Steve Bannon’s pardon complicates case against his co-defendants

Christian Berthelsen
Bloomberg
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Donald Trump’s midnight pardon of Steve Bannon complicates the case against the three other men charged with using border-wall donations for personal expenses.

The former chief White House strategist was the highest-profile person accused by Manhattan federal prosecutors in August of defrauding people who gave $25 million to the nonprofit We Build the Wall Inc. Though donors thought they were helping to fund private portions of Trump’s promised wall along the U.S. border with Mexico, the government says around $1 million of the money was used for travel and personal luxuries, including a Range Rover for Bannon.

President Donald Trump's former chief strategist Steve Bannon leaves federal court in New York Thursday, Aug. 20, 2020, after pleading not guilty to charges that he ripped off donors to an online fundraising scheme to build a southern border wall.

Bannon, 67, and the other men said the prosecution was politically motivated and have denied wrongdoing. But some legal observers predicted the lesser-known defendants would eventually be persuaded to cooperate with the government and flip on Bannon. The pardon means the others are more likely cast Bannon as the architect of the scheme, experts said, knowing he can’t be harmed by their claims.

“If I were representing someone in that case, I would try to frame it as, This is all Bannon’s doing,’ and blame Bannon,” said Harry Sandick, a criminal defense lawyer and former Manhattan federal prosecutor. “My key argument would be, The real bad guy here was Steve Bannon.’ The case is better for the other defendants without Bannon than with him.”

98% Conviction Rate

John Meringolo, a lawyer for one of Bannon’s co-defendants, Timothy Shea, declined to say whether there would be a change in strategy.

“I am happy for Mr. Bannon,” said Meringolo. “Unfortunately the institution of the federal criminal justice system has a 98% conviction rate and a lot of innocent people go to jail. I hope that Mr. Shea can be exonerated.”

Lawyers for the other two defendants, Brian Kolfage and Andrew Badolato, did not respond to requests for comment on Wednesday. A lawyer for Bannon also didn’t immediately respond to a request for comment.

The case may still prove tough for Bannon’s former co-defendants. Jed Shugerman, a law professor at Fordham University in New York, noted that the government had a large amount of evidence against the men, including emails and texts. Prosecutors could also summon Bannon to testify against them, though he could still invoke his Fifth Amendment right against self-incrimination based on a hypothetical state prosecution. If he lies under oath, he can still be prosecuted for perjury.

Wild Card

But legal experts said any attempt to get Bannon to testify could be fraught for the government. While he could strengthen the case against the others, he might also prove a wild card for prosecutors, both in terms of what he says and how the jury reacts to him. Shugerman said it may not be worth the risk.

“This is the kind of case that prosecutors call a paper case, in that the documents are so clear,” said Shugerman. “The witness adds color and detail to the paper” but isn’t strictly necessary.

According to the government, the four men told donors “100% of the funds raised” for We Build the Wall would be used for construction but began devising ways to launder funds for their own use soon after launching the charity. They made outsized payments to contractors who kicked a portion of the funds back to them and round-tripped some of the funds through a shell company. The effort has resulted in about five miles of border fencing in two different locations in Texas and New Mexico.

Trump went back and forth on whether to include Bannon in the raft of pardons and commutations he issued in his final hours in office. Though Bannon was one of the architects of Trump’s 2016 election victory, the two men clashed in the White House and had a falling-out after caustic comments by Bannon appeared in author Michael Wolff’s 2018 tell-all book “Fire and Fury.”

Sad Thing

Trump distanced himself from his former adviser at the time of his arrest, saying the case was a “sad thing for Mr. Bannon.”

Bannon sought to mend the fence with Trump in the last few months, playing a role in pushing a supposed scandal involving the business dealings of President Joe Biden’s son Hunter. In November, Bannon called for violence against Dr. Anthony Fauci and Federal Bureau of Investigation Director Christopher Wray over their perceived disloyalty to Trump. Bannon’s longtime lawyer withdrew from the case after the remarks.

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