Tag: Corporate crime

Hearings in $1 billion lawsuit filed by auto tycoon Carlos Ghosn against Nissan start in Beirut

Lebanese judicial officials say hearings in the $1 billion lawsuit filed by auto tycoon Carlos Ghosn against Nissan and other defendants have started in Beirut

ByBASSEM MROUE Associated Press

September 18, 2023, 11:44 AM

FILE – Former Nissan executive Carlos Ghosn speaks during an interview with The Associated Press in Beirut, Lebanon on June 23, 2023. Lebanese judicial authorities have questioned two people at the request of Turkey on suspicion of being involved in the 2019 escape of auto tycoon Carlos Ghosn from Japan to Lebanon, judicial officials said Friday, Sept. 8, 2023. (AP Photo/Hassan Ammar, File)

The Associated Press

BEIRUT — Hearings in the $1 billion lawsuit filed by auto tycoon Carlos Ghosn against Nissan and other defendants started in Beirut on Monday with lawyers of both sides meeting the judge in charge of the case, judicial officials said.

The former Nissan CEO filed the case against Nissan in May in Beirut, alleging he was detained in Japan in 2018 on false charges because of what he calls the automaker’s disinformation against him. The 69-year-old Ghosn is seeking half of the $1 billion in damages and half for compensation including salary, retirement funds and stock options.

Ghosn is also seeking monetary compensation from a Nissan affiliate based in Lebanon, as well as from entities that took part in the investigation leading up to his arrest.

He was arrested in Japan in November 2018 on charges of breach of trust, misusing company assets for personal gains and violating securities laws by not fully disclosing his compensation. In December 2019, he jumped bail in Japan in a daring escape by hiding in a box spirited aboard a private jet out of the country.

He now lives in Lebanon, which has no extradition treaty with Japan and does not extradite its citizens. Renault and Nissan have both been distancing themselves from the Ghosn scandal. Ghosn has citizenship in Lebanon, France and Brazil.

In a session that lasted about four hours at the Palace of Justice in Beirut, lawyers representing Ghosn and Nissan met with Judge Sabbouh Suleiman at the Beirut prosecutor’s office, the officials said on condition of anonymity in line with regulations. None of the lawyers or the judge spoke to reporters.

A date was expected to be set for the next session.

Ghosn led Japanese automaker Nissan for two decades, rescuing it from near-bankruptcy before his 2018 arrest.

He is now wanted in Japan and France. Since he fled to Lebanon, Beirut has received three notices from Interpol based on arrest warrants for him from those countries. In France, he is facing a number of legal challenges, including tax evasion and alleged money laundering, fraud and misuse of company assets while at the helm of the Renault-Nissan alliance.

The office of Ghosn’s lawyer declined to comment on the case when contacted by The Associated Press.

Ghosn claims to be the victim of a character assassination campaign led by Nissan with the complicity of the Japanese government, aided by accomplices in France.

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September 18, 2023
Republican Texas AG Ken Paxton is acquitted of all 16 corruption charges at impeachment trial

Texas Attorney General Ken Paxton was acquitted Saturday of all charges at a historic impeachment trial that divided Republicans over whether to remove a powerful defender of former President Donald Trump after years of scandal and criminal charges.

The verdict reaffirmed Paxton’s durability in America’s biggest red state and is a broader victory for Texas’ hard right after an extraordinary trial that put on display fractures within the GOP nationally heading into the 2024 elections. In the end, Paxton was fully cleared by Senate Republicans, who serve alongside his wife, state Sen. Angela Paxton.

Angela Paxton was not allowed to vote. But she attended all two weeks of the trial, including the reading of the verdict, when all but two of her fellow 18 Republican senators consistently voted to acquit her husband on 16 impeachment articles that accused him of misconduct, bribery and corruption. Ken Paxton, who was absent for most of the proceedings, did not attend the verdict.

It clears the way for Paxton to reclaim his role as Texas’ top lawyer, more than three months after his stunning impeachment in the Texas House forced him to temporarily step aside.

