Steve Bannon is released on $5m bail and says 'this entire fiasco is to stop the wall being built' after appearing in court in handcuffs over $25m border wall fundraiser fraud following his arrest on Chinese billionaire's superyacht
Steve Bannon has been released on $5 million bail after appearing in court in handcuffs and pleading not guilty to being part of an alleged crowd funded border wall scam.
The former Donald Trump campaign strategist beamed with excitement as he emerged from Manhattan federal court on Thursday afternoon with his coronavirus mask in one hand and papers in the other.
As he approached a throng of reporters, Bannon said: 'This entire fiasco is to stop people who want to build the wall.'
Bannon had appeared before a judge to answer charges of defrauding hundreds of thousands of people as part of a group pledging to use private donations to build a section of border wall - hours after he was arrested at sea aboard a superyacht owned by a Chinese billionaire.
During the hearing the 66-year-old had his hands cuffed in front of him while a large, white mask covered most of his face. He was still wearing his distinctive two shirts.
He rocked back and forward as he sat on a chair in a holding cell at the courthouse, where he appeared via video while his lawyers dialed in on the telephone.
Magistrate Judge Stewart Aaron approved Bannon's release on $5 million bail, secured by $1.75 million in assets.
Two 'financially responsible' co-signers will have to guarantee his bail and he was ordered to surrender his passport and banned from traveling outside Washington D.C. or contacting his co-defendants without permission. He was specifically banned from private planes and yachts.
The circumstances of his arrest – Bannon was on board the 150-foot yacht the Lady May owned by Chinese billionaire Guo Wengui in Long Island Sound, off the Connecticut coast, NBC News first reported – provided an odd twist that had a onetime top advisor to the president facing charges of helping swindle contributors by funneling charity donations to one of his partners and funding a 'lavish' lifestyle.
DailyMail.com obtained the last photographs of Bannon, hours before federal agents seized him in a dramatic arrest, checking his phone on the $35 million yacht just off Westbrook, Connecticut.
The source who shot the photos said: 'We saw the yacht come in on Tuesday night and the next day we saw a C-130 military plane circle over it, today there were more Coastguard military planes all around it.'
Former Donald Trump campaign strategist Steve Bannon is seen leaving Manhattan Federal Court on Thursday after pleading not guilty to being part of an alleged crowd funded border wall scam
Bannon, 66, beamed with excitement as he emerged from the court after his hearing on charges of conspiracy to commit wire fraud and conspiracy to commit money laundering
Holding his coronavirus mask in one hand, Bannon waved at the crowds gathered outside the courthouse
He was quickly swarmed by reporters desperate to hear what he had to say about the charges leveled against him
From the White House to the big house: Bannon appeared by video link at federal court in Manhattan. He was in a holding cell, handcuffed and wearing two shirts and a mask. He pleaded not guilty to counts of fraud which carry a maximum sentence of 40 years
Magistrate judge Stewart Aaron approved Bannon's release on $5 million bail, secured by $1.75 million in assets.
Chinese authorities have accused Wengui of fraud. He has been pictured with Bannon aboard the megayacht, and this summer they were behind an effort to declare a new 'Federal State of New China' that flew flags towed by planes around New York Harbor.
Bannon helped make confronting China a centerpiece of Donald Trump's 2016 campaign, a posture the president has continued into his tenure in office. Another key tenet of that election was building a wall on the southern border that Trump said Mexico – not the U.S. government – would pay for.
The We Build The Wall scheme raised $25 million to fund its own barriers in Texas and New Mexico, some of which have been built. The group's online appeal for funds included a picture of President Trump and a stamp that said 'Trump Approved.' His son Don Jr. visited one section in Sunland Park, New Mexico, in July 2019.
But prosecutors say it was a scam: donors' cash was also funneled to its founder Brian Kolfage and to Bannon.
Bannon, who helped steer Trump's campaign then joined him in the White House in 2017 as chief strategist only to be forced out, is accused of getting $1 million in the alleged scheme, spending hundreds of thousands of that on 'expenses.
House before his arrest: Steve Bannon, wearing his distinctive two shirts, was on deck checking his phone hours before federal agents, with a C-130 plane overhead, arrested him
Luxury: The Cayman Islands-registered Lady May where Steve Bannon was seized
The group's founder, Kolfage, is also accused of fraudulently pocketing funds. He claimed he did not get a cent from the scheme but instead got $100,000 up front and $20,000 a month salary, prosecutors allege, living a lavish lifestyle at Miramar Beach in the Florida panhandle.
