference in the 2016 U.S. presidential election, the Conspirators transferred many of the documents they stole from the DNC and the chairman of the Clinton Campaign to Organization 1."
One thing is clear in reading this indictment - Mueller is running a legitimate and important investigation and it needs to continue.
Monday, June 18, 2018
If Congressman Trey Gowdy is to be believed, and I see no reason not to believe him, this should be an interesting week in Washington. According to Gowdy, Speaker Paul Ryan read the riot act to the DOJ and FBI on Friday night about the Bureau's stonewalling and foot dragging in the face of longstanding subpoenas issued by the House Judiciary and Intelligence Committees. If the subpoenas are not complied with, Gowdy warned that the full constitutional powers of the House will be employed by week's end. It is clear that Gowdy was not just talking about holding people in contempt. Gowdy's comments are significant, because he has been one of the few House Republicans to consistently support the work of Bob Mueller and to give the benefit of the doubt to the Bureau regarding the origins of the Russian investigation. This has often put him on the outs with the many Trump shills on the GOP side. What apparently pushed Gowdy over the edge was the Horowitz Report's revelation of Peter Strzok's text response to Lisa Page that "we'll stop" Trump from being elected President. Astonishingly, it appears that this text had not been provided to the House prior to the release of the Horowitz Report. I suspect as well that Gowdy was enraged to read in the Report that the Bureau, with the active involvement of Deputy Director McCabe, sat on its knowledge of the Weiner laptop materials, even keeping it from the DOJ prosecutors who had been involved in the Clinton email server investigation (dubbed "Midyear Exam"), until alarmed officials in the SDNY U.S. Attorney's Office tipped off an attorney at Main Justice. It is clear that at the time Strzok was leading and ramping up the Russia investigation, he and a large group of DC FBI officials were suppressing the discovery of 347,000 potentially relevant emails on Weiner's laptop. This is why even the rather tame Horowitz Report "did not have confidence that Strzok's decision to prioritize the Russia investigation over following up on the Midyear-related investigative lead discovered on the Weiner laptop was free from bias." But make no mistake about it, Strzok did not act alone. As many as 39 FBI officials were likely to have participated in a September 28, 2016 secure video teleconference (SVTC) in which the discovery of 141,000 emails potentially relevant to Midyear Exam was discussed. (McCabe was informed of the 347,000 figure later that evening.) This was an FBI conspiracy of silence. The irony is that the FBI's attempt to suppress the Weiner emails almost certainly aided Trump's electoral victory. If the emails had been processed in a timely fashion, without publicity, their ultimate irrelevance would have been established prior to the election and Comey would not have needed to make the damaging announcement that he was reopening the Midyear investigation. It will be doubly ironic if there were wholly legitimate reasons to open the Russia investigation, but the FBI's misguided efforts to hide its own mistakes ends up tainting and derailing the entire project. Byron York reports here on the growing House GOP suspicion that the FBI is hiding even bigger bombshells.
Thursday, June 14, 2018
Analysis to follow in a while.
Here also is the Press Release and Executive Summary of OIG Report.
Monday, June 11, 2018
Here is the Indictment returned late last week in U.S. v. James Wolfe. Wolfe worked for 30 years for the United States Senate Select Committee on Intelligence ("SSCI") handling top secret and other classified information provided by the Executive Branch to Congress. According to the Indictment, Wolfe leaked the identity of "Male-1" to at least two reporters on two separate occasions and then lied about it to FBI Special Agents. Male-1 is none other than Carter Page and it is clear that the leaks were intended to damage Donald Trump. Reporter #2, referenced in the Indictment, is New York Times reporter Ali Watkins who was romantically involved with Wolfe for almost four years. Records of Watkins' email and phone contacts (but apparently not their contents) were subpoenaed from third party providers. Andrew McCarthy of NRO Online has commentary here, while Alex Pappas of Fox News examines some of Ms. Watkins' embarrassing historical tweets concerning the identity of leakers and the propriety of sleeping with sources. The press and certain members of Congress are concerned, as well they should be, about DOJ's capture of journalistic records. But keep in mind that the press is not the only institution with a watchdog role. The SSCI performs that function as well, and does so officially, with respect to intelligence-related oversight, and it is ironic (in a bad way) that its Chief of Security, if the charges are accurate, betrayed SSCI's trust. At this point Wolfe has only been charged, under 18 U.S.C. Section 1001 (the Martha Stewart statute) with lying to the FBI.
