Prosecutors say Barrack used his insider access to White House officials that he gained through roles like his position as chair of Trump’s inaugural committee to give the UAE “non-public information about the views and reactions of senior U.S. government officials following a White House meeting between senior U.S. officials and senior UAE officials.”
Also charged in the case were an aide to Barrack at his investment firm Colony Capital, Matthew Grimes, and a businessman from UAE, Rashid Al-Malik.
Prosecutors allege that early in the Trump administration, Barrack sought to be appointed to a high-profile role in Middle East policy, while telling his allies in UAE that such an appointment would be good for them.
“In his communications with Al Malik, the defendant framed his efforts to obtain an official position within the Administration as one that would enable him to further advance the interests of the UAE, rather than the interests of the United States,” prosecutors wrote in a court filing.
While the indictment gives numerous examples of Barrack working closely with Al-Malik to advance UAE interests, it is vague about Barrack’s motivation for doing so. However, the indictment suggests that Barrack’s public relations and lobbying efforts for UAE were intertwined with his financial and investment interests. Prosecutors contend that in December 2016, Grimes sent Al-Malik a proposal that said implementing the plan could “achieve outsized financial returns.”
In addition, the three men charged in the case were working at the time on efforts to help a UAE ally, Saudi Arabia, acquire nuclear power technology from the U.S. That project, which became the focus of a House Oversight Committee investigation, included an effort to use UAE and Saudi funds, along with U.S. investments to take over the U.S.-based energy firm Westinghouse. The House probe found that Al-Malik was acting both on behalf of UAE and Saudi officials.
Prosecutors contend that in May 2016, Barrack shared with the UAE what he called a “totally confidential” draft of a Trump speech on energy and that Al-Malik later attended the inauguration festivities as a “personal guest” of Barrack.
The indictment alleges that Barrack and Grimes obtained a “dedicated cellular phone” for their communications with top UAE officials and installed a secure messaging application on it for that purpose.
Prosecutors also allege Grimes agreed to remove a reference to “dictatorships” in a Barrack op-ed at the UAE officials’ request. “They didn’t like Dictatorships word….They don’t want to be labeled as dictators, which is true,” Al-Malik told Grimes.
The op-ed referenced in the indictment appears to be one Fortune Magazine published on Oct. 22, 2016 that denigrated the Arab Spring movement while praising Saudi Arabia, a close ally of UAE. Barrack’s language tracks with what Grimes agreed to.
“The instability created by contradictory Western interests has invited far worse atrocities by the new regimes than the crimes perpetrated by the previous order,” Barrack wrote.
The indictment says that after the op-ed was published, Al-Malik wrote to Grimes: “Big boss loved it.”
Barrack made his fortune, which Forbes has estimated at $1 billion, while at the helm of private equity firm Colony Capital. He stepped down as the company’s CEO last year and as executive chairman of the firm in April. He and Grimes were arrested in the Los Angeles area and made their initial appearances in federal court there Tuesday afternoon.
Prosecutors said in court papers that they are asking that Barrack be held in federal custody and transported to New York City, so he can go before a federal judge in Brooklyn for a bail hearing. They said Barrack’s extensive wealth and foreign ties would give him ample opportunity to try to hide out overseas.
“There is no doubt that the defendant’s vast financial resources and access to private aircraft give him all the necessary means to flee from justice, now that he is facing extremely serious criminal charges supported by overwhelming evidence,” prosecutors wrote.
Prosecutors also noted that after the FBI interviewed Al-Malik in Los Angeles in 2019, he left the U.S. and has never returned.
During a brief appearance before U.S. Magistrate Judge Patricia Donahue, Barrack’s attorney Matt Herrington said the two sides are continuing to negotiate about a bail package. Donhaue agreed to keep Barrack in Los Angeles until another hearing set for Monday morning.
Grimes also went before the same judge earlier in the same session. His attorney, Matthew Freedman, said his client is 27 years old and is no longer employed by Colony.
“He is a fairly low-level individual in all of this,” said Freedman. “He no longer works at the company.”
Freedman also noted that Grimes has known for years about the federal investigation and, unlike Al-Malik, hasn’t tried to escape. “My client did not flee,” the defense attorney said.
While Freedman sought release for Grimes on a temporary bond, Donahue rejected that idea. “I do find that the defendant presents a very serious risk of flight,” she said. She also continued his bail hearing until Monday.
The indictment is the latest move by the Justice Department to beef up enforcement of laws aimed at limiting and disclosing foreign influence in the U.S. However, the foreign-agent statute used to charge Barrack was not the Foreign Agents Registration Act, but a lesser-known statute typically used to charge individuals accused of working at the direction of senior officials of a foreign government.
The prosecutor handling the bail hearings in Los Angeles, Mack Jenkins, called the statute “very infrequently used.” He said it reflects the elite circles that Barrack and the others were attempting to influence and wield influence on behalf of.
“We’re talking about the highest levels at the UAE and the highest levels of the United States,” Jenkins said.
The charge also offers another benefit the prosecutor did not mention. While FARA requires proof that a person knew his or her conduct was illegal, the foreign-agent statute used to charge Barrack and his co-defendants requires no such proof.