The outcome far from ends Paxton’s troubles. He still faces trial on felony securities fraud charges, remains under a separate FBI investigation and is in jeopardy of losing his ability to practice law in Texas because of his baseless attempts to overturn the 2020 election.

The jury of 30 senators spent about eight hours deliberating behind closed doors before emerging for the historic vote. A two-thirds majority is required to convict Paxton on any of the charges that accuse Paxton of bribery, corruption and unfitness for office.

The trial has plunged Texas Republicans into unfamiliar waters as they confronted whether Paxton should be removed over allegations that he abused his office to protect a political donor who was under FBI investigation.

For nearly a decade, Paxton has elevated his national profile by rushing his office into polarizing courtroom battles across the U.S., winning acclaim from Donald Trump and the GOP’s hard right.

The case centered on accusations that Paxton misused his office to help one of his donors, Austin real estate developer Nate Paul, who was indicted in June on charges of making false statements to banks. Paul has pleaded not guilty.

Eight of Paxton’s former deputies reported him to the FBI in 2020, setting off a federal investigation that will continue regardless of the verdict. Federal prosecutors investigating Paxton took testimony in August before a grand jury in San Antonio , according to two people with knowledge of the matter who spoke on condition of anonymity because of secrecy rules around the proceeding.

One of the impeachment articles centered on an alleged extramarital affair Paxton had with Laura Olson, who worked for Paul. It allegeed that Paul’s hiring of Olson amounted to a bribe.

Paxton faces an array of legal troubles beyond the impeachment. Besides the federal investigation for the same allegations that gave rise to his impeachment, he also faces a bar disciplinary proceeding over his effort to overturn the 2020 election and has yet to stand trial on state securities fraud charges dating to 2015. He pleaded not guilty in the state case, but his lawyers have said removal from office might open the door to a plea agreement.

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September 16, 2023
Alex Murdaugh makes his first appearance in court since his murder trial

BEAUFORT, S.C. — Alex Murdaugh appeared publicly for the first time since his murder trial at a Thursday state court hearing over the slew of financial crimes allegedly committed by the disbarred South Carolina attorney.

The man found guilty this March of fatally shooting his wife and youngest son in June 2021 got a fleeting break from the maximum-security prison where he is serving a life sentence without parole. The prosecution and defense agreed Thursday that some of the 101 total charges brought against Murdaugh will be heard at a trial beginning the week of Nov. 27.

Murdaugh sat in an orange jumpsuit, occasionally whispering with his lawyers, as he learned how he will spend the week after Thanksgiving.

It won’t be long before Murdaugh finds himself back in another courtroom. A federal hearing over a similar bevy of charges is scheduled next Thursday in Charleston. There, Murdaugh is expected to plead guilty to theft and wire fraud — possibly marking the first time he will have legally taken responsibility for any of the more than 100 charges that have piled up since he first reported his family members’ deaths over two years ago.

Adding to the saga’s twists are recent allegations that the court clerk improperly influenced the jury in the murder case. In a request for a new trial filed last week, defense attorneys accused Rebecca Hill of telling jurors not to trust Murdaugh’s testimony and pressuring them to quickly deliver a verdict.

The murder trial cast a shadow over the Thursday proceeding. Defense attorney Dick Harpootlian asked that the state trial wait until they finish litigating the federal case and the matter of jury tampering. He argued it would be difficult to get a fair trial within a year of the widely watched murder trial’s conclusion.

“Where are you going to get a jury? Mars?” Harpootlian told Circuit Court Judge Clifton Newman.

Newman, the same judge who presided over the nearly six-week murder trial earlier this year, said the indictments were issued across many counties home to people capable of serving on a jury. He said he would not presume that jurors could not be assembled.

Murdaugh has been indicted for taking $8.8 million in legal settlements from clients who were badly injured or the families of those killed on the job. Victims included the family housekeeper who died in a fall at the Murdaugh home. He is also accused of stealing nearly $7 million from his law firm over a nine-year period during which he made almost $14 million.

Other charges relate to an eight-year drug ring and money laundering scheme that prosecutors say involved $2.4 million in checks written to a friend who used some of the money on a painkiller distribution network.

