Russian Charged With Trying to Influence U.S. Voters

Elena Khusyaynova of St. Petersburg, Russia, is charged with conspiracy to defraud the U.S. for managing the financing of the social media troll operation that included the Internet Research Agency, which special counsel Robert Mueller’s investigators charged with crimes.

A Russian who allegedly worked on funding online propaganda efforts to manipulate voters in the 2016 and 2018 elections was charged with a federal crime Friday as part of a wider conspiracy to hurt U.S. democracy, CNN reports. Elena Khusyaynova, 44, of St. Petersburg, Russia, is charged with conspiracy to defraud the U.S. for managing the financing of the social media troll operation that included the Internet Research Agency, which special counsel Robert Mueller’s investigators charged with crimes earlier this year. Prosecutors say she aided the Russian effort to “inflame passions” online related to immigration, gun control and the Second Amendment, the Confederate flag, race relations, LGBT issues, the Women’s March and the NFL National Anthem debate.

The social media efforts specifically focused on the shootings of church members in Charleston, S.C., and concert attendees in Las Vegas, the Charlottesville “Unite the Right” rally, which left one counterprotester dead, and police shootings of African-American men, the complaint says. The criminal charge says the Russians’ online manipulation effort focused on multiple political viewpoints and candidates. The effort had an operating budget of $35 million, prosecutors say, and was allegedly funded by Russian oligarch Yevgeny Prigozhin and his companies. Prigozhin has not responded to a criminal charge he faces from Mueller for funding the scheme before the 2016 election. “The conspiracy has a strategic goal, which continues to this day, to sow division and discord in the U.S. political system, including by creating social and political polarization, undermining faith in democratic institutions, and influencing U.S. elections,” said the criminal complaint in the Eastern District of Virginia.

from https://thecrimereport.org

Public Corruption Cases Down During Trump Administration

The federal government has filed 23.5 percent fewer pubic corruption cases, 340, during the first eleven months of fiscal year 2018 than during the previous year, reports TRAC at Syracuse University. 

The federal government has filed 23.5 percent fewer pubic corruption cases, 340, during the first eleven months of fiscal year 2018 than the previous year, reports TRAC at Syracuse University. There were 485 prosecutions during the prevfious fiscal year. TRAC obtained case-by-case information via Freedom of Information Act from the Executive Office for United States Attorneys. Compared with five years ago, when there were 636, the estimate of FY 2018 public corruption prosecutions is down 41.7 percent.

Overall, the data show that prosecutions of this type are down 45 percent from the of 675 reported in 2008 and down 59.1 percent from the 906 reported in 1998. The prosecution of state officials for corruption accounted for about one in ten (10.9 percent) of prosecutions. Most of the remaining prosecutions involved alleged corruption at the federal level. These included corruption offenses by federal law enforcement officials (10.3 percent), in federal programs (7.1 percent), in federal procurement (6.2 percent), and miscellaneous other federal corruption offenses (19.7 percent). The Federal Bureau of Investigation was the lead investigative agency on half (49.7 percent) of these prosecutions. A diverse array of other federal agencies were the lead investigators on the remaining half. The Postal Service handled one out of every ten – the second most active investigative agency in turning up corruption cases that were federally prosecuted during FY 2018

from https://thecrimereport.org

Ex-Senate Staffer Admits Lying to FBI in Leak Probe

James Wolfe, the former security director of the Senate Intelligence Committee, pleaded guilty Monday to making a false statement to the FBI. Records from a New York Times reporter were seized during the investigation.

James Wolfe, the former security director of the Senate Intelligence Committee, pleaded guilty Monday to making a false statement to the FBI as part of an investigation into media leaks, the Wall Street Journal reports. Wolfe acknowledged making a false statement to FBI agents who questioned him in December 2017. Two other false statement charges will be dropped in a plea agreement. Wolfe he wasn’t charged with actually leaking classified information. As part of the investigation, records from New York Times reporter Ali Watkins were seized, a tactic that prosecutors typically avoid because of concerns about interfering with the First Amendment.

Watkins and Wolfe were romantically involved, according to prosecutors, who suggested that he provided her with information about the committee’s work. Watkins has denied using Wolfe as a source, but was reassigned from the national security beat after the relationship became public. Under the plea agreement, Wolfe is likely to serve up to six months in prison and pay a fine of less than $9,500. President Trump has urged Attorney General Jeff Sessions to prosecute leakers aggressively, saying the disclosure of classified information is a national security threat. The Justice Department said last year that it had more than tripled the number of leak investigations from the number pending at the end of the Obama administration, which brought more leak cases than all prior administrations combined.

from https://thecrimereport.org

Democratic House Intern Accused of Doxing Senators

The U.S. Capitol Police arrested a congressional intern for posting addresses and private information of Republican senators during the hearing on Supreme Court nominee Brett Kavanaugh. Rep. Sheila Jackson Lee (D-TX) fired the intern.

