Muellerama continues: Obama advisor trial opens

In political terms, Greg Craig’s trial might be more of a sideshow in the Robert Mueller circus. In terms of its impact on lobbying, his prosecution has already transformed the industry by instilling a new respect for the Foreign Agent Registration Act (FARA). But will Barack Obama’s former White House counsel be the first Democrat to go to prison over a Russia-collusion theory that turned out to be largely empty in the first place?

Former Obama White House counsel Gregory B. Craig faces trial Monday for allegedly lying to the Justice Department in a prosecution that has shaken up the capital’s billion-dollar foreign influence industry.

In charging Craig — one of Washington’s most prominent attorneys, in connection with his work for the Ukraine government at a leading law firm — the Justice Department signaled a new era for the Foreign Agents Registration Act, a once nearly dormant law that since 2017 has been invoked in more than 20 federal prosecutions aimed at combating foreign interference in U.S. politics.

Craig has pleaded not guilty in federal court in Washington. The charge against him stems from alleged public relations work, rather than lobbying, while with the law firm Skadden, Arps, Slate, Meagher & Flom. He is accused not of failing to register as a foreign agent under the law, but with lying and withholding information from Justice officials seeking to determine whether he was required to register.

Craig, who also served as a legal advisor to Bill Clinton, took part in the rough-and-tumble of Ukrainian politics before the ouster of Viktor Yanukovich. His firm had worked for the Russia-friendly government along with Paul Manafort to spin the results of the kangaroo-court corruption trial of Yanukovich’s main political enemy Yulia Tymoshenko. At one point in 2012, Craig leaked an independent analysis of the trial to the New York Time’s David Sanger, which is the crux of the charge Craig faces.

According to the indictment, Craig lied to investigators about the nature of his communications with Sanger. Craig insists that he didn’t leak to Sanger to promote the PR efforts of Yanukovich but to correct against them. Craig’s attorneys will argue that the spin Manafort wanted to put on the report would have done serious damage to Skadden Arps and its credibility, and Craig leaked the report to Sanger to make sure the NYT could publish the less-credulous version of the report.

That’s what happened, whether it was truly Craig’s intent or not. The NYT offered a very skeptical view of the Tymoshenko trial, although noting that Skadden Arps seemed to be in the bag for the government in its analysis:

In a report commissioned by the government of Ukraine, a team of American lawyers has concluded that important legal rights of the jailed former prime minister, Yulia V. Tymoshenko, were violated during her trial last year on charges of abusing her official power, and that she was wrongly imprisoned even before her conviction and sentencing.

The lawyers, led by President Obama’s former White House counsel, Gregory B. Craig, concluded that Ms. Tymoshenko was denied legal counsel at “critical stages” of her trial and that at other times her lawyers were wrongly barred from calling relevant witnesses.

Those two findings suggest that she could have some success in a pending appeal before the European Court of Human Rights.

But over all, the lawyers, from the firm of Skadden, Arps, Slate, Meagher & Flom, seemed to side heavily with the government of President Viktor F. Yanukovich, which commissioned their report. They concluded that Ms. Tymoshenko’s conviction was supported by the evidence presented at trial, and they found no evidence in the trial record to support to her main contention: that her prosecution was a politically motivated effort by Mr. Yanukovich, her archrival, to sideline her and cripple Ukraine’s main opposition party.

Craig himself appears in the story co-written by Sanger, dodging the question about whether the trial was a political hit on Tymoshenko:

“We leave to others the question of whether this prosecution was politically motivated,” he said. “Our assignment was to look at the evidence in the record and determine whether the trial was fair.”

The article says that the report was commissioned by the Yanukovich government, but most of the money came from a Ukrainian oligarch, Politico notes:

“The Times wrote an appropriately skeptical story [that] raised questions about the political nature of the trial and about the compensation that Mr. Craig’s firm was paid for the report,” McCraw said.

The Times article said Craig wouldn’t comment on the funding of the report. The bulk of the more than $4 million came from a Ukrainian steel oligarch, Victor Pinchuk. Prosecutors say part of why Craig did not register was to avoid revealing the financing for the report. They also suggest he didn’t want to register because it could affect his ability to serve in a high government post in a future administration.

In case readers don’t recall, Pinchuk’s name has come up a few times in connection with the Clintons. He was a major donor to the Clinton Foundation, as well as an envoy on Yanukovich’s behalf to Hillary Clinton herself. Those ties existed while Hillary served as Secretary of State and Pinchuk was violating sanctions against Iran. During that four-year span, Pinchuk put over eight million dollars into the Clinton Foundation and planned to spend even more on the Clinton Global Initiative.

Craig may have had more than one reason to lie to cover up Pinchuk’s involvement, in other words. If Hillary Clinton won in 2016, would any of this been uncovered?

It’s out in the open now, and Craig appears to be in real trouble. If the special counsel is correct that Craig was leaking the report to benefit Yanukovich, then he and Skadden Arps were acting as foreign agents and needed to register as such. They allege that Craig lied and withheld evidence of this exchange with Sanger in order to keep that failure a secret from investigators. If Craig’s correct, though, it means that Skadden Arps was independent of Yanukovich and Manafort and didn’t need to register under FARA, so the obstruction charges are meritless. Unfortunately for Craig, Skadden Arps has already settled their end of the case and paid $4.6 million in admitting that they should have registered under FARA, and Judge Amy Berman Jackson has refused to dismiss the charges.

It’s curious that this trial has started at all after that. Either Craig’s convinced he can beat the rap, or Mueller’s team is convinced he can’t. We’ll soon see who made the wisest bet.