Special Counsel Robert Mueller’s “Report on the Investigation into Russian Interference in the 2016 Presidential Election” highlights already well publicized concerns about covert foreign influence on U.S. politics. In response to those concerns, the Department of Justice (“DOJ”) is focusing more on a previously somewhat obscure law from 1938: the Foreign Agents Registration Act (“FARA”). FARA requires anyone engaging in political activities in the U.S. on behalf of a foreign entity to disclose those activities by registering and filing certain information with the DOJ. Willful violations of the law carry significant criminal penalties, including fines and/or up to five years imprisonment.
FARA was enacted in 1938 due to concerns that the Nazi German government was secretly using U.S. firms and citizens to disseminate propaganda in the U.S. More than 80 years later, covert foreign intervention in U.S. politics has again become a major public concern, and at least seven FARA charges have been brought in connection to the Special Counsel’s investigation. In comparison, only seven criminal FARA cases in total were brought between 1966 and 2015.
In recent weeks the DOJ has continued to signal its renewed focus on FARA enforcement. For example, a former prosecutor from the Special Counsel’s investigation has been selected to lead the DOJ’s FARA enforcement efforts. And on April 11th, while speaking at an American Enterprise Institute event, the Assistant Attorney General of the National Security Division, John Demers, indicated that he expects to see continued focus on FARA enforcement. Demers suggested that the DOJ may need to perform additional inspections of FARA registrants, issue more deficiency letters, further scrutinize the content of FARA registrations, and explore potential civil enforcement remedies.
Importantly, not all work done on behalf of a foreign entity requires registration. In fact, there are several instances which are explicitly exempt under FARA, such as for religious, scholastic, or scientific activities, or if an agent has registered under the Lobbying Disclosure Act. Outside the specified exemptions, whether registration is required largely turns on whether the foreign agent is engaging in “political activities,” which the Act defines as “any activity that the person engaging in believes will, or that the person intends to, in any way influence any agency or official of the Government of the United States. . . .” This definition gives foreign agents some wiggle room to determine on their own whether they believe their activities are “influencing” the government, and therefore whether registration is necessary. Combined with the Act’s historically low enforcement, the administrative burdens involved, and stigmas attached to registering as a foreign agent, many people may have decided that registration is not worth it. However, increased criminal prosecution of FARA violators could change the calculus behind that decision.
Among other things, FARA requires an agent to register with the DOJ before conducting activities on behalf of a foreign principal, and within 10 days of agreeing to enter into the agency relationship. Registration also requires filing several additional documents, such as copies or descriptions of the terms of the agency agreement, a detailed statement of every activity the agent is performing, and information about contributions from the foreign principal to the agent. Supplemental statements must be filed every 6 months during the agency relationship, and any informational materials distributed on behalf of the foreign principal must include a “conspicuous statement” regarding the agency relationship and also be filed with the government.
In the past, the government preferred pursuing registration for alleged FARA violators rather than seeking prosecution, and companies may have felt comfortable not registering until instructed to do so.10 However, if the government decides to increase its enforcement efforts, remaining unregistered could lead to criminal prosecution. Therefore, unregistered foreign agents should seriously consider reexamining whether registration would be in their best interest. Given that the number of active FARA registrants increased from 365 to 458 between 2016 and 2018, some agents may have already taken heed of the Special Counsel’s investigation and decided to register.11 With increased enforcement on the horizon, expect those numbers to continue to rise as companies and individuals carefully evaluate their practices and consult with counsel to determine how best to comply.
