Santos Isn’t Going To Prison Because He Used To Be Kitara— Here’s Why He's Going To Prison

Kremlin crash flowed to Santos from Russian oligarch Viktor Vekselberg via cousin Andrew Intrater

Open Secrets— which gets all of its information from the FEC— reports just 3 independent expenditures for George Santos, or whatever his names, in 2021-’22. An NRA group spent $132, an anti-Choice group spent $3,377, and the NRCC, the GOP’s version of the DCCC, spent $103,000. This is egregiously inaccurate and doesn’t even begin to delineate the hundreds of thousands of dollars— if not millions— spent by outside groups to elect Santos. And this is what’s going to put Santos in prison, rather than all the absurd lies that have captured the public’s— and the media’s— imagination.

It’s not illegal to lie about where you went to school, where you worked, where you played volleyball, what your religion is, where and when your mother died, whether you just liked dressing like a girl or were an actual full-on drag queen, and not even, necessarily, what your name is. It is illegal to be involved in a straw donor operation and to coordinate with the Kremlin, crypto and other shady sources to buy a seat in Congress. We’ve been emphasizing this since December and finally, the media has figured it out as well... or is starting to. Tracing money laundered into politics that is meant to not be traced, is very difficult and time consuming. Few journalists would even try. This is going to come down to the Justice Department-- if the House Republicans don't prevent them from doing so-- before we know the full scope of Santos' life of crime.

Yesterday, reporting for The Hill, Emily Brooks and Mike Lillis wrote that the controversies swirling around Santos “are shifting quickly from résumé lies to questionable finances, posing a much more serious threat to the embattled freshman even as he vows to remain in Congress. While the early cloud of scandal had focused on the ethics of Santos’ fabricated campaign biography, more serious revelations suggest the Long Island Republican might have violated campaign finance laws— a much graver class of misconduct that could result in civil penalties, criminal prosecution, expulsion from Congress or all three.” None of this is stopping McCarthy and the rest of the House Republican leadership from hanging onto him and protecting him. McCarthy even appointed him to a the Science, Space and Technology Committee where he will be able to access classified information that his Russian sponsors will be very interested in seeing.

The questions center around the hundreds of thousands of dollars Santos has loaned his campaigns from personal accounts; his sharp increase in reported wealth; an outside group that was raising funds on behalf of his campaign, without being registered with the Federal Election Commission (FEC); and a host of expenses submitted by his campaign for $199.99— one cent less than the figure requiring receipts.

“We certainly are talking about potential FEC investigations and DOJ investigations,” said Robert Maguire, research director with Citizens for Responsibility and Ethics in Washington.

…Santos’ public filings show a spike in personal wealth between his 2020 and 2022 campaigns, coinciding with the creation of his company, the Devolder Organization LLC, and at least $705,000 in personal loans to his 2022 campaign and more than $80,000 during his 2020 run.

A financial disclosure form in 2020 said he made $55,000 from LinkBridge Investors during the previous year, and listed no other assets, income or liabilities.

Then, in 2022, Santos reported bringing in a $750,000 salary from his new company, Devolder, along with holding between $1 million and $5 million in a savings account, between $100,001 and $250,000 in a checking account, and an apartment in Rio de Janeiro valued between $500,001 and $1,000,000.

Santos formed Devolder in May 2021, according to documents filed with the Florida secretary of state. His campaign website previously said that his company managed $80 million in assets, but that claim has since been removed. The Washington Post reported that financial data company Dun & Bradstreet estimated in July 2022 that the company had revenue of only $43,688.

Santos told radio station WABC and then the Daily Beast that he withdrew money from his company as his salary, then used it to fund his campaign.

The Devolder Organization was in the “capital introduction” business, Santos told Semafor in December, similar to the company where he previously worked, LinkBridge.

“What I will do is I will go look out there within my Rolodex and be like: ‘Hey, are you looking for a plane?’ ‘Are you looking for a boat?’ I just put that feeler out there,” Santos said.

Santos said he would then connect people to wealthy investors and institutions, and “landed a couple of million-dollar contracts” in the first six months.

“If you’re looking at a $20 million yacht, my referral fee there can be anywhere between $200,000 and $400,000,” Santos told Semafor.

Santos has confirmed little else about the specifics of how his company made money, though some public reports have identified a few clients.

Santos told the Daily Beast in December that the Devolder Organization contracted with Acrisure, the parent company of The Whitmore Group insurance brokerage. The Whitmore Group’s CEO, James Metzger, is a major GOP donor and also contributed to Santos’s campaign.

The Devolder company was one of several organizations authorized to manage and control Red Strategies USA — separate from Redstone Strategies— according to documents reported in a Campaign Legal Center FEC complaint against Santos. FEC reports show just one political committee payingRed Strategies USA: Tina Forte for Congress, the Republican candidate who challenged Rep. Alexandria Ocasio-Cortez (D-NY). It is unclear how much, if any, of the $1110,320 paid from the Forte campaign ultimately went to Devolder.

