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SDNY News Clips, February 22, 2019 SDNY News Clips Friday, February 22, 2019 Contents Public Corruption 2 Ulrich 2 Manafort 4 Mueller 7 Inauguration Committee 14 R. Kelly 16 General Crimes 22 Okoumou 22 Civil Division 24 NYCHA 24 Civil Frauds 27 FEMA 27 Matters of Interest 32 Judge rules DOJ violated the law by failing to confer with victims of Jeffrey Epstein 32 The Lawyers Who Did Not Break 34 New Attorney General in Hot Seat as Mueller Report Nears 36 1 EFTA00065022  SDNY News Clips, February 22, 2019 Public Corruption Ulrich Teamsters ex-vice president took bribes from health plan administrator: feds Daily News By Stephen Rex Brown 2/21/19 His future's on the rocks. The ex-vice president of a Teamsters union that reps beverage industry workers took tens of thousands of dollars in bribes from a health plan administrator, federal prosecutors charged Thursday. John Ulrich, who served as the vice president of International Brotherhood of Teamsters Local 812 and a trustee of the union's health plan, began soliciting the bribes in 2013 when he was facing "financial difficulties," prosecutors said. Court papers did not identify the third-party health plan administrator, which processed insurance claims for the union's 3,000 members. Ulrich allegedly demanded quarterly payments of $5,000 in exchange for using his influence to make the union continue using the administrator instead of switching to another plan. He later demanded larger bribes, starting in 2014 and again in 2015, prosecutors said. Ulrich told the health plan administrator that he needed additional payments for another trustee — but it went into his pockets, the feds said. "John Ulrich abused his position as the vice president of a labor union and trustee for its health plan by selling his influence to the Union's health care administrator. As part of this alleged scheme, Ulrich betrayed the trust of the Union members who elected him in order to line his pockets with bribe money," Manhattan U.S. Attorney Geoffrey Berman said. Ulrich, 48, of Newburgh, pleaded not guilty and was released on $100,000 bond. After a special union board meeting in February 2016, Ulrich was fired from Teamsters Local 812 and removed from his position as trustee of the health plan "There's more to the story," Ulrich said. 2 EFTA00065023  SDNY News Clips, February 22, 2019 Former Teamsters VP Pleads Not Guilty To Taking Bribes Law360 By Mike Curley 2/21/19 The former vice president of the International Brotherhood of Teamsters Local 812 pled not guilty in New York federal court on Thursday to allegations he solicited bribes from an executive of the union's health benefit plan administrator to ensure the union kept the administrator on board. John Ulrich was arrested Thursday morning, arraigned in the afternoon and released on a $100,000 bond. Ulrich had been removed as vice president in February 2016 for embezzling funds by using a union credit card for personal reasons, among other offenses, according to board documents. Ulrich served on the board of trustees for the health plan serving the union's 3,000 members at the time of the bribery scheme, according to court documents. According to the indictment, in 2013 when he was having financial problems, Ulrich allegedly approached an executive with the plan's third-party administrator, asking for a $5,000-per-quarter bribe in exchange for making sure the board didn't hire a different administrator. "As alleged, John Ulrich abused his position as the vice president of a labor union and trustee for its health plan by selling his influence to the union's health care administrator," U.S. Attorney Geoffrey S. Berman said in a press release. "As part of this alleged scheme, Ulrich betrayed the trust of the union members who elected him in order to line his pockets with bribe money." Over the next two years, Ulrich allegedly demanded increased payments, which he told the administrator were for another trustee of the health fund, and the administrator continued to give the bribes. "Instead of advocating for the best possible benefit programs for the union members he represented, Ulrich allegedly entered into a quid-pro-quo arrangement that served to advance his needs and the needs of the plan's third-party administrator," FBI Assistant Director William F. Sweeney Jr. said in a press release. "In his official role, he was charged with protecting the interests of his fellow union employees, but as we allege today, this trustee couldn't be trusted." During the February 2016 meeting at which Ulrich was removed as vice president, he was confronted with an email sent from his account requesting a bribe, according to the indictment. According to documents related to his termination, the bribery scheme was not listed among the reasons for his removal from office. A spokesperson for the U.S. Attorney's Office declined further comment, referring to the press release. Representatives for Ulrich and for the union could not immediately be reached for comment Thursday. The government is represented by Assistant U.S. Attorneys Eli J. Mark and Louis A. Pellegrino. Ulrich is represented by Jolene LaVigne-Albert of Schlam Stone & Dolan LLP. The case is U.S.A. v. Ulrich, case number 1:19-cr-00107, in the U.S. District Court for the Southern District of New York. 3 EFTA00065024  SDNY News Clips, February 22, 2019 Manafort Manafort Is Expected to Face Charges in New York, Even if Trump Pardons Him NYT By William