By Josh Gerstein
Prosecutors for special counsel Robert Mueller are urging a federal judge to turn down former Trump campaign chairman Paul Manafort’s argument that a money laundering charge he faces is flawed because the activity that generated the funds — lobbying for a foreign government — is not illegal.
Manafort is accused of laundering more than $30 million that flowed through offshore bank accounts in connection with his work related to Ukraine, but Manafort’s defense lawyers argued in a motion filed last month that his failure to register as a foreign agent in connection with that lobbying isn’t sufficient to render the proceeds the kind of illegally obtained funds that can sustain a money laundering conviction.
However, prosecutors said in a response Wednesday that in 2001 Congress specifically designated felony violations of the Foreign Agents Registration Act as the sort of activity that can lead to money laundering charges.
“This language reflects that Congress added FARA alongside other foreign-focused offenses that it understood to generate proceeds capable of being laundered through U.S. financial institutions — that is, that Congress understood FARA not only as an offense capable of being promoted through the flow of money into the United States, but one that would itself generate proceeds subject to downstream laundering,” prosecutors wrote. “Manafort’s position runs against the grain of that Congressional expectation.”
Mueller’s team also made another point: Even if some of the funds Manafort controlled might have been paid whether or not the lobbying effort was properly registered, he may well have been paid a premium or paid specifically to engage in a lobbying scheme intended to operate illegally, below the radar.
“Manafort overlooks the possibility that a party ‘acting as an agent of a foreign principal’ may well be paid not simply to serve as such an agent but specifically to do so without registering — that is, to ‘wilfully fail to provide information to the government’ that is required under FARA,” the prosecution team wrote.
The prosecution also submitted a filing Wednesday challenging a motion by Manafort’s defense to throw out one of two counts alleging he made false statements or caused others to do so in connection with the lobbying work. Prosecutors say they can pursue a catch-all false statements charge as well as a separate one alleging violation of a specific law focused on false statements related to foreign lobbying.
Manafort is facing two separate indictments obtained by Mueller’s office. One, in Washington, focuses on money laundering and foreign lobbying. Another, in Alexandria, Virginia, involves tax fraud, bank fraud and failure to report overseas bank accounts. The 69-year-old Manafort could potentially spend the rest of his life in prison if convicted in either case.
Neither case appears to directly relate to allegations of collusion between the Trump campaign and Russia, but prosecutors have closely scrutinized Manafort’s dealings with Ukraine because of alliances between Russia and many Ukrainian politicians and businessmen.
In addition to the count-by-count challenges prosecutors responded to Wednesday in the Washington case, Manafort’s defense is challenging all the charges in both cases on the grounds that Mueller’s appointment by Deputy Attorney General Rod Rosenstein was invalid and that Mueller has exceeded any authority he may have.
Manafort’s trial on the charges filed in Virginia is set for July 10. His trial in Washington is set to begin Sept. 17.