The U.S. Capitol Police on Wednesday arrested a congressional intern for posting addresses and private information of senators, NPR reports. Jackson Cosko, 27, allegedly posted “private, identifying information (doxing) about one or more United States senators to the Internet.” Cosko, an intern for Rep. Sheila Jackson Lee (D-TX), has been fired, according to her chief of staff, Glenn Rushing. Cosko previously worked for Democratic Sens. Maggie Hassan of New Hampshire and California’s Barbara Boxer, who has retired.

Last week, the Wikipedia pages of Republican Sens. Mike Lee of Utah, Orrin Hatch of Utah and Lindsey Graham of South Carolina were altered to show their addresses, phone numbers and email address. The information was posted during the hearing in which Supreme Court nominee Brett Kavanaugh and Christine Blasey Ford testified about Ford’s accusation that Kavanaugh sexually assaulted her in 1982. All three are GOP senators support Kavanaugh. Cosko has been charged with making public restricted personal information, witness tampering, threats in interstate communications, unauthorized access of a government computer, identity theft, second-degree burglary and unlawful entry. A bot that tracks edits to Wikipedia pages found that the changes were made from a computer on Capitol Hill on the House side.

from https://thecrimereport.org

Trump Could Owe Civil Fines if Times Report is Correct

If authorities confirm the New York Times conclusion that President Trump and his family cheated the Internal Revenue Service for decades, the statute of limitations for criminal charges has long run out, but civil cases have no such limits, and the financial penalties could be staggering.

Though President Trump insists he did nothing wrong on his taxes, experts say he could be on the hook for tens of millions of dollars in civil fines if state and federal authorities substantiate a New York Times report that found he and his family cheated the IRS for decades, the Associated Press reports. The statute of limitations for criminal charges has long run out, but civil cases have no such limits, and the financial penalties could be staggering. Civil fraud charges for intentionally underpaying taxes could include a penalty of up to 75 percent of the unpaid federal taxes and double the unpaid state amount, experts said. The penalties “could be substantial, and if the allegations are proven in court, they should be levied,” said Norman Eisen of Citizens for Responsibility and Ethics in Washington and former chief ethics counsel in the Obama administration.

The New York tax department said it is studying the Times’ 15,000-word report and “vigorously pursuing all appropriate avenues of investigation.” Trump tweeted that the newspaper did “a very old, boring and often told hit piece on me.” New York University tax law Prof. Daniel Shaviro says the IRS can reopen old tax returns if fraud is suspected. Tax law experts expressed skepticism that the IRS would mount any civil investigation. The main reason, they said, is that the Times account says IRS officials have already conducted extensive audits of the estate left by Trump’s parents. “That ship has sailed,” said Mark Everson, IRS commissioner during President George W. Bush’s second term and now with AlliantGroup, a Houston-based corporate tax advisory firm. He added: “I would be concerned were the service to reach back that far in time, given that it could only be doing so because of the person’s current position.”

from https://thecrimereport.org

Trump Profited By ‘Dubious Tax Schemes,’ NY Times Says

In the 1990s, Donald Trump and his siblings set up a sham corporation to disguise millions of dollars in gifts from their parents, reports the New York Times Trump helped his father take improper tax deductions worth millions more. A Trump lawyer said “allegations of fraud and tax evasion are 100 percent false, and highly defamatory.”

President Trump participated in “dubious tax schemes” in the 1990s, including instances of fraud, that greatly increased the fortune he received from his parents, the New York Times reports. Trump won the presidency calling himself a self-made billionaire and said his father, New York City builder Fred Trump, provided little financial help. A Times investigation, based on confidential tax returns and financial records, found that Trump received the equivalent of at least $413 million from his father’s real estate empire. He and his siblings set up a sham corporation to disguise millions of dollars in gifts from their parents. Trump helped his father take improper tax deductions worth millions more. He helped devise a strategy to undervalue his parents’ real estate holdings on tax returns by hundreds of millions of dollars, sharply reducing the tax bill when those properties were transferred to him and his siblings.