K. Rashbaum 2/22/19 The Manhattan district attorney's office is preparing state criminal charges against Paul J. Manafort, President Trump's former campaign chairman, in an effort to ensure he will still face prison time even if the president pardons him for his federal crimes, according to several people with knowledge of the matter. Mr. Manafort is scheduled to be sentenced next month for convictions in two federal cases brought by Special Counsel Robert S. Mueller III. He faces up to 25 years in prison for tax and bank fraud and additional time for conspiracy counts in a related case. It could effectively be a life sentence for Mr. Manafort, who turns 70 in April. The president has broad power to issue pardons for federal crimes, but no such authority in state cases. And while there has been no clear indication that Mr. Trump intends to pardon Mr. Manafort, the president has spoken repeatedly of his pardon power and defended his former campaign chairman on a number of occasions, calling him a "brave man." The office of the Manhattan district attorney, Cyrus R. Vance Jr., first began investigating Mr. Manafort in 2017 in connection with loans he received from two banks. Those loans were also the subject of some of the counts in the federal indictment that led to his conviction last year. But the state prosecutors deferred their inquiry in order not to interfere with Mr. Mueller's investigation. They resumed their investigation in recent months, and a state grand jury began hearing evidence in the case, several people with knowledge of the matter said. The panel is expected to wrap up its work in the coming weeks, several of the people said, and prosecutors likely will ask the grand jurors to vote on charges shortly thereafter. Mr. Vance's office is expected to seek charges whether or not the president pardons Mr. Manafort. The plan was first reported by Bloomberg. Mr. Manafort's defense team is likely to challenge any charges brought by Mr. Vance's office on double jeopardy grounds. New York state law includes stronger protections than those provided by the United States Constitution. But prosecutors in Mr. Vance's office have expressed confidence that they would prevail, people with knowledge of the matter said. Jason Maloni, a spokesman for Mr. Manafort, said his legal team had no comment. Mr. Vance's office also had no comment. Mr. Manafort, who worked for Mr. Trump's campaign during a critical five months when he became the Republican Party's presidential nominee in 2016, was convicted in federal court in Virginia in August on eight counts of various financial crimes. Prosecutors said Mr. Manafort used foreign accounts to hide millions of dollars from his political consulting work in Ukraine and evade taxes, and lied to banks to obtain millions of dollars in loans. 4 EFTA00065025  SDNY News Clips, February 22, 2019 Weeks later, he agreed to plead guilty in a related case in federal court in Washington, D.C., and cooperate with prosecutors from Mr. Mueller's office. But the deal blew up when a judge ruled he had repeatedly lied to the government about his contact with a Russian associate during the campaign and after the election. Prosecutors claim that the associate, Konstantin V. Kilimnik, has ties to Russian intelligence, and have been investigating whether he was involved in a covert attempt to influence the 2016 presidential election results. In the Manhattan case, the evidence presented to a grand jury appears to be connected to loans issued by Citizens Bank in Rhode Island and Federal Savings Bank in Chicago. The district attorney's office has jurisdiction to bring the charges because New York City is a financial center through which U.S. dollar transactions typically flow. The banks have received grand jury subpoenas for records relating to the loans they issued to Mr. Manafort, which were worth millions of dollars, people with knowledge of the matter said. The grand jury also has been hearing testimony about the loans. Citizens Bank has been cooperating with the investigation, according to a person with knowledge of the matter. A spokeswoman for Federal Savings Bank did not respond to a request for comment. It is unclear precisely what charges Mr. Manafort would face, but they could include three state felonies: falsifying business records, if the evidence shows Mr. Manafort used the loan money for an unauthorized purpose, mortgage fraud and tax evasion. 5 EFTA00065026  SDNY News Clips, February 22, 2019 Mannattan prosecutor poised to step up if Trump provides presidential pardon for pal Manafort Daily News By Shayna Jacobs and Larry McShane 2/22/19 Manhattan District Attorney Cy Vance Jr. is poised to slap new criminal charges on convicted federal felon Paul Manafort if President Trump pardons his former campaign chairman, according to a report by Bloomberg News. The prosecutor's carefully constructed state case would need to avoid double jeopardy protections for defendant Manafort, who is facing sentencing next month on a variety of charges. Prosecutors recommended a prison sentence of up to 24 years, a virtual life sentence for the 69-year-old Trump ally snared in the legal net cast by Special Counsel Robert Mueller. The president has refused to rule out a pardon for Manafort, and has already granted clemency to political supporters like Arizona sheriff Joe Arpaio and right-wing commentator Dinish D'Souza. A spokesman for Vance did not return an email request for comment on the report. Federal prosecutors recommended a prison sentence of up to 24 years, a virtual life sentence for the 69-year-old Trump ally snared in the legal net cast by Special Counsel Robert Mueller. The president has refused to rule out a pardon for Manafort. He has already granted clemency to political supporters like Arizona sheriff Joe Arpaio and right-wing commentator Dinish D'Souza. Bloomberg reported that the Manhattan top prosecutor began his probe of Manafort months before the launch of the Mueller investigation. The Special Prosecutor's office brought charges of conspiracy, bank fraud and failure to register as an agent of a foreign country against Manafort. 