He faces an additional nine counts of tax evasion for allegedly ducking just under $487,000 in state incomes taxes. Convictions would carry up to five years in prison for each count.

Also pending Thursday were case updates for two men who have already been found guilty in federal court for assisting with those plots.

Lawyers have yet to agree on a trial date for Russell Laffitte over 21 state charges. The ex-CEO of Palmetto State Bank was sentenced in August to seven years in federal prison for helping Murdaugh steal nearly $2 million from clients. A jury last November found him guilty of six federal charges related to wire and bank fraud.

An old college friend of Murdaugh’s is awaiting his state sentence after he pleaded guilty last month to 23 state charges that he helped steal millions of dollars in settlements from the sons of the family’s housekeeper. Cory Fleming, a former attorney, had previously been sentenced to nearly four years in prison on similar federal charges. The judge in that case said he would tell Newman that no additional prison time should result from the state charges.

—-

Pollard is a corps member for the Associated Press/Report for America Statehouse News Initiative. Report for America is a nonprofit national service program that places journalists in local newsrooms to report on undercovered issues.

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September 14, 2023
Lawyers argue indicted Backpage employees sought to keep prostitution ads off the site

PHOENIX — A former executive and two operations managers for classified site Backpage.com worked vigorously to keep the platform free of ads for prostitution even as strategies on how to do so constantly shifted, their attorneys said Tuesday at a federal trial in Phoenix.

Defense lawyers for Scott Spear, Andrew Padilla and Joye Vaught had their turn to make opening statements against charges of facilitating prostitution and money laundering. They highlighted how all three made great efforts to work with authorities, whether it was by giving testimony, sharing key user information or taking calls in the middle of the night.

“Backpage was viewed in law enforcement as the most cooperative site,” said Bruce Feder, the attorney for former executive vice-president Spear. “They thought they were doing good. They wanted to get abusers off their site.”

Joy Bertrand described how Vaught “battled bad apples” for nine years. As the assistant operations manager, Vaught worked to keep ads that could be seen as proposing sex acts or were just “trashy” from being posted. Bertrand read from an email Vaught sent to a staff moderator in 2014 pointing out ads with several violations that had slipped through.

“She was proud of the job she had. She bragged about it,” Bertrand said. “As you see each piece of the government’s evidence, please view it with skepticism.”

Padilla’s attorney described how he rose from having an $11-per-hour job to becoming a full-time operations manager. At one point, he was helping oversee 200 site moderators out of an office in Dallas. But under Backpage CEO Carl Ferrer, the standards used to screen for potential prostitution ads were not clear, attorney David Eisenberg said.

“This system constantly evolved, which led to confusion at his job,” Eisenberg said. “Who’s the guiding light here? Not my client.”

The three are co-defendants alongside Backpage founder Michael Lacey and former chief financial officer John Brunst, whose attorneys made opening statements last month.

This is the second trial of all five on charges in what authorities say was a scheme to knowingly sell ads for sex on the classified site.

All five have pleaded not guilty to facilitating prostitution. Of the five, Lacey and two others have pleaded not guilty to money laundering charges.

The first trial ended in a mistrial in September 2021 when a judge concluded prosecutors had too many references to child sex trafficking in a case where no one faced such a charge.

Lacey founded the Phoenix New Times weekly newspaper with James Larkin, who was charged in the case and died by suicide in July. Lacey and Larkin held ownership interests in other weeklies such as The Village Voice and ultimately sold their newspapers in 2013. But they held onto Backpage, which authorities say generated $500 million in prostitution-related revenue from its inception in 2004 until 2018, when it was shut down by the government.

The site’s marketing director has pleaded guilty to conspiring to facilitate prostitution and acknowledged he participated in a scheme to give free ads to prostitutes to win over their business. Ferrer pleaded guilty to a separate federal conspiracy case in Arizona and to state money laundering charges in California.

Prosecutors say Backpage’s operators ignored warnings to stop running prostitution ads, some involving children. They are accused of giving free ads to prostitutes and cultivating arrangements with others who worked in the sex trade to get them to post ads with the company.

