Saturday, September 15, 2018
In 2012, Paul Manafort had a problem. He was seeking a way to bolster the interests of his pro-Russian Ukrainian clients in Washington, but he did not want to set off tough federal disclosure rules for foreign lobbying. His solution, federal prosecutors say, was to help the Ukrainians create a nonprofit group in Brussels. He then recruited a pair of top lobbying firms to represent the group, an arrangement intended to obscure the fingerprints of the ultimate beneficiary of the lobbying -- the Russia-aligned president of Ukraine, Viktor F. Yanukovych, and his oligarch-backed political party.
But even some people at the lobbying firms he recruited saw the nonprofit group, the European Center for a Modern Ukraine, as a sham, according to new evidence laid out by prosecutors when they unveiled a plea agreement with Mr. Manafort in federal court in Washington on Friday.
A co-founder of the Podesta Group, Tony Podesta, told his team to operate on the understanding that Mr. Yanukovych "is the client," while an employee at the other firm, Mercury Public Affairs, called the claim that the nonprofit was independent from Mr. Yanukovych "nonsense," comparing it to "Alice in Wonderland."
Nonetheless, the Podesta Group and Mercury went along with Mr. Manafort's ruse, despite the reservations now coming to light. Relying on the written attestation from the European Center, which paid them more than $1 million each.
Now, that work, and the decision not to disclose it under the Foreign Agents Registration Act, has turned Podesta and Mercury into subjects of interest in a series of linked investigations that have roiled Washington's lobbying industry.
This year, Mr. Mueller's team referred cases involving possible illegal Ukrainian lobbying by Podesta, Mercury and the law firm Skadden, Arps, Slate, Meagher & Flom -- all of which Mr. Manafort had recruited to do work related to Ukraine -- to federal prosecutors in New York.
And the evidence that Mr. Mueller's prosecutors publicly unveiled on Friday could help their New York colleagues build the cases against the firms, including the correspondence that questioned the independence of the European Center. The firms were not named in the court filings, but they do not dispute that prosecutors are referring to them.
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