6 EFTA00065027  SDNY News Clips, February 22, 2019 Mueller Trump faces legal issues for the rest of his presidency, no matter what Mueller finds LA Times By Chris Megerian 2/22119 President Trump is likely to celebrate if the final report from special counsel Robert S. Mueller III echoes Trump's relentless claims of "no collusion" with Russia — or least doesn't outline a criminal conspiracy between his 2016 campaign and the Kremlin. No matter what Mueller concludes, the president remains in considerable legal jeopardy. The Russia probe spawned a web of federal, state and congressional inquiries into virtually every aspect of Trump's career — the company that bears his name, the campaign that won him the White House, the inauguration that celebrated his improbable victory, and the administration that he currently leads from the Oval Office. Prosecutors in Manhattan, Brooklyn, Washington and Virginia are all pulling at threads that the FBI started unraveling two years ago. Legal problems, and possibly further indictments of Trump's friends and aides, are likely to shadow the president for the rest of his White House tenure. "Once you turn over one stone, there are a host of other matters that come to light," said Bruce Udolf, who worked for the independent counsel's office that investigated President Bill Clinton. "And you start turning over those stones as well." In addition to the 34 people charged by Mueller, other crimes have been uncovered in other jurisdictions. The U.S. attorney in the Southern District of New York, for example, successfully prosecuted Trump's personal lawyer, Michael Cohen, for hush money payments to two women who claimed they had affairs with Trump. He pleaded guilty to two campaign finance violations, among other crimes. Prosecutors from the same office also have issued subpoenas for records from Trump's inauguration, including how the inaugural committee spent a record $107 million. The U.S. attorney for the Eastern District of New York, based in Brooklyn, is reportedly conducting a related probe. So is the U.S. attorney in Washington, D.C., where a lobbyist, Sam Patten, has already pleaded guilty to helping a Ukrainian oligarch illegally buy tickets to Trump's inauguration. And the U.S. attorney in the Eastern District of Virginia has charged an Iranian American businessman in illegal lobbying on behalf of Turkey, a case that grew out Mueller's prosecution of Trump's former national security advisor, Michael Flynn. State officials are also digging into Trump. In December, the New York state attorney general forced the Donald J. Trump Foundation, once billed as the charitable arm of the president's business empire, to dissolve and give away remaining assets under court supervision. 7 EFTA00065028  SDNY News Clips, February 22, 2019 The attorney general, Barbara Underwood, accused the foundation of "functioning as little more than a checkbook" for Trump's business and political interests, and of "a shocking pattern of illegality" that included unlawfully coordinating with Trump's 2016 presidential campaign. Her office also has pursued a lawsuit that could bar Trump and three of his adult children from the boards of other New York charities, as well as order them to pay millions of dollars in restitution and penalties. In Congress, newly empowered House Democrats are rolling out investigations into Trump's unreleased tax returns, a controversial proposal to transfer nuclear technology to Saudi Arabia, the White House's handling of security clearances for classified information, and more. "Once the oversight process kicks in, you never know where it's going to end up," said Jim Manley, a former senior Democratic aide on Capitol Hill. "With Democrats in control, no one can expect that they know how this is going to play out." Trump has slammed the congressional probes as "presidential harassment." Democrats are going "nuts" while "looking at every aspect of my life, both financial and personal, even though there is no reason to be doing so," he tweeted. Congressional investigations can fizzle out in partisan finger-pointing. But some uncover real scandals and snowball into direct threats for the White House. "Investigations take on a life of their own, and they usually end up much broader than what they originally looked at," said Julian Zelizer, a presidential historian at Princeton University. The independent counsel appointed to investigate Clinton in 1994 started with a suspicious real estate transaction in Arkansas, for example. Four years later the office finished by probing the president's affair with a White House intern, a scandal that led to Clinton's impeachment by the House. Watergate, the mother of all scandals, began with a bungled burglary at the Democratic National Committee headquarters in 1972. It ended two years later with President Nixon resigning from