Wednesday, May 16, 2018
Judge Amy Berman Jackson's Memorandum Opinion and Order gives a green light to Special Counsel Robert S. Mueller III proceeding with the case against Paul J. Manafort, Jr. (see here and here). Her straightforward Order dissects the authority provided to the Special Counsel and rejects Manfort's claims that this was beyond the Special Counsel's appointment and if not, that he overstepped his appointment. Taking the allegations in the Indictment, she demonstrates how the Supereding Indictment clearly falls within the realm allowed of the Special Counsel. One interesting side note in this Order is the discussion of the role of internal agency regulations. She states, "internal agency regulations do not create rights that an individual under investigation may enforce in court." Judge Jackson, while allowing this case to proceed, does include an important point that should be noted when reviewing documents of anyone accused of crimes. She states that, "[i]t bears emphasizing at this stage that Manafort is presumed to be innocent of these charges, and it will be the prosecution's burden to prove him guilty beyond a reasonable doubt." But the bottom line is that Special Counsel Mueller may continue, as he should.
Saturday, May 12, 2018
Here is Jonathan Turley's latest column for The Hill discussing the emerging "legal strategy" of Team Trump. It is clear that the hiring of Rudy Giuliani and Emmet Flood was part of a concerted effort to smear Team Mueller while preparing the public for Trump's invocation of Executive Privilege and/or his Fifth Amendment Privilege against self-incrimination. The new strategy buys time and kills two birds with one stone--both avoiding a Trump interview and allowing a sustained and withering attack to weaken Mueller. Like so much of the Trump approach, it uses the Clinton Playbook, the one employed by President Clinton at the urging of Dick Morris. Deny, delay, attack, weaken. Of course, Trump and his surrogates have been going after Mueller for awhile, but drafting Giuliani, a presumed legal heavyweight, was supposed to add stature, heft, and gravitas to the project. The problem was in the execution. It turns out Rudy Giuliani should change his name to Rusty Giuliani. He is rusty on the facts of his client's case, rusty on the law, and rusty on the ethical duties of an attorney. Virtually every one of his appearances has been marked by inaccuracies (factual and legal) and buffoonery. Rudy seems to be running on fumes and celebrity status. Here are just a few samples of his deft touch:
Mueller, the FBI, and the DOJ respect him, even though they are running a "garbage investigation" using "storm trooper tactics." (Do you think they still respect you?)
Presidential immunity from indictments and subpoenas was written right into the Constitution by the Framers. (This must be the long lost Alexander Hamilton Invisible Ink draft.)
There is definitely no campaign finance violation, because Trump reimbursed Cohen from personal funds. (The purpose of the payment, among other factors, must also be examined.)
Clinton was only questioned by Team Starr for 2.5 hours. (It was 4 hours. Not a huge point perhaps, but Rudy still had it wrong a week later. Does he have a researcher?)
Judge Ellis criticized the search of Michael Cohen's office. (Ellis did not mention the search at all.)
The President knew about the payments to Stormy Daniels. The President didn't know. I was talking about myself. I'm still learning the facts. Maybe I shouldn't be discussing privileged conversations I had with my client.
I make payments for my clients all the time without them knowing about it. (This presumably caused Greenberg Traurig to sever its relationship with Giuliani at the end of the week, with the law firm publicly denying that it engages in such conduct.)
The most disheartening thing about Rudy's performance has been his apparent refusal to sit down, learn the case, and refresh himself on the law.
Whatever the Grand Plan was supposed to be in wheeling Giuliani out, there is no Grand Plan involved in his performance to date.
Friday, May 11, 2018
Perhaps one of the most confused areas of the law is the Hobbs Act/Bribery area. Cases throughout the years have defined the need for a quid pro quo (McCormick), and noted how a passive acceptance can satisfy that prong of the statute (Evans). But when do you have a quid pro quo, is something that can often be a difficult factual question. Equally confusing is determining what constitutes an "official act." The Supreme Court in McDonnell held that "setting up a meeting, hosting an event, or making a phone call 'standing alone' would not be sufficient . . ."
