US Justice Department Continues Focus on Criminal Enforcement of FARA
As predicted earlier this year in our January update, the US Department of Justice (DOJ) has continued to ramp up enforcement of the Foreign Agents Registration Act (FARA) and related political laws through criminal prosecution. This Legal Update provides a brief summary of recent criminal cases, and highlights several issues to watch in the coming months.
With certain exemptions, FARA requires agents of foreign principals to register with DOJ for conducting specified activities within the United States, including “political activities,” acting as a public relations counsel or political consultant, or representing a foreign principal before federal agencies.1 Registered agents must provide regular reports to the DOJ, detailing the activities they conducted on behalf of foreign principals and the compensation received from each foreign principal—which are substantially more demanding requirements than those of the Lobbying Disclosure Act. The penalty for a willful failure to register under FARA is imprisonment for up to five years, among other penalties.2 In addition, and as we discuss below, other criminal provisions rely on FARA as a predicate for prosecution.
Below we discuss recent, high-profile criminal prosecutions for FARA violations. Collectively, they show that:
- DOJ’s use of FARA as a predicate to prosecute foreign influence activity has not slowed, despite prior losses in some cases;
- Public officials and US technology and media platforms, among others, face exposure to investigations—if not prosecution and conviction—when performing political and other covered activities on behalf of a foreign principal (and should consider their compliance protocols accordingly); and
- FARA reaches well beyond traditional lobbying activity, because FARA applies to a broad range of activities designed to shape US public opinion and policy. FARA itself does not prohibit acting as a foreign agent, but it does require transparency that one is doing so.
DOJ’s Enforcement of FARA in the Context of the Federal Election
In the context of countering perceived malign foreign influence in the federal election, DOJ has continued to rely on FARA to investigate and prosecute both foreign actors and their US agents for covert influence activity.
A September 4, 2024 indictment charged two Russian nationals Kostiantyn “Kostya” Kalashnikov and Elena “Lena" Afanasyeva with FARA violations, alleging that those employees of Russian state-controlled media outlet RT (formerly known as Russia Today), allegedly paid online commentators $10 million to “pump pro-Russia propaganda and disinformation across social media to US audiences,” according to US Deputy Attorney General Lisa Monaco. While operating from Moscow using fake identities and shell companies in Turkey, the United Arab Emirates, and Mauritius, Kostya and Lena deceived a US content creation company and two US influencers into posting English-language videos to TikTok, Instagram, X, and YouTube. More than 2,000 videos on YouTube alone generated more than 16 million views, and many of the videos contain commentary on US domestic and foreign policy. This prosecution (which echoes Special Counsel Mueller’s indictment of the Internet Research Agency troll farm for similar activity undertaken from abroad) signals DOJ’s commitment to exposing Russian covert influence efforts ahead of the 2024 presidential election. Content creators and companies that engage with or manage such talent should be mindful of their clients and business relationships, including the source of any payments they receive, as even unwitting work on behalf of a foreign government could lead to investigations and related expenses.
Relatedly, and on the same day, DOJ seized “32 internet domains that the Russian government and Russian government-sponsored actors have used to engage in a covert campaign to interfere in and influence the outcome of our country’s elections,” said Attorney General Merrick B. Garland. The following day, the Justice Department announced it indicted American commentator Dimitri K. Simes (who previously headed a US think tank) and his wife for violating US sanctions against Russia for their work for Channel One Russia, a state-owned television network. These three developments represent a broader effort by the government to counter perceived covert foreign influence by Russia ahead of November’s presidential election.
State and Local Officials Are Targets of Foreign Influence Operations and Criminal Enforcement Alike
On September 3, Linda Sun, former aide to New York Governors Kathy Hochul and Andrew Cuomo, was charged with conspiring to violate FARA and failing to register under the statute—among other crimes—by allegedly acting on behalf of the government of the People’s Republic of China (PRC) and the Chinese Communist Part (CCP).3 Sun worked for the New York State (NYS) government since 2012, and allegedly acted as an undisclosed agent of the PRC and CCP by: blocking access for Taiwanese government representatives to the NYS governor’s office; changing messaging from NYS politicians regarding issues of importance to the PRC and CCP, like the detention of Uyghurs in PRC state-run camps; obtaining official NYS governor proclamations for PRC government representatives; and arranging meetings for visiting delegations from the PRC with NYS government officials. Allegedly, Sun “actively concealed” that she was acting as a foreign agent while she received millions of dollars in kickbacks and other benefits tied to a $3.6 million Long Island residence, $1.9 million condominium in Hawaii, and a 2024 Ferrari, in what DOJ officials called a “brazen attempt . . . to corrupt our political processes.”
Earlier this summer, a former Central Intelligence Agency and White House official, Sue Mi Terry was indicted on criminal charges for failing to register under and conspiring to violate FARA. The indictment alleges that after leaving public service, and for more than a decade, Terry provided South Korean intelligence officers with access, information, and advocacy in exchange for luxury handbags, expensive meals, and thousands of dollars of funding for her public policy think tank. Terry also published articles in the US and South Korean press, sharing viewpoints and phrases provided by the South Korean government. This prosecution highlights that DOJ will enforce FARA with respect to foreign agents of any foreign government or political party, including allies.
