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United States v. Michel

United States District Court, District of Columbia

November 6, 2019

UNITED STATES OF AMERICA
v.
PRAKAZREL MICHEL (1), Defendant.

          MEMORANDUM OPINION

          COLLEEN KOLLAR-KOTELLY, UNITED STATES DISTRICT JUDGE

         In this criminal action, Defendant Prakazrel Michel has brought three pending motions. First, he has moved under Federal Rule of Criminal Procedure 12 to dismiss Counts Two and Three of the Indictment on the basis that they are barred by the statute of limitations. Second, he has moved to sever Count Four of the Indictment. Lastly, he has moved for a bill of particulars listing unindicted co-conspirators known or unknown to the grand jury under Count One of the Indictment. Upon consideration of the Indictment, briefing, relevant legal authorities, and record as a whole, the Court DENIES Mr. Michel's Motion to Dismiss Counts Two and Three, [1] DENIES WITHOUT PREJUDICE his Motion to Sever Count Four, [2] and GRANTS IN PART his Motion for a Bill of Particulars.[3]

         I. BACKGROUND

         A, Indictment

         A grand jury returned an Indictment charging Mr. Michel and his co-Defendant, Malaysian national Low Taek Jho, on May 2, 2019. Indictment ("Indict."), ECF No. 1. The Indictment contained four charges against Mr. Michel arising from an alleged scheme to funnel money from a foreign donor, Mr. Low, into the 2012 Presidential Election and to conceal the true source of those contributions from the Federal Election Commission ("FEC"). Id. ¶¶ 1-2. Mr. Michel and Mr. Low "concealed the scheme from the candidate, the candidate's campaign and administration, federal regulators, and the public." Id. ¶ 2.

         Count One of the Indictment charges Mr. Michel with conspiracy to defraud an agency of the United States in violation of 18 U.S.C. § 371. Id. ¶¶ 23-70. It alleges that from about June 2012 to June 2015, Mr. Michel and Mr. Low conspired with each other and with others "known and unknown to the grand jury" to do three things: (1) "[k]nowingly defraud the United States by impairing, obstructing, and defeating the lawful functions of a department or agency of the United States," which was "the FEC's ability to administer federal regulations concerning source and dollar restrictions in federal elections"; (2) "[k]nowingly and willfully make foreign contributions and independent expenditures" that aggregated to more than $25, 000 in a calendar year in violation of 52 U.S.C. § 30121 and 52 U.S.C. § 30109(a)(1)(A); and (3) "[k]nowingly and willfully make contributions to a candidate for federal office in the names of other persons" that aggregated to more than $25, 000 in a calendar year in violation of 52 U.S.C. § 30121 and 52 U.S.C. § 30109(a)(1)(A). Id. ¶ 24. The Indictment provided a similarly broad object of the conspiracy, which in full reads:

The object of the conspiracy was for MICHEL and JHO LOW to gain access to, and potential influence with, Candidate A and his administration, by secretly funneling foreign money from JHO LOW through MICHEL and other straw donors to Political Committees A and B, all while concealing from the committees, the FEC, the public, and law enforcement the true source of the money.

Id. ¶ 25.

         According to the Indictment, the manner and means by which Mr. Michel and Mr. Low carried out the conspiracy were numerous and included using shell entities and bank accounts, using conduits or straw donors, attending certain fundraising events and White House events, providing false statements to the FEC, and using false tax records. Id. ¶¶ 26-35. The Indictment further alleges that Mr. Michel and Mr. Low committed numerous overt acts in furtherance of the conspiracy. Id. ¶¶ 36-70. These acts spanned from 2012 through 2015. Id.

         One set of overt acts concerns alleged use of straw donors to Political Committee A at various fundraisers beginning in June 2012.[4] Id. ¶¶ 37-60. Mr. Michel allegedly received a large sum of at least $1, 000, 000 from Mr. Low and funneled that money through straw donors to make contributions to Political Candidate A in June through September 2012. Id. ¶¶ 37-43. He also. according to the Indictment, made efforts to secure permissions for Mr. Low and Mr. Low's father to attend a fundraising event in Washington, D.C. in September 2012 and then attended the event with Mr. Low's father. Id. ¶¶ 55-56. Another set of overt acts concerns Mr. Michel contributing money obtained from Mr. Low directly to Political Committee B in his own name and in the name of a certain company, Company E. Id. ¶¶ 61-63.

