According to AP, Paul Manafort, who had been functioning as Donald Trump’s campaign manager, aided Ukraine's president, Viktor Yanukovych in 2012 by clandestinely routing at least $2.2 million to Washington lobbying firms Podesta Group Inc. and Mercury LLC.
Federal law requires U.S. lobbyists to declare publicly if they represent foreign leaders or their political parties, then give details to the Justice Department. If Manafort and his business partner, Rick Gates, violated that law, which would be considered a felony, they could be subject to five years in prison and a fine of up to $250,000.
AP reported that sources with direct knowledge of Gates' work said when Gates and Manafort acted as consultants to to Yanukovych’s party, Gates routed the advocacy work done by a pro-Yanukovych nonprofit to the lobbying firms.
The European Centre for a Modern Ukraine, which included parliament members from Yanukovych's party, gave $2.2 million to the lobbying firms to push Congress to support Yanukovych's government. The nonprofit paid the Podesta Group $1.13 million between June 2012 and April 2014 and also $1.07 million to Mercury to lobby Congress.
Some the efforts included fighting against a congressional resolution designed to urge Yanukovych to release one of his rivals from prison.
The lobbying firms worked on behalf of Yanukovych until he fled Ukraine in 2014. The lobbying firms told AP they had no obligation to disclose their activities to the Justice Department.
One former Podesta employee told AP that in April 2012, Gates called the nonprofit's role as supplying a source of money that could not be traced to the Ukrainian politicians paying him and Manafort. Other current and former Podesta employees have stated there were internecine arguments within the company over the legality of the arrangement.
Mercury obtained a legal opinion that argued the European Centre qualified as a "foreign principal" under the Foreign Agents Registration Act and disclosure to the Justice Department was not necessary. The Podesta Group's CEO, Kimberley Fritts, said the two lobbying firms agreed disclosure was not necessary, telling AP, "If counsel had determined FARA was the way to go, we would have gladly registered under FARA.”
Vin Weber, the head of Mercury, told AP that Manafort discussed the project even before he discussed it with Anthony Podesta, the head of the Podesta Group and the brother of John Podesta, the campaign chairman for Democratic nominee Hillary Clinton. Ina Kirsch, the director of the European Centre, told AP her group never worked with Manafort or Gates.
Podesta's firm has previously registered its activities with the Justice Department over its work for Albania, the Republic of Azerbaijan, Cyprus, Georgia, India, Japan, Kenya, Kosovo, the Maldives, Moldova, Morocco, Somalia, South Korea, South Sudan, Vietnam and others. Mercury has disclosed to the Justice Department its work on behalf of government interests in the Cayman Islands, Nigeria, Qatar, Somalia, Turkey, one of the United Arab Emirates, Uganda and others.