Category Archives: DOJ, DC and inside the Beltway

Subpoena: State Dept vs. Clinton Foundation

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How the Clinton Foundation is organized

What We Know About WJC, LLC, Bill Clinton’s Consulting Company

Financial disclosures show that the former president started a pass-through company to channel his consulting fees.

Clinton Foundation received subpoena from State Department investigators

Investigators with the State Department issued a subpoena to the Bill, Hillary and Chelsea Clinton Foundation last fall seeking documents about the charity’s projects that may have required approval from the federal government during Hillary Clinton’s term as secretary of state, according to people familiar with the subpoena and written correspondence about it.

The subpoena also asked for records related to Huma Abedin, a longtime Clinton aide who for six months in 2012 was employed simultaneously by the State Department, the foundation, Clinton’s personal office, and a private consulting firm with ties to the Clintons.

The full scope and status of the inquiry, conducted by the State Department’s inspector general, were not clear from the material correspondence reviewed by The Washington Post.

A foundation representative, who spoke on the condition of anonymity to discuss an ongoing inquiry, said the initial document request had been narrowed by investigators and that the foundation is not the focus of the probe.

A State IG spokesman declined to comment on that assessment or on the subpoena.

Representatives for Hillary Clinton’s presidential campaign and Abedin also declined comment.

[How Huma Abedin operated at the center of the Clinton universe]

There is no indication that the watchdog is looking at Clinton. But as she runs for president in part by promoting her leadership of the State Department, an inquiry involving a top aide and the relationship between her agency and her family’s charity could further complicate her campaign.

For months, Clinton has wrangled with controversy over her use of a private email server, which has sparked a separate investigation by the same State Department inspector general’s office. There is also an FBI investigation into whether her system compromised national security.

Bill Clinton used LLC as a pass through

Clinton was asked about the FBI investigation at a debate last week and said she was “100 percent confident” nothing would come of it. Last month, Clinton denied a Fox News report that the FBI had expanded its probe to include ties between the foundation and the State Department. She called that report “an unsourced, irresponsible” claim with “no basis.”

During the years Clinton served as secretary of state, the foundation was led by her husband, former president Bill Clinton. She joined its board after leaving office in February 2013 and helped run it until launching her White House bid in April.

Abedin served as deputy chief of staff at State starting in 2009. For the second half of 2012, she participated in the “special government employee” program that enabled her to work simultaneously in the State Department, the foundation, Hillary Clinton’s personal office and Teneo, a private consultancy with close ties to the Clintons.

Abedin has been a visible part of Hillary Clinton’s world since she served as an intern in the 1990s for the then-first lady while attending George Washington University. On the campaign trail, Clinton is rarely seen in public without Abedin somewhere nearby.

Republican lawmakers have alleged that foreign officials and other powerful interests with business before the U.S. government gave large donations to the Clinton Foundation to curry favor with a sitting secretary of state and a potential future president.

Both Clintons have dismissed those accusations, saying donors contributed to the $2 billion foundation to support its core missions: improving health care, education and environmental work around the world.

Sen. Bernie Sanders (Vt.), Clinton’s opponent in the Democratic primary, has largely avoided raising either issue in his campaign. Last spring, Sanders expressed concerns about the Clinton Foundation being part of a political system “dominated by money.”

Sanders has batted away questions about the email scandal, famously saying at a debate last fall that, “The American people are sick and tired of hearing about your damn emails.”

The potential consequences of the IG investigation are unclear. Unlike federal prosecutors, inspectors general have the authority to subpoena documents without seeking approval from a grand jury or a judge.

But their power is limited. They are able to obtain documents, but they cannot compel testimony. At times, IG inquiries result in criminal charges, but sometimes they lead to administrative review, civil penalties or reports that have no legal consequences.

The IG has investigated Abedin before. Last year, the watchdog concluded she was overpaid nearly $10,000 because of violations of sick leave and vacation policies, a finding that Abedin and her attorneys have contested.

