Steve Bannon, the bombastic former high-level advisor to President Donald J. Trump, and three colleagues have been charged with allegedly defrauding donors who support building a border wall in the southwestern United States.
According to information from the U.S. Attorney’s Office for the Southern District of New York of the Department of Justice, Bannon and a trio of alleged accomplices were charged with defrauding “hundreds of thousands of dollars in connection with an online crowdfunding campaign known as ‘We Build the Wall’ that raised more than $25 million.”
Language on the We Build The Wall website refers to it as a 501(c)(4) nonprofit. The New York Field Office of the United States Postal Inspection Service assisted in the case.
Also indicted were Andrew Badolato, who according to the Sarasota Herald-Tribune has been the focus of “numerous lawsuits, substantial monetary judgments and sizeable Internal Revenue Service liens” and is believed to have associated with organized crime family members; Brian Kolfage, a combat-disabled U.S. Air Force veteran who founded We Build the Wall Inc. in December 2018; and, Timothy Shea, acting administrator of the U.S. Drug Enforcement Administration. It was not immediate known if Shea would step down.
We Build the Wall was originally launched as a GoFundMe effort with a $1 billion goal, The NonProfit Times reported in January 2019. When the organization switched to 501(c)(4) status, its then-300,000 donors were required to actively opt in to redirecting contributions to the new nonprofit. It is unknown publicly how many did so, nor whether any of their failures to do so were part of the charges.
All four are each charged with one count of conspiracy to commit wire fraud and one count of conspiracy to commit money laundering, each of which carries a maximum penalty of 20 years in prison.
“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,” Acting U.S Attorney Audrey Strauss said via a statement.
Strauss continued, “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.”
The defendants allegedly “engaged in fraud when they misrepresented the true use of donated funds,” said United States Postal Service Inspector in Charge Philip R. Bartlett via a statement. “As alleged, not only did they lie to donors, they schemed to hide their misappropriation of funds by creating sham invoices and accounts to launder donations and cover up their crimes, showing no regard for the law or the truth.”
According to the statement from the Department of Justice Southern District of New York, the four men, along with others, “orchestrated a scheme to defraud hundreds of thousands of donors, including donors in the Southern District of New York, in connection with an online crowdfunding campaign ultimately known as ‘We Build The Wall’ that raised more than $25 million to build a wall along the southern border of the United States. In particular, to induce donors to donate to the campaign, Kolfage repeatedly and falsely assured the public that he would ‘not take a penny in salary or compensation’ and that ‘100% of the funds raised . . . will be used in the execution of our mission and purpose’ because, as Bannon publicly stated, ‘we’re a volunteer organization.”
Prosecutors allege those representations are false and that those charged received hundreds of thousands of dollars in donor funds from We Build the Wall, which they each used in a manner inconsistent with the organization’s public representations. Prosecutors charged that Kolfage covertly took for his personal use more than $350,000 in funds that donors had given to We Build the Wall, while Bannon, through a nonprofit under his control, received more than $1 million “at least some of which Bannon used to cover hundreds of thousands of dollars” in personal expenses, prosecutors charged.
The men allegedly devised a scheme to route payments from We Build the Wall to Kolface indirectly through a nonprofit and a shell company under Shea’s control, among other avenues. They did so by using fake invoices and sham vendor arrangements.
The case is assigned to U.S. District Judge Analisa Torres in the Southern District of New York. “We Build the Wall Inc., is a Florida nonprofit tax-exempt advocacy organization,” boasting of 500,000 donors. Despite referring to itself as a “Florida non-profit”, a P.O. Box listed at the bottom of the organization’s home page is based in Houston.
As of early morning, August 20, the home page for We Build the Wall features brief testimonials from former Trump campaign manager Corey Lewandowski; Donald Trump Jr.; Kimberly Guilfoyle, a member of the Trump Victory Committee’s finance committee and Donald Trump Jr.’s girlfriend; Brandon Judd, President of the National Border Security Council; and Rep. Louie Gohmert (R-Texas.)