Authorities say Backpage employees would aggregate more users by identifying prostitutes through Google searches, then call and offer them a free ad. The site also is accused of having a business arrangement in which it would place ads on another site that lets customers post reviews of their experiences with prostitutes.

Backpage’s operators said they never allowed ads for sex and used people and automated tools to try to delete such ads. They maintain the content on the site was protected by the First Amendment.

Prosecutors said the moderation efforts by the site were aimed at concealing the true nature of the ads.

Lacey also is accused of using cryptocurrency and wiring money to foreign bank accounts to launder revenues earned from the site’s ad sales after authorities say banks raised concerns that they were being used for illegal purposes.

At trial, the Backpage defendants are barred from bringing up a 2013 memo by federal prosecutors who examined the site and said at the time that they hadn’t uncovered evidence of a pattern of recklessness toward minors or admissions from key participants that the site was used for prostitution.

In the memo, prosecutors had said witnesses testified Backpage made substantial efforts to prevent criminal conduct on its site and coordinated such efforts with law enforcement agencies. The document was written five years before Lacey, Larkin and the other former Backpage operators were charged in the Arizona case.

A Government Accountability Office report released in June 2021 said the FBI’s ability to identify victims and sex traffickers had decreased significantly after Backpage was seized by the government because law enforcement was familiar with the site and Backpage was generally responsive to requests for information.

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September 12, 2023
Google spent billions to build an illegal monopoly, Justice Department says as trial gets under way

Federal prosecutors opened a landmark antitrust trial against Alphabet Inc.’s Google on Tuesday with charges the search-engine giant for years intentionally snuffed competition through exclusive contracts with wireless carriers and phone makers.

Google
GOOGL,
-1.15%
GOOG,
-1.21%
spent billions of dollars on such contracts to cement its dominant position, a clear violation of U.S. antitrust law, prosecutors said.

“This case is about the future of the internet, and whether Google’s search engine will ever face meaningful competition,” Justice Department lawyer Kenneth Dintzer told the court. He said Google pays more than $10 billion a year to Apple Inc.
AAPL,
-1.71%
and other companies to ensure Google is the default or only search engine available on browsers and mobile devices used by millions of consumers.

Google’s search business accounted for more than half of the $283 billion in revenue Alphabet recorded in 2022. Search in large part has fueled the company’s $1.7 trillion market valuation.

Google attorney John Schmidtlein countered that companies and consumers use Google’s popular search engine “because it delivers value to them, not because they have to.”

The legal jousting in a Washington, D.C., federal court kicked off what is expected to be a contentious multiweek trial that could be one of the biggest domestic antitrust trials since the federal government tussled with Microsoft Corp.
MSFT,
-1.83%
in the 1990s. Like that case, this one involves arguments over tying together multiple proprietary products.

To that end, Justice Department officials allege Google’s contracts ensure that Android devices come with Google apps and services, including Google search, preinstalled.

Google Chief Executive Sundar Pichai heads a witness list of senior executives and former employees from Google, Apple, Microsoft and Samsung Electronics Co.
005930,
+1.28%.

“This feedback loop, this wheel has been turning for 12 years, and it always turns to Google’s advantage,” Dintzer said.

Conversely, Schmidtlein said Apple’s decision to make Google the default search engine in its Safari browser underscores that Google’s search engine is the product consumers prefer. “Apple repeatedly chose Google as the default because Apple believed it was the best experience for its users,” he said.

The Google case “could not be more different” from Microsoft litigation in the late 1990s and early 2000s, Schmidtlein asserted. “The evidence will show that Microsoft’s Bing search engine failed to win customers because Microsoft did not invest [and] did not innovate,” he said. “At every critical juncture, the evidence will show that they were beaten in the market.”

