By LOUIS FLORES
After WNYC 93.9 FM broadcast a report, raising questions about deed transfers and the financing of real estate investments made by Paul Manafort, a former chair of President Donald Trump's committee to elect, a spokesperson for Mr. Manafort issued a statement on behalf of Mr. Manafort, strenuously denying any allegations of wrong-doing in the WNYC report. The journalists Ilya Marritz and Andrea Bernstein had raised questions in their report about purchases of three real estate properties, made in the names of shell companies, the later transfer of ownership of those properties from the shell companies into the name of Mr. Manafort, and the subsequent mortgaging of those properties by Mr. Manafort. According to the WNYC report, the pattern of purchase, title transfer, and financing raised red flags for the industry. "Real estate and law enforcement experts say some of these transactions fit a pattern used in money laundering ; together, they raise questions about Manafort’s activities in the New York City property market while he also was consulting for business and political leaders in the former Soviet Union," the report stated, in relevant part.
Press reports have already raised the spectre that Mr. Manafort faces legal scrutiny from each of the U.S. Department of Justice, the Federal Bureau of Investigation, and the Internal Revenue Service. Investigators are trying to determine whether Mr. Manafort was paid millions for consulting services in monies that were "laundered from corrupt sources" and whether Mr. Manafort failed to register as a foreign agent due to his lobbying for foreign Governments, according to a report published by McClatchy DC on 30 March.
It is not known how Federal law enforcement agencies will be able to conduct any investigation into close political allies to President Trump. Federal investigations that yield to criminal prosecution are usually closely coördinated with the U.S. Attorney's Office that has jurisdiction on an investigation, according to one of the guidelines applicable to FBI domestic operations. Because the real estate properties that were the subject of the WNYC report were located in Manhattan and Brooklyn, the U.S. Attorneys' Offices that would have jurisdiction over any investigation of potential wrong-doing would be the Federal prosecutors' offices for New York's southern and eastern districts. Both offices were recently purged of their top Federal prosecutors, former U.S. Attorneys Preet Bharara and Robert Capers, respectively, as part of a DOJ-wide firing by the Trump administration of hold-over appointments made during the Obama administration. Early in his administration, President Trump also fired Acting U.S. Attorney Sally Yates, because she would not follow direct orders from the White House to vigorously defend the first controversial Muslim travel ban that was later ruled unconstitutional by the Courts. Although some top DOJ officials assert that the nation's top law enforcement agency is independent from political influence, the series of purges at the DOJ by the Trump administration have made clear that if top DOJ officials do not follow orders from the White House, then the Trump administration will remove from office those independent-minded law enforcement officials. The purging has reportedly created a culture of hostility and fear at the DOJ. President Trump has separately faced criticism for attempting to intimidate the judiciary, according to a report published by The Washington Post.
In the face of the apparent culture of fear and intimidation at the DOJ, it is not known whether another powerful prosecutor, State Attorney General Eric Schneiderman (D-New York), would exert jurisdiction over any investigation into the questions raised about Mr. Manafort's real estate investments in New York. In the recent past, State Attorney General Schneiderman has made public statements, indicating that his office was prepared to keep the Trump administration in check. However, those statements were made generally, and they focused on the realms of civil rights, employee protections, women's healthcare, and the environment, according to a report published by The Associated Press. Possibly in anticipation of the Trump DOJ's antipathy toward voting rights protections, the office of the State Attorney General applied in January to join a class action lawsuit filed in U.S. District Court in Brooklyn, seeking to bring the New York City Board of Elections into compliance with Federal voting rights laws. If the White House or the DOJ waver on defending voting rights nationally, then at least the office of State Attorney General Schneiderman has positioned itself to defend voting rights locally. On voting rights, the office of the State Attorney General has both the legal framework and the political will to make a difference. It is not known if State Attorney General Schneiderman has both when it comes to fighting allegations of politically-connected financial corruption that may involve real estate.
Part of what may compromise any Federal investigation of Mr. Manafort's investments stems from the procedures followed by Federal prosecutors. In the United States Attorneys' Manual, several sections compel Federal prosecutors to either keep the DOJ's Criminal Division or the Deputy U.S. Attorney General in Washington apprised of developments in, or to seek consultation about, sensitive or significant investigations. See USAM §§ 9-2.155, 1-13.000, and 1-14.000. Another section compels Federal prosecutors to obtain permission from the Criminal Division before seeking a racketeering indictment of significant Government officials. See USAM § 9-110.310. The latter provides discretion to Federal prosecutors to bring cases based on the violation of State laws, but for which either the local prosecutor would be unable to successfully prosecute the case or for which the case would involve significant Government officials, and the significant Government officials would pose "special problems" for the local prosecutor.
However, it is not known what guidelines, procedures, or protocols would grant the State Attorney General's Office discretion to prosecute cases that may involve significant Government officials, who would pose "special problems" for the Federal prosecutor, unless those powers are inherent or discretionary in nature. Multiple requests for information were made to the office of State Attorney General Schneiderman, but each request was never answered. The press office for Acting U.S. Attorney Bridget Rohde declined to answer advance questions submitted for this report. The press office of Acting U.S. Attorney Joon Kim did not answer requests for information about policies and procedures for this report.
For this report, the attorney reportedly representing Mr. Manafort referred questions to a professional spokesperson, who was likewise representing Mr. Manafort. The spokesperson issued to Progress Queens the identical rebuttal statement that Mr. Manafort's team had issued to WNYC.
Some New York activists, who have been opposing President Trump's regressive social, economic, and legal agenda, appeared to not be closely following the questions being raised about Mr. Manafort's real estate investments. When contacted by Progress Queens, some activists said that they knew generally about the issue, but there was no response made when asked by Progress Queens whether State Attorney General Schneiderman should investigate Mr. Manafort's real estate investments. At times, criminal charges in a politically-connected corruption probe can have a cascading effect on the political landscape, leading to a series of events that can result in changes in political leadership -- and possibly reform. In the past, State Attorney General Schneiderman has faced criticism for not vigorously investigating real estate corruption. State Attorney General Schneiderman's chief political counselor is his ex-wife, the unregistered lobbyist, Jennifer Cunningham, who had an early lobbying meeting with then President-elect Trump at Trump Tower in January, before the inauguration.