In the first trial Sheldon Silver, former Speaker of the NY State Assembly, along with Dean Skelos, a former majority leader in the State Senate, both were convicted. But the convictions were quickly overturned because they failed to comply with the McDonnell pre-requisites. And now, according to the NYTimes, Silver was convicted on retrial. (Benjamin Weiser, Sheldon Silver Is Convicted in 2nd Corruption Trial).
For those who doubted the government's ability to prosecute public corruption cases post-McDonnell, this verdict should be very welcomed. For those who are seeking clearer lines between legal moneys paid and illegality, an appeal in this case may provide more answers. I keep wondering if the answer will all come down to "green."
Sunday, May 6, 2018
The leak and publication of 49 questions for President Trump, orally given to President Trump's lawyers by Robert Mueller's team and then transcribed by Jay Sekulow, has unquestionably damaged Team Mueller's reputation. Why? Many of the questions are incredibly broad, incredibly stupid, and/or incredibly intrusive forays into core functions of the Executive Branch. But whose questions were they? The original New York Times story indicated that the questions were revealed orally in a meeting between Team Trump and Team Muller and then transcribed by Team Trump. Next we were informed by other media sources that Sekulow was the scrivener and that the 49 questions may be more in the nature of a Team Trump moot court briefing book, based upon a smaller set of inquires/topics broached by Team Mueller. For example, the AP reported that a "person familiar with the matter, who insisted on anonymity to discuss ongoing negotiations, said Trump’s lawyers extrapolated a list of expected questions based on conversations with Mueller’s team. The questions contained in a document posted online by the Times on Monday night reflected questions that defense lawyers anticipated rather than verbatim queries that Mueller’s team provided, the person said." The subsequent clarifications have been all but forgotten on the Internet and cable news shows and it is still widely assumed that the 49 questions are a verbatim rendition of those directly relayed by Team Mueller to Team Trump.
But the difference between the two versions is significant. If these are the literal questions from Mueller's team, they reflect (in addition to the flaws noted above) a dangerously elastic view of criminal obstruction of justice. If they are mere briefing book questions, intended to prepare the President for every possible question Team Mueller may ask, they should be of much less concern to Team Trump and to observers attempting to fairly critique the Mueller operation. Finally, if these are briefing book questions that were deliberately leaked and packaged to the media by Team Trump as if they were Team Mueller's literal proposed interview questions for President Trump, this says something disturbing about the Trump legal operation.
Saturday, May 5, 2018
Attached is the transcript of yesterday's hearing in the Eastern District of Virginia on Paul Manafort's Motion to Dismiss the Indictment against him: USA v PAUL J MANAFORT JR - 5-4-2018 Hearing on Motion to Dismiss. The hearing was before Judge T.S. Ellis III and was characterized by Judge Ellis's typically blunt and withering wit.
Here are some takeaways:
- Despite the headline worthy comments of Judge Ellis, the Court will reject Manafort's argument that the Indictment should be dismissed because the Order appointing Mueller is broader than the Special Counsel regulation allows. DAG Rod Rosenstein's August 2 2017 Letter Re The Scope of Investigation and Definition of Authority makes clear that Mueller had the authority from the first day of his appointment, on May 17, 2017, to investigate Manafort for colluding with Russian officials during the 2016 election in violation of U.S. laws and for crimes arising out of payments Manafort received from former Ukrainian President Victor Yanukovych. Judge Ellis indicated that he considered this to be the government's strongest argument. Unless Judge Ellis believes that Rosenstein's August 2 letter was an after-the-fact sham, the letter puts an end to Manafort's central claim. Judge Ellis may also find, although this is not as certain, that the Special Counsel regulation creates no personal rights for Manafort that are enforceable in a judicial proceeding. In other words, this is a non-justiciable intra-branch matter within the Department of Justice.
