Why the Indictment of the Lawyer at the Trump Tower Meeting Matters

The Russian lawyer who attended the 2016 Trump Tower meeting has been charged with obstruction of justice, according to indictments unsealed Tuesday. The charge against Natalia Veselnitskaya relates to a money laundering case separate from the investigation into whether Russia interfered in the 2016 U.S. presidential election, but the court documents provide a detailed account of her close relationship with the Kremlin.

Veselnitskaya is best known for offering members of Donald Trump’s campaign team supposed dirt on Hillary Clinton in the now infamous meeting at Trump Tower, but she was also the lawyer for Prevezon Holdings, which was accused of using proceeds from a massive Russian tax fraud scheme to buy property in New York City. The lawyer who uncovered the scheme, Sergei Magnitsky, died a grisly death in a Moscow prison. To prove that the property was bought with ill-gotten gains, federal prosecutors in the Southern District of New York had to show that the proceeds came from the tax fraud scheme, which is alleged to have involved the Russian police and tax authorities. The case was eventually settled in May 2017.

Jaimie Nawaday, now a partner at the Kelley Drye & Warren law firm, worked on the Prevezon case as an assistant U.S. attorney in the Southern District of New York. Foreign Policy spoke to her about the significance of the charge against Veselnitskaya.

Foreign Policy: Were you surprised by the indictment that was unsealed Tuesday?

Jaimie Nawaday: I wasn’t surprised, but I was very pleased. I assumed after MSNBC aired its program last spring reporting that Veselnitskaya had been emailing the Russian prosecutor in the Prevezon case that we would see charges at some point. And we did, and they came quite quickly.

FP: For those who have not been following it, what was the significance of the Prevezon case?

JN: It was significant because of the death of Sergei Magnitsky and the human rights significance that the case took on, given that Magnitsky was the lawyer who investigated the original Russian tax fraud and was then arrested and imprisoned and ultimately beaten to death. The office doesn’t just look at the dollar value of the case, but there are a whole host of reasons it can look at in deciding to bring a case. A case like Prevezon—that required a tremendous amount of resources, given that there was a foreign tax fraud and an international money laundering scheme that had to be proved. The dollar value at the end of the day is relatively insignificant compared with other cases brought in the Southern District of New York. But it was nevertheless a case certainly worth pursuing because of the human rights significance.

FP: So, in your case, you would have had to prove this underlying crime, that there was a major tax heist that allegedly reached high levels in the Russian authorities?

JN: That’s exactly right because the Prevezon case was a civil forfeiture case, which is sort of a hybrid civil-criminal case. In this case, the allegation was that crime proceeds were used to purchase real estate properties in New York, and in order for them to be seized and forfeited, the government had to prove that this Russian tax fraud had occurred. And not only that but trace the proceeds of the fraud that went through shell companies around the world and into New York City real estate.

FP: So that’s perhaps why the Russian prosecutor’s office may not have been so forthcoming in the case if it was potentially a high-level crime carried out in Russia?

JN: Right. I think historically, there has not been a lot of cooperation from Russia for U.S. prosecutions, and this certainly was no exception, whatever the reasons were. Sometimes the response back from Russia is worse than nothing.

FP: What do you mean by worse than nothing?

JN: You can’t prove a Russian tax fraud occurred and trace proceeds without Russian court documents, tax records, incorporation records, bank records—all sorts of things were needed given the nature of the scheme that was alleged in Prevezon. And not only were the requested records not provided, but the Russian government said that the case had no merit and that essentially the U.S. prosecutors had been duped by Bill Browder [the financier whose company was defrauded by the scheme Magnitsky uncovered] and that we should proceed to jointly investigate him instead. In this case, the defense argued, including Veselnitskaya, that the response that came back from the Russian government was exculpatory as to her clients.

FP: Can you explain in layman’s terms what Tuesday’s indictment accuses Veselnitskaya of doing and why this is so significant?

JN: In the course of the Prevezon case, a request was sent from U.S. prosecutors to Russian prosecutors. It’s called an MLAT [mutual legal assistance treaty], and it’s essentially like an international subpoena. It’s a request to another country that says, “We have this case. These are the allegations, here is the evidence that we need, here’s why we need it, and please help us.”

Russian prosecutors are obviously supposed to keep that request and its response confidential and then transmit it back to the United States. What we learned in this particular case was that the Russian prosecutors were corresponding with Veselnitskaya while preparing their response back to the United States. So she not only knew about the U.S. request having been made, but she actually had input into drafting the response back to the United States. And, of course, the response that came back was not at all what U.S. prosecutors would want. It provided none of the records, and it suggested that the case had no merit. So essentially she had rigged the MLAT process in the Prevezon case and was charged with obstruction of justice as a result of her interference. And then her representations to court in the Prevezon case obviously suggested that she had nothing to do with the process and suggested that the MLAT response was exculpatory.

To boil it down, the indictment was for interfering with the U.S. judicial process in the Prevezon case.

FP: What were the consequences for the case?

JN: The immediate consequence was that the prosecution team was left without evidence that it was certainly going to need to prove its case at trial. So what that means as a practical matter is they had to look for some type of equivalent or similar evidence, which they were able to do, fortunately.

FP: If an MLAT request is based on good faith from one attorney’s office to another, what guarantees do you have that the information you’re getting back is legitimate, especially if it’s coming from an undemocratic country?

JN: Well, the short answer is you don’t. It’s a terrible dilemma to be in because you have to choose whether to put out requests and possibly compromise the confidentiality of the investigation, which would have occurred in Prevezon. I mean, had that been a pending criminal investigation, that could have jeopardized the safety of all sorts of witnesses. On top of that, you have to worry about the sort of falsely exculpatory language coming back from the foreign government. But if you don’t send out the requests at all, you probably can’t proceed with the case.

FP: Were you concerned about witness safety when you were preparing the case?

JN: Witness safety is always a concern in a case like that.

FP: What does Tuesday’s indictment say about Russia’s, or any authoritarian state’s, ability to play a malevolent role in a U.S. legal case?

JN: It makes clear that this has happened in the past. The good news is that it’s also heightened awareness of the real risk that is presented. Who knows what ultimately comes of the prosecution. But it shows that the prosecutor’s office will stand on its principles.

This conversation has been condensed and edited for publication.