Welcome to Pay Dirt—exclusive reporting and research from The Daily Beast’s Lachlan Markay on corruption, campaign finance, and influence-peddling in the nation’s capital. For Beast Inside members only.
The Mueller probe is over, but the vehicle that Trumpworld used to finance its legal defense through contributions from big Republican donors remains active—and a number of questions about the fund remain unresolved.
Now government regulators are trying to ensure the rules for such legal-defense funds are put on paper before the next such legal entanglement arises.
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For Trump’s legal-defense fund, officially named the Patriot Legal Expense Fund Trust LLC, the chief question is whose legal bills it paid. We still don’t know, because the fund’s administrators have refused to publicly say—and are not required to do so.
Instead, the fund simply itemizes the payments to law firms, leaving the public to wonder which individuals in Trump’s orbit are benefitting from the generosity of its high-dollar donors—chief among them casino magnate Sheldon Adelson—or even whether those individuals are government officials or not.
In September 2018, for instance, the fund reported paying about $8,500 to the firm Schertler & Onorato, which represents both Republican National Committee security consultant and former Trump bodyguard Keith Schiller as well as Sam Patten, a Republican lobbyist who pleaded guilty to special counsel charges that he acted as an unregistered foreign agent. The same month, it paid nearly $120,000 to the firm Akin Gump Strauss Hauer & Feld. It’s still unclear whose legal services that money financed.
Without that information, it’s impossible to know if, say, a donor is attempting to buy influence with a particular public official by financing that official’s legal defense.
Apparently recognizing the shortcomings in rules governing such legal-defense funds, the Office of Government Ethics is eyeing new regulations on such entities in the future. This week it announced that it is seeking “stakeholder input” on such regulations, which could include efforts to step up financial transparency and reporting requirements.
“There is currently no statutory or regulatory framework in the Executive Branch for establishing a legal expense fund,” OGE wrote. “This limited approach… does not fully address potential appearance concerns with the creation and operation of legal expense funds for the benefit of Executive Branch employees.”
Those new regulations could significantly improve the transparency of such legal-defense funds in the future. For now, though, the Patriot Legal Expense Fund Trust is operating largely in the dark. Just a few weeks ago, it amended a filing from the second quarter of last year. The new filing, submitted to the Internal Revenue Service in late March and made publicly available last week, includes only the cover page and none of the specific financial information such reports are designed to disclose.
It’s not even clear what, exactly, was amended. Nothing on the cover page of the amended report is different from the initial filing. And a spokesman for the legal defense fund didn’t respond to questions about it.
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