- It was striking to me that Michael Dreeben, who spoke for the government, did not lead with the argument that Rosenstein's August 2 letter resolves the question of whether Mueller is acting within his authority. Why not? Is it because, Mueller does not want a detailed factual inquiry on this point? During the motions hearing, both sides referenced Rosenstein's December 13, 2017 House Judiciary Committee testimony. Here are relevant Excerpts from that testimony, in which Rosenstein stated under oath that "the specific matters are not specified in the [May 17] order. So I discussed that with Director Mueller when he started, and we've had ongoing discussion about what is exactly within the scope of his investigation." (Rosenstein could not say with 100% certainty what parts of Mueller's investigation were an expansion and what parts were a clarification of Mueller's original mandate. He promised to get back to the House Judiciary Committee on this point.] Dreeben told Judge Ellis that the "specific factual [August 2] statement, as [DAG] Rosenstein described in his Congressional testimony, was conveyed to the special counsel upon his appointment in ongoing discussions that defined the parameters of the investigation that he wanted the special counsel to conduct." So which is it? Was the scope of the investigation crystal clear on March 20, 2017 or on May 17, 2017, or did it have to be hammered out in ongoing discussions. Rod Rosenstein's May 17 2017 Order Appointing Robert S. Mueller III clearly states that Mueller has the authority to conduct the investigation confirmed by former FBI Director Comey in his March 20, 2017 Congressional testimony. Manafort's attorney, Kevin Downing, wanted to see any memos written by Rosenstein leading up to Mueller's appointment to help determine the scope of Mueller's authority. When Judge Ellis asked Downing how he knew such memos existed, Downing, who worked under Rosenstein for five years, replied: "Mr. Rosenstein is a stickler for memos being written, for there to be a written record for the actions of the Department of Justice." Downing argued that if Rosenstein exceeded his authority in appointing Mueller, Mueller "does not have the authority of a U.S. Attorney." In that event, according to Downing, any indictment procured from the grand jury by Mueller's operation would presumably be null and void.
- Fox News's assertions that Judge Ellis accused the Mueller team of "lying" and using "unfettered power" to target Trump are not supported by the record. Judge Ellis did express extreme skepticism regarding one of the government's arguments and made the undoubtedly true statement that the government was using Manafort to go after Trump.
- The non-justiciable, intra-branch dispute argument by Mueller's people could end up biting them in the butt in another context. Expect President Trump to use a similar argument if he is subpoenaed, asserts Executive Privilege, and is challenged on this point by Mueller. Trump will argue that Mueller, as an inferior officer within the President's DOJ, lacks regulatory authority to contest Executive Privilege, and that the entire matter is a non-justiciable, intra-branch dispute. Contrary to general assumptions, U.S. v. Nixon does not settle this issue. The Supreme Court in Nixon rejected President Nixon's justiciability argument, but did so on the basis that Special Prosecutor Leon Jaworski had the explicit authority to contest assertions of Executive Privilege pursuant to the terms of the federal regulation that governed his appointment. As far as I can tell, Special Counsel Mueller has not been given explicit authority to contest issues of Executive Privilege.
May 5, 2018 in Corruption, Current Affairs, Defense Counsel, Fraud, Government Reports, Grand Jury, Investigations, Judicial Opinions, News, Obstruction, Perjury, Privileges, Prosecutions, Prosecutors | Permalink | Comments (0)
Tuesday, April 24, 2018
The redacted version of the Comey Memos have now been released and do not on their face come close to establishing criminal obstruction of justice by Donald Trump. What they do show is a new President with no concept of how to appropriately interact with his condescending, schoolmarmish FBI Director.
There are conceivably four potential endeavors to obstruct justice referenced in the memos.
1. According to Comey's notes, the President asks Comey if he can see his way to "letting this go, to letting Flynn go," because, "Flynn is a good guy and has been through a lot." It was an inappropriate request, but it was not an order. Had it been an order, it would have been even more inappropriate, but still not a crime. The President has the constitutional authority to order an investigation closed.
2. The President also asks Comey to "lift the cloud" hanging over him by publicly confirming that the President is not under investigation. Comey had already volunteered to Trump at least twice that Trump was not under investigation. Comey declined the President's request to publicly "lift the cloud" and lectured him on the appropriate channels through which to make such a request. There was nothing wrong with the President's request and there would have been nothing wrong with Comey acceding to it.