Although FARA is often viewed through the lens of contacts with federal officials, collectively, these cases are also a reminder that state and local officials, as well as private parties, are bound by the statute’s obligations to register, and that willful failure to do so carries criminal exposure.
Federal Officials Face Wider Criminal Exposure for Actions on Behalf of Foreign Entities
Pursuant to 18 U.S.C. § 219, it is a criminal offense for a “public official” of the United States in the executive, legislative, or judicial branches to be or to act as an “agent of a foreign principal,” as FARA defines that term. This criminalizes action as a foreign agent by covered officials and, as such, does not require the government to prove willfulness, as it must to convict someone of failing to register under FARA. (Similarly, former federal officials should take note of post-employment restrictions that temporarily prohibit their work on behalf of foreign governments and political parties, as defined by FARA, on pane of criminal penalties.)4
On July 16, 2024, DOJ secured a victory in its second set of corruption charges against former Senator Robert “Bob” Menendez (D-NJ). One year ago, Menendez was indicted on charges of taking bribes to help New Jersey business partners associated with the government of Egypt. In an October 2023 superseding indictment, DOJ charged Menendez with conspiring to act as an agent under FARA while serving as a public official, among other things. Following a ten-week trial, a jury convicted him and two co-defendants on 16-counts of corruption. According to the government, the evidence at trial demonstrated that Menendez accepted gold bars, stacks of cash, and a Mercedes-Benz as bribes to further the business and personal interests of three business partners. US Attorney Damian Williams said, “corruption isn’t costless: it erodes public trust, and it undermines the rule of law. That’s why we’re so committed to fighting it, regardless of political party.” This victory comes after prosecutors failed to convict Menendez in a 2017 case accusing him of using his influence to help a Florida eye doctor. Menendez has appealed his conviction.
DOJ charged another sitting member of Congress in May 2024 with accepting almost $600,000 in bribes from the government of Azerbaijan and a Mexican bank in two schemes involving bribery, unlawful foreign influence, and money laundering. In exchange for the bribes, US Congressman Enrique Roberto “Henry” Cuellar (D-TX) allegedly agreed to use his office to influence US foreign policy in favor of Azerbaijan, and to pressure high-ranking US Executive Branch officials to take beneficial measures for the Mexican bank. Cuellar is charged with the same conflict-of-interest statute as Menendez, and is scheduled for trial in spring 2025.
Other FARA Issues to Watch
As we previously discussed, Jennifer Gellie, the acting chief of the DOJ National Security Division’s Counterintelligence and Export Control Section (where the FARA Unit resides), hinted at a December 2023 FARA conference that a long-anticipated notice of proposed rulemaking may seek to narrow DOJ’s 20-year-old interpretation of one of the most frequently invoked exemptions, an aspect of the so-called Commercial Exemption. The statute exempts from registration those agents engaged “only (1) in private and nonpolitical activities in furtherance of the bona fide trade or commerce of such foreign principal; or (2) in other activities not serving predominantly a foreign interest.”5 DOJ has interpreted subsection § 613(d)(2)’s “foreign interest” to refer to foreign government interests; its regulations currently provide that lobbying and other political activities on a foreign entity‘s behalf will be exempt under this provision if the activities directly promote the foreign corporation’s own economic interests, rather than the political or public interests of a foreign government or political party (and are not directed by the latter type of entity).6 But Gellie signaled that DOJ may propose to narrow the exemption under § 613(d)(2) to only those activities that predominantly benefit a domestic interest, regardless of whether the foreign interest is governmental, commercial, or non-profit. This would work a sea change in FARA’s requirements since Congress passed the Lobbying Disclosure Act in 1995, and this and another exemption channeled most disclosure of commercial lobbying activity to that statute. However, even though DOJ’s proposed rule cleared review at the Office of Management and Budget in July 2024, it has not yet been released.
Finally, as we noted previously, DOJ’s civil enforcement practice stumbled with the DC District Court’s decision, recently affirmed on appeal, that the obligation to register under FARA terminates when the underlying agency relationship ends, rendering DOJ powerless to seek a civil injunction compelling registration to disclose historical activity undertaken as part of a previous, terminated agency relationship. DOJ initially had until July 29, 2024 to seek en banc review of the DC Circuit’s decision, but on August 21, sought a second, 30-day extension of that deadline. This, of course, could mean nothing more than the challenges of getting internal-DOJ agreements to challenge an adverse decision during the summer months; but it could also reflect a real debate within DOJ over whether to risk a higher-profile loss en banc or to let the decision stand (but accept a more limited enforcement authority).
Combined with increased criminal enforcement of FARA, a possible rule change to narrow a critical exemption to FARA-registration makes it more important than ever for companies and individuals to consider compliance programs or training. To learn more, contact Adam S. Hickey, Timothy Keeler, Kelly Kramer, Michael Leibner, and Ravi Shah.
3 Sun’s husband and co-defendant, Chris Hu, is also charged with money laundering conspiracy, conspiracy to commit bank fraud, and misuse of means of identification.
