MORGANTOWN — Two Florida businessmen are facing federal charges for, among other things, making illegal donations to two Super PACs – one of them based in Morgantown – that raised and spent money in West Virginia during the 2018 election.
The two men have also been subpoenaed by the U.S. House of Representatives, as part of its impeachment inquiry, to probe their connections to President Trump’s personal attorney Rudy Giuliani.
The man are Lev Parnas and Igor Fruman, the U.S. Attorney for the Southern District of New York and the New York FBI field office announced jointly. They are charged with what they term a “straw donor scheme,” which is making political donations under another person’s name.
According to the announcement, Parnas and Fruman had no prior history of significant political donations, but began attending fundraising affairs and making donations in March 2018 in order to “advance their personal financial interests and the political interests of at least one Ukrainian government official with whom they were working.”
In May 2018, they made a $15,000 donation to Morgantown-based 35th Inc., a Super PAC that supported the U.S. Senate campaign of Attorney General Patrick Morrisey, and a $325,000 donation to Arlington, Va.-based America First Action, which supported Republican candidates across the country. The release doesn’t name the PACs but their names appear in FEC records.
They made the contributions under the name of Global Energy Producers (GEP) of Boca Raton, Fla., a company they had just recently formed and purported to engage in exporting and importing liquefied natural gas.
But the funds never passed through the GEP coffers, the release said, but came from a private loan to Fruman from third parties.
“Parnas and Fruman deliberately made the contributions in GEP’s name in order to evade federal reporting requirements and to conceal that they were the true source of the contributions, including so as to hide from creditors the fact that they had access to funding,” the release said. “When media reports about the GEP contributions first surfaced, an individual working with Parnas remarked, ‘This is what happens when you become visible … the buzzards descend,’ to which Parnas responded, ‘That’s why we need to stay under the radar.’”
In response to a complaint filed with the FEC about the $325,000 donation, Parnas and Fruman submitted affidavits containing false information.
During the 2017-2018 reporting period, America Frist Action received $38.5 million in contributions. Along with the $325,000 from GEP, it also received, in November 2018, $27,500 each from Gov. Jim Justice and his senior advisor, Bray Cary (through Cary Communications).
Among the PAC’s $29.3 million in 2018 independent expenditures was $1.2 million opposing former state Sen. Richard Ojeda in his run against former Delegate Carol Miller for the 3rd Congressional District seat, which Miller won.
During the same period, 35th Inc. received $2.2 million in contributions. Along with the $15,000 from GEP, it received, in October, $37,500 each from Justice and Cary Communications.
It spent $1.1 million supporting Morrisey and $779,889 opposing his GOP rival, former Rep. Evan Jenkins, in the primary. Morrisey lost the Senate race to incumbent Democrat Joe Manchin.
Parnas and Fruman also allegedly committed to raise $20,000 to support Rep. Pete Sessions, R-Texas, in exchange for Sessions’ assistance in getting the then-U.S. ambassador to Ukraine removed or recalled. The recall request came from one or more Ukrainian officials.
As part of this effort, Fruman made his maximum contribution of $2,700 to Sessions then gave another $2,700 under Parnas’ name.
In connection with the alleged scheme, both are charged with one count of conspiring to make contributions in connection with federal elections in the names of others, which carries a maximum sentence of five years in prison; one count of making false statements, which carries a maximum sentence of five years in prison; and one count of falsifying records to obstruct the administration of a matter within the jurisdiction of the FEC, which carries a maximum sentence of 20 years in prison.
Parnas, Fruman and two others, David Correia of Florida, and Andrey Kukushkin of California are also charged in a foreign donor scheme.
In the scheme, the four planned to open a recreational marijuana business that would be funded by an unnamed Russian national. To further their business plan and gain retail marijuana licenses, they also aimed to use the Russian as a funding source for political donations to candidates and politicians in Nevada, New York and other states.
The Russian made two $500,000 wires to the four in September and October 2018 to advance the scheme, the release said. The business venture ultimately failed.
The four are each charged with one count of conspiring to violate the ban on foreign donations and contributions in connection with federal and state elections, which carries a maximum sentence of five years in prison.
The House subpoena orders Parnas and Fruman to produce the requested documents by Oct. 16. The subpoena references press reports that say Parnas and Fruman were allegedly helping Giuliani to get Ukrainian officials to investigate former Vice President Joe Biden. They were also allegedly involved in pressing Ukrainian officials to change leadership at a state-owned energy company in order to benefit individuals involved in Giuliani’s Biden investigation.
The subpoena says both men are Giuliani’s clients. It says that based on that relationship they have been refusing requests to cooperate with the inquiry, but as private citizens they don’t fall under the umbrella of Trump’s ban on executive branch cooperation.
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