Republican lawmakers, led by Senate Judiciary Committee Chairman Charles E. Grassley (R-Iowa), have alleged that Abedin’s role at the center of overlapping public and private Clinton worlds created the potential for conflicts of interest.

Examples of fees paid for speeches

Hillary Emails Back in the News, Again

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  Yoga and wedding arrangements? Not so much..

State Dept: Top Official Didn’t Know About Hillary’s Server, Even Though He Was On Email Discussing It

DailyCaller: A spokesman for the State Department insisted during a press conference on Wednesday that Patrick Kennedy, the Under Secretary of Management at the department, was not aware Hillary Clinton maintained a private server in her home while she was secretary of state.

But that claim — made by spokesman Mark Toner — is a curious one given that emails published by The Daily Caller last month show that Kennedy was involved in an August 2011 email exchange with two of Clinton’s top aides and another State Department official in which Clinton’s private email server was discussed.

Whether Kennedy knew about Clinton’s private server is a key point in the ongoing email kerfuffle. In his role, the 42-year veteran manages all facets of State Department business, including personnel matters, logistics, information technology, and budgetary issues. He is also the official who has served as the State Department’s main point of contact with Clinton, her attorneys, and her aides throughout the ongoing email scandal. He sent the letters requesting that Clinton and her aides hand their emails over to the State Department.

Given his central position at State, it would stand to reason that Kennedy should have known — and should have been informed — that Clinton was using a private email server housed in her New York residence.

As one reporter put it during Wednesday’s press briefing: “How could he not know if he’s responsible for both [Diplomatic Security] and for the people who do the technical and computer stuff at State?”

But Kennedy knowing about the server would also raise questions about why the career diplomat allowed Clinton to use an email system was vulnerable to outside threats. Not to mention the risks posed by Clinton’s sending and receiving of classified information.

Kennedy’s name popped up on Wednesday when Fox News’ Catherine Herridge reported that he was one of the State Department officials who handled 22 “top secret” emails found on Clinton’s server. Clinton and her aides, Jake Sullivan, Huma Abedin, Cheryl Mills, and Philippe Reines all either sent the sensitive emails, received them, forwarded them, or commented on them.

 

The State Department has determined that the emails are so sensitive that they will be withheld from the Clinton records being released in batches at the end of each month since June.

Fox’s Herridge also reported that Kennedy told the House Select Committee on Benghazi during an interview earlier this month that he knew about Clinton’s personal email account from the beginning of her tenure, but that he was not aware of the “scope” of its use for government business.

A spokesperson for the Committee declined to comment on matters involving private interviews.

During Wednesday’s questioning, Toner said three times that Kennedy, who frequently emailed with Clinton about work-related issues, did not know about Clinton’s private server.

“He’s spoken to it before — or we’ve spoken to it before — that he did not have knowledge of the computer server that she set up in her residence,” said Toner, who also stated that Kennedy told the Benghazi Committee that he did not know about the server.

“What his knowledge or what his awareness at the time — other than what he has said already, or what we have said already — which is that he was not aware of her having a private server at her home,” Toner said later in the press briefing.

But an Aug. 30, 2011 email chain obtained by TheDC last month through a FOIA lawsuit shows that Kennedy was involved in a conversation that explicitly mentioned Clinton’s server.

 

In the email, Stephen Mull, then-executive secretary at State, thanked Cheryl Mills for alerting him to problems that Clinton was having sending emails on the personal Blackberry that she used to send and receive work email. The Blackberry was “malfunctioning,” Mull noted, “possibly because of [sic] her personal email server is down.”

Kennedy was copied on that email as well as on a response from Abedin. On top of indicating that Kennedy was made aware of Clinton’s use of a personal server, the emails also show that Abedin, Clinton’s deputy chief of staff and an official on her presidential campaign, vetoed a proposal to set Clinton up with a second Blackberry equipped with a State.gov email address.

“Doesn’t make a whole lot of sense,” Abedin said in response to the proposal. Clinton was never provided a State Department-issued Blackberry. Why Kennedy did not intervene at that time is anybody’s guess.