office and many of his top aides in handcuffs. "Every time we developed one lead, another one came along," said Rufus Edmisten, who served as deputy counsel on the Senate Watergate Committee. The Russia investigation has also produced unexpected leads, especially from Cohen, Trump's former lawyer. After he pleaded guilty to campaign finance violations for the hush money payments, Cohen told the court in New York that Trump had directed the illegal scheme, the most direct accusation yet that the president was personally involved in a crime. The escalating investigations in New York have alarmed Trump's allies. "I think that the Mueller investigation is not the president's biggest problem," former New Jersey Gov. Chris Christie, a former U.S. attorney, said recently on MSNBC. "Southern District of New York's investigation has always been much more dangerous." 8 EFTA00065029  SDNY News Clips, February 22, 2019 Some prosecutions have pierced the murky world of foreign lobbying, which was loosely scrutinized before Mueller was appointed. Flynn, who was forced to resign as Trump's national security advisor after lying about his contacts with the Russian ambassador, later admitted to working as an unregistered foreign agent for Turkey during the 2016 campaign. "Arguably you sold your country out," a judge told him in December. The Flynn investigation spawned another case. Federal prosecutors in the Eastern District of Virginia recently charged Flynn's former business partner Bijan Kian with conspiracy and acting as an unregistered foreign agent for Turkey. He has pleaded not guilty. Also under indictment is Kamil Ekim Alptekin, a Turkish businessman who hired Flynn's firm and has denied that Ankara played any role in the contract. A different scheme was unearthed while Mueller prosecuted Paul Manafort and Rick Gates, the chairman and deputy chairman of Trump's 2016 campaign, for money laundering, conspiracy and other crimes related to their work as political consultants in Ukraine. Skadden, Arps, Slate, Meagher & Flom LLP, a prominent law firm that worked with Manafort, agreed in January to forfeit $4.6 million from the project. The Southern District of New York is also scrutinizing some of Manafort's former colleagues, including former Obama White House counsel Greg Craig, longtime Democratic lobbyist Tony Podesta and former Minnesota congressman Vin Weber. No charges have been filed. 9 EFTA00065030  SDNY News Clips, February 22, 2019 If this isn't obstruction of justice ... CNN By Elie Honig 2/22/19 This week's New York Times report that President Donald Trump asked then-acting Attorney General Matthew Whitaker to get US Attorney Geoffrey Berman to un-recuse himself and take charge of the Michael Cohen investigation evokes an old school, Nixonian attempt to obstruct justice. If the reporting is accurate, Trump's actions make his intent clear: Get my hand-picked appointee -- Trump personally interviewed Berman before he was appointed to run the Southern District of New York -- back on the Cohen case to limit the damage done to me. I've charged and tried obstruction of justice cases. If this isn't an attempt to obstruct, then I don't know what is. Trump has offered only the weakest of defenses: The conversation with Whitaker didn't happen, and the report is "fake news." (Note the pause in this video before Trump answers; prosecutors or poker players might call this a "tell.) That defense collapses under scrutiny. First, Whitaker has essentially admitted he did speak with Trump about the Southern District of New York case. Under questioning in Congress -- stemming from CNN's exclusive reporting that Trump discussed that investigation with Whitaker -- Whitaker forcefully denied he had spoken to Trump about special counsel Robert Mueller's investigation but bobbed, weaved and ultimately declined to answer when asked if he and Trump had discussed the Southern District of New York case. Common sense: When a witness strongly denies he discussed one thing but dodges on the other, that means he discussed the other thing. Also, Trump happens to have done the exact same thing he reportedly tried to do to Berman -- convince him to un-recuse and take charge of a criminal matter to limit potential damage to Trump -- to former Attorney General Jeff Sessions. Trump repeatedly and publicly berated Sessions, calling him "scared stiff and Missing in Action," retweeting a commentator who referred to Sessions' recusal as "an unforced betrayal," and declaring that Sessions should un- recuse and "stop this Rigged Witch Hunt right now." Trump tried to bully Sessions into getting back into the Russia case to limit damage done to Trump; is it any wonder Trump tried to do the exact same thing to the Southern District of New York? 10 EFTA00065031  SDNY News Clips, February 22, 2019 Mueller Report Expected to Co to Justice Department Within Weeks NYT By Katie Benner 2/21/19 The new attorney general, William P. Barr, is preparing for the special counsel to deliver a report in coming weeks on the results of the investigation into Russian interference in the 2016 election, two officials briefed on the Justice Department's preparations said. President Trump's legal team and other allies of the administration have incorrectly predicted an imminent end to the investigation by the special counsel, Robert S. Mueller III, for well over a year. It remains unclear whether Mr. Mueller might take further public action, such as additional indictments, before submitting