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September 12, 2023
FTC Issues Fines For Sassy Retail Employees Who Cut Declined Credit Cards In Half

WASHINGTON—Cracking down on the common but unethical practice seemingly rampant in department stores, the Federal Trade Commission began issuing fines this week for any sassy retail employee who held up a customer’s declined credit card and cut it in half. “A lot of these snobbish retail employees seem to derive a sick pleasure out of dramatically snipping the credit card belonging to a self-described shopaholic in half, rather than the standard procedure of handing the card back and simply informing them it’s been declined,” said FTC chair Lina Khan, explaining that these workers got away with the practice for years by blaming the credit card companies, claiming “they told me to do that” on the phone when the shopper looked at them, shocked. “This has been happening since the early ’90s, and it’s time we took it seriously—that’s why there will now be a $200 minimum fine for any gum-smacking cashier with scissors in their hand, no exceptions. It’s not only about financial privacy concerns, we also want to cut down on the mental anguish that a consumer is put through when these rude sales associates inform them that they must go and have a little chat with their manager, which they proceed to do behind a nearby door with a little window, allowing them to look back at the customer and snicker within view. These people need to learn that just because you work at a mall, you do not get to be a smug mean girl and get away with it.” At press time, the FTC had issued a warning to American consumers to be especially wary of any retail employee possessing a vaguely French accent and dressed in all black.

Economy Collapses After 10-Year-Old Boy Spends Entire U.S. GDP On Fortnite Skins

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September 8, 2023
Wealthy Russian with Kremlin ties gets 9 years in prison for hacking and insider trading scheme

BOSTON — A wealthy Russian businessman with ties to the Kremlin was sentenced Thursday to nine years in prison for his role in a nearly $100 million stock market cheating scheme that relied on secret earnings information stolen through the hacking of U.S. computer networks.

Vladislav Klyushin, who ran a Moscow-based information technology company that did work for the highest levels of the Russian government, was convicted in February of charges including wire fraud and securities fraud after a two-week trial in federal court in Boston.

Authorities say he personally pocketed more than $33 million in the scheme, which involved breaking into computer systems to steal earnings-related filings for hundreds of companies — including Microsoft and Tesla — and then using that insider information to make lucrative trades.

Klyushin, 42, has been jailed in the U.S. since his extradition in 2021, and the more than two years he’s been detained will be credited to his prison term. He was arrested in Switzerland after arriving on a private jet and just before he and his party were about to board a helicopter to whisk them to a nearby ski resort. After he completes his sentence, he’s expected to be deported to Russia.

Klyushin, who walked into the courtroom in handcuffs, sat at a table with his attorneys and listened to an interpreter through headphones as lawyers argued over the sentence. At the advice of his attorney, he declined to address the judge before she sentenced him.

Four alleged co-conspirators — including a Russian military intelligence officer who’s also been charged with meddling in the 2016 presidential election — remain at large, and even though prosecutors allege in a court filing that they’re still “likely sitting at their keyboards,” they acknowledge that they four will likely never be extradited to the U.S. to face charges.

Prosecutors had sought 14 years in prison, saying a stiff punishment was crucial to send a message to overseas cybercriminals. Assistant U.S. Attorney Seth Kosto told the judge that Klyushin has accepted no responsibility for his crimes and that once he serves his sentence, he’ll return to Russia, where he is a “powerful person” with “powerful friends in the highest echelons of Russian society.”

“Hackers will be watching this sentence to decide whether it’s wroth engaging in this kind of conduct,” Kosto said.

Prosecutors say the hackers stole employees’ usernames and passwords for two U.S.-based vendors that publicly traded companies use to make filings through the Securities and Exchange Commission. They then broke into the vendors’ computer systems to get filings before they became public, prosecutors said.

Armed with insider information, they were able to cheat the stock market, buying shares of a company that was about to release positive financial results, and selling shares of a company that was about to post poor financial results, according to prosecutors. Many of the earnings reports were downloaded via a computer server in Boston, prosecutors said.

Klyushin has denied involvement in the scheme. His attorney told jurors that he was financially successful long before he began trading stocks and that he continued trading in many of the same companies even after access to the alleged insider information was shut off because the hacks were discovered.

Defense attorney Maksim Nemtsev called prosecutors’ prison request “draconian,” adding that there is “no reason to think that he would would risk the well-being of his family again by committing crimes.”

