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Skadden Arps settles FARA claims arising from Manafort investigation

January 17, 2019

International law firm Skadden Arps Slate Meagher Flom has agreed to pay $4.6 million and register as a foreign agent for failing to notify the Justice Department of its lobbying work on behalf of the Ukrainian government, the department said Thursday.

The allegations against Skadden were uncovered by special counsel Robert Mueller’s probe into former Trump campaign chairman Paul Manafort’s Ukrainian lobbying work. Mr. Manafort pleaded guilty last year to failing to register as a foreign agent.

Under the agreement, Skadden will pay the $4.6 million in fees and expenses it secretly received from Ukraine to the U.S. Treasury and retroactively register as a foreign agent.

Prosecutors say the firm’s 2012 work for Russian-backed former Ukrainian president Viktor Yanukovych justifying the prosecution of his political opponent, Yulia Tymoshenko.

The report was a public relations effort to influence U.S. policy and public opinion, the Justice Department said. Yet, the firm failed to notify the department.

The Justice Department also said a Skadden partner made false and misleading statements to its Foreign Agents Registration Unit, leading it to conclude the law firm was not obligated to register.

The partner was not named, but widely believed to be former Obama White House Counsel Gregory Craig, who left the firm in April 2018.

The lead partner told the FARA unit that he only replied to media requests about the report and did not actively disseminate among the U.S. press.

In 2011, Mr. Craig traveled to Ukraine with a team of Skadden attorneys, including Alex van der Zwaan, a London-based lawyer. Mr. van der Zwaan pleaded guilty last year to lying to Mr. Mueller’s team about his contacts with Mr. Manafort and his business associate, Rick Gates.

“Law firms should handle inquiries from the federal government the same way they would counsel their clients to: with appropriate due diligence to ensure the honesty of their response,” Assistant Attorney General John Demers said in a statement. “Sadden’s failure to do so, and reliance on only the representations of the lead partner on the matter hid from the public that its report was part of a Ukrainian foreign influence campaign.”

In 2012, Mr. Manafort hired Skadden to author a report justifying the prosecution of former Ukrainian prime minister Yulia Tymoshenko. The Justice Department said the $12,000 paid to produce the report came from a Ukrainian businessman through an account controlled by Mr. Manafort.

Last year, Skadden partner Alex van der Zwaan pleaded guilty to misleading investigators with Mr. Mueller’s team about his communications related to the report. It is not clear if he is the partner whom the Justice Department says misled its FARA unit.

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