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A senior finance executive at Donald J. Trumps family business has testified before a state grand jury in Manhattan as prosecutors ramp up their investigation of Mr. Trump and his company, according to people with knowledge of the matter.

The executive, Jeffrey McConney, has long served as the Trump Organizations controller, making him one of a handful of high-ranking executives to oversee the companys finances.

The testimony comes as the prosecutors have trained their focus on one of Mr. McConneys colleagues, Allen H. Weisselberg, the Trump Organizations long-serving chief financial officer. The prosecutors, who are working for the Manhattan district attorney, Cyrus R. Vance Jr., have examined the extent to which Mr. Trump handed out valuable benefits to Mr. Weisselbergs family and whether taxes were paid on those perks, The New York Times has reported.

Mr. Vances office has mounted an aggressive effort to gain Mr. Weisselbergs cooperation against Mr. Trump and the Trump Organization, people with knowledge of that effort have said. When seeking to turn an insider into a cooperating witness, prosecutors often seek leverage over the person, including any evidence of past wrongdoing, and then typically offer leniency in exchange for testimony or assistance.

The decision to subpoena Mr. McConney, who has worked at the company for nearly 35 years, suggests that the examination of Mr. Weisselbergs conduct has reached a new phase, with the grand jury hearing evidence about him.

Under state law, witnesses such as Mr. McConney who appear before the grand jury are granted immunity on the subject of their testimony. They cannot exercise their Fifth Amendment right to refuse to answer questions on the grounds that they might incriminate themselves. (If they lie, they still can be prosecuted for perjury.)

A lawyer for Mr. McConney could not be reached for comment. Mary E. Mulligan, a lawyer for Mr. Weisselberg, declined to comment, as did the Trump Organization.

ABC News first reported that Mr. McConney had testified before the grand jury. Other witnesses have also been also been called to testify in recent days.

Mr. Vances office recently convened a special grand jury to hear evidence about Mr. Trump, Mr. Weisselberg and the Trump Organization, according to a person with knowledge of the matter. While Mr. Vances office was already using grand juries to issue subpoenas, obtain documents and hear some testimony, the new grand jury is expected to hear from a range of witnesses in the coming months and could eventually vote on an indictment.

There is, however, no indication that the investigation has reached such an advanced stage or that prosecutors have decided to seek charges against Mr. Trump or his company.

Mr. Trump, a Republican, has argued that the investigation is a politically motivated fishing expedition. A spokesman for Mr. Vance, a Democrat, declined to comment.

The investigation into Mr. Weisselberg centers on the valuable benefits that Mr. Trump provided him and his family over the years, including tens of thousands of dollars in private school tuition for at least one of Mr. Weisselbergs grandchildren, free apartments and leased cars, The Times has reported.

In general, those types of benefits are taxable although there are some exceptions and the prosecutors appear to be scrutinizing whether Mr. Weisselberg failed to pay those taxes.

More broadly, the investigation into the Trump Organization has focused on whether Mr. Trump and the company manipulated property values to obtain certain loans and tax benefits, among other potential financial crimes.

Earlier in the investigation, the prosecutors had focused on hush money payments made during the 2016 presidential campaign to two women who said they had affairs with Mr. Trump.

Mr. McConneys name surfaced in those early stages in a subpoena issued to the Trump Organization in August 2019. The prosecutors, seeking records related to the investigation into the hush money records, sought documents and communications involving a number of people, including Mr. McConney, Mr. Weisselberg and other Trump Organization employees.

Mr. McConney, 66, graduated from Baruch College in 1978 after studying accounting and finance, and joined the Trump Organization about a decade later.

He kept a low profile for years even as he rose to become the companys controller and a senior vice president. But during the 2016 presidential campaign, he appeared in news reports to answer questions about how Mr. Trumps charitable foundation was raising and spending its money.

Asked in September 2016 to account for why the foundation had donated $25,000 to a campaign group associated with a Florida prosecutor who was reportedly weighing an investigation into Trump University, Mr. McConney told The Washington Post, That was just a complete mess-up on names. Anything that could go wrong did go wrong.

Original post:
Senior Trump Organization Official to Testify Before Grand Jury - The New York Times

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Some people do not like to be told no. I learned this lesson the hard way on Sept. 21, 2015, at a border checkpoint in Eagle Pass, Texas.

Although I was born in Chicago, I have family in Mexico that I had not seen in years. So I drove from my home in rural Kentucky for a visit. While waiting to cross a bridge over the Rio Grande, I snapped a few photos on my phone so my cousins could see where I was.

Using the camera was legal, but two agents from U.S. Customs and Border Protection saw me acting like a tourist and told me to pull over. They asked me to delete the photos and I agreed, but that did not end the confrontation.

