Federal Law Enforcement
Paul Manafort Guilty Plea Highlights Increased Enforcement of Foreign Agents Registration Act
The guilty plea former Trump campaign chairman Paul Manafort entered Friday marks a milestone in the Department of Justice’s efforts to enforce the Foreign Agents Registration Act (FARA) more vigorously. In Count One of the government’s superseding criminal information, Manafort pleaded guilty to conspiracy to defraud the United States in connection with his failure to register under FARA as an agent of the government of Ukraine; that country’s Party of Regions; former Ukrainian president Viktor Yanukovych; and the Opposition Bloc, a successor to Yanukovych’s Party of Regions. In the same count, Manafort also pleaded guilty to conspiracy in connection with FARA-related false statements and misrepresentations to the Department of Justice in violation of both FARA and the general false-statements statute, 18 U.S.C. § 1001.
Some brief history for context: FARA is a somewhat arcane law that was enacted in 1938 in response to pro-Nazi propaganda activities in the United States. Historically not a major feature of the Justice Department’s national security enforcement program, FARA has come to play an increasingly prominent role in the government’s response to foreign influence operations in the United States.
FARA requires persons in the United States who engage in specified activities as “agents” of “foreign principals” to register with the Department of Justice and to file periodic disclosure reports. Such activities include “political activities,” which is broadly defined to cover “any activity the person engaging in believes will, or that the person intends to, in any way influence any agency or official of the Government of the United States or any section of the [American] public.” The primary purpose of FARA, as the Justice Department recently told Congress, “is to ensure that the American public and our lawmakers know the source of information that is provided at the behest of a foreign principal, where that information may be intended to influence U.S. public opinion, policy, and laws.”
The Justice Department has considerably stepped up enforcement of FARA in recent years—something that has become clear to lobbyists and public relations firms in the United States as well as foreign governments and political parties that hire them. As chief of the Justice Department’s Counterintelligence and Export Section from late 2014 to early 2018, I was responsible for overseeing enforcement of FARA. One of my top priorities was to strengthen that enforcement effort and to make more transparent how the Justice Department evaluates whether a party has an obligation to register. There is heightened risk for companies and individuals who evade their registration and disclosure obligations, and more plentiful information is available from the government about how FARA applies and how to effect compliance.
The most acute manifestation of increased enforcement is the assortment of FARA-related criminal prosecutions by Special Counsel Robert S. Mueller, all of which were approved by the Justice Department. In addition to Manafort’s guilty plea entered Friday, the special counsel’s office has obtained a guilty plea from Manafort’s former business associate Richard (Rick) Gates for conspiring to violate FARA; and it has indicted the Russian Internet Research Agency and multiple Russian nationals for conspiracy to violate FARA. When former national security adviser Michael Flynn pleaded guilty to making a false statement to the FBI regarding his contacts with former Russian ambassador to the United States Sergey Kislyak, Flynn also admitted that he made materially false statements and omissions in documents he filed with the Justice Department pursuant to FARA regarding a project performed by him and his company, the Flynn Intel Group, for the principal benefit of the government of Turkey. Washington lobbyist Sam Patten pleaded guilty in August to violating FARA by failing to register in connection with lobbying and political consulting services on behalf of the Opposition Bloc, the Ukrainian political party referenced in the Manafort cases. And the Justice Department obtained another FARA conviction in May, in the case of United States v. Chaudhry, for failure to register in connection with political activities on behalf of the government of Pakistan, including efforts to influence views by various U.S. think tanks regarding U.S.-Pakistani relations.
These prosecutions reflect a significant surge in the criminal enforcement of FARA. Between 1966 and 2015, the Department of Justice brought only seven criminal cases under FARA. In the wake of this visibly ramped-up enforcement, it is understandable why companies and individuals are more skittish about their FARA registration obligations.