his report to Mr. Barr. Once the report is submitted, it is not certain how much of it will become public or when. The submission of a report by Mr. Mueller would effectively mean his office is closing down. The special counsel would no longer be conducting investigations in conjunction with the F.B.I., and Mr. Mueller would not be opening any new lines of inquiry. But active cases that have not yet been brought to a conclusion would likely continue. New prosecutors from outside the special counsel's operation could pick up cases that remain in progress. And some cases that spun off from Mr. Mueller's investigation — including those being conducted by the United States attorney's office in Manhattan involving Michael D. Cohen and Mr. Trump's business — would continue unaffected. No matter what the special counsel concludes, the findings will be sure to send shock waves through Washington, with Mr. Trump's presidency on the line and both Democrats and Republicans poised to spin the contents to their advantage. The White House is bracing for revelations that could politically damage Mr. Trump, or open him up to the possibility of impeachment by the Democrat-controlled House, even if he is not accused of criminal conduct. The transmittal of the report to Mr. Barr would also place the attorney general in the spotlight as he decides how much of the findings to share with lawmakers and the public. Mr. Mueller was appointed as the special counsel on May 17, 2017, in the wake of Mr. Trump's decision eight days earlier to dismiss James B. Comey as F.B.I. director. Mr. Mueller was given a mandate to investigate whether Russia interfered in the 2016 election and "any links and/or coordination between the Russian government and individuals associated with the campaign of President Donald Trump." He was also given the option of referring any other matters that he might come across in doing so to other federal prosecutors, who can further investigate and open new cases. Once Mr. Mueller's report is in his hands, Mr. Barr will have to review it for any classified information that would have to be omitted from any summary that Mr. Barr might decide to release, a process that could take days or even weeks. 11 EFTA00065032  SDNY News Clips, February 22, 2019 Former Justice Department and F.B.I. officials said that Mr. Barr could also draw up an unclassified summary to be widely distributed to lawmakers — making leaks all but certain — as well as a classified version to be shared with a smaller group of Congressional leaders. A spokeswoman for the Justice Department and a spokesman for the special counsel's office declined to comment. The country has been riveted by Mr. Mueller's nearly two-year investigation into Russian election interference and whether Trump campaign officials worked with the Russians trying to sway the election in favor of Mr. Trump. The special counsel's office has indicted dozens of people, including a half dozen former Trump campaign advisers who have been indicted or pleaded guilty to past financial crimes, lying to the F.B.I., obstructing the special counsel investigation and failure to properly disclose their work for foreign governments. The office has also indicted dozens of Russian intelligence officers for stealing and then weaponizing information from Hillary Clinton's inner circle. And it has indicted Russian propagandists for the misinformation campaigns they spread on social media that sought to dampen support for Mrs. Clinton in her campaign against Mr. Trump. But Mr. Mueller has not filed explicit public allegations that Mr. Trump, his campaign officials or other members of his inner circle worked with Russian operatives to influence the outcome of the 2016 election. And the special counsel's office has not divulged any information regarding one of the main strands of its investigation — whether Mr. Trump or his aides could be criminally charged with obstruction of justice. At his confirmation hearings, Mr. Barr resisted pressure from Democrats to make firm commitments about how transparent he will be in sharing Mr. Mueller's report with Congress and the public. The regulations governing the special counsel say only that Mr. Mueller must submit to the attorney general a confidential report detailing his decisions to bring charges in the inquiry. It is then up to Mr. Barr to decide how much of that report should be shared with Congress. During his confirmation hearings, Mr. Barr said that he believed it best to be transparent about the report, consistent with the special counsel's rules and the law. Before he was nominated, Mr. Barr wrote a 19-page memo last summer arguing that Mr. Mueller was on shaky legal ground if he tried to treat Mr. Trump's decision to fire Mr. Comey, the former director of the F.B.I., as an act of obstruction — a memo that has Democrats in Congress worried that the attorney general comes to the investigation with biases that could move him to share very little of the report with lawmakers. Mr. Barr has also noted that the department does not generally publish derogatory information about individuals who have not been charged with crimes. Given that there is a longstanding Justice Department legal opinion that a sitting president cannot be charged with a crime, Mr. Barr may have to weigh whether it is right to share any information from the report that may cast Mr. Trump in unflattering light. 