There was little resistance from the Internal Revenue Services. The president’s parents, Fred and Mary Trump, transferred well over $1 billion to their children, which could have produced a tax bill of at least $550 million under the 55 percent tax rate then imposed on gifts and inheritances. The Trumps paid $52.2 million,  about 5 percent. Trump lawyer Charles Harder said the Times’s “allegations of fraud and tax evasion are 100 percent false, and highly defamatory. There was no fraud or tax evasion by anyone.” The president’s brother, Robert Trump, said that after Fred and Mary Anne Trump died, “All appropriate gift and estate tax returns were filed, and the required taxes were paid.” After the Times report, the New York state tax department said it was “vigorously pursuing all appropriate avenues of investigation,” the Associated Press reports.

from https://thecrimereport.org

Musk Settles With SEC to End Securities Fraud Charges

The settlement will force Elon Musk to step aside as chairman  of Tesla, the company he co-founded, for three years and pay a $20 million fine. The SEC announced the deal two days after it sued Musk in federal court for misleading investors.

Elon Musk reached a deal with the Securities and Exchange Commission on Saturday to resolve securities fraud charges. The settlement will force Musk to step aside as chairman  of Tesla, the company he co-founded, for three years and pay a $20 million fine, the New York Times reports. The SEC announced the deal two days after it sued Musk in federal court for misleading investors over his post on Twitter last month that he had “funding secured” for a buyout of the electric-car company at $420 a share. The SEC deal allows to remain as chief executive, something he could have jeopardized if he had gone to battle with the agency.

A Musk tweet about taking his company private, along with attacks on critics on social media, raised concerns with investors about whether Musk has become too focused on criticism from so-called short-sellers who had been making bets against him and Tesla. The company has been struggling to meet audacious production goals for its Model 3 sedan. The company’s stock dropped almost 14 percent after the SEC lawsuit. Tesla, which is also settling with the SEC, will pay a $20 million penalty. The company will add two independent directors and take steps to monitor Musk’s communications with investors. It will also create a permanent committee of independent directors to monitor disclosures and potential conflicts of interest. SEC chairman Jay Clayton said the settlement sent a message that “when companies and corporate insiders make statements, they must act responsibly, including endeavoring to ensure the statements are not false or misleading.”

from https://thecrimereport.org

Too Big to Jail: Letting White Collar Criminals Off the Hook

The idea that some corporations are too important to the economy to suffer criminal consequences for wrongdoing only produces higher rates of corporate chicanery, according to a forthcoming study in the Yale Law Review.

Allowing major corporate wrongdoers to escape criminal penalties by using heavy fines or deferred prosecution agreements makes it harder to deter financial crime and creates “disturbingly high” rates of repeated white-collar fraud, according to a forthcoming paper in the Yale Law Review.

It also reduces public confidence by creating “a popular narrative that prosecutors permit (financial) managers to buy their way out of trouble,” wrote Nick Werle of Yale Law School.

The paper, entitled “Prosecuting Corporate Crime When Firms Are Too Big to Jail,” suggests that the belief that some firms are so critical to the economic system that ‘the government cannot credibly threaten them” with criminal sanctions has given those a large corporations in turn little incentive to curtail crimes such as fraud, bribery, environmental safety offenses, antitrust violations, and money laundering.

Fines are almost always the only penalty they face.

“Relatively few” individuals are ever prosecuted, and even when they are, their sentences are “generally more lenient” than defendants who are “outside the corporate crime context,” the paper said, noting that corporate defendants are sentenced to jail less often and serve shorter sentences.

According to Werle, the idea that some firms are “Too Big To Jail” (TBTJ) means in practice that “prosecutors will not hold them accountable” for any crimes they commit.

“When firms become TBTJ, deterrence breaks down,” he wrote.

In fact, Werle added, when a corporation contemplates “a highly profitable but illegal opportunity,” it may figure into its costs the size of a possible corporate fine if they are caught, knowing that they can play the “TBTJ” card if investigated. In other words, they will never be fined an amount that they can’t cover because the government won’t want to bring down a corporation important to the economy.

In such a calculation, the corporation may decide that crime does pay.

The paper calls for prosecutors to alter their strategies and investigative tactics, to prosecute culpable individuals, reduce their reliance on corporate cooperation, and insist on structural reform of the companies. It zeroes in on the government’s reliance on Deferred Prosecution Agreements (DPA).

In a DPA, the government agrees to accuse the company of wrongdoing while not prosecuting a crime; afterward, there is usually a large fine, and the company says it will clean up its act. Whether it really does so is debatable, said Werle.

According to Werle, “the list of corporate recidivists with multiple convictions in quick succession includes many corporations with dominant positions in their industries, including BP, ExxonMobile, Pfizer, GlaxoSmithKline, AIG, Barclays, HSBC, JPMorgan, UBS, and Wachovia.”