They also wanted me to hand over the phone and provide my passcode. I had done nothing wrong, and the agents had no probable cause or warrant, so I declined. I had rights, I explained, but the agents did not care. You dont have rights here, one of them told me.

What came next was the start of a five-year ordeal that culminated in April when the U.S. Supreme Court declined to hear my case. The agents opened my door, unbuckled my seatbelt and yanked me from the truck.

Then they proceeded to rummage through the vehicle. The scene seemed surreal, like I had fallen asleep and awaken in a land without liberty. I looked around for a flag or anything to prove I was still on U.S. soil.

Eventually, the searchers found five bullets that I had forgotten in the trucks center console, and accused me of carrying munitions of war. Using the discovery as a pretext, they handcuffed me, interrogated me and locked me in a concrete cell with no windows.

Four hours later, they released me but refused to return the truck. Instead, they attempted civil forfeiture, a moneymaking scheme that allows the government to seize and keep property permanently without convicting the owner of a crime.

Rather than enjoying a family reunion, I found myself on the side of the road with my suitcase1,300 miles from home. For the next two years, the government buried me in paperwork and ignored my petitions for a hearing to reclaim the truck.

I could see the inside of a holding cell, but not the inside of a courtroom.

While all of this was going on, I had to continue making loan, registration and insurance payments on the truck to maintain my credit score, something essential for my livelihood. Overall, I paid thousands of dollars for a vehicle I could not drive.

Finally, I partnered with a public interest law firm called the Institute for Justice, which fights civil forfeiture. The government quickly returned my truck following a lawsuit, to make it go away, but refused to adopt procedures to prevent similar misconduct in the future. The government also refused to compensate me for the financial hardships and civil rights violations.

A trial court agreed that the government owed me nothing and could hold my truck for years without a hearing, and the 5th U.S. Circuit Court of Appeals came to the same conclusion. Despite the setbacks, I still had faith in the system. So I went to the Supreme Court with a simple question: Can the government take a vehicle and try to keep it without giving the owner a prompt hearing?

The Fifth Amendment guarantees due process, which should make the answer obvious, but all I got from the court of last resort was silence. The rejection of my case left me looking around, once again, for evidence that I was still standing on U.S. soil.

The government exists to protect individual rights, not trample on them. As things stand, people cannot demand prompt hearings while government abuse is ongoing, and they cannot hold the government accountable afterward by seeking damages.

Congress cannot let the lack of accountability stand. It must pass meaningful reform.

Otherwise, what can I tell my relatives in Mexico? When I failed to arrive on time for the visit in 2015, they worried that criminals had intercepted me south of the border. The truth was worse. My own government did so before I even could leave the United States.

Gerardo Serrano lives on a farm in Tyner, Kentucky.

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Read the original post:
Op Ed: Border Agents Took My Truck, and the Supreme Court Shrugged - Houston Press

Imprisoned felon Martin Shkreli nicknamed "Pharma Bro" was busted for using a contraband phone to discuss pharmaceutical industry business matters with associates from behind bars.

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U.S. District JudgeDenise Cote made the ruling on Tuesday, saying the 38-year-old widely disdained ex-pharmaceutical executive used the contraband phone to communicate with former Vyera Pharmaceuticals colleagues.

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Shkreli founded Phoenixus, the parent company of Vyera, which is the rebranded name of Turing Pharmaceuticals. It's the company behind the overnight price hike of the life-saving antiparasitic medication, Daraprim, whose cost Shkreli jacked up from $13.50 per tablet to over $500 per tablet in 2015.

"The plaintiffs have shown that Shkreli has used a prison phone to discuss highly relevant company business and that he knew in doing so that those communications should have been but would not be preserved," Cote's 11-page ruling states. "Shkreli's use of the prison phone to discuss business development constitutes intentional spoliation and warrants sanctions."

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Two Vyera executives testified that they were in communication with Shkreli from 2017 to 2019 while the reputed Pharma Bro was incarcerated at a low-security prison in Allenwood, Pennsylvania.

Akeel Mithanisaid he communicated with Shkreli about business development from the end of 2018 through February 2019, sometimes using the encrypted messaging platform, WhatsApp, while Kevin Mulleady provided two text messages he received from Shkreli in October 2017.

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When asked during a deposition earlier this year whether he had a contraband phone in his procession or had access to one in prison, Shkreli invoked his Fifth Amendment right.

"The plaintiffs have been prejudiced by Shkreli's conduct because they do not have access to messages about Vyera that Shkreli sent and received while in prison," Cote said. "In an exercise of discretion, however, this Court declines to impose the plaintiffs' proposed sanctions. As a result, Shkreli's proposed sanction that he be precluded from introducing any argument or evidence contrary to the presumption that he communicated with Mr. Mulleady and Mr. Mithani about company business from prison is adopted."