12 EFTA00065033  SDNY News Clips, February 22, 2019 Mr. Trump is scheduled to travel to Vietnam next week for a summit with Kim Jong-un, the leader of North Korea. Should the department share any damaging information about the president during his diplomatic trip, it could undermine his meeting. The president recently called Mr. Barr "a tremendous man, a tremendous person, who really respects this country and respects the Justice Department." Even after the Mueller report has been delivered and shared, federal prosecutors in New York, Washington and possibly elsewhere will continue to investigate Mr. Trump, his businesses and other leads uncovered by the special counsel's office. Those investigations and the possibility of criminal charges against Mr. Trump or an entity or person close to him are likely to loom over the remainder of the president's term. 13 EFTA00065034  SDNY News Clips, February 22, 2019 Inauguration Committee Trump Inaugural Committee Challenged Vendor Requests and Budgeting, Documents Show WSJ By Rebecca Davis O'Brien and Rebeccal Ballhaus 2/21/19 In the weeks before his inauguration, top officials on President Trump's inaugural committee repeatedly sounded alarms about the budgets submitted by several vendors, according to correspondence, committee records and draft budgets reviewed by The Wall Street Journal. Some of the materials, which haven't previously been reported, have been shared with federal prosecutors in New York, according to people familiar with the investigation. Federal prosecutors are probing the committee's dealings with vendors as part of a wide-ranging investigation into the 2017 inaugural committee, according to a subpoena the committee received earlier this month and people familiar with the investigation. Among other matters, prosecutors are interested in whether any vendors were paid off the books, the people familiar with the investigation said. Less than a month before the inauguration, in an email to colleagues, Heather Martin, the committee's budget director, questioned the budget submitted by a top vendor, event-production company Hargrove Inc. The company, she wrote, was using "wildly different pricing" from its work on previous inaugurals. She noted "redundancy" and "excessively high" prices for labor, centerpieces and even bike racks. It was one of several vendor budgets—including one submitted by WIS Media Partners, a firm run by Stephanie Winston Wolkoff, a former adviser to first lady Melanie Trump—that was questioned by inaugural organizers, according to the records reviewed by the Journal. Hargrove provided explanations for why the pricing was different before the committee went forward with their contract, people familiar with the planning said. The company was ultimately paid $25 million, according to the committee's tax filings. Hargrove executives and media representatives didn't respond to requests for comment. A representative for PSAV Inc., which bought Hargrove last year, didn't respond to requests for comment. A spokesman for WIS said the group "went through a thorough budget review" with inaugural officials, who approved the spending. The spokesman said WIS returned $1 million to the committee, having completed its work under the approved budget, and submitted an audit of WIS's spending two months after the inauguration. Ms. Wolkoff's concerns about the committee's spending, captured in a recorded conversation with Mr. Trump's former lawyer Michael Cohen, helped prompt the investigation into the inaugural. Her concerns focused on Hargrove; the inaugural committee's deputy chairman, Richard Gates; and its chairman, Tom Barrack, people familiar with the recording said. A spokesman for Mr. Barrack declined to comment. There is no sign Mr. Barrack is under investigation. 14 EFTA00065035  SDNY News Clips, February 22, 2019 A lawyer for Mr. Gates didn't respond to requests for comment. Mr. Gates has been cooperating with Justice Department investigations since pleading guilty last year to a case brought as part of special counsel Robert Mueller's investigation of Russian interference in the 2016 election. A spokeswoman for the inaugural committee said it "remains confident it has fully complied with all applicable legal requirements." Mr. Trump's inaugural committee raised a record $107 million in donations, twice what was raised for former President Barack Obama's first inaugural in 2009. The committee says it spent $104 million on the inauguration. In a December 2016 email, an executive at one of the inaugural committee's vendors wrote that his projected budget reflected more than $5 million for talent and travel. "DJT wants it to be bigger/better and outside of the box than any other inauguration," the executive wrote. Correspondence and draft budgets for the high-profile Chairman's Global Dinner, a pre-inaugural event for foreign diplomats and top donors, show the proposed use of Hargrove and another vendor for similar services led to confusion among organizers. The dinner, billed as Mr. Trump's debut on the international stage, had an initial budget of $3.3 million, but ultimately cost nearly $4.3 million, according to an inaugural official. In a draft budget, Hargrove sought $2.9 million to work on the chairman's dinner, including more than $2.4 million to stage performances by the band Alabama and "Steve Wynn's Showstoppers," a revue of Broadway show tunes developed by Steve Wynn, a casino mogul and top Trump ally who was a finance co-chairman of the inaugural committee. Another company, PRG, submitted a $2.7 million budget to produce the same