Kolfage, an Iraq war veteran who had both legs amputated and lost his right arm in a rocket attack, was arrested at his home in Florida.
At the White House Trump denied knowing anything about the scheme and tried to distance himself from his former campaign manager.
'I feel very badly. I haven't been dealing with him for a very long period of time,' he said in the Oval Office, adding: 'I haven't been dealing with him at all. It's a very sad thing by Mr. Bannon.'
'He was involved in our campaign and for a small part of our administration.' In fact Bannon was the campaign CEO for its last 88 days after the ousting of Paul Manafort - who is now a convicted felon himself - and then was Trump's 'Chief Strategist,' with a West Wing office close to the Oval Office.
He also tried to distance himself from the scheme despite its ties to his inner circle, saying: 'I don't like that project. I thought it was being done for showboating reasons. It was something I very much thought was inappropriate to be doing.'
The stunning indictment of a top former Trump advisor comes on Day Four of the Democratic convention, when Joe Biden is set to speak.
'No one needed a federal indictment to know that Steve Bannon is a fraud,' said Biden deputy campaign manager Kate Bedingfield on a conference call with reporters.
Trump, she said, 'has consistently used his office to enrich himself, his family and his cronies, so is it really any surprise that yet another one of the grifters he surrounded himself with and placed in the highest levels of government was just indicted? Sadly, it is not.'
Together on the yacht: This is Steven Bannon on the Lady May with its owner Guo Wengui, a fugitive Chinese billionaire who has declared his own new government of China. The 150ft vessel was off Connecticut when he was taken into custody
Live from the yacht - before the feds arrived: Steve Bannon took part in his 'war room' podcast from the Lady May on Wednesday. He was in federal custody and on his way to court the following morning
Seized: This is the Lady May off the Connecticut coast Thursday after the arrest of Steve Bannon.
'Sad.' Donald Trump, who met Iraqi prime minister Mustafa Al-Kadhimi at the White House, tried to distance himself both from Bannon - saying he had not dealt with him for a long time - and the wall scheme, despite its ties to his family and inner circle
Where it is: The Lady May is position just off Westbrook, CT, where it was boarded by federal agents who removed Steve Bannon
How it was marketed: This was the GoFundMe originally set up to 'privately fund' a border wall
Husband and wife scam: Prosecutors say Brian Kolfage funneled cash to himself to pay for boat payments, cosmetic surgery and tax and credit card debt, with his wife Ashley, 34, getting cash which was concealed too. She is not indicted
Trump world star: Donald Trump Jr. visited a section of the wall built by Brian Kolfage's scheme in New Mexico in July 2019
The investigation did not involve the FBI - but did involve the U.S. Postal Inspectors. It was led by prosecutors from the public corruption unit of the United States Attorney's office in Southern News York - the same unit which charged Jeffrey Esptein and arrested Ghislaine Maxwell.
The high-profile arrest raised immediate questions of whether main Justice Department officials were aware of the investigation into a one-time top advisor to the president.
Attorney General Bill Barr told the Associated Press he first learned of the probe several months ago but has not gotten regular briefings on the case.
Prosecutors say the group promised donors it was a volunteer effort that would direct all funds toward a crash effort to construct wall without government red tape. In reality, say federal prosecutors in New York, the group's founders siphoned off funds for themselves.
'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,' according to the indictment unsealed in the Southern District of New York Thursday morning.
'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,' according to the indictment.
'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.'
The indictment states that Kolfage, 37, who lives in Miramar Beach, Florida, with his wife Ashley, 34, 'covertly took for his personal use more than $350,000 in funds that donors had given to We Build the Wall' through a non-profit he controlled.
It states that Bannon, 66, who became wealthy through film investments, consulting, and formerly running the conservative Breitbart website, 'received over $1 million from We Build the Wall, at least some of which Bannon used to cover hundreds of thousands of dollars in Bannon's personal expenses.'
Postal Inspector-in-Charge Philip R. Bartlett: '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.'
The indictment says the alleged fraudsters used a non-profit and a shell company controlled by Kolfage.