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Cote did not find that Vyera as a company fell short in failing to preserve Shkreli's messages by wiping his company-issued iPhone during a factory reset, even after regulators implemented a preservation notice; however, she did order Vyera to file a letter stating whether it searched for the messages in the company's iCloud backup.

"Although it is undisputed that the Shkreli phone was subject to a factory reset in or around 2016-2017, Vyera has represented that it automatically backs up employee messages to iCloud," she said. "No party has suggested that that back up would not include text messages Shkreli sent and received using the Shkreli Phone. Counsel for Vyera will be required to confirm that an appropriate search has been conducted for these messages and that any relevant communications have been produced."

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After a federal jury convicted Shkreli in 2017 of securities fraud for an unrelated "Ponzi-like scheme" involving investors in another drug company, Retrophin, he was slapped with additional civil antitrust charges in connection to the Daraprim scandal.

Those accusations, says Law & Crime, could lead to Shkreli'slifetime banfrom the pharmaceutical industry.

See the rest here:
Imprisoned Felon Martin Shkreli Busted For Using Contraband Phone To Discuss Pharma Business With Associates Following Daraprim Scandal - Radar Online

Ex-pharmaceutical executive Martin Shkreli speaks to the press in front of U.S. District Court for the Eastern District of New York with members of his legal team after the jury issued a verdict on Aug. 4, 2017.

Not even a seven-year sentence for securities fraud can keep Martin Shkreli from allegedly engaging in the machinations that earned him the nickname Pharma Bro.

In a ruling on Tuesday, a federal judge found that Shkreli used a contraband phone to communicate with his associates in the company behind Daraprim, the live-saving drug whose price he jacked up 40-fold roughly half a decade ago.

After the drug went from $13.50 per tablet to $500 overnight, Shkreli was criminally prosecuted for an unrelated Ponzi-like scheme involving investors in another drug company, Retrophin.

After a federal jury convicted him of securities fraud charges, state and federal regulators piled on civil antitrust charges revived from the old Daraprim scandal. Those accusations could lead to Shkrelis lifetime ban from the pharmaceutical industry.

En route to trial, the Federal Trade Commission and multiple attorneys general asked U.S. District Judge Denise Cote to sanction Shkreli for destroying evidence. They asked the judge to effectively decide the cases major issues in their favor before a trial, seeking judicial findings that Shkreli was continuously involved in Vyera and Phoenixuss business from 2015 to present, communicated with Vyera executives about company business from prison, and engaged in the challenged conduct to restrain generic entry into the Daraprim market.

Refusing to go quite so far, Judge Cote made clear that she agreed with at least some of the regulators allegations about Shkrelis handling of the evidence.

The plaintiffs have shown that Shkreli has used a prison phone to discuss highly relevant company business and that he knew in doing so that those communications should have been but would not be preserved, the 11-page ruling states. Shkrelis use of the prison phone to discuss business development constitutes intentional spoliation and warrants sanctions.

The business communications at issue have to do with the company Vyera, the rebranded name of the company behind Shkrelis price hike of Daraprim, Turing Pharmaceuticals. Phoenixus is the parent company of Vyera. Shkreli founded the company.

Vyera executive Akeel Mithani testified that he communicated with Shkreli about business development from the end of 2018 through February 2019, while Shkreli was incarcerated inside a low-security prison in Allenwood, Pennsylvania.

Some of those communications took place over the encrypted messaging platform WhatsApp, Mithani testified.

Kevin Mulleady, an owner and former director of Vyera, produced two text messages that he received from a still-incarcerated Shkreli in October 2017, some two months after the reputed Pharma Bros conviction.

When asked during a deposition earlier this year whether he had a cell phone in prison, Shkreli invoked his Fifth Amendment right against self-incrimination, according to the ruling.

The plaintiffs have been prejudiced by Shkrelis conduct because they do not have access to messages about Vyera that Shkreli sent and received while in prison, Judge Cote found, opting for the lighter sanctions Shkreli proposed rather than what regulators requested.

In an exercise of discretion, however, this Court declines to impose the plaintiffs proposed sanctions, her ruling states. As a result, Shkrelis proposed sanction that he be precluded from introducing any argument or evidence contrary to the presumption that he communicated with Mr. Mulleady and Mr. Mithani about company business from prison is adopted.

Cote declined to find that Vyera fell short in failing to preserve Shkrelis messages by wiping his company-issued iPhone during a factory reset between 2016 and 2017, after regulators placed a preservation notice.

