March 22, 2016

Trump's Mafia linked business pal comes to the fore

NY Times - A federal judge has asked the Obama administration to shield from public disclosure court records related to the once-secret criminal history of a former Donald Trump business partner.

In an unusual order prompted by an unsealing request from The Associated Press, U.S. District Judge Brian M. Cogan said that unless the Justice Department acts before April 18, he will decide whether to make the court files public under the assumption that federal prosecutors don't care.

The case involves Felix Sater, a Trump business associate who pleaded guilty in a major Mafia-linked stock fraud scheme in the late 1990s and cooperated with the government. The AP reported in December that, even after learning about Sater's background, Trump tapped Sater for a business development role in 2010 that included the title of senior adviser to Trump, and had an office in the Trump Organization's headquarters.

Sater's criminal past initially drew attention because of his ties to Trump, now the front-runner for the Republican presidential nomination. But legal disputes over information related to Sater's efforts to cooperate with the government — which was ongoing during the period he worked with Trump — also raises questions about court secrecy.

"It seems to me that the government has a unique interest in keeping documents that relate to cooperation agreements under seal," Cogan wrote in his order. "The government should speak and assert its position as to whether the public's right to access each document in the record is outweighed by a compelling need for secrecy."

Lawyers for the AP had asked the judge to justify sealing a five-year criminal contempt proceeding in U.S. District Court for the Eastern District of New York.

Not only did Cogan seal all documents in the contempt case, he also initially censored the AP's request that he unseal his justification for being withheld from public view. When The New York Times asked the judge to make public the AP's request to release the documents, that request was kept secret, too. Late last week, the judge also made requests by the AP and the newspaper publicly accessible — but ordered that the parties to the case file any responses to them under seal.

The defendants in the contempt case, Frederick Oberlander and Richard Lerner, are attorneys the government said revealed once-secret court records about Sater's crimes and cooperation. Sater's lawyers — who once included Leslie Caldwell, now the head of the Justice Department's criminal division — have said that Sater's cooperation was vital to national security and disclosures about his past put him in danger.

Also at issue in the case are statements that U.S. Attorney General Loretta Lynch — formerly the top prosecutor in Cogan's district — made about Sater's case before the Senate confirmed her last year. Oberlander and Lerner said the government improperly permitted Sater to use his status as a secret cooperator to commit new crimes and avoid paying restitution to past victims, who are owed millions of dollars.

In February 2015, Lynch told Republican Sen. Orrin Hatch of Utah that information about Sater's restitution "remains under seal," and that the Justice Department would never waive victims' right to restitution as part of a cooperation agreement. Court records publicly available at the time showed Sater was not ordered to pay back the victims. One of Sater's attorneys said at the time that the lack of restitution, and the $25,000 fine, reflected the difficulty of identifying specific victims and the government's gratitude to Sater.

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