TheDC reached out to the State Department to find out more about the apparent inconsistency between Toner’s comments on Wednesday and the August 2011 emails. Perhaps Kennedy didn’t see the email? Perhaps he assumed that another email server that was linked to Clinton’s Blackberry was being discussed by Stephen Mull, the executive secretary of State?

But the agency provided few additional details.

“Today the State Department indicated that comments made by Under Secretary Kennedy to the Benghazi Committee were being misconstrued. Beyond that, we are not going to speak to this further,” ‎‎a State Department official told TheDC.

Hat tip Chuck!

 

 

Iran’s Windfall From Nuclear Deal Cut in Half by Debts

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NYT’s -WASHINGTON — Iran gained access to about $100 billion in frozen assets when an international nuclear agreement was implemented last month, but $50 billion of it already was tied up because of debts and other commitments, a U.S. official said on Thursday.

Stephen Mull, the State Department’s lead coordinator for implementing the international nuclear agreement with Tehran, also told the House Foreign Affairs Committee there was no evidence Iran had cheated in the first few weeks since the deal was implemented.

Mull and John Smith, acting director of the Treasury Department office that oversees sanctions, faced heated questioning from some members of the committee, where several Democrats had joined Republican lawmakers in opposing the nuclear pact that was reached in July.

Many have worried that Iran would cheat on the deal and use unfrozen funds for action against Israel or to support Islamist militants elsewhere in the region.

“Of that amount, a significant portion of it, more than $50 billion, is already tied up,” Mull said.

It was the first top-level congressional hearing on the nuclear pact since Jan. 16, when world powers lifted crippling sanctions against Iran in return for it compliance with the agreement to curb its nuclear ambitions.

“We seem to be in many instances talking tough about Iran,” said U.S. Representative Eliot Engel, the panel’s top Democrat, a deal opponent. “In reality our actions are far away from our rhetoric and that’s a worrisome thing. We want to make sure that Iran’s feet are held to the fire.”

Many members of the U.S. Congress, where every Republican and a few dozen Democrats opposed the agreement, have been calling for legislation to impose new sanctions on Iran over its ballistic missile program and human rights record.

House Republicans have been pushing legislation to restrict the ability of President Barack Obama, a Democrat, to lift sanctions under the nuclear pact. One measure passed the House on Feb. 2 almost entirely along party lines but it has not yet been taken up in the Senate and Obama has promised a veto.

*** Not so fast, all is still not kosher….

WASHINGTON (AP) — A State Department official says the U.S. does not know the precise location of tons of low-enriched uranium shipped out of Iran on a Russian vessel under the landmark nuclear agreement.

Testifying Thursday, Ambassador Stephen Mull tells the House Foreign Affairs Committee the stockpile is a Russian custody issue.

Critics of the nuclear deal seized on the shipment’s status to show the agreement’s flaws. New Jersey GOP congressman Chris Smith says it’s “outrageous and unbelievable” that Russia is being trusted to be the repository for such sensitive material. Russia is a close ally of Iran.

The low-enriched uranium is suitable mainly for generating nuclear power and needs substantial further enrichment for use in the core of a nuclear warhead. Mull says he’s confident the material will be controlled properly.

***

Saudi Arabia and Bahrain have banned Iranian-flagged vessels from entering their waters and imposed other shipping restrictions, according to ship insurers citing local reports, potentially escalating tensions between Tehran and Riyadh.

Iran has been struggling to ramp up oil exports and still faces insurance and financing hurdles despite the lifting of international curbs on its banking, insurance and shipping sectors last month as part of a nuclear deal with world powers.

A ban on Iranian ships in those ports is unlikely to affect international trade, although the uncertainty will add to trade hiccups for Iran.

Some ship insurers in recent days, citing reports from local agents and correspondents, said in notes to members that Saudi Arabia and Bahrain had banned all Iranian-flagged ships from entering their waters.

Norwegian ship insurer Gard said Bahrain had imposed a ban on any vessel that has visited Iran as one of its last three port calls.