But criminal prosecution is not the only manifestation of increased FARA enforcement. Keeping in mind that the main purpose of FARA is to promote transparency and disclosure, the Justice Department’s more muscular enforcement posture has resulted in a substantial increase in FARA registrations, including some high-profile registrations. For example, consider the registrations of media organizations involved in the production and dissemination in the United States of programming and content on behalf of foreign principals in Russia, including RTTV America and RIA Global, which produces content for the Russian state-owned news outlet Sputnik. Those registrations—like the registrations of Manafort, Gates, and the lobbying firms the Podesta Group and Mercury LLC—occurred as a result of the Justice Department’s forceful exercise of its limited administrative authorities to engage in fact-finding and make determinations about parties’ obligations to register under FARA. As private attorneys representing potential FARA registrants have noted, the nature and extent of written questions and document requests they receive from the department to probe whether their clients have an obligation to register are considerably more demanding than in past years.
One area of greater enforcement focus is the reliance by some lobbyists on a 1995 statutory amendment to FARA that, when properly utilized, enables qualified parties to register under the Lobbying Disclosure Act (“LDA”) rather than FARA. This provision—one of several statutory exemptions to FARA registration—authorizes a party engaged in lobbying activities in the United States on behalf of a foreign commercial or other private-sector foreign entity to register under the LDA, whose disclosure requirements are far less extensive than FARA’s. In particular, parties who register under the LDA are not required to detail specific lobbying activities in which they engaged—disclosure that is required under FARA. This “LDA exemption” (sometimes referred to as the “commercial exemption”) is not available if a foreign government or foreign political party is the “principal beneficiary” of the activities in the United States at issue.
But where it is not readily apparent whether an ostensibly commercial entity is acting for the principal benefit of a foreign government or political party—or whether a party’s activities otherwise trigger the statute—the Justice Department’s fact-finding options to determine whether FARA registration is required are constrained. The department lacks authority to compel answers to questions or the production of documents unless it has initiated a criminal investigation or civil injunctive action. As a result, the department’s FARA administrative staff must rely principally on voluntary cooperation to obtain information and documents in order to evaluate whether a party has an obligation to register. (I occasionally remarked to Justice Department colleagues that it often felt as though we were bringing a butter knife to a bar fight.)
Congress has taken preliminary, if anemic, steps aimed at strengthening FARA enforcement. Senate Judiciary Committee Chairman Charles Grassley and Rep. Mike Johnson, a member of the House Judiciary Committee, introduced the Disclosing Foreign Influence Act last October. And Sens. Dianne Feinstein and John Cornyn introduced the Foreign Agents Registration Act of 2018 in March Most notably, both bills would repeal the LDA exemption. If the exemption were repealed, U.S. subsidiaries of foreign-headquartered businesses would have to register under FARA if they engaged in U.S. lobbying activities that were directed, controlled or financed by their foreign parent. Similarly, other U.S.-based lobbyists acting on behalf of foreign commercial interests would have to register under FARA. Both bills also would address the gap in the Justice Department’s fact-finding authorities in an administrative setting by empowering the department with administrative subpoena authority—authority the department sought, unsuccessfully, in bills introduced in 1991 and 1999.
It is doubtful either bill will be enacted. The Senate Committee on Foreign Relations, to which both bills were referred, has taken no action on either of them. The Trump administration has been publicly silent on both bills, and the Justice Department’s National Security Division—which has responsibility for enforcing FARA—has declined to say whether it supports the legislation.
Meanwhile, the Justice Department has recently taken other steps to promote compliance with FARA. Under the regulations that implement FARA, potential registrants or their attorneys may ask the department’s FARA Registration Unit for a written advisory opinion on how it interprets the statute with respect to a given set of facts, so they can make a more informed decision about whether they must register. In June, the Justice Department published online approximately 50 redacted advisory opinions issued since January 2010 addressing how the FARA Registration Unit interprets certain FARA provisions. (Before this, only three opinions had previously been publicly available.) The Justice Department’s stated commitment to greater transparency in how it enforces FARA suggests that more advisory opinions will be published in the future, further enhancing public understanding of a law that has become a significant tool in the government’s approach to addressing foreign influence operations in the United States.