CrimeSteve Bannon Charged with Defrauding Donors to “We Build the Wall” Campaign

Steve Bannon, President Donald Trump’s former top political adviser, was charged today (Thursday) in New York with defrauding donors in a scheme related to an initiative called “We Build the Wall,” an online crowdfunding effort which collected more than $25 million from citizens who wished to help Trump’s border wall project for the U.S.-Mexico border.

“As alleged, the defendants defrauded hundreds of thousands of donors, capitalizing on their interest in funding a border wall to raise millions of dollars, under the false pretense that all of that money would be spent on construction,” Audrey Strauss, the acting United States attorney in Manhattan, said in statement Thursday. “While repeatedly assuring donors that Brian Kolfage, the founder and public face of We Build the Wall, would not be paid a cent, the defendants secretly schemed to pass hundreds of thousands of dollars to Kolfage, which he used to fund his lavish lifestyle.”

U.S. postal inspectors arrested Bannon in the early hours of Thursday on a boat off the coast of Connecticut. They brought him to Manhattan where he faced charges in a two-count indictment unsealed in federal district court. He is expected to appear before a U.S. magistrate judge in New York later on Thursday.

Federal authorities say Bannon led a group of three other men — Brian Kolfage, 38, an Air Force veteran from Miramar Beach, Florida; Andrew Badolato, 56, a financier from Sarasota, Florida; and Timothy Shea, 49, of Castle Rock, Colorado – in plotting to defraud donors to the We Build the Wall project.

Prosecutors say that as the founder of We Build the Wall, Kolfage, in letters and emails to potential donors and on the project’s website, promised that he would “not take a penny in salary or compensation,” and that every penny raised would be used “in the execution of our mission and purpose.”

Fox News reports that within a week of Kolfage launching the campaign in December 2018, they raised roughly $17 million. Prosecutors said that due to concerns over where the money was going, the crowdfunding platform told Kolfage to identify a nonprofit that the money would go to or the funds would be returned. At that point, prosecutors said, Bannon and Badolato created the nonprofit We Build the Wall Inc.

The stated goal of the initiative was then changed from giving the money to the government — for the purpose of augmenting the funds allocated by Congress or by executive order — to using the money to privately construct the wall. Past donors had to agree to have their money used for that purpose. In seeking the permission of donors, the founders, again, assured that all of the money would go to wall construction, and not to Kolfage or the organization’s board, the indictment said.

Prosecutors charge that these promises were false. Kolfage secretly took more than $350,000 in donations for his own personal use. Prosecutors say that Bannon used an unnamed nonprofit organization he created to receive more than $1 million from the donations to We Build the Wall, using the hundreds of thousands of dollars to pay off personal expenses and keeping the rest in his bank account.

To conceal the illicit flow of money, prosecutors said, the four men routed payments from “We Build the Wall” not only through Mr. Bannon’s nonprofit group, but also through a shell company controlled by Shea.

Prosecutors say Bannon and the others concealed the payments to themselves “by using fake invoices and sham ‘vendor’ arrangements,” as well as other means of keeping the payments quiet.

Bannon and the other defendants were each charged with conspiracy to commit wire fraud and conspiracy to commit money laundering. Each count carries a maximum penalty of 20 years in prison.