Bannon, 66, was arrested along with Brian Kolfage, 38, Andrew Badolato, 56, and 49-year-old Timothy Shea for defrauding people through an online crowdfunding campaign "We Build the Wall" that raised more than US $25 million.
US President Donald Trump's former top adviser Stephen Bannon was arrested on Thursday and charged for his role in defrauding thousands of donors in connection with an online crowdfunding campaign to build Mexico border wall, the US Justice Department said on Thursday.
The campaign "We Build the Wall" raised more than US $25 million.
Bannon, 66, was arrested along with Brian Kolfage, 38, Andrew Badolato, 56, and 49-year-old Timothy Shea. They were arrested on Thursday morning and Bannon will be presented in the Southern District of New York. Kolfage and Badolato will be presented before different courts in Florida and Shea will be presented before a court in Colorado.
"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 United States Attorney for the Southern District of New York Audrey Strauss said.
It was assured to donors that Kolfage, the founder and public face of "We Build the Wall", would not be paid a cent but the defendants secretly schemed to pass hundreds of thousands of dollars to him, which he used to fund his lavish lifestyle, he added.
The men 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.
Philip R. Bartlett, Inspector-in-Charge of the New York Field Office of the United States Postal Inspection Service (USPIS) said the defendants allegedly engaged in fraud when they misrepresented the true use of donated funds.
"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. This case should serve as a warning to other fraudsters that no one is above the law, not even a disabled war veteran or a millionaire political strategist," he said.
According to the Indictment unsealed in Manhattan federal court, starting in approximately December 2018, Kolfage, Bannon, Badolato and Shea, and 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 organisation.”
In truth, they received hundreds of thousands of dollars in donor funds from We Build the Wall, which they each used in a manner inconsistent with the organisation’s public representations, a statement issued by Department of Justice said.
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 non-profit organisation under his control (“Non-Profit-1”), received over $1 million, at least some of which he used to cover hundreds of thousands of dollars for personal expenses.
To conceal the payments to Kolfage from "We Build the Wall," the four accused devised a scheme to route those payments from "We Build the Wall" to him indirectly through Non-Profit-1 and a shell company under Shea's control, among other avenues.
They did so by using fake invoices and sham “vendor” arrangements, among other ways, to ensure, as Kolfage noted in a text message to Badolato, that his pay arrangement remained “confidential” and kept on a “need to know” basis.
Bannon was a key strategist of Trump's 2016 Presidential campaign and later served as chief White House strategist.
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 "Former White House chief strategist Steve Bannon")
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