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Greg Craig, former Obama White House counsel, indicted in case linked to Mueller probe

Former Obama administration White House counsel Greg Craig has been indicted by the Department of Justice with making false statements and concealing material information about his activities on behalf of Ukraine. Lawyers for Craig had expected their client to be charged in a foreign lobbying investigation spun off from special counsel Robert Mueller's Russia probe, arguing in a statement that Craig "is not guilty of any charge and the government's stubborn insistence on prosecuting Mr. Craig is a misguided abuse of prosecutorial discretion."

Craig, 74, was indicted by a grand jury in the U.S. District Court for the District of Columbia for willfully falsifying and concealing material facts from the National Security Division's Foreign Agents Registration Act (FARA) Unit and for making false and misleading statements to the FARA Unit, according to a release by the DOJ. The maximum penalties for the charged offenses are, respectively, five years' imprisonment and a $250,000 fine, and five years' imprisonment and a $10,000 fine. 

Craig will be arraigned Friday, at 1:30 p.m. ET.

In a video statement released Thursday evening, Craig said he never concealed information or misled the Justice Department, and said he was confident he would beat the charges.

"This prosecution is unprecedented and unjustified," Craig said. "I am confident that both the judge and the jury will agree with me."

The investigation into Craig comes as the Justice Department is cracking down on unregistered foreign lobbying and consulting. Federal prosecutors in New York have been investigating two prominent Washington lobbying firms in a similar probe, and Justice Department officials in Washington have been increasingly willing to prosecute people who they believe intentionally conceal their lobbying work from the federal government.

"This case was thoroughly investigated by the SDNY and that office decided not to pursue charges against Mr. Craig. We expect an indictment by the DC US Attorney's Office at the request of the National Security Division. Mr. Craig is not guilty of any charge and the government's stubborn insistence on prosecuting Mr. Craig is a misguided abuse of prosecutorial discretion," Craig's attorneys wrote. 

The scrutiny of Craig stems from an investigation of former Trump campaign chairman Paul Manafort and his work on behalf of a pro-Russian political party in Ukraine. If filed, the charges would come about three months after Craig's former law firm agreed to pay more than $4.6 million and publicly acknowledge that it failed to register with the government for its work for the Ukraine.

The civil settlement with Skadden, Arps, Slate, Meagher & Flom LLP laid much of the blame for the firm's conduct on Craig, who was a senior partner.

Craig's lawyers did not say why they expect him to be charged. They said federal prosecutors in New York had declined charges, but they expected an indictment to be brought by the U.S. Attorney's office in Washington at the request of the Justice Department's national security division.

The lawyers' assertion could not be confirmed Wednesday evening. Spokesmen for the Justice Department and the U.S. Attorney's office declined to comment.

Craig is a prominent Washington attorney and was the first White House counsel to former President Barack Obama. In private practice, his clients have included former North Carolina Sen. John Edwards and James Cartwright, the former vice chairman of the Joint Chiefs of Staff, who was charged in a leaks investigation.

The work that drew the Justice Department's attention occurred in 2012 when Craig and Skadden were hired by the Ukrainian government to compile a report on the prosecution of Yulia Tymoshenko, a former Ukrainian prime minister. Tymoshenko was a political opponent of then-Ukrainian President Viktor Yanukovych, who was a longtime Manafort patron.

The report was billed as independent, and while critical in some ways of Tymoshenko's trial, critics have said it whitewashed a politically motivated prosecution.

In its settlement earlier this year, Skadden acknowledged it participated in a public relations campaign for the report and should have registered under the Foreign Agents Registration Act, or FARA, because of it. The firm also acknowledged it had been paid $4.6 million for the report and not just $12,000, as the Ukrainian government had said at the time.

The settlement painted an unflattering picture of Craig's conduct.

In 2012 and 2013, the firm's work attracted the attention of the Justice Department, which sought to determine whether the firm should register under FARA. But according to the settlement, a senior partner matching Craig's description made several "false and misleading" statements to the government, allowing the firm to avoid registration.

In the statement Wednesday, Craig's lawyers denied that he lied to the government or his firm. They acknowledged that Craig spoke to reporters about the report but denied it was part of a public relations campaign that would run afoul of FARA.

"Mr. Craig repeatedly refused requests that he participate in Ukraine's media and lobbying campaign to promote the Tymoshenko Report," they wrote. 

They said he spoke to reporters at The New York Times about the report to "make certain that the Times would accurately summarize the report's criticisms of the Tymoshenko trial and not rely on misinformation from Ukraine and its representatives."

FARA is a decades-old law meant to allow Americans to know when foreign entities are trying to influence public opinion or policymakers. The law, enacted in 1938 to unmask Nazi propaganda in the United States, requires people to disclose to the Justice Department when they advocate, lobby or perform public relations work in the U.S. on behalf of a foreign government or political entity.

In the last few years, the Justice Department has brought several high-profile prosecutions involving FARA. That includes a case against Manafort, who was recently sentenced to more than seven years in prison.

Clare Hymes contributed to this report.

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