Sun Sentinel Palm Beach Edition
Records: Whitaker knew of fraud
Democrats call his role with patent firm ‘troubling’
Acting attorney general remained active in company despite complaints from customers of fraud.
WASHINGTON — Months after joining the advisory board of a Miamibased patent company in 2014, Matthew Whitaker began fielding complaints from customers that they were being defrauded, including from a client who showed up at his Iowa office to appeal to him personally for help, records show.
Yet Whitaker, now the acting attorney general, remained an active champion of World Patent Marketing for three years — even expressing willingness to star in national television ads promoting the firm, the records show.
Internal Federal Trade Commission documents released Friday in response to a public records request reveal the extent of Whitaker’s support for World Patent Marketing, even amid a barrage of warnings about the company’s behavior.
The FTC eventually filed a complaint against World Patent Marketing, accusing it of cheating customers and falsely promising that it would help them patent and profit from their inventions, according to court filings. Some clients lost their life savings, the agency alleged.
In May of this year, a federal court in Florida ordered World Patent Marketing to pay a settlement of more than $25 million and close up shop, records show. The company did not admit or deny wrongdoing.
Whitaker, a former U.S. attorney, did little to assist the investigation. When the FTC subpoenaed his records, he missed the deadline to reply. In a voice mail responding to two followup calls from investigators, Whitaker said he was happy to cooperate and stressed an important role he had just assumed in Washington.
“I didn’t know that you had served a subpoena,” Whitaker said in his October 2017 message, released by the FTC on Friday. “I am now at the Department of Justice here in Washington DC, as the chief of staff to the Attorney General, so I want to be very helpful.”
Whitaker never provided any of his records, according to two people familiar with the investigation. He had told the FTC most of his communications were privileged legal discussions. He also said he had a minimal role at the company and “wouldn’t have personally ever said anything about the business,” according to an investigator’s notes.
Whitaker did not respond to a request for comment. In a previous statement, Justice Department spokeswoman Kerri Kupec said, “Acting Attorney General Matt Whitaker has said he was not aware of any fraudulent activity. Any stories suggesting otherwise are false.”
Rep. Elijah Cummings, the ranking Democrat and future chairman of the House Oversight and Government Reform Committee, said the records show Whitaker was alerted early to the alleged fraud and should have taken action.
“These new documents suggest that Mr. Whitaker was personally aware of allegations of fraud by World Patent Marketing and its CEO at the same time he was receiving payments as a member of the Advisory Board,” Cummings said in a statement. “If true, this is extremely troubling and raises serious concerns about his fitness to serve as acting Attorney General and whether he was properly vetted for this critical position.”
Sen. Tom Udall, D-N.M., called Whitaker’s response to the FTC subpoena “beyond alarming.”
Udall said Whitaker’s record was likely to have created serious hurdles if his nomination for the post of acting attorney general had been reviewed by Congress.
As the FTC was investigating the company, agency officials examined whether Whitaker played a role in trying to help the company silence critics by threatening legal action, as the Post previously reported.
Whitaker joined the board of World Patent Marketing in 2014 after a failed U.S. Senate run.