3. After asking Comey to "lift the cloud" for the umpteenth time, Trump tells Comey, "I have been very loyal to you, very loyal, we had that thing you know." Comey believes this was a reference by Trump to their January 27, 2017 conversation in which Comey expressed his preference to remain on the job as FBI Director and Trump asked for and received a pledge of "honest loyalty" from Comey. In other words, Comey believes that Trump wanted Comey to "lift the cloud" hanging over Trump in return for Comey keeping his job. Assuming that Trump actually said this, it was not a crime. Trump has the constitutional authority to order an investigation closed. He has the authority to fire any non-civil service appointee for refusing to carry out such an order. Trump could have told Comey, "lift the cloud or I will fire you." Ergo, he can certainly suggest that Comey owed it to him to "lift the cloud."
4. Trump repeatedly told Comey that the Russian hooker story was false, because Trump did not stay overnight in Russia during the 2013 Miss Universe Pageant. Apparently Trump did stay overnight. Is this a false statement to a law enforcement officer by someone endeavoring to obstruct justice? The Government would have to prove that Trump actually made this statement knowing it was false and knowing that he was under criminal investigation. But Trump had been already been told by Comey, multiple times, that he was not under investigation. Thus, even assuming that Trump made the statement in question and intentionally lied (as opposed to misremembering), a prosecutor would have to show that Trump was endeavoring to obstruct a criminal investigation, despite having been told that there was no investigation.
If Comey's notes are accurate, the President was a boorish novice with no comprehension of long-accepted norms regarding acceptable interaction between the President and his FBI Director. That doesn't make Trump a criminal.
Tuesday, April 10, 2018
Playing the press has become an important component in handling a white collar case. In the past, one might remain silent and let the case be resolved prior to making any statements, especially press-related statements. With the speed of the internet, it often becomes necessary for attorneys to respond to allegations to provide a level playing field. It, therefore, was no surprise to see Michael Cohen's attorney, Stephen M. Ryan, issuing a press release. (see here). He calls the US Attorneys Office "completely inappropriate and unnecessary." He argues that his client "has cooperated completely with all government entities, including providing thousands of non-privileged documents to the Congress and sitting for depositions under oath."
It is interesting to see the use of a search here as opposed to a subpoena. The downside of the government using a search is that it is more expensive, not secret like the grand jury process, requires probable cause, and if the probable cause is later found lacking the entire search can be invalidated. The upsides of a search are surprise, getting the material immediately without having to wait for the grand jury, obtaining items that might be found in plain view, and also receiving possible incriminating statements from individuals while performing the search, this latter one mostly applicable in the corporate or business context. One can argue obstruction of justice either way. On one hand you get the items in question before there is any possibility of them being destroyed. On the other hand if documents were destroyed, prosecutors would have a "short-cut offense" to charge of obstruction of justice.
In my Article, White Collar Shortcuts, forthcoming in the Illinois Law Review, I note how prosecutors are using investigative and charging "short-cuts" more frequently in white collar cases. Whether the use of a search warrant was a "short-cut" here, remains to be seen.
Wednesday, April 4, 2018
Monday night, in the U.S. District Court for the District of Columbia, Special Counsel Robert Mueller filed his Response [Government's Response in Opposition to Motion to Dismiss] to Paul Manafort's Motion to Dismiss the Superseding Indictment. Manafort's Motion to Dismiss is bottomed on the alleged invalidity of Acting AG Rod Rosenstein's May 7 2017 Order Appointing Robert S. Mueller III as Special Counsel and defining Mueller's jurisdiction. As part of his Response, Mueller referenced and filed Attachment C, a redacted version of Rosenstein's August 2 2017 Letter Re The Scope of Investigation and Definition of Authority.