performances. PRG's proposed budget, prepared for Mr. Gates, included some of the exact language and prices used in Hargrove's budget, prompting questions from organizers about why both firms would work on the performances. Mr. Gates said Hargrove would "be involved in certain aspects" and would support PRG, according to correspondence viewed by the Journal. The inaugural official said Hargrove wasn't ultimately contracted for the production, and that Mr. Gates's email predated the final contract that inaugural officials signed hiring PRG. A spokeswoman for PRG said the company hadn't received a subpoena, and declined to answer questions about the company's work on the inaugural. Members of the committee also questioned payments made to a number of vendors and subcontractors with ties to Mr. Trump's business, family, campaign and administration, correspondence reviewed by the Journal shows. The Trump International Hotel in Washington, D.C., at first sought $3.6 million for eight days of space and food, according to a December 2016 email, which was forwarded by one inaugural organizer to her colleagues. The organizer wrote: "Ummm..." The committee ultimately paid $1.5 million from Dec. 1 through the inauguration, according to an inaugural official. A firm owned by Brad Parscale, the campaign's digital media director who is now Mr. Trump's campaign manager for 2020, was paid nearly $2.7 million, including $2.1 million for a digital media buy focused on drawing crowds to the inauguration, according to people familiar with the matter. 15 EFTA00065036  SDNY News Clips, February 22, 2019 R. Kelly R. Kelly Charged With Sexual Abuse in Chicago NYT By Elizabeth A. Harris 2/22/19 The R&B singer R. Kelly was charged on Friday in Chicago with 10 counts of aggravated criminal sexual abuse. The news was reported by The Chicago Sun-Times and The Chicago Tribune, citing court records. Mr. Kelly, who has been trailed by accusations of sexual misconduct for two decades, has been under renewed scrutiny since the documentary "Surviving R. Kelly" was broadcast on Lifetime in January. The celebrity lawyer Michael Avenatti said last week that he had obtained a video showing Mr. Kelly having sex with a 14-year-old girl, and given it to the Cook County State's Attorney's Office in Chicago. He has said that Mr. Kelly and the girl refer to her age multiple times in the video, which is more than 40 minutes long. On Thursday, two additional women came forward at a news conference in New York organized by their lawyer, Gloria Allred, to accuse Mr. Kelly of sexual abuse and misconduct when they were minors. The two women, Latresa Scaff, 40, and Rochelle Washington, 39, said they met the singer after a concert in the mid- 1990s when they were 16 and 15; they said he asked for a threesome and had sex with Ms. Scaff. Steven Greenberg, Mr. Kelly's lawyer, did not immediately respond to a request for comment, but he has said that Mr. Kelly "denies that he has engaged in any illegal conduct, of any kind whatsoever." Mr. Kelly, 52, has never been convicted of a crime, but he has been trailed for years by allegations of sexual misconduct and abuse. More than 20 years ago, Vibe magazine questioned a marriage certificate that said the singer Aaliyah was 18 when she and Mr. Kelly were wed. She was, in fact, 15 at the time and the marriage was annulled. Mr. Greenberg has said Mr. Kelly did not know she was underage at the time. Aaliyah died in a plane crash in 2001. The following year, Mr. Kelly was arrested on child pornography charges, over a tape prosecutors said showed him having sex with and urinating on an underage girl. After six years of delays, Mr. Kelly was acquitted in 2008 on all 14 charges against him. The girl from the video never testified, and Mr. Kelly's lawyers argued that her identity could not be proven. In 2017, the music journalist Jim DeRogatis wrote articles for BuzzFeed that described Mr. Kelly keeping women in a "cult," in which he kept them from their families and exerted tremendous control over their lives. After so many years in which Mr. Kelly seemed impervious to the accusations against him, things seemed to take a turn in January, after "Surviving R. Kelly" caused a stir. Law enforcement authorities in Illinois and Georgia, where he has lived, began looking into his conduct. And after tremendous public pressure from activists, Mr. Kelly was dropped by his label, RCA, just two weeks after the program aired. 16 EFTA00065037  SDNY News Clips, February 22, 2019 R. Kelly Is Accused of Sexual Misconduct by Two More Women NYT By Karen Zraick 2/21/19 Two additional women came forward on Thursday to accuse the R&B star R. Kelly of sexual abuse and misconduct while they were minors. The women, who had not previously spoken publicly about the accusations, gave their accounts at a news conference in New York organized by their lawyer, Gloria Allred. The two women, Latresa Scaff, 40, and Rochelle Washington, 39, both of Maryland, said they met the singer, whose real name is Robert Kelly and who has faced sexual abuse accusations going back more than two decades, after a concert in Baltimore in 1995 or 1996. Mr. Kelly had performed with LL Cool J at an arena in the city. The two teenagers, who were about 16 and 15 at the time, bought tickets to the concert and an after-party at a nearby nightclub, they said. Ms. Allred showed photos of the two women that they said were taken that night. They had dressed up and were smiling broadly as they posed