Santos previously worked at Harbor City Capital, which the Securities and Exchange Commission (SEC) said was a Ponzi scheme and was shuttered in 2021. Santos was not charged with a crime in connection to that SEC case and has denied knowledge of alleged wrongdoing.

The origin of Santos’s newfound wealth has intrigued legal and political experts for another reason: It fueled the large loans he made to his campaign.

Rep. Matt Gaetz (R-FL) asked Santos where the money for his campaign loans came from in a recent interview on the “War Room” podcast.

“I’ll tell you what. It didn’t come from China, Ukraine, or Burisma, how about that?” Santos said, deflecting the question while taking aim at business dealings by President Biden’s son, Hunter Biden.

Richard Briffault, a Columbia Law School professor specializing in campaign finance, said those loans may be the most consequential piece of the Santos puzzle, from a criminal justice standpoint, if they are found to have been “an illegal means of disguising illegal contributions.”

“If it turns out that that was a device for donors to funnel money to the campaign, that itself is illegal— Santos would be a ‘straw donor’ falsely claiming he provided the money when it really came from someone else,” Briffault said Friday in an email.

The seriousness of the infraction would worsen if those donations exceeded the legal limit of $2,900 per donor in any one cycle, Briffault added. And the gravity would compound further if the donors were found to be corporations or foreign entities.

“And if Santos ‘knowingly’ participated in this, we are talking about a felony,” Briffault said.

The Campaign Legal Center, a nonprofit government watchdog, raised similar concerns in a complaint filed this month with the FEC, in which it accused Santos of concealing the “true sources” of the $705,000 he loaned his campaign and using campaign funds for personal expenses, both in violation of federal law.

The group also said that, if Santos diverted funds from his company to himself in order to make personal loans to his campaign, the loans could be considered prohibited corporate contributions.

Aside from the sharp rise in Santos’s wealth creating questions about how he made that money, how he reported and used the funds in relation to his campaign could get him in legal trouble.

House Ethics Committee rules say that candidates and new members must disclose any clients that paid more than $5,000 for services that the candidate or member personally performed. Santos did not list any clients on his financial disclosure, an issue noted by New York Reps. Ritchie Torres (D) and Dan Goldman (D) in a complaint they filed with the committee.

Santos is also under scrutiny for filing dozens of campaign expenditures of $199.99— one penny shy of the minimum payment for which the FEC requires proof of purchase. The filings list payments claimed to a spectrum of retailers, including Best Buy, Uber and a Long Island restaurant, Il Bacco Restaurante, where Santos claimed more than $25,000 in campaign expenses over the 2020 and 2022 cycles.

Maguire, CREW’s research director, said those filings not only raise red flags about the accuracy of the reported expenses, but also could be an indication that Santos understood the rules but tried to evade them— an important distinction since the prosecution of certain campaign finance violations requires evidence of willful intention on the part of the violator.

“It is not something we see very often, mostly because we don’t see campaigns engaging in what appears to be pretty obvious lying on their campaign finance reports,” Maguire said Friday. “And so it’s something that could end up being used to prove ‘knowing and willful’ violations of the rules.”

Additional murky campaign finance questions surround fundraising operations by Redstone Strategies. That group’s website states that it was “started from individuals who have been experters [sic] in marketing and others in politics.”

The New York Times reported on a fundraising solicitation email describing RedStone Strategies as an “independent expenditure” group working to support Santos, but the FEC has no record it was registered as a PAC. A Redstone Strategies LLC formed in November 2021 lists Santos’ Devolder Organization as one of its managing officers.

Important to keep in mind: for his own partisan interests, Kevin McCarthy is endangering national security by putting Santos on committees and giving him access to American secrets. And for her own partisan interests, Elise Stefanik, helped get Santos elected in the first place, helping raise tens of thousands of dollars for him. CNN reported this morning that "Multiple Republican operatives in Washington and New York told CNN that they found it implausible that Stefanik had not been aware of Santos’ falsehoods, given rumors about Santos had been passed around in GOP circles since at least the summer of 2021. 'Stefanik’s team was laser focused on electing Santos to Congress-- more than just about any other race in the country,' a senior Republican strategist involved in campaigns before the midterms said. House Speaker Kevin McCarthy said last week that he 'always had a few questions about' the veracity of Santos’ resume. Still, he headlined a fundraiser for Santos in October, about five weeks before the election, according to a promotion of the event. Neither McCarthy, Stefanik, nor other prominent Republicans who have supported Santos are calling for him to resign. One source in Republican politics familiar with the dynamics of the situation told CNN that Stefanik 'was an advocate throughout the process specific to (Santos) even when others had questions. No two ways about it she was a significant supporter of his.'"