Before Monday night there was no public knowledge of this August 2 letter, which sets out in detail, among other things, the specific matters already under investigation before Mueller came on board. According to the August 2 letter, the May 7 Order had been "worded categorically in order to permit its public release without confirming specific investigations involving specific individuals." The private August 2 letter, in contrast, "provides a more specific description of your authority." Recall that the May 7 Appointment Order authorized Mueller to "conduct the investigation confirmed by then-FBI Director James B. Comey in testimony before the House Permanent Select Committee on Intelligence on March 20, 2017, including...(i) any links and/or coordination between the Russian government and individuals associated with the campaign of President Donald Trump; and (ii) any matters that arose or may arise directly from the investigation; and (iii) any other matters within the scope of 28 C.F.R § 600.4(a)." The August 2 letter unequivocally states that "[t]he following allegations were within the scope of the Investigation at the time of your appointment and are within the scope of the Order:
• Allegations that Paul Manafort:
º Committed a crime or crimes by colluding with Russian government officials with respect to the Russian government's efforts to interfere with the 2016 election for President of the United States, in violation of United States law;
º Committed a crime or crimes arising out of payments he received from the Ukrainian government before and during the tenure of President Viktor Yanukovych;
In other words, FBI Director Comey was already investigating Manafort for possible criminal collusion with the Russians and for payments Manafort received from Yanukovych, before Mueller came into the picture. By including the Yanukovich payments in his probe of Trump, Comey displayed an aggressiveness sadly absent from the investigation of Ms. Clinton's email server.
What is odd is that Rosenstein's August 2 letter was sent almost three months after Mueller began his inquiry. You would think that such a specific private memo detailing the scope of Mueller's investigative authority would have been issued contemporaneously with the May 7 Order. That it wasn't suggests there were disagreements in defining the outer boundaries of Mueller's charter or that Mueller or Rosenstein began to perceive problems with the wording of the May 7 Order and foresaw the possibility of just the sort of Motion to Dismiss ultimately filed by Manafort.
Rachel Stockman at Law and Crime notes here that the more specific delineation of authority laid out in the August 2 letter came one week after the raid on Manafort's home. Mueller may have wanted written reassurance that the search and seizure were within his authority ab initio, or, as we say in Texas, from the get-go.
Tuesday, April 3, 2018
The Washington Post is reporting that "Mueller told Trump's Lawyers the President isn't" a target of the Special Counsel's Investigation, but that in early March "Mueller described Trump as a subject of his investigation." (see here & here)(emphasis added). Whether President Trump currently is a subject or witness is important, especially for legal counsel in advising whether their client should testify or speak with investigators.
"A target is a person as to whom the prosecutor or the grand jury has substantial evidence linking him or her to the commission of a crime and who, in the judgment of the prosecutor, is a putative defendant." U.S. Attorney's Manual 9-11.151. Being told that one is not a target is definitely something good for President Trump to hear. But "[a] subject of an investigation is a person whose conduct is within the scope of the grand jury's investigation." Id. This is something that may or may not be good for President Trump. It can mean that the government just hasn't made up their mind yet as to whether the individual will remain under investigation or move to being a witness. This last category, a witness, is obviously the preferred place to be, if one has to be anywhere near a grand jury or being asked to speak with government attorneys.
"A grand jury may properly subpoena a subject or a target of the investigation and question the target about his or her involvement in the crime under investigation." U.S. Attorneys Manual 9-11.150. "It is the policy of the Department of Justice to advise a grand jury witness of his or her rights if such witness is a "target" or "subject" of a grand jury investigation." U.S. Attorney's Manual 9-11.151. Because the DOJ Manual is unenforceable at law, there is little that one can do if they are not advised of their rights as a target or subject, except perhaps report the prosecutors for not following their internal policy. In some instances, more common perhaps in white collar cases, a subject or target may "request or demand the opportunity to tell the grand jury their side of the story." Government lawyers are instructed that a "refusal to do so can create the appearance of unfairness." U.S. Attorney's Manual 9-11.152.
But should a target or subject testify or even be questioned by government attorneys? Some white collar individuals feel they can talk their way out of an indictment, when in fact they are talking their way right into one. So targets and subjects can be hesitant to speak with the government without any immunity. Even with immunity, the fear is that they will provide false evidence, perjure themselves, or if not before a grand jury say something materially false to investigators and be criminally liable under the false statement statute (18 U.S.C. 1001).
So if reports are accurate that President Trump is not a target, this does not necessarily mean he can rest easy. If he remains a subject, then it will be more time before we know where things stand. It is common in white collar cases for individuals to remain in a holding pattern for many months and sometimes years as white collar investigations take time.