Thursday, July 13, 2017

Klein Conspiracy in the NonTax Crimes News (7/13/17)

I don't see the Klein conspiracy raised often in the popular press.  So, I was surprised to see it here.   Spencer Ackerman and Betsy Woodruff, ‘Dopey’ Donald Trump Jr. Just Might Be Saved by His Own Ignorance (DailyBeast 7/11/17), here.  And, Another article taking off the Daily Beast article is TRUE BLUE REPORT: I learned a new term today—Republicons are the KLEIN CONSPIRACY PARTY, here.

I assume most readers are now aware about the news buzz of an additional Russian off-the-radar screen connection for the Trump Administrations -- Donald Trump Jr.'s emails and meeting with a Russian Lawyer allegedly close to the Putin Kremlin.  So, what does the known information mean in the real world.  Well, on its face, perhaps not much in a traditional crimes sense (for the crimes commonly known).  But that is where the broad sweep of the defraud conspiracy under 18 USC § 371 comes in.  The Klein conspiracy is often a shorthand for the defraud conspiracy, but I use the term in a narrower sense to mean the defraud conspiracy related to impairing or impeding the lawful function of the IRS.  Klein was a tax defraud conspiracy case.  United States v. Klein, 247 F.2d 908 (2d Cir. 1957).  For any readers that my be interested in my views on my concerns with the potential scope of the defraud conspiracy in a tax setting and its companion tax obstruction crime, § 7212(a), much in the tax crimes news lately, see:  John A. Townsend, Tax Obstruction Crimes: Is Making the IRS's Job Harder Enough, 9 Hous. Bus. & Tax. L.J. 255, 334-335 (2009)).

At any rate, back to DJT, Jr.  Here is the relevant portion of the Daily Beast article referring to Barbara McQuade, who, until Trump took office, was the U.S. attorney for Eastern Michigan:
McQuade, however, thinks the emails indicate that the younger Trump could be guilty of a so-called “Klein conspiracy,” which makes it a crime to “defraud the United States.” 
“It doesn’t have to any monetary value,” McQuade said. “It could be defrauding the U.S. government in honest elections.” 
But then comes another twist. The younger Trump would have to “knowingly and wilfully violate” a known legal duty, and “his lawyer will say he had no idea” the intended transaction – which Donald Trump Junior thus far denies actually occurred – was illegal. In this case, Mariotti said, ignorance of the law can be an excuse.
This Klein conspiracy and the tax obstruction counterpart has been much addressed on this blog and in my article linked above.  The Government's imagination -- at least claims -- about the defraud conspiracy is that it is broader than the tax crimes requiring willfulness -- specific intent to violate a known legal duty, the Cheek test of willfulness.  All the defendant has to do, in the Government narrative, is to impair or impede the lawful function of the Government agency.  And the list of things that can do that -- thus criminalized -- is virtually anything the  mind can imagine that would have a likely effect of ever so slightly impairing a Government agency in whatever it is doing within the scope of its responsibility.

Focusing on the DJT, Jr., episode as reported in the credible press I read -- DJT, Sr. would say the fake press -- does not clearly indicate that the emails in question and the meeting in question would rise to the level of a defraud conspiracy.  But we know only part of the story.  And, if there were any agreement among the Trump affiliated persons attending or aware of the meeting to keep it quiet from relevant Government agencies (say FBI and the agencies vetting the security clearances of the attendees), well, there we have the elements of the defraud conspiracy.

But, the saving grace in terms of ultimately knowing what happened and its legality is that we have a cop on the beat -- Mueller who has integrity and determination to get to the bottom and prosecute those who may have violated the law.  Let's trust the integrity of the process.

In the meantime, I do have concerns about the defraud / Klein conspiracy as I note in  my article and its solo companion, tax obstruction under § 7212(a), that the Supreme Court will address in the case it accepted for certiorari in Marinello.  We all just need to stay tuned.

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