Matthew Sanderson Comments on FARA Enforcement

Skadden, Arps, Meagher, Slate & Flom sought to close the doors on its unwelcome connection to the Mueller probe when it inked a $4.6 million settlement with the Department of Justice in January, resolving claims that it violated the Foreign Agents Registration Act by not disclosing work undertaken on behalf of the Ukrainian government.

 . . .

It will be a “continual reminder of something they wanted to move past once they signed the settlement agreement in January,” said Matt Sanderson, a member at Caplin & Drysdale.

Sanderson, an expert on compliance with the FARA statute, noted that Skadden wound up on the hot seat because of its failure to exercise due diligence after the Department of Justice made an initial inquiry in December 2012 about whether the firm’s work for Ukraine required it to register. That came less than a week after Craig spoke with several reporters about a report the a report the firm prepared about the prosecution of Yulia Tymoshenko, a former prime minister and political rival of the country’s president at the time, Viktor Yanukovych.

Sanderson said the firm’s laissez-faire response was in keeping with a previous standard, but that kind of approach no longer cuts it.

“They’re sending a message to the regulated community that they’re no longer going to accept a half-hearted effort in responding to letters of inquiry,” he said.

“It’s hard to think of a better scenario than that of Skadden: ‘We’re trusting the word of a former White House counsel, a very prestigious lawyer, we’re trusting him to be accurate and complete. It was reasonable for us to not look at the facts independently and pull all communications,’” Sanderson said. “There are not many law firms that are responding to letters who have facts that are that good.”

 . . .

Sanderson emphasized that the charges against Craig, particularly the second count of providing misstatements under FARA, are no slam dunk for the government. The defendant will likely argue that it does not apply because he never registered under FARA, and also that the statute of limitations has run.

“On that particular legal issue, there’s no precedent,” Sanderson said.

For the full article, please visit The American Lawyer’s website (subscription required).

Excerpt taken from the article “Ex-Partner's Fight Against Lobbying Charges to Put Skadden Back in Limelight” by Dan Packel for The American Lawyer.