Although it is undisputed that the Shkreli phone was subject to a factory reset in or around 2016-2017, Vyera has represented that it automatically backs up employee messages to iCloud, Judge Cote found. No party has suggested that that back up would not include text messages Shkreli sent and received using the Shkreli Phone. Counsel for Vyera will be required to confirm that an appropriate search has been conducted for these messages and that any relevant communications have been produced.

Cote directed Vyera to file a letter stating whether it searched the companys iCloud backup to or from the Shkreli phone.

Shkrelis lawyer did not immediately respond to an email requesting comment.

Read the ruling below:

(Photo by Spencer Platt/Getty Images)

Have a tip we should know? [emailprotected]

Link:
Pharma Bro Martin Shkreli Gets a Slap on the Wrist for Using Contraband Phone to Discuss Pharma Business Behind Bars - Law & Crime

When I teach civil rights law, I always start the semester with a misleadingly straightforward hypothetical scenario. Imagine a police officer pulls over an unarmed driver for a broken taillight and eventually shoots and kills the driver. Did the officer break any criminal or civil rights laws? This exercise never fails to set off a fiery debate: Did the driver obey the officer? Why couldnt the cop have used a taser? Dont people have a right to not to be killed over a minor traffic infraction? And sooner or later, one student typically reminds the class of a fundamental point about America: But hes a police officer.

Think about that. But hes a police officer.

When cops, unlike average civilians, deploy brute force under certain circumstances, we excuse the violence as law and order. But when law enforcement officers abuse their authority, violating our rights, we have federal criminal civil rights law to hold them accountable.

Except we pretty much dont.

Section 242 of Title 18 of the federal codemakesit a crime for a public official acting in their official capacity to willfully deprive a person of their constitutional rights. Yet prosecutors rarely bring charges under the statute, averaging just41cases per year. The recent federal indictment of the Minneopolis police officers related to the killing of George Floyd is an exception that highlights just how infrequent such prosecutions are, even when they are clearly warranted.

Why? The answer boils down to a little-known 1945 Supreme CourtcasecalledScrews v. United States.

In that case, Sheriff Claude Screws of Baker County, Georgia, had arrested Robert Hall, a Black man, for allegedly stealing a tire. Screws and two other officers then drove Hall to the local courthouse, where they bludgeoned him while he was handcuffed with their fists and a blackjack. The officers then dragged Halls limp body from the courthouse to the jail and called an ambulance. Hall died within the hour.

Screws was charged and convicted under the law known today as 242. But he appealed. Screwss argument went something like this: because 242 is so poorly written, he couldnt have known that he was breaking it. And punishing him for a law that he couldnt have known he was breaking, his logic ran, violated his due process rights under the Fifth Amendment.

The Supreme Court agreed and overturnedScrewss conviction. To hear the justices tell it, the statute was indeed so vague that it had failed to give him fair warning about what he could and couldnt do. But rather than strike down 242, the Court decided instead to save the law from unconstitutionality, holding that to violate the law, a public official need willfully deprive a person of their constitutional rights.

If only curing 242s deficiencies had been so simple.

But Congress can fix it, and the Brennan Center has published areportlaying out a blueprint enabling lawmakers to do just that. And it is essential because there are so many places where a lack of local accountability allow police to act with impunity. The broad strokes are illustrated by our two main suggestions.

Start with 242s due process problem. Recall from theScrewscase that criminal defendants bear a right to know what conduct is illegal. Our first recommendation would take care of this by having Congress spell out what conduct is off limits. It can do this by including some of the most egregious criminal civil rights violations the Supreme Court has long understood as out-of-bounds excessive force, sexual misconduct, and deliberate indifference to the medical needs of a person in custody.

Turn now to 242s high standard-of-proof problem. Thanks to theScrewsopinion, prosecutors must establish beyond a reasonable doubt that a public official willfully deprived a person of their rights. But proving specific intent basically, establishing what a person was thinking when they acted is a difficult needle to thread. Hence prosecutors reluctance to bring 242 charges. Indeed, just look at what all it took for Derek Chauvins 242 indictment to happen: a chilling video capturing the barbaric plunder of George Floyds body that sparked a national racial awakening.

Our second recommendation would remedy this. Congress should lower 242s intent standard from willfully to knowingly or recklessly. No longer would a jury need to try to peer into a defendants mind as part of finding a defendant guilty.

By taking together our twin suggestions, Congress would make it easier to pursue and prove 242 violations. And that would signal that our Constitution cannot tolerate palpable misconduct and brutality. That the lives of those routinely subjected to state cruelty matter. That America can be better than this.

Read more:
How Congress Can Give Teeth to the Federal Law on Police Accountability - brennancenter.org