Breaking: DoJ loses special-counsel FARA case on Craig

It didn’t take long for a jury to dispense with one of the few cases from the special counsel investigation into Russiagate to make it to trial. A few minutes ago, the jurors acquitted Greg Craig of violations of the Foreign Agent Registration Act (FARA) and allegations that he deliberately misled investigators:

Former Obama White House counsel Gregory Craig was acquitted Wednesday of giving false information to federal authorities about his work on behalf of the Ukrainian government amid a new crackdown on illicit foreign influence.

The case against Craig, a high-powered Washington lawyer, was one of a handful of investigations that grew out of special counsel Robert Mueller’s investigation into Russian interference in the 2016 election.

Craig was acquitted after more than two weeks of testimony followed by less than five hours of deliberation. Craig faced trial in federal court for falsifying and concealing information about his work for the government of former Ukrainian president Viktor Yanukovych. Americans who work on behalf of foreign governments within the United States are required to register with the Justice Department.

It looked like Mueller and the Department of Justice had a case against Craig, at least on paper. Craig and his firm Skadden Arps worked with the Russia-friendly government in Ukraine at the time, as did Paul Manafort and Rick Gates. They hired Craig and his law firm to conduct a “review” of the trial of Yulia Tymoshenko to push back against the commonly held perception that it was a political hit job. The report noted that Tymoshenko’s rights had been violated but that the evidence supported a conviction anyway, and Craig later leaked the report to the New York Times.

The purpose of that leak was one of the key points of Craig’s trial. Prosecutors argued that he leaked it to the Times to promote the Viktor Yanukovych government’s propaganda against Tymoshenko, and therefore acted illegally as a foreign agent. Prosecutors also alleged that Craig concealed the fact that his efforts were funded by Russia-friendly oligarch and Yanukovych crony Viktor Pinchuk, who gave $4 million to Skadden Arps. (Skadden Arps settled its case for $4.6 million.) However, Craig argued that he leaked it to make sure the derogatory information about the Yanokovych government got out:

Craig has insisted that he never lied to or sought to mislead the government and that he genuinely did not believe he needed to register as a foreign agent. The argument is based in part on what Craig contended was an acrimonious and distrustful relationship with Manafort and with a firm Ukraine hired to publicize the report, FTI Consulting.

Craig’s defense alleged that the relationship grew so strained that in dealing with Sanger and other journalists, he was trying to counteract or preempt an aggressive spin job Manafort was overseeing to make the report sound like a ringing endorsement of the controversial prosecution of Tymoshenko.

Looks like the jury bought Craig’s explanation — or at least thought it was one reasonable explanation. It’s unclear why prosecutors thought it wouldn’t be.

That makes Mueller/DoJ 2-1 on FARA trials out of the Russiagate probe, but one of the wins comes with an asterisk. The DoJ had a premade case on Manafort long before the 2016 election, which Mueller revived in order to pressure Manafort and Gates into flipping on Donald Trump. It turned out that they didn’t have any dirt to dish, but Mueller’s team still scored easy wins on the case. They also convicted Bijan Rafekian in July, a former partner of Michael Flynn, who is presently appealing the verdict.

The Washington Post’s Spencer Hsu writes that this might force Congress to revamp FARA:

The acquittal marks a high-profile setback for a Justice Department crackdown on foreign lobbying in the United States, exposing flaws in a difficult prosecution that was handed off among several offices before Craig’s April indictment. Before the trial began, a judge dismissed a count against Craig directly involving the registration requirements, saying the rules seemed vague as applied to Craig’s circumstances.

The verdict is likely to stir debate over whether to clarify or strengthen provisions of the Foreign Agents Registration Act, which requires Americans paid by foreign governments or politicians to influence U.S. policy or opinion to register with the Justice Department.

Maybe, but perhaps a big part of this was the fact that the DoJ has only recently taken this 80-year-old law seriously. It’s tough to expect juries to do the same, especially in an instance where there’s no other apparent fraud alleged. Manafort operated a complex scheme to enrich himself, but Craig was more or less doing his job, albeit for unpleasant characters. The sudden embrace of FARA as sole grounds for criminal prosecution no doubt had something to do with the jury’s decision-making.