Ukraine scandal nets 2 tied to Giuliani
Pair faces campaign finance charges amid impeachment inquiry
WASHINGTON — Federal prosecutors unsealed charges Thursday against two men who have aided President Donald Trump’s efforts to gather damaging information in Ukraine about his political opponents, a criminal case that signaled growing legal exposure for the president’s allies as Trump tries to blunt an impeachment inquiry in Congress.
The indictment of the two men, Lev Parnas and Igor Fruman, sketched a complex scheme to violate campaign finance laws and did not accuse Trump of wrongdoing. But it revealed new details about the push to pressure Ukraine: a campaign encouraged by Trump, led by his private lawyer Rudy Giuliani and assisted by obscure figures like Parnas and Fruman.
Trump continues to defend the effort, which is the focus of the im
peachment inquiry that House Democrats opened last month. The new indictment, however, suggests the first criminal implications of the shadow foreign policy that Giuliani pushed on behalf of the president.
And it is another example of the extent that the messy power dynamics of Ukraine — a former Soviet republic and close U.S. ally with a recent history of political upheaval — now dominate discussions about Trump’s future. The impeachment inquiry began after a CIA officer who has worked at the White House raised alarms about a July telephone call in which Trump seemed to suggest that U.S. military aid was contingent on Ukraine’s help in unearthing information that could help Trump politically.
Giuliani has been public about his hunt for damaging information about Democrats, and the indictment gives a more complete picture about how he seems to have subcontracted part of the work to Parnas and Fruman, two of his longtime associates.
It directly connected the two men to a key element of the pressure campaign, an effort to recall the United States ambassador to Ukraine, Marie Yovanovitch, after she became a focus of criticism from many of Trump’s allies. Parnas and Fruman donated money and pledged to raise additional funds in 2018 — some violating legal limits — for a congressman who was then enlisted in the campaign to oust her, court papers showed.
They were charged with making illegal campaign donations, and law enforcement officials harshly criticized the scheme.
“Campaign finance laws exist for a reason,” William Sweeney Jr., the top agent in the FBI’s New York office, said during a news conference Thursday. “The American people expect and deserve an election process that hasn’t been corrupted by the influence of foreign interests, and the public has a right to know the true source of campaign contributions.
“Laws make up the fabric of who we are as a nation,” he added. “These allegations aren’t about some technicality, a civil violation or an error on a form. This investigation is about corrupt behavior and deliberate lawbreaking.”
The lawmaker is named in the indictment only as “Congressman-1,” but campaign finance filings identify him as former Rep. Pete Sessions, R-Texas. Sessions, then the chairman of the powerful House Rules Committee, wrote a letter in 2018 to Secretary of State Mike Pompeo saying that Yovanovitch should be fired for privately expressing “disdain” for the current administration.
Sessions, who lost his reelection bid last year, said in a statement that he could not confirm that he was “Congressman-1” but that he would “vigorously defend myself against any allegations of wrongdoing” and that he had no knowledge of the scheme detailed by prosecutors.
He said that he met the two men to discuss Ukraine’s bid for energy independence and that he wrote to Pompeo “separately, after several congressional colleagues reported to me that the current U.S. ambassador to Ukraine was disparaging President Trump to others as part of those official duties.”
Some Trump allies believed Yovanovitch was trying to impede their effort to dig up damaging information about former Vice President Joe Biden and his son Hunter Biden, a former Ukrainian official has said, and House Democrats are looking into whether her removal was linked to Trump’s attempts to gain politically helpful information.
Parnas and Fruman are witnesses in their impeachment inquiry, and Parnas had been scheduled to be questioned Thursday by investigators.
Yovanovitch was herself scheduled to appear Friday on Capitol Hill, but she remains an employee of the State Department and the Trump administration could try to block her testimony. If that happens, House Democrats have said that they are prepared to subpoena her.
Parnas and Fruman were arrested Wednesday evening at Dulles International Airport as they held one-way tickets on a Lufthansa Airlines flight to Frankfurt, Germany. They were walking down a glass-framed jetway when two plainclothes officers stopped them, according to someone who witnessed the arrest.
At a hearing Thursday in federal court in Northern Virginia, prosecutors argued that the men were flight risks, and a judge set bail at $1 million each. Fruman and Parnas were represented by two lawyers who defended Paul Manafort, the president’s former campaign chairman who was convicted last year in the same courthouse of financial crimes associated with his own work in Ukraine.
A lawyer for the men, John Dowd, who was not at the hearing, declined to comment. His clients were ordered to appear in court Thursday in New York, where the charges were filed.
The work the two men did in Ukraine for Giuliani seems to have been a mixture of business and politics. Parnas advised Giuliani on energy deals in the region and pursued his own in Ukraine even as he portrayed himself as a representative of Giuliani on the Trump-related matters.
The indictment said Parnas acted “at least in part, at the request of one or more Ukrainian government officials.” None were named, but Yovanovitch’s main critic in the Ukrainian government was Yuriy Lutsenko, then the nation’s prosecutor general who himself has a history of wielding the law as a weapon in his personal political battles.
Both Fruman and Parnas appear to have at least glancing contacts with Trump. Trump invited Fruman to a fundraiser at Mar-aLago last year, he said in an interview with Forum Daily, a publication that bills itself as the “Voice of Russian Speaking America. The article featured a photo of the two men, with the president giving a thumbs-up sign.
Parnas posted a photo on Twitter this spring of himself with the president and wished Trump a happy birthday. “I am honored to call you Mr. President!!!,” he wrote. “And my friend!!”
The president sought to distance himself from the men as he left the White House on Thursday en route to a political rally in Minnesota.
“I don’t know those gentlemen,” Trump said. “Now it’s possible I have a picture with them because I have a picture with everybody. I don’t know about them. I don’t know what they do. I don’t know, maybe they were clients of Rudy. You’d have to ask Rudy.”
Giuliani said that no one from the Justice Department had contacted him about Parnas and Fruman. “I have to presume they’re innocent,” he said. None of those facts that I see there make any sense to me, so I don’t know what they mean.”
He said that he was aware they were leaving the country, but he dismissed the idea that they were fleeing and said they regularly travel to Europe on business.
Based in South Florida, Parnas and Fruman are executives of an energy company that donated $325,000 to a pro-Trump super PAC last year, which prompted a Federal Election Commission complaint by a nonpartisan campaign finance watchdog accusing the men and the company of violating campaign finance laws.
Not long before the large donation, the men created a limited liability company called Global Energy Products, which they used to funnel large contributions, according to the indictment.
Last month, Giuliani sought to minimize the significance of the campaign finance inquiry into the two men and said it was resolved. And on Thursday, he questioned the timing of the indictment. “All I can tell you about this arrest is, it comes at a very suspicious time,” he said.
Prosecutors said Parnas and Fruman, along with two other men indicted Thursday, David Correia and Andrey Kukushkin, also funneled money to state and federal candidates in exchange for potential influence, according to court papers. The men wanted to set up recreational marijuana businesses in Nevada and other states, and were seeking political help to get access to the necessary licenses.
Correia was still at large but was expected to turn himself in, according to a law enforcement official.