         The last set of acts deal with false reports and statements to the FEC. Id. ¶¶ 64-70. This includes the following reports and statements, which Mr. Michel allegedly caused or made:

• On or about July 20, 2012: Political Committee A submitted an FEC form that attributed contributions to straw donors when they were allegedly not the true source of those contributions. Id. ¶ 64.
• On or about September 20, 2012: Political Committee A submitted an FEC form that attributed contributions to straw donors who were allegedly not the true source of the contributions. Id. ¶ 65.
• On or about October 15, 2012: Political Committee B submitted an FEC form that claimed Mr. Michel was the true source of a contribution when Mr. Low was allegedly the true source. Id. ¶ 66.
• On or about October 25, 2012: Political Committee B submitted an FEC form that claimed that Company E was the true source of contributions when Mr. Low was allegedly the true source. Id. ¶ 67.
• On or about December 6, 2012: Political Committee B submitted an FEC form that claimed that Mr. Michel's company was the true source of a contribution when Mr. Low was allegedly the true source. Id. ¶ 68.
• On or about January 30, 2013: Political Committee B submitted an amended report containing the same false statements as in the report submitted on December 6, 2012. Id.
• On or about February 6, 2013: Political Committee A submitted an amended report containing the same false statements as they made on September 20, 2012. Id. ¶ 65.
• On or about June 3, 2013: Political Committee A submitted an amended report containing the same false statements submitted in the report on July 20, 2012. Id. ¶ 64.
• On or about June 15, 2015: In response to a complaint filed with the SEC alleging that Mr. Michel had illegally made contributions to Political Committee B, Mr. Michel caused to be submitted to the FEC an allegedly "false declaration" stating that he had made four contributions to Political Committee B and that he had no reason to hide the true source of his donations to Political Committee B. Id. ¶¶ 69-70.

         Second, the Indictment charges Mr. Michel with concealment of material facts under 18 U.S.C. § 1001(a)(1)-(2). Id. ¶¶ 71-72. In particular, the Indictment framed Mr. Michel as having "knowingly and willfully falsified, concealed, and covered up, by a trick, scheme, and device," a material fact and "made or caused to be made false, fictitious, and fraudulent statements or representations in a matter within the jurisdiction of the executive branch." Id. ¶ 72. He allegedly did this through many of the same acts underlying the conspiracy in Count One, which fall into three categories: (1) he caused Political Committee A to make false statements regarding the source of certain contributions on or about July 20, 2012, September 20, 2012, February 6, 2013, and June 3, 2013; (2) he caused Political Committee B to submit false statements regarding the source of certain contributions on or about October 15, 2012, October 25, 2012, December 6, 2012, and January 30, 2013; and (3) he submitted a declaration to FEC with the false statement that Mr. Michel was the source of the contributions made to Political Committee B. Id.

         Count Three of the Indictment charges Mr. Michel with making a false entry in a record in violation of 18 U.S.C. § 1519 on the basis that Mr. Michel allegedly caused Political Committee A to make false statements in an FEC form on or about June 3, 2013 that listed the straw donors as the true sources of certain contributions. Id. ¶¶ 73-74. Similarly, Count Four of the Indictment charges Mr. Michel with making a false entry in a record under the same statute based on his allegedly false declaration submitted to the FEC on June 15, 2015. Id. ¶¶ 75-76.

         B. Requests for Foreign Evidence

         In 2018, the Government submitted two ex parte applications to suspend the statute of limitations under 18 U.S.C. § 3292. It submitted its first application on February 16, 2018, based on a February 2, 2018 official request from the Office of International Affairs of the Department of Justice to the British Virgin Islands ("BVI") for evidence, specifically seeking "records confirming that the source of the contribution money was a foreign entity in the British Virgin Islands, and banking and communications records concerning the relevant fund transfers." Def.'s Mot. to Dismiss Ex. 1 at 1, 3; see Id. at Ex. 1, Attach. B (official request to BVI). The application explained that a grand jury was investigating Mr. Michel, Mr. Low, and others for "'the following offenses: 18 U.S.C. §§371 (conspiracy) and 1001 (false statements), and 52 U.S.C. §§30116 (contributions in excess of legal limits) and 30121 (contributions and donations by foreign nationals)." Id. Ex. 1 at 1; see Id. Ex. 1 Attach. A at 1 (declaration in support of application explaining same).

         Chief Judge Beryl A. Howell granted the Government's ex parte application on March 7, 2018, suspending the statute of limitations as of February 2, 2018, when the request was sent to the BVI. Id. Ex. 2 at 1-2. She reiterated the offenses that the grand jury was considering and found that it "reasonably appear[ed], based on a preponderance of evidence presented to the Court, that evidence of the offenses under investigation [wa]s located in the British Virgin Islands." Id. Ex. 2 at 1. The BVI responded to the official request on June 11, 2018. Id. Ex. 3; Gov't Opp'n to Mot. to Dismiss at 5.