They used fake invoices, sham vendors as part of the effort, keeping the system 'confidential' and 'need to know,' according to the indictment, which quotes from a Kolfage email.
Lavish lifestyle: Brian Kolfage boasted about his private jet travel before - now prosecutors say he continued it
Boats too: Florida-based Brian Kolfage boasted about his lifestyle on Instagram - now prosecutors say innocent donors paid for his way of living including payments on his $600,000 boat
Also indicted are Andrew Badolato of Florida and Timothy Shea of Colorado.
According to financial disclosures when he joined the White House staff, Bannon was worth between $10 million and $48 million in 2017, with most of the value in his consulting firm, Bannon Strategic Advisors.
Trump fired Bannon in Agust 2017 after the adviser publicly disagreed with the administration's North Korea policy. Trump later said Bannon had 'lost his mind.'
But more recently Bannon has been an influential Trump world voice, appearing frequently on television and running a podcast where Trump aides are guests. There have been persistent reports of regular contact between the two men, but no known in person meetings.
Board members of We Build the Wall include Erik Prince, a the billionaire mercenary who is and brother of U.S. Education Secretary Betsy DeVos, former Kansas Secretary of State Kris Kobach - another Trump-world figure who led the failed inquiry into alleged voter fraud - and former Boston Red Sox pitcher Curt Schilling.
Kolfage, a Purple Heart triple amputee veteran behind the effort, pushed back at critics after he was accused in public of using funds to fund a lavish lifestyle – which included flying in private jets and buying a $600,000 boat.
He says he bought the vessel a year before the $20 million GoFundMe campaign for the wall. Kolfage was wounded during the Iraq war in 2004.
Pushing back against online critics, We Build The Wall Inc. posted a video on Facebook that showed a factory producing steel bollards.
They wrote: 'Just when we thought that the fake news media couldn't get more ridiculously desperate, they're now proving how low they'll go by claiming that 'We Build The Wall' founder, Brian Kolfage, bought a yacht with the GoFundMe money
Just weeks ago, Trump tweeted out his dissatisfaction with the project after the group built a section of wall just 35 feet from the Rio Grande river on the U.S.-Mexico border, leading to concerns about erosion and flooding.
'I disagreed with doing this very small (tiny) section of wall, in a tricky area, by a private group which raised money by ads,' Trump tweeted. 'It was only done to make me look bad, and [perhaps] it now doesn't.'
In Trump world: Brian Kolfage and his wife Ashley were guests at Mar-a-Lago in February last year where they posed with Eric Trump. Kolfage frequently tagged Donald Trump and his son Don Jr. on Instagram
The group also financed wall in Sunland Park, New Mexico, near El Paso, Texas. The group sells tickets for private tours of this section of wall for $20
'We Build the Wall' has tackled two projects, the three-mile stretch along the Rio Grande in Texas
The group 'We Build the Wall' raised money for construction of this portion of the wall, promoting updates on its social media pages
The explosive indictment comes weeks after Trump fired the U.S. attorney for SDNY in June. It was announced by Acting U.S. Attorney Audrey Strauss, who has stepped into the role after Trump failed in an effort to install his own preferred replacement.
It charges Bannon used the funds he took to secretly repay Kolfage and cover hundreds of thousands of dollars in personal expenses.
The group's original documents posted publicly stated that '100 per cent' of funds would go to the government for wall construction. After Bannon joined the effort, it shifted to building private wall sections.
The group ultimately had to go back to donors to get approval for the new arrangement, and promised them that Kolfage 'will take no salary.'
Despite 'numerous public statements' that Kolfage wouldn't get paid, the men leading the group reached a 'secret agreement' where Kolfage got $100,000 'up front' and '20 [per] month.'
They 'schemed' to pass the payments 'indirectly' through third parties due to the prior pledge.
An email from Bannon stated that there would be 'no deals I don't approve' from a non-profit he set up that was used to make the payments, which then went forward at $20,000 per month.
To conceal the payments, Kolfage directed Badolato that payments 'should be made to Kolfage's spouse,' according to the indictment. The non-profit issued a 1099 form that nonprofits file with the IRS stating that it had paid Kolfage's spouse for 'media.' That was a reference to Kolfage's wife Ashley, 34.
Of course it is a political hit job. What else could it be? Grow up.
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