Democrats Introduce Bill to Strengthen Foreign Agents Law

By Kenneth P. Doyle

Three Senate Democrats introduced legislation to strengthen enforcement of the Foreign Agents Registration Act in response to high-profile cases of unregistered foreign agents who advised President Donald Trump during and after his 2016 campaign.

The bill, introduced July 31 by Sens. Tammy Duckworth (D-Ill.), Dick Durbin (D-Ill.) and Richard Blumenthal (D-Conn.), would authorize the Justice Department to impose civil fines against FARA violators. Currently, the law has only criminal penalties, and the high bar for proving criminal intent has limited the number of enforcement cases pursued by the DOJ.

Noting that the DOJ’s current enforcement policy focuses on “voluntary compliance,” the senators said in a statement that “lax enforcement has resulted in a status quo where individuals representing foreign governments regularly violate this law.”

Among those who avoided timely registration as foreign agents are retired Army Lt. Gen. Michael Flynn, a former top national security adviser to Trump, and Paul Manafort, Trump’s former campaign director. Flynn and Manafort filed FARA registration documents this year, acknowledging that they had previously worked, without registering under the law, to advance the interests of foreign governments and political parties.

Foreign Influence Hidden

“The American people had no idea when Michael Flynn became President Trump’s National Security Advisor that he had been paid a significant amount of money to further the interests of the Turkish and Russian governments,” Duckworth said in the statement. “They did not know Paul Manafort had been paid tens of millions of dollars by a Kremlin-connected Ukrainian political party when he became Donald Trump’s campaign chairman.”

“These former Trump staffers, like countless other lobbyists, failed to disclose their status as foreign agents and they should face the consequences instead of being allowed to continue to operate with impunity,” she said.

In addition to strengthening FARA enforcement, the senators’ legislation also seeks to increase transparency by requiring increased disclosure of all lobbying materials and contacts, even with a single person. Currently, foreign agents only have to disclose materials sent to multiple recipients, allowing them to hide individual meetings and communications even with an influential policymaker or a member of Congress, the senators’ statement said.

The new bill, titled the Foreign Agent Lobbying Transparency Enforcement Act, would close this gap and also make sure that foreign agents disclose the specific recipients of their foreign lobbying materials and the original date of distribution of the materials.

The foreign agents law requires registration through an office in the Justice Department. U.S. lobbyists and consultants representing the interests of foreign governments and political parties are required to register.

Critics said for years that FARA disclosure requirements aren’t being adequately enforced by the DOJ and that the only real pressure to comply with the law is the public attention drawn when foreign advocacy work is revealed in news reports.

Inspector General Recommendations

A DOJ inspector general’s report issued last year included 14 specific recommendations for improving enforcement of the foreign agents law, led by the call to make FARA advisory opinions public in order to help inform advocates when they are required to register under FARA. Subsequently, the DOJ’s FARA office put up brief summaries of three advisory opinions on its website.

Other inspector general recommendations included a call to develop a comprehensive strategy for FARA enforcement and administration. DOJ Inspector General Michael Horowitz testified at a Senate Judiciary Committee hearing July 27 that his office was told that DOJ’s National Security Division (NSD), in charge of FARA compliance, is still developing a comprehensive enforcement strategy and a tool for tracking FARA cases. Horowitz said his office would continue to monitor these efforts.

Horowitz also noted that last year’s report called for improved oversight of FARA registrations to ensure the timely submission of required documents after finding that 62 percent of initial registrations were untimely, and that 50 percent of registrants filed at least one recurring six-month supplemental statement late.

The Senate committee hearing where Horowitz testified drew widespread attention when Judiciary Committee Chairman Charles Grassely (R-Iowa) threatened to subpoena Manafort and Donald Trump Jr. to discuss the controversy over a recently revealed meeting last year with a Russian lawyer and others. Manafort and Trump didn’t testify in public but agreed to provide information to the committee, Grassley said in a statement.

LDA Exemption

Another recommendation of the inspector general’s report called for a formal assessment of a major gap in the in the FARA law—exemption from FARA disclosure for those who register under the federal Lobbying Disclosure Act. Washington lobbyists frequently opt to register under the lobbying law, rather than FARA, if legally permitted, because of the LDA’s less onerous disclosure requirements.

Lobbyists for foreign companies and nonprofits are allowed to register under the LDA, but not if their work is to advance the interests of a foreign government or political party. The line between LDA and FARA registration isn’t always clear, legal experts say.

The inspector general’s report said DOJ had agreed to perform a study of the LDA waiver and other exemptions from FARA disclosure and determine the need for and viability of possible legislative changes. The current status of this assessment is unclear.

Horowitz testified that the inspector general’s office has an “ongoing dialogue with NSD” about the LDA exemption and has been told that the division “continues to assess the LDA and other FARA exemptions to determine whether pursuing legislative changes may be appropriate.”

Horowitz said his office would continue to monitor this recommendation until the NSD makes a final determination as to whether to pursue a legislative change to the LDA and other FARA exemptions.

Flynn, Manafort

The LDA exemption played a crucial role in Flynn and Manafort avoiding initial registration under FARA. Flynn’s consulting firm, Flynn Intel Group, had registered last year under the LDA regarding its advocacy work but said at that time that it was working for a private company based in the Netherlands, Inovo BV, not the Turkish government. Flynn’s subsequent FARA registration said he actually was working to advance the interests of Turkey.

In addition, two major Washington consulting firms, the Podesta Group Inc. and Mercury Public Affairs LLC, filed FARA registrations earlier this year regarding work they did in 2012 related to Ukraine. The registrations followed news reports in recent months that Manafort arranged the Ukraine advocacy work and that the arrangement may have been intended to avoid revealing the involvement of a pro-Russia Ukrainian political party, which was seeking to improve its image with U.S. officials.

Podesta Group and Mercury Public Affairs had filed registrations under the LDA for the same work they later disclosed under FARA. The filings under the lobbying law said the firms were working for a Brussels-based nonprofit, the European Centre for a Modern Ukraine, which provided assurances that it wasn’t controlled or funded by a foreign government or political party.

The Podesta Group is headed by Tony Podesta, a veteran Democratic lobbyist and brother of John Podesta, Hillary Clinton’s presidential campaign manager. The Mercury Public Affairs Washington office is headed by former Rep. Vin Weber (R-Minn.), a veteran Republican lobbyist.

Manafort himself filed a FARA registration in June. The retroactive filing said Manafort received $17.1 million for his work with a Ukrainian political party. Manafort’s filing covered his work on behalf of Ukraine’s pro-Russian Party of Regions between 2012 and 2013.

To contact the reporter on this story: Kenneth P. Doyle in Washington at kdoyle@bna.com

To contact the editor responsible for this story: Paul Hendrie at pHendrie@bna.com

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