His lawyers asked the court for leniency, saying Klyushin had no prior criminal history and has already been seriously punished. He spent months in solitary confinement in Switzerland while awaiting extradition to the U.S. and his company has lost multimillion dollar contracts, his attorneys wrote.

Klyushin owned a Moscow-based information technology company that purported to provide services to detect vulnerabilities in computer systems. It counted among its clients the administration of Russian President Vladimir Putin and the Ministry of Defense, according to prosecutors.

Klyushin’s close friend and an alleged co-conspirator in the case is military officer Ivan Ermakov, who was among 12 Russians charged in 2018 with hacking into key Democratic Party email accounts, including those belonging to Hilary Clinton’s presidential campaign chairman, John Podesta, the Democratic National Committee and the Democratic Congressional Campaign Committee. Ermakov, who worked for Klyushin’s company, remains at large.

Prosecutors have not alleged that Klyushin was involved in the election interference.

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September 7, 2023
Russian businessman convicted in insider trading scheme that used hacked company information gets 9 years in US prison

Russian businessman convicted in insider trading scheme that used hacked company information gets 9 years in US prison

ByThe Associated Press

September 7, 2023, 10:50 AM

BOSTON — Russian businessman convicted in insider trading scheme that used hacked company information gets 9 years in US prison.

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September 7, 2023
A look at the 20 articles of impeachment against Texas Attorney General Ken Paxton

Texas Attorney General Ken Paxton faces an impeachment trial in the state Senate starting Tuesday on articles overwhelmingly approved by the House of Representatives.

Paxton, a Republican and star of the conservatives legal movement, was suspended from office in May when the GOP-controlled House voted 121-23 to impeach him on 20 articles ranging from bribery to abuse of public trust. Most of the articles deal with Paxton using his office to benefit a wealthy donor, Nate Paul, prompting eight of the attorney general’s top deputies to report him to the FBI in 2020.

Three other charges date back to Paxton’s pending 2015 felony securities fraud case, including lying to state investigators. The Senate is not immediately taking up those charges and a fourth related to Paxton’s ethics filings in the impeachment trial.

Paxton has said he expects to be acquitted and that the charges are based on “hearsay and gossip, parroting long-disproven claims.”

Here’s look at the 20 articles of impeachment:

DISREGARD OF OFFICIAL DUTY

ARTICLE 1 – Protection of charitable organization

Paxton is accused of failing to act as a public protector of charitable organizations by directing his employees in the attorney general’s office to intervene in a lawsuit brought by the Roy F. & JoAnn Cole Mitte Foundation against entities controlled by Paul, harming the Austin charity in an effort to benefit the wealthy donor.

ARTICLE 2 – Abuse of the opinion process

Paxton is accused of misusing his official power to issue written legal opinions. He allegedly had employees prepare an opinion that protected some of Paul’s properties from being sold in foreclosure. Paxton concealed his actions by asking a Senate committee chairperson to seek that opinion. He’s also accused of directing employees to reverse their legal conclusion to help Paul.

ARTICLE 3 – Abuse of the open records process

Paxton is accused of misusing his official power by allegedly interfering with his office’s handling of a public records request dealing with the files of a criminal investigation into Paul.

ARTICLE 4 – Misuse of official information

Paxton is accused of misusing his power to administer public information law by improperly obtaining previously undisclosed information held by the attorney general’s office to benefit Paul.

DISREGARD OF OFFICIAL DUTY

ARTICLE 5 – Engagement of Cammack

Paxton is accused of misusing official powers by hiring attorney Brandon Cammack to investigate a baseless complaint made by Paul. That led to Cammack issuing more than 30 grand jury subpoenas in an effort to help Paul.

ARTICLE 6 – Termination of whistleblowers

Paxton is accused of violating the state’s whistleblower law by retaliating against employees who reported his alleged unlawful acts to law enforcement, terminating them without good cause or due process. He’s also accused of engaging in a public and private campaign to impugn those employees’ professional reputations or prejudice their future employment.

