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Ex-Trump aide Bannon pleads not guilty in border wall scheme

Steve Bannon, former President Donald Trump's former chief strategist, talks about the approaching midterm election during an interview with The Associated Press, Sunday, Aug. 19, 2018, in Washington. Bannon told the Associated Press that if the elections were held today, he believed the GOP would lose 35 to 40 seats and the House of Representatives, but argued there was time to turn that around. (AP Photo/J. Scott Applewhite)

NEW YORK (AP) — President Donald Trump’s former chief strategist, Steve Bannon, was pulled from a luxury yacht and arrested Thursday on allegations that he and three associates ripped off donors trying to fund a southern border wall, making him the latest in a long list of Trump allies to be charged with a crime.

The organizers of the
“We Build The Wall” group portrayed themselves as eager to help the
president build a “big beautiful” barrier along the U.S.-Mexico border,
as he promised during the 2016 campaign. They raised more than $25
million from thousands of donors and pledged that 100% of the money
would be used for the project.

But according to the criminal
charges unsealed Thursday, much of the money never made it to the wall.
Instead, it was used to line the pockets of group members, including
Bannon, who served in Trump’s White House and worked for his campaign.

allegedly took over $1 million, using some to secretly pay co-defendant
Brian Kolfage, an Air Force veteran who lost both legs in a mortar
attack in Iraq and the founder of the project, and to cover hundreds of
thousands of dollars in personal expenses.

“This case should serve
as a warning to other fraudsters that no one is above the law, not even
a disabled war veteran or a millionaire political strategist,” said
Philip R. Bartlett, inspector-in-charge of the New York office of the
U.S. Postal Inspection Service, which arrested Bannon aboard a luxury
yacht at 7 a.m.

Hours after his arrest, Bannon, 66, of Washington,
D.C., pleaded not guilty during an appearance in a Manhattan federal
court. He is the latest addition to a startlingly long list of Trump associates who have been prosecute
d, including his former campaign chair, Paul Manafort, whom Bannon
replaced, his longtime lawyer, Michael Cohen, and his former national
security adviser, Michael Flynn.

Trump has also made clear that he
is willing to use his near-limitless pardon power to help political
allies escape legal jeopardy, most recently commuting the sentence of
longtime political adviser Roger Stone.

Bannon was taken into
custody on a 150-foot (45-meter) yacht called Lady May, which was off
the coast of Connecticut, authorities said. The boat is owned by exiled
Chinese billionaire Guo Wengui and currently for sale
for nearly $28 million. According to Marine Traffic, a commercial
tracking service, the vessel’s transponder signal went dark on June 17,
shortly after it departed a port in Connecticut en route to Miami,
potentially indicating its beacon was inoperable or had been turned off.

his hearing, Bannon appeared by video with his hands cuffed in front of
him and a white mask covering most of his face. He rocked back and
forth on a chair in a holding cell with his lawyers on the telephone.
The magistrate judge approved Bannon’s release on $5 million bail,
secured by $1.75 million in assets.

When he emerged from the
courthouse, Bannon tore off his mask, smiled and waved to news cameras.
As he went to a waiting vehicle, he shouted, “This entire fiasco is to
stop people who want to build the wall.”

Kolfage, 38, of Miramar
Beach, Florida, did not respond to requests for comment. Also charged
were Andrew Badolato, 56, of Sarasota, Florida, and Timothy Shea, 49, of
Castle Rock, Colorado, the owner of an energy drink company called
Winning Energy. The company’s cans feature a cartoon superhero image of
Trump and claim to contain “12 oz. of liberal tears.” Shea appeared at a
brief virtual hearing in Denver.

Other prominent members of the
wall group included former Kansas Secretary of State Kris Kobach, its
general counsel; Erik Prince, founder of the controversial security firm
Blackwater; former Republican Rep. Tom Tancredo of Colorado; and former
major league baseball pitcher Curt Schilling. They were not named in
the indictment.

After the arrest, Trump quickly distanced himself from Bannon and the project.

I read about it, I didn’t like it. I said this is for government, this
isn’t for private people. And it sounded to me like showboating,” he
told reporters at the White House.

An immigration plan unveiled by
Trump last year included a proposal to allow the public to donate
toward his long-promised wall, as the Kolfage group had originally said
was its mission before shifting its focus to private construction. But
Trump later denounced the project publicly, tweeting last month that he
“disagreed with doing this very small (tiny) section of wall, in a
tricky area, by a private group which raised money by ads” and claiming,
“It was only done to make me look bad.”

Attorney General William
Barr told The Associated Press he had been made aware of the
investigation into Bannon months ago but did not say whether the
president had been informed.

According to the indictment, the
defendants used fake invoices, another nonprofit and sham vendor
arrangements to try to hide their efforts to siphon money. Under the
arrangement, Bannon and his co-defendants allegedly paid Kolfage
$100,000 up front and an additional $20,000 monthly, all while claiming
they served as volunteers and that Kolfage was not paid.

indictment said Kolfage “went so far as to send mass emails to his
donors asking them to purchase coffee from his unrelated business,
telling donors the coffee company was the only way he ‘keeps his family
fed and a roof over their head.’”

Kolfage eventually spent some of
the over $350,000 he received on home renovations, payments toward a
boat, a luxury SUV, a golf cart, jewelry, cosmetic surgery, personal tax
payments and credit card debt.

All four were charged with
conspiracy to commit wire fraud and conspiracy to commit money
laundering. Each charge carries a potential penalty of up to 20 years in

Originally called “We the People Build the Wall,” the
campaign launched in December 2018 and raised approximately $17 million
in its first week. But it soon drew scrutiny, according to the
indictment. The crowdfunding site that hosted the campaign suspended it
and threatened to return donations unless the money was transferred to a
legitimate nonprofit. Bannon was brought in around that time.

Stockton, who helped start the campaign and then left the project to
work on the upcoming presidential election, said it seemed clear that
prosecutors were “attacking political infrastructure that supports
President Trump right before the election.” He was not charged in the

Benjamin Harnwell, who with Bannon launched an institute in
Italy to train future populists, called the indictment “spurious” and
evidence that the “forces of darkness” would stop at nothing to destroy
the combative Bannon.

A voice of nationalist, outsider
conservatism, Bannon led the conservative Breitbart News before being
tapped to serve as chief executive officer of Trump’s campaign in its
critical final months. He later served as chief strategist during the
turbulent early days of Trump’s administration and was at the forefront
of many of its most contentious policies, including its travel ban on
several majority-Muslim countries.

But Bannon, who clashed with
other top advisers, was pushed out after less than a year. And his split
with Trump deepened after he was quoted in a 2018 book making critical
remarks about some of Trump’s adult children. Bannon apologized and soon
stepped down as chairman of Breitbart.

Bannon, who served in the
Navy and worked as an investment banker at Goldman Sachs and as a
Hollywood producer before turning to politics, now hosts a pro-Trump
podcast called “War Room,” which began during the president’s
impeachment proceedings and has continued during the pandemic.

A day before the indictment was unsealed, Kolfage was a featured guest on the show and solicited donations.

Long and Colvin reported from Washington. Associated Press writers Jennifer Peltz in New York; Nomaan Merchant in Northbrook, Illinois; Cedar Attanasio in Santa Fe, New Mexico; Dave Collins in Hartford, Connecticut; Mike Balsamo in Cleveland; Nicole Winfield in Rome and Michael Biesecker in Washington contributed to this report.