“There is currently no such restriction in Saudi Arabia,” Gard wrote, citing information from a logistics provider. Saudi Arabian and Bahraini authorities did not immediately respond to requests for comment.

Ship insurer West of England said separately: “An entered vessel has since been denied entry to Bahrain after visiting an Iranian port two port calls earlier, resulting in the fixture being cancelled.”

Other ship insurers had yet to issue any guidance or confirm there were new regulations in place.

 

While oil companies such as Italy’s Eni and France’s Total have been looking to book cargoes from Iran, international insurers are no nearer to resolving concerns over US sanctions that remain in place.

Last month, Sunni Muslim Saudi Arabia cut ties with Shi’ite Iran after its Tehran embassy was attacked following Riyadh’s execution of a Shi’ite cleric.

In solidarity with Riyadh, Kuwait and Qatar subsequently pulled out their ambassadors from Tehran, and the United Arab Emirates downgraded its ties. Bahrain and two non-Gulf states, Djibouti and Sudan, severed relations completely.

Saudi Arabia and Iran – leading members of the Organisation of the Petroleum Exporting Countries – continue to grapple with weak oil prices.

The Double Life of a FL. Congressman

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  Hello Ethics Committee….

Email Shows Concern About Alan Grayson’s Hedge Fund

Email correspondence from June 2015 between Representative Alan Grayson and his campaign manager at the time involves concern among his staff about the political damage Mr. Grayson’s hedge fund could cause his Senate bid.

For just a few additional facts on Grayson, his scandals and his history, go here. Even the Huffington Post has several items on his highly contested and perhaps even violent marriage, annulment or divorce.

Alan Grayson’s Double Life: Congressman and Hedge Fund Manager

WASHINGTON — The hedge fund manager boasted that he had traveled to “every country” in the world, studying overseas stock markets as he fine-tuned an investment strategy to capitalize on global companies’ suffering because of economic or political turmoil.

But the fund manager had an even more distinctive credential to showcase in his marketing material in June 2013: He was a “U.S. congressman,” Representative Alan Grayson, Democrat of Florida, a member of the House Foreign Affairs Committee. Now he is also among the leading Democratic candidates for one of Florida’s United States Senate seats.

This highly unusual dual role — a sitting House lawmaker running a hedge fund, which until recently had operations in the Cayman Islands — has led to an investigation of Mr. Grayson by the House Committee on Ethics.

The inquiry has become public, but emails and marketing documents obtained by The New York Times show the extent to which Mr. Grayson’s roles as a hedge fund manager and a member of Congress were intertwined, and how he promoted his international travels, some with congressional delegations, to solicit business.

Interviews and the documents show that Mr. Grayson told potential investors in his hedge fund that they should contribute money to the fund to capitalize on the unrest he observed around the world, and to take particular advantage when there was “blood in the streets.”

The emails also show how Mr. Grayson’s work for the hedge fund — which had $16.4 million in assets as of October and only for investors since it was established — at times interfered with his other duties. In August 2015, after Mr. Grayson introduced legislation calling for larger annual increases in Social Security benefits, he signed off on a plan to highlight the proposal at an event in Tampa, Fla., emails obtained by The Times show. But the plan was scuttled, two former aides said, when economic turmoil in China sent stock markets tumbling globally and Mr. Grayson had to turn his attention to the fund.

Ken Scudder, a spokesman for Mr. Grayson, disputed that account. “There has never been any time when Representative Grayson’s investment activities have disrupted any of his work, whether official or campaign-related,” he said.

Mr. Grayson says he has done nothing wrong. “Here is something that is not true: that I somehow traded on my membership as a U.S. congressman to get clients for this fund,” Mr. Grayson said in an interview. He added that in the last year he had refunded the full original investments put in by his two outside investors in a fund that had faced steep losses — leaving only Mr. Grayson and a family trust invested in the fund.

Mr. Grayson has closed the Cayman Islands branches of the hedge fund, and in September, after the ethics complaint was filed, he changed the name of the fund from the Grayson Fund to the Sibylline Fund, LP. He did so, he said, to try to assuage critics who said he was violating congressional ethics rules by naming a professional business after himself. Although Mr. Grayson said he did not agree that the name was a violation, “there was no point in arguing about it any longer.”

