The sheer number of Donald Trump’s cronies indicted, convicted, or still under investigation partially explains why this summer’s fraud and money laundering indictment of Stephen K. Bannon, Trump’s 2016 campaign manager, and White House Chief Strategist, didn’t get the attention it deserved. Bannon is, of course, only the latest member of Trump’s inner circle to face criminal charges – a group that includes Paul Manafort who Bannon replaced at the campaign; Manafort’s Deputy, Rick Gates; National Security Advisor Michael Flynn; Trump’s personal lawyer Michael Cohen; Roger Stone, the Republican trickster.
But there are many reasons that make what Bannon did worth following closely even if his trial is not scheduled until May 2021.
Bannon was indicted for a terrible crime that we cannot let be normalized. What he did mimics Trump’s fraud against students at Trump University and Trump’s misuse of donations to his Trump Foundation. Did Bannon learn from Trump or did Trump hire Bannon because he knew he shared his views of what is acceptable? We’ll never know but we do know that Bannon’s indictment along with that of all the others working for Trump’s campaign and administration is just one more reflection of the (im)moral climate the President has set for his administration. It’s a tone that has diminished our position as a world leader and that should influence how each of us votes.
It is also a predictor of more to come, possibly something broad enough to encompass a number of Trump hires and volunteers. Indeed, more seems imminent. The Washington Post and other news outlets are reporting that Elliott Broidy, a California venture capitalist who raised millions for Trump’s inaugural and served as Finance Chair of the RNC, may be charged soon with violating lobbying laws for his efforts on behalf of China to get the Chinese Guo Wengui, extradited to China. Prosecutors are also reportedly interested in Broidy’s work on behalf of a Malaysian client to end a federal criminal investigation. Guo links Broidy to Bannon because Bannon was staying aboard Guo’s luxury yacht when he was arrested for fleecing the donors to, We Build The Wall. The reported case against Broidy may indicate that Bannon’s arrest was step one of a larger case. In addition to Guo giving Bannon use of his yacht, he allowed Bannon to use his private jet to promote Republican congressional candidates in 2018. That arrangement could violate campaign finance laws banning foreign donations.
Is there a larger money laundering case that federal prosecutors in the SDNY and Hawaii are putting together? Can Bannon and/or Broidy be flipped to build a case against higher-ups? Rumor is that Broidy may be cooperating, but he and Bannon can wait for a post-election pardon regardless of who wins the election since Trump can hand them out until Jan. 20. Even so, flipping seems entirely possible. Bannon and three co-defendants are charged with enriching themselves at the expense of hundreds of thousands of donors to an alleged not-for-profit, “We Build The Wall,” by falsely promising that the founder would receive no compensation and 100% of all contributions would go to building a wall on our southern border (a wall that Trump said Mexico would pay for before diverting Pentagon funding to that purpose when Congress refused to fund it when Mexico didn’t). The indictment also mentions that they didn’t create an actual nonprofit organization until they got caught saying they were one but weren’t, and they didn’t get legally required building permits until they got caught at that too. And, The Texas Tribune and ProPublica report that engineers have said that the three-mile wall built by We Build the Wall will fail due to erosion.
We Build the Wall raised $25 million and, despite its promises to donors, the indictment alleges WBTW used $1 million for other purposes. They paid its founder hundreds of thousands and diverted even more for the personal benefit of Bannon and the other defendants. They covered up those expenditures for luxury items including a boat, an SUV, travel, and even cosmetic surgery by laundering the funds through shell companies and a second suspicious nonprofit founded by Bannon, Citizens of the American Republic.
While personal enrichment is odious enough, it may be the flow of money to Bannon’s political operations that prove to be more damaging to Trumpworld. The indictment refers to “Non-Profit-1” which may be Bannon’s nonprofit Citizens of the American Republic, created to promote “economic nationalism.” The California-based nonprofit serves as a platform for Bannon’s films and podcasts that promote Trump’s ideology. Federal prosecutors reveal that they intend to seize the assets of “non-profit-1. If, as suspected, it is Bannon’s CAR, one can only imagine who else might be ensnared in that web.
The Democrats don’t talk about Russia or Ukraine that much anymore. But it’s important to remember that there are still a lot of legal loose ends out there before the election. In addition to Bannon’s indictment and Broidy’s possible one, the D.C. Circuit Court of Appeals kept alive the case against former National Security Adviser Michael Flynn, at least for now. Flynn, you’ll remember was fired for lying about his phone call with the Russian ambassador to the U.S. in the days leading up to Trump’s inauguration. He pled guilty to lying to the FBI and obstruction of justice and accepted a plea deal but later unsuccessfully tried to withdraw his guilty plea. Then, while awaiting sentencing, AG William Barr had the DOJ move to dismiss the case on what I consider flimsy grounds—a move that led to the resignation of at least one career prosecutor. When the lower court refused to toss it out, Barr ordered the Justice Department to appeal it and has now lost that appeal in an en banc decision by the DC Circuit. (NOTE: I am a plaintiff in a suit by my fellow Assistant Watergate Special Prosecutors to be amicus in the case.) Could Bannon who was at the top of the Trump White House at the time of Flynn’s crime and a regular National Security Council participant for a time offer any insight on this case or other prosecutions?
If all this wasn’t bad enough, we learned this week that Rod Rosenstein, who oversaw the Mueller investigation, may have constricted it so tightly that the special counsel was prohibited from investigating what might have been the full extent of the Trump campaign’s ties to Russia in 2016.
I’ve been a prosecutor going back before Watergate. I see a legal morass that is still getting larger for the president. That’s true weeks before the election and ever truer afterward whether he’s still in office or not.