The White House:
Two associates of Rudy Giuliani were arraigned Wednesday on charges they used straw donors to make illegal campaign contributions to politicians and committees to advance their business interests. (Oct. 23)
Lev Parnas, an associate of President Donald Trump’s personal attorney, Rudy Giuliani, must submit to questioning under oath about alleged fraudulent contributions to GOP politicians and causes, a federal judge in Florida ruled on Tuesday.
The ruling was issued in a civil action seeking to recover about $510,000 from Parnas.
The judge also authorized a family trust to try to recover money Parnas allegedly transferred to organizations including the pro-Trump political action committee America First Action, the National Republican Congressional Committee and a campaign committee for Pete Sessions, a former Republican congressman from Texas.
Those donations are the subject of a criminal investigation involving Parnas, a Ukrainian-born Florida businessman, Igor Fruman, a Belarus-born business associate, and two other men.
The four were indicted earlier this month on charges of campaign finance violations. All four have pleaded not guilty.
Parnas and Fruman figure in the Trump impeachment inquiry. They helped Giuliani seek damaging information in Ukraine about the family of former Vice President Joe Biden, one of Trump’s 2020 presidential campaign challengers. They also reportedly assisted Giuliani in pushing for the ouster of the U.S. ambassador to Ukraine, Marie Yovanovitch. Trump recalled her to Washington, D.C., in May.
House committees have subpoenaed Parnas and Fruman to testify.
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The judge issued the ruling in response to a motion filed by a family trust that sued Parnas over an unpaid loan of $350,000. Parnassought the money to invest in a movie called “Anatomy of an Assassin.” The film was never produced.
U.S. District Court Judge Donald Middlebrooks ordered Parnas to undergo questioning “about his assets and the alleged fraudulent transfers.”
The actions could enable the trust to recover money Parnas allegedly transferred to the committees even as he failed to pay the judgment.
However, Parnas is unlikely to undergo questioning in the civil debt recovery lawsuit before the criminal case is resolved. America First Action and the campaign committees will have an opportunity to file legal defenses and will have the right to a jury trial before any decision is made to turn funds over to the trust.
Attorneys representing Parnas and the congressional campaign committee did not immediately respond to messages seeking comment. Matt Mackowiak, a spokesman for Sessions, declined to comment.
Kelly Sadler, a spokeswoman for America First Action, declined to comment beyond a written statement that said, “America First Action takes our legal obligations seriously and scrupulously complies with the law.”
America First received $325,000 from a company tied to Parnas in May 2018. A national watchdog organization contends the Trump super PAC violated federal law by concealing the origin of that contribution in a report to the Federal Election Commission.
“I think the evidence shows that America First Action violated the law,” said Brendan Fischer, the director for federal reform at the Campaign Legal Center, which alerted the FEC to the suspicious transaction during the summer of 2018.
Fischer said his group investigated the contribution because it fit the profile of a straw donation, a transaction someone makes on behalf of another. That’s illegal.
America First Action reported that the money came from a Parnas-Fruman company called Global Energy Producers. That firm was just five weeks old, had conducted no business, and didn’t have enough income or investments to make the contribution, according to the Campaign Legal Center.
Two associates of Giuliani have been charged with funneling foreign money to U.S. political campaigns, and President Trump says he doesn’t know them.
The record of the wire transfer shows that America First Action actually received the money from a company called Aaron Investments I LLC, a different company connected to Parnas.
The Campaign Legal Center’s complaint alleges the money originated from a private loan obtained by Fruman, passed through an attorney and contributed to America First Action by Aaron Investments.
According to the campaign finance indictment, the money never passed through a Global Energy Producers account.
The debt collection at the heart of Tuesday’s ruling stems from a 2015 federal lawsuit in New York City. It accused Parnas and one of his companies, Parnas Holdings Inc., of failing to repay $350,000 in loans from a Long Beach, New York, entity called Pues Family Trust IRS.
In March 2016, a federal judge in New York City ordered Parnas and his company to pay the trust $510,434.70. The trust registered the judgment in federal court in southern Florida, where Parnas and his company are based, in January 2019.
But the trust has been unable to collect anything from Parnas and his company, filings in the case show.
The conspiracy case against Parnas and Fruman accuses them of scheming to circumvent federal law against foreign influence by funneling foreign money to U.S. political campaigns and committees. Two other Parnas and Fruman associates, David Correia and Andrey Kukushkin, were also indicted in the case. They, too, have pleaded not guilty.
The goal, according to the indictment, was to buy political influence. Thousands of dollars in contributions linked to the alleged scheme were distributed to GOP congressional candidates across the U.S.
Some of the contributions were used in a separate effort to win support from government officials for a retail cannabis business that was planned in several states, the indictment alleges.
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