MISAPPLICATION OF PUBLIC RESOURCES

ARTICLE 7 – Whistleblower investigation and report

Paxton is accused of misusing public resources by directing employees to conduct a sham investigation into terminated employees’ whistleblower complaints and publish a report containing false or misleading statements in Paxton’s defense.

DISREGARD OF OFFICIAL DUTY

ARTICLE 8 – Settlement Agreement

Paxton is accused of misusing his official powers by concealing his wrongful acts in connection with the whistleblower’s complaints by entering into a settlement with the whistleblowers that provides for payment from public funds. The settlement halted the wrongful termination suit and delayed the discovery of facts and testimony at trial, to Paxton’s advantage. That allegedly prevented voters from making an informed decision about his reelection in 2022.

CONSTITUTIONAL BRIBERY

ARTICLE 9 – Paul’s employment of a woman with whom Paxton has acknowledged having an affair

It is alleged that Paxton benefited from Paul’s decision to hire the woman. In exchange, Paul allegedly received favorable legal assistance from, or specialized access to, the attorney general’s office.

ARTICLE 10 – Paul’s providing renovations to Paxton home

It is alleged that in exchange for providing the renovations, Paul received favorable legal assistance from, or specialized access to, the attorney general’s office.

OBSTRUCTION OF JUSTICE

ARTICLE 11 – Abuse of judicial process

Paxton is accused of abusing the process to thwart justice in the securities fraud case against him. It is alleged that Paxton concealed facts from voters with protracted delay of that trial, preventing voters from making an informed decision about his election. The Senate is not, at least initially, taking up this article in Paxton’s impeachment trial.

ARTICLE 12 – Abuse of judicial process

It is alleged that Paxton benefited from donor Jeff Blackard’s lawsuit that interfered with payment of the prosecutors in Paxton’s securities fraud case. That allegedly delayed the case, including discovery of facts and testimony at trial, and deprived voters of a chance to make an informed decision when voting for attorney general.

The Senate is not, at least initially, taking up this article in Paxton’s impeachment trial.

FALSE STATEMENTS IN OFFICIAL RECORDS

ARTICLE 13 – State Securities Board investigation

Paxton is accused of making false statements to the State Securities Board in connection with its investigation of his failure to register with the board as an investment adviser required by state law.

The Senate is not, at least initially, taking up this article in Paxton’s impeachment trial.

ARTICLE 14- Personal financial statements

Paxton is accused of failing to fully and accurately disclose financial interests in his financial statements filed with the Texas Ethics Commission.

The Senate is not, at least initially, taking up this article in Paxton’s impeachment trial.

ARTICLE 15 – Whistleblower response report

It is alleged that Paxton made or caused to be made multiple false or misleading statements in the lengthy written report issued by his office in response to whistleblower allegations.

ARTICLE 16 – CONSPIRACY AND ATTEMPTED CONSPIRACY

Paxton is accused of conspiring or attempting to conspire with others to commit acts described in one or more articles.

ARTICLE 17 – MISAPPROPRIATION OF PUBLIC RESOURCES

Paxton is accused of misusing his official powers by causing employees to perform services for his benefit and the benefit of others.

ARTICLE 18 – DERELICTION OF DUTY

Paxton is accused of violating the Texas Constitution, his oaths of office, statutes and public policy against public officials acting contrary to the public interest by engaging in acts described in one or more articles.

ARTICLE 19 – UNFITNESS FOR OFFICE

Paxton is accused of engaging in misconduct, private or public, of such character as to indicate his unfitness for office, as shown by the acts described in one or more articles.

ARTICLE 20 – ABUSE OF PUBLIC TRUST

Paxton is accused of using, misusing or failing to use official powers to subvert the lawful operation of the state government and obstruct the fair and impartial administration of justice, bringing the attorney general’s office into scandal and eroding public confidence in state government, as shown by the acts described in one or more articles.

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September 4, 2023
Intuit braces for negative FTC ruling on free tax prep advertising, vows appeal

More than a year ago, the Federal Trade Commission sued Intuit Inc., the maker of TurboTax, for allegedly tricking people into thinking they could file their income taxes for free with the tax-preparation giant.

