Mueller’s Most Lasting Legacy May Be on K Street

The special counsel’s investigation has upended Washington’s influence industry.

Special counsel Robert Mueller and his wife, Ann Mueller, walk in Washington on March 24. (Tasos Katopodis/Getty Images)

BY ELIAS GROLL

| MARCH 28, 2019, 10:41 AM
Robert Mueller’s most enduring legacy may not be on Pennsylvania Avenue but on K Street, where the special counsel’s successful prosecution of former Trump campaign manager Paul Manafort and other lobbyists has sent a frisson of fear through Washington’s influence industry.

Despite his failure to find evidence that U.S. President Donald Trump colluded with the Russians during his 2016 campaign, Mueller’s investigation and indictment of some of Washington’s most infamous lobbyists has sparked a flurry of foreign agent filings by the city’s well-heeled power brokers. It has also prompted a stepped-up effort at the Justice Department to enforce the Foreign Agents Registration Act (FARA), a law first passed in 1938 and aimed at bringing a measure of transparency into foreign governments’ efforts to influence U.S. politics.

Prior to the Mueller investigation, Justice Department lawyers had rarely issued an indictment under FARA, but that changed with the prosecution of Manafort and his deputy Rick Gates on charges related to the pair’s failure to register as foreign agents.

“To the extent that there are prominent Washington lobbyists who think their prominence somehow insulates them from the reach of law enforcement, the Manafort and Gates case stands for the proposition that no one is above the law,” said David Laufman, who first initiated the increased enforcement of FARA in 2015 while serving as head of the Counterintelligence and Export Control Section at the Justice Department.

With the Mueller probe wrapping up, one of his key deputies, Brandon Van Grack, is now running the FARA enforcement unit as part of stepped-up effort to enforce the law. In remarks at a conference of white-collar lawyers earlier this month, John Demers, the head of the Justice Department’s National Security Division, said his prosecutors are transitioning “from treating FARA as an administrative obligation and regulatory obligation to one that is increasingly an enforcement priority.”

First passed in 1938 in a bid to counter Nazi propaganda in the United States, FARA is aimed at injecting a measure of transparency in the propaganda consumed by U.S. citizens and documenting foreign governments’ lobbying activity. The act targets mostly political activity but also includes tourism and trade promotion.

But in the decades since World War II, the law was rarely enforced. Between 1966 and 2015, federal prosecutors brought only seven cases under FARA. Instead of prosecuting violators of the act, the department would typically bring them into compliance with the law by compelling lobbyists and trade groups to file the detailed disclosure documents mandated by the law, according to a 2016 Justice Department Office of the Inspector General report on the issue.

“Prosecution under FARA was never common, because it was seen as a registration requirement more than a criminal statute, so authorities would focus on encouraging voluntary compliance over prosecution,” said Scott Anderson, a former State Department lawyer who is now a fellow at the Brookings Institution.

The Justice Department’s increased use of FARA began in 2015, when the officials in Washington began more aggressively pushing companies to register under the law. Mueller’s investigation has demonstrated the full potential of the law to bring legal action against political consultants raking in huge sums of money from foreign political groups, all while attempting to evade transparency requirements.

So far, stepped-up FARA enforcement has mostly focused on state-backed media outlets. In the last year, Justice Department prosecutors have pressured the Russian outlets RT and Sputnik and the Chinese broadcaster CGTN to register.

In their assessment of Russian meddling in the 2016 election, U.S. intelligence officials found that RT and Sputnik amplified the Kremlin’s messaging. Intelligence officials have warned that Chinese state media outlets may serve a similar function for Beijing, though press freedom advocates argue that targeting media outlets may also chill legitimate journalistic activity.

In his investigation of foreign influence in U.S. politics, Mueller has demonstrated that FARA can be a powerful tool in the hands of an aggressive prosecutor. According to the 2016 Inspector General report, FBI agents investigating FARA cases repeatedly encountered a reluctance in the National Security Division to approve prosecutions under the law.

The cases investigated by Mueller fall squarely within the intent of the law: exposing attempts to covertly influence U.S. politics. And in investigating the political operatives around Trump’s campaign, he appears to have simply ripped up the cautious approach that had previously controlled Justice Department thinking in prosecuting such cases.

In addition to Manafort and Gates, Mueller and other U.S. attorneys offices to whom he referred cases prosecuted a series of fringe figures on charges of violating FARA or statutes related to it.

These individuals include Bijan Kian and Kamil Ekim Alptekin, business associates of Michael Flynn, Trump’s former national security advisor, who were charged with conspiring to violate FARA and carry out lobbying on behalf of Turkey. The political operative Sam Patten pleaded guilty to violating FARA for his lobbying activity on behalf of Ukrainian figures.

Although Mueller’s probe has wrapped up, federal prosecutors are still examining cases related to foreign lobbying that his investigation uncovered. The most prominent of these is the possible prosecution of former White House counsel Greg Craig, who worked with Manafort in his attempt to curry favor in Washington for former Ukrainian President Viktor Yanukovych.

In January, the Justice Department announced that it had reached a settlement with Craig’s former law firm Skadden, Arps, Slate, Meagher & Flom for its role in the Yanukovych lobbying campaign. The firm agreed to register as a foreign agent and pay the U.S. government its billings for the Ukraine work, which amounted to more than $4.6 million.

The Ukrainian government contracted with Skadden to produce a report whitewashing its prosecution of opposition leader Yulia Tymoshenko, and according to the settlement agreement, the firm—relying on the lead partner—made false statements about its contacts with the media regarding the report it authored.

Ahead of the report’s release, Craig reached out to a reporter for the New York Times, David Sanger, and set up a call with him and a lobbyist for Ukraine. Craig later delivered the report to Sanger and provided the reporter with a quote for his article on the report. (Another Skadden lawyer, Alex van der Zwaan, pleaded guilty in 2018 on charges of lying to Mueller’s investigators probing Skadden’s Ukraine work)

Whether Craig will face charges for his role in the Manafort scheme represents one of the early tests of the Justice Department’s intensified enforcement of FARA. Craig, who served as White House counsel to President Barack Obama, represents the pinnacle of the Washington legal establishment. He would be the first Obama official to be implicated in a prosecution tied to Mueller’s probe.

But whether Craig will face charges is very much an open question. Critics of the foreign agent law argue that it endows prosecutors with enormous discretion and that it remains poorly interpreted by the courts.

“It’s hard to think of any other federal criminal statute that is still enforced but that has as little interpretive law associated with it as does FARA,” said Robert Kelner, an attorney at Covington and Burling who specializes in political law compliance.

Kelner represented Flynn, Trump’s former national security advisor, who pleaded guilty to lying on his FARA filings in connection with lobbying work done on behalf of Turkey.

“As we speak there are undoubtedly hundreds, if not thousands, of American organizations that are technically in violation of FARA. I’m confident in that statement,” Kelner said. “How many cases are being investigated and brought?”

If recent history is any guide, K Street is about to see more.

Staff writer Robbie Gramer contributed reporting to this article.