with LL Cool J and in front of a backdrop emblazoned with Mr. Kelly's visage. At the after-party, Mr. Kelly pointed to the girls and asked his security guards to bring them to the stage, the women said. They were offered drugs and alcohol, and Mr. Kelly's staff members paid for a taxi to take them back to his hotel, Ms. Scaff said. While waiting for Mr. Kelly to arrive in a hotel suite, the girls were so excited that they called a local radio station to tell them they were with R. Kelly, Ms. Scaff said. They went on live radio and "many people heard us," she added. Mr. Kelly entered the room a short while later with his penis exposed and asked the girls to dance, Ms. Scaff said. He asked for a threesome, the women said, and Rochelle, who was younger, said she would not participate and went into the bathroom. Mr. Kelly then asked Latresa to perform oral sex, and had sex with her, she said. She was under the influence of marijuana and alcohol at the time, she added. Afterward, neither girl saw Mr. Kelly again. Ms. Scaff said she told friends about what had happened, and Ms. Washington told her mother. "When I first met R. Kelly that night, I was very happy and excited because I was young and star-struck," Ms. Scaff said. But in hindsight, she said, she feels hurt. "I am speaking out because I want to encourage other victims who I know must be out there to come forward as well," she added. Ms. Allred said that both women met with officials from the office of the United States attorney for the Eastern District of New York on Thursday afternoon to share their accounts. 17 EFTA00065038  SDNY News Clips, February 22, 2019 Asked why she chose that office, rather than the Baltimore Police Department or another agency, Ms. Allred said she had confidence in the prosecutors there and believed that they were investigating Mr. Kelly. A spokesman for the office said he could not confirm that. A lawyer for Mr. Kelly did not immediately return a call and email requesting comment. Mr. Kelly has faced accusations of sexual misconduct and abuse for decades but has never been convicted; he has denied that he had sex with minors or held women against their will. He was acquitted in 2008 of 14 counts of child pornography in a trial that centered on a sex tape, and has reached settlements with numerous accusers. But momentum against him has been building since Buzzfeed News's publication in July 2017 of a lengthy investigation into accusations that Mr. Kelly held women in a so-called sex cult. That article, by the journalist Jim DeRogatis, who has been reporting on the accusations against Mr. Kelly for nearly 20 years, spurred a six-part Lifetime documentary, "Surviving R. Kelly," that aired last month and included testimony from several women who accused Mr. Kelly of abuse. Public opinion seemed to turn against him. His label, RCA Records, has dropped him, and Spotify has removed his songs, which include "Ignition" and "I Believe I Can Fly," from its playlists. He is also being investigated in at least two states: Illinois and Georgia, where he had homes and where prosecutors have urged any potential victims or witnesses to come forward. The celebrity lawyer Michael Avenatti also said last week that he had given Chicago prosecutors a videotape that, according to a report, appears to show Mr. Kelly having sex with a girl who may have been underage. Ms. Allred said she represented "a number" of Mr. Kelly's accusers - she would not specify how many — and said that some were worried that videos of them being abused might be circulating. Ms. Washington, who cried as she spoke, encouraged women who were victimized by Mr. Kelly to contact lawyers and law enforcement officials. "I want victims to know it's not their fault," she said. 18 EFTA00065039  SDNY News Clips, February 22, 2019 New R. Kelly Accuser Claims Singer Had Sex With Her When She Was Underage Rolling Stone By Kory Grow 2/21/19 Two women are adding their voices to the chorus against R. Kelly. At a press conference in Midtown Manhattan on Thursday, Latresa Scaff and Rochelle Washington alleged that the singer spotted them at an afterparty for one of his concerts in the Baltimore area during the mid-Nineties and invited them back to his hotel room where they claim he exposed himself and coerced one of them into sex. They claim they had been offered alcohol and drugs at the party and were incapable of making rational decisions. One of the women was 15 at the time, the other 16. Scaff, now age 40, held back tears as she told a room of reporters about Kelly's alleged behavior toward her and her friend Washington, now 39. "The man who had let us into [Kelly's hotel room] ... said, `R. Kelly is getting ready to enter the room. Pull up your dresses," she recalled. "Rochelle and I did what we were told. We were standing, and we had panties on underneath our dresses. Then R. Kelly came into the room a few minutes later. The other man left right away when Kelly entered the room. Mr. Kelly was wearing jeans and a white T-shirt. His penis was out and was over the top of his pants." She went on to claim that Kelly lied on the bed with them, arms around each, and enticed them by saying that he was making a new music video that they could feature in. "After he said that, he started touching my breasts and vagina," Scaff said. "He put his hand under my dress. He asked both of us if we would do a threesome. Rochelle said, `No, I do not do that.' She left and went to the bathroom. ... When Kelly was alone with