         Then, on September 28, 2018, the Government submitted an ex parte application based on a September 27, 2018 official request from the Office of International Affairs of the Department of Justice to the United Arab Emirates ("UAE"). Def.'s Mot. to Dismiss Ex. 5 at 1; see Id. Ex. 4 (redacted request to UAE). In its application, the Government explained that a grand jury was conducting an investigation of Mr. Michel, Mr. Low, and others "for the following offenses: 18 U.S.C. §§371 (conspiracy), 1001 (scheme to conceal and false statements), and 1519 (falsification of records); and 52 U.S.C. §§30116 (contributions in excess of legal limits) and 30121 (contributions and donations by foreign nationals)." Id. Ex. 5 at 1.

         In its second application, the Government specifically requested information pertaining to Associate B, who purportedly owned a company suspected to be involved in funneling the alleged funds as part of the conduit scheme. Id. Ex. 5 at 4. Associate B was a United States citizen who was believed to be residing in the UAE. Id. It further described the evidence requested as including "evidence showing the source of the funds transferred to Michel by Low [and various corporate entities potentially connected with Associate B]; [Associate B]'s knowledge of the control, if any, that Low exercised over the funds paid to Michel and subsequently donated to the United States Presidential election in 2012; [Associate B]'s knowledge of Low's intentions regarding the United States Presidential election in 2012, and what, if any, influence Low intended to exercise during the campaigns; and [Associate B]'s knowledge of the relationship and dealings between Michel and Low." Id. Ex. 5 at 4.

         Chief Judge Howell granted the Government's second ex parte application on September 28, 2018. Id. Ex. 6 at 1. The Order granting the application suspended the statute of limitations commencing on September 27, 2018. Id. Ex. 6 at 2. Like with the first Order, this one repeated the offenses under investigation according to the ex parte application and found that, under the preponderance of evidence standard, it appeared that "evidence of the offenses under investigation [wa]s located in the United Arab Emirates." Id. Ex. 6 at 1. According to the Government, the UAE has not yet responded to its request. Gov't Opp'n to Mot. to Dismiss at 6.

         II. DISCUSSION

         Mr. Michel has made three pretrial Motions: a Motion to Dismiss Counts Two and Three, a Motion to Sever Count Four, and a Motion for a Bill of Particulars. The Court considers each Motion in turn.

         A. Motion to Dismiss Counts Two and Three

         Mr. Michel first moves to dismiss Counts Two and Three of the Indictment on the grounds that they are barred by the applicable five-year statutes of limitations. See 18 U.S.C. § 3282(a) (providing five-year statute of limitations for non-capital criminal offenses, unless otherwise specified). He also challenges Count Two on duplicity grounds. Federal Rule of Criminal Procedure 12 provides that a "party may raise by pretrial motion any defense, objection, or request that the court can determine without a trial on the merits." Fed. R. Crim. P. 12(b)(2). When considering a motion to dismiss an indictment, a court must assume the truth of the factual allegations in the indictment. United States v. Ballestas, 795 F.3d 138, 149 (D.C. Cir. 2015). The Court first addresses Mr. Michel's arguments regarding Count Two before turning to his arguments related to Count Three.

         1. Count Two is not barred by the statute of limitations or duplicitous.

         Count Two charges Mr. Michel with concealment of material facts in violation of 18 U.S.C. § 1001(a), a statute that can be violated in three ways. The Indictment alleges that Mr. Michel violated it in the ways outlined by subsections 1001(a)(1) and 1001(a)(2). Subsection 1001(a)(1) proscribes "knowingly and willfully" falsifying, concealing, or covering up "by any trick, scheme or device a material fact" in "any matter within the jurisdiction of the executive, legislative, or judicial branch of the Government of the United States." 18 U.S.C. § 1001(a)(1). Subsection 1001(a)(2) proscribes "knowingly and willfully" making "any materially false, fictitious, or fraudulent statement or representation" in the jurisdiction of the same. Id. § 1001(a)(2). The penalties for violating this provision include a fine and imprisonment of up to five to eight years. Id. § 1001(a). In particular, the Indictment alleges that Mr. Michel violated subsection 1001(a)(2) through a scheme, trick, and device, and that the acts constituting that scheme ranged from July 20, 2012, when Political Committee A made its first false report, to June 15, 2015, when Mr. Michel submitted his own declaration the FEC. Indict. ¶¶ 71-72.

         Mr. Michel argues that this count is barred by the statute of limitations for two reasons. First, he claims that Section 1001 is not a continuing offense for statute of limitations purposes. And because it is not a continuing offense, each of the allegedly false statements must be its own charge, and he therefore challenges it on duplicity grounds. Second, he contends that the Government's application to suspend the statute of ...


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