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Bannon charged with fraud over border wall

By HENG WEILI in New York | China Daily Global | Updated: 2020-08-21 11:54

FILE PHOTO: Former White House chief strategist Steve Bannon departs after testifying in the criminal trial of Roger Stone, former campaign advisor to US President Donald Trump, on charges of lying to Congress, obstructing justice and witness tampering at US District Court in Washington, US, Nov 8, 2019. [Photo/Agencies]

Steve Bannon, who was instrumental in President Donald Trump's 2016 election victory, was arrested on Thursday and charged with defrauding donors in a plan to privately fund a wall along the US-Mexico border, prosecutors said.

Bannon, 66, who helped articulate the "America First" populism and opposition to immigration that have been cornerstones of Trump's term, pleaded not guilty, as did three other men charged.

Also charged on Thursday were Brian Kolfage, 38, Andrew Badolato, 56, and Timothy Shea, 49.

Bannon, a frequent critic of China, whom Trump fired from his post as White House chief strategist in August 2017, and the others were charged by federal prosecutors in Manhattan with conspiracy to commit wire fraud and conspiracy to commit money laundering.

Prosecutors accused the defendants of defrauding hundreds of thousands of donors through a $25 million crowdfunding campaign called "We Build the Wall". The wall was a signature issue in Trump's 2016 campaign.

Bannon was arrested in Connecticut by agents from the prosecutor's office and the US Postal Inspection Service aboard a 150-foot (45-meter) yacht, according to a law enforcement source. The yacht, the Lady May, is owned by Chinese fugitive billionaire Guo Wengui, with whom Bannon has had a working relationship. Guo, who has been in the US since 2014, is one of China's most wanted fugitives.

Bannon and Guo also are being investigated by the FBI and the SEC over a private offering valued at more than $300 million to fund a media company that both men are associated with, The Wall Street Journal reported Wednesday.

At his hearing Thursday, Bannon had his hands cuffed in front of him while a large, white mask covered most of his face. He rocked back and forward as he sat on a chair in a holding cell at federal court in Manhattan, from where he appeared via video.

The judge approved Bannon's release on $5 million bail, secured by $1.75 million in assets.

Trump told reporters at the White House that he feels "very badly" about the charges but distanced himself from Bannon and the alleged scheme.

"I do think it's a sad event," the president said. "I haven't dealt with him at all now for years, literally years."

Bannon headed the right-wing Breitbart News website before joining Trump's campaign. An anti-globalist, Bannon has since promoted a variety of conservative causes and candidates in the US and abroad.

Lawyers for Bannon and the other men did not respond to requests for comment.

Other Trump associates to be arrested or convicted include former campaign chairman Paul Manafort, longtime friend and adviser Roger Stone and former personal lawyer Michael Cohen.

Trump, in his quest to build the border wall, has faced court challenges, logistical hurdles and congressional opposition. His administration has completed 30 new miles (48 km) of border fencing and replaced another 240 miles (386 km) of barriers along the 2,000-mile (3,200-km) border, government figures show.

The group connected to Bannon built two wall sections on private land in New Mexico and Texas, drawing criticism from local residents who said proper permits were not obtained. The Texas wall section has experienced erosion, a report last month showed.

"I know nothing about the project," Trump said Thursday, "other than ... when I read about it, I didn't like it. I said, 'This is for government, this isn't for private people,' and it sounded to me like showboating."

Trump also said he did not believe he had ever met the three others charged.

Kate Bedingfield, deputy campaign manager for Democratic presidential candidate Joe Biden, said Trump has "consistently used his office to enrich himself, his family and his cronies, so is it really any surprise that yet another one of the grifters he surrounded himself with and placed in the highest levels of government was just indicted?"

Bannon allegedly took more than $1 million, using some funds to secretly pay Kolfage, the founder of the project, and to cover hundreds of thousands of dollars in personal expenses.

Shea is the owner of an energy drink company called Winning Energy. The company's cans feature a cartoon superhero image of Trump and claim to contain "12 oz. of liberal tears".

Trump later denounced the project publicly, tweeting last month that he "disagreed with doing this very small (tiny) section of wall, in a tricky area, by a private group which raised money by ads" and claiming, "It was only done to make me look bad."

Attorney General William Barr told The Associated Press he had been made aware of the investigation into Bannon months ago but did not say whether the president had been informed.

According to the indictment, the defendants used fake invoices, another nonprofit and sham vendor arrangements to try to hide their efforts to siphon money.

Bannon and his co-defendants allegedly paid Kolfage $100,000 upfront and an additional $20,000 monthly, while claiming they served as volunteers and that Kolfage was not paid.

Kolfage eventually spent some of the more than $350,000 he received on home renovations, payments toward a boat, a luxury SUV, a golf cart, jewelry, cosmetic surgery, personal tax payments and credit card debt.

The wall campaign was launched in December 2018 and raised approximately $17 million in its first week. But the crowdfunding site that hosted it suspended the campaign and warned that it would return donations unless the money was transferred to a legitimate nonprofit. Bannon was brought in around that time.

Reuters and The Associated Press contributed to this story.

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