Now, an administrative judge inside the agency has ruled against Intuit — and the company said in a Friday afternoon SEC filing that it’s going to keep fighting the case, even if that means incurring “significant costs.”

“We expect to appeal this decision to the FTC Commissioners and, if necessary, then to a federal court of appeals. We intend to continue to defend our position on the merits of this case,” the company said in its 10-K filing.

“There is no monetary penalty, and Intuit expects no significant impact to its business,” Intuit spokesman Rick Heineman said in a statement. The company will appeal “this groundless and seemingly predetermined decision by the FTC to rule in its own favor,” he said.

Intuit already reached a $141 million settlement with state attorneys general about the allegations of deceptive advertising. The company says it has been clear and upfront with customers about costs. It did not admit liability in the settlement.

The FTC could not be immediately reached for comment Friday afternoon.

In March 2022, the regulator sued Intuit in federal court to immediately stop commercials that repeated “free” over and over. Intuit pulled some of the advertising and after filing season ended, a San Francisco federal judge said the FTC bid for emergency halts didn’t need to happen under the circumstances.

FTC lawyers also lodged an internal administrative complaint. “Intuit widely disseminated ads on television, on the radio, and online that gave consumers the impression that they could use TurboTax for free, even though two-thirds of taxpayers don’t qualify for Intuit’s free TurboTax offerings,” they wrote in administrative complaint proceedings.

The ongoing legal fight is happening while the broader fight over of free tax preparation is heating up. The Internal Revenue Service is planning to test its own pilot program in the upcoming filing season where taxpayers can file their taxes directly with the IRS instead of through tax preparation companies or individual preparers.

TurboTax and the tax software industry oppose the proposed IRS direct file system. So do Congressional Republicans.

One sticking point in the looming government shutdown is how much money the IRS should be getting in its budget. The House appropriations bill would forbid the IRS from using any money to build the direct file system.

Intuit Inc.
INTU,
+1.44%
shares closed 1.4% higher Friday, at $549.60, and the disclosure didn’t seem to be having much effect on the shares in after-hours trading. Shares are up 41% year to date, while the Dow Jones Industrial Average
DJIA
is up 5% and the S&P 500
SPX
is up 17.6%.

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September 1, 2023
3M Nears Roughly $5.5 Billion Earplugs Settlement

3M Nears Roughly $5.5 Billion Earplugs Settlement

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August 27, 2023
Founders of crypto mixer arrested, sanctioned after US cracks down on Tornado Cash

WASHINGTON — U.S. government officials on Wednesday started cracking down on the co-founders of the virtual currency mixer Tornado Cash, just days after a federal judge decided that the government had the authority to sanction them.

Treasury’s Office of Foreign Assets Control sanctioned Russian national Roman Semenov, one of the three co-founders of Tornado Cash, for allegedly supporting the North Korean hacking organization Lazarus Group, among other things.

Also Wednesday, the Justice Department unsealed an indictment charging Semenov and Tornado Cash co-founder Roman Storm, from Auburn, Washington, with conspiracy to commit money laundering, operating an unlicensed money transmitting business and other crimes. Storm was arrested in Washington on Wednesday by federal officials.

Semenov is believed to be in Dubai.

Tornado Cash and other mixing services combine various digital assets, including potentially illegally obtained funds along with legitimately obtained funds, so that illegal actors can obscure the origin of the stolen funds.

Tornado Cash was sanctioned in August 2022, accused of helping to launder more than $7 billion worth of virtual currency since its creation in 2019. The Justice Department says Tornado Cash facilitated more than $1 billion in money-laundering transactions, including hundreds of millions for Lazarus Group. Treasury says Tornado Cash systems were used, among other things, to launder more than $96 million drawn from the June 2022 Harmony blockchain bridge theft and August 2022 Nomad crypto firm heist.

Federal prosecutors also charged Semenov and Storm with violating the sanctions against Tornado Cash.

The penalties and arrest come after U.S. District Judge Robert Pitman decided Aug. 17 that Treasury did not overstep its authority in sanctioning