But Mr. Grayson’s activities have long concerned his campaign aides. In private emails in June, Mr. Grayson’s aides pleaded with him to close the hedge fund, convinced that its focus on investing in nations hit by political or economic strife, and its ties to the Cayman Islands, a notorious tax haven, sharply conflicted with his image as a scold of Wall Street — even if he had not done anything wrong.

“This is going to be the drip, drip, drip story that never goes away,” Doug Dodson, Mr. Grayson’s Senate campaign manager until the end of 2015, wrote in a June email to Mr. Grayson, saying his political opponents would “try to make you look like a hypocrite and a fraud and not the populist you claim to be.” Read the whole summary here.

Have you Met Taylor Johnson?

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Imagine a government doing this to an employee, when an employee is bound by law to do so. Ah, Harry Reid, of course.

EXCLUSIVE: ICE Whistleblower Fired After Refusing DHS Hush Money

DailyCaller: The Department of Homeland Security on Thursday dismissed an ICE whistleblower it was secretly smearing to reporters after she testified before Congress about her troubles with the agency.

Special Agent Taylor Johnson — who had a storied career until she irked Senate Minority Leader Harry Reid by objecting to a visa program for foreign investors tied to the senator’s son — says she declined to take a $100,000 severance package because it included a non-disclosure agreement.

Gee, what a great use of taxpayer money that would have been. Pay a woman not to talk about what already got nationwide coverage when she talked about it before Congress.

DHS Acting Assistant Secretary for Public Affairs Todd Breasseale did not respond to multiple inquiries about the reason for Johnson’s dismissal and why they tried to buy her silence.

Despite all the media coverage of her case, including a Washington Gadfly report that the ICE press secretary with the approval of Breasseale was peddling confidential information to discredit her in violation of the Privacy Act, Taylor is not surprised she got the boot.

“My entire chain of command was appointed by Obama,” she remarked. “They can do anything they want.”

In testimony last June to the Senate Committee on Homeland Security and Governmental Affairs Johnson said she was stripped of her gun and badge, without explanation, after discovering fraud and abuse.

“Some of the violations investigated surrounding the project included bank and wire fraud, and I discovered ties to organized crime and high-ranking politicians and they received promotions that appeared to facilitate the program,” Johnson testified.

She said that during her investigation in 2013, she “discovered that EB-5 applicants from China, Russia, Pakistan, Malaysia had been approved in as little as 16 days” and that case files “lacked the basic and necessary law enforcement queries.”

At ICE, Johnson had amassed many awards and never had any disciplinary problems. But everything changed abruptly in 2013 when she invoked the ire of Senator Reid by holding up a visas for a foreigner investor in a Las Vegas casino represented by his son, attorney Cory Reid.

The Senator’s office complained to Johnson’s Special Agent in Charge. She was then placed on administrative leave, without explanation, on October 13, 2013.

Under pressure from Senate Democratic staffers Johnson did not mention in her testimony the role Reid’s office played in her ouster. But the DHS Inspector General concluded in a report last March that U.S. Customs and Immigration Services (USCIS) director Alejandro Mayorkas intervened in “an unprecedented matter” to approve EB-5 visas for the Las Vegas casino investors after pressure from Reid’s office.

The report essentially vindicated complaints by Johnson and other DHS employees about the program.

DHS has never given any public explanation for the disciplinary action it took against Johnson. After the hearing a DHS spokeswoman said they do not talk about personnel matters.

But this past December, ICE press secretary Gillian Christensen, citing confidential information from Johnson’s file, tried to convince this reporter off the record that she was a dishonest and a problem employee.

That argument is going to be even harder to peddle now that the Department would have allowed Johnson to leave with a clean work record and $100,000 in spending money if she promised to keep her mouth shut.

Johnson is soliciting donations on gofundme.com to cover legal fees for a possible federal lawsuit.