There was widespread criticism over the lack of prosecutions of TBTJ global corporations after the 2008 financial crisis, noted Werle.

The criticism intensified after the March 2013 Senate Judiciary Committee hearings on the DPA arranged by the Department of Justice (DOJ) with the global bank HSBC for facilitating money laundering by Mexican cartels and others.

“Despite the lurid details, the bank paid $1.92 billion and no individuals were prosecuted,” Werle wrote.

A high-level DOJ official admitted during the hearings that prosecutors consult with regulators and change strategy when told bringing a case might wreak serious economic damage.

“Deferred prosecution agreements are the norm, even though they are subject to few statutory procedures or binding regulations,” wrote Werle.

While in recent years, those charged with white collar crimes have been prosecuted, it’s rarely the case with people employed by a TBTJ company. Many have pointed to the existence of the “revolving door” between DOJ and the private sector.

“Critics have described a culture of deference to corporate defendants, an unwillingness to accept the risks of taking complex white-collar cases to trial, and an eagerness to settle, even if that meant forgoing cases against individuals,” said the paper.

Werle called for legislative reform that would introduce “binding procedural requirements and meaningful judicial review.”

Prosecutors should not “rely on corporate fines to do the job alone,” he concluded.

A complete copy of the paper is available here.

Nancy Bilyeau is Deputy Editor-Digital  of The Crime Report. She welcomes readers’ comments.

from https://thecrimereport.org

Texas Woman Sent Back to Prison in Illegal Voting Case

Crystal Mason had been convicted of tax fraud in 2011 and was on supervised release in November 2016 when she voted for Hillary Clinton. Texas law requires that felons complete their entire sentence, including supervised release or parole, before they regain the right to vote.

Crystal Mason, a Texas woman who voted illegally in the 2016 presidential election while on supervised release will have to go back to federal prison, the Dallas Morning News reports. A federal judge in Fort Worth ruled Thursday that Mason, 43, must spend ten months behind bars followed by 26 months of supervised release. Mason had been sentenced to five years in state prison for illegal voting. She had been convicted of tax fraud in 2011 and was on supervised release — the federal court system’s version of parole — in November 2016 when she voted for Hillary Clinton. Texas law requires that felons complete their entire sentence, including supervised release or parole, before they regain the right to vote.

When Mason voted in 2016, poll workers did not find her name on a list of registered voters and told her she could fill out a provisional ballot. She signed an affidavit affirming that if she was a convicted felon, that she had “completed all of my punishment including any term of incarceration, parole, supervision, period of probation.” Mason said she was never told she wasn’t legally allowed to vote and wouldn’t have cast a ballot had she known. Mason’s lawyers called the punishment “draconian.” “It is tantamount to someone being sent to prison because they didn’t understand the fine print on some of their mortgage documents,” said attorney Alison Grinter.

from https://thecrimereport.org

Texas Woman Faces Five-Year Prison Term for Voting

“Why would I vote if I knew I was not eligible? What’s my intent?,” asks Crystal Mason, who is appealing her conviction. Mason says she didn’t realize she was barred from casting a ballot because of a conviction for tax fraud.

When Crystal Mason appears in federal court in Fort Worth, Tx., on Thursday, she has been warned by her lawyers to be ready for prison. Mason, a 43-year-old mother of three, has been sentenced to five years in Texas state penitentiary – with extra time pending in a federal lock-up. All because she committed the crime of voting, The Guardian reports. On November 8, 2016, Mason walked to her local Fort Worth polling station to perform her civic duty. To her surprise, her name wasn’t registered on the voting rolls, so she cast a provisional ballot pending further checks. The small print of the form read “I understand that it is a felony of the 2nd degree to vote in an election for which I know I am not eligible.” She didn’t read those words, focused on correctly entering her personal details.

Nor did she know that under Texas’s strict electoral laws, she was ineligible to vote. By dint of a previous conviction for tax fraud, for which she had served five years in prison, and for which she was now out on supervised release, she was one of 500,000 Texans barred from the electoral process. Three months later, she was called to a courthouse, placed in handcuffs and held overnight in jail. Mason is appealing her conviction on the grounds that the Texas law disenfranchising felons is vaguely and confusingly written. “Why would I vote if I knew I was not eligible? What’s my intent? What was I to gain but losing my kids, losing my mom, potentially losing my house? I have so much to lose, all for casting a vote,” she says. With a population of  900,000, Fort Worth is the nation’s 15th-largest city, yet it cannot persuade its people to vote, with just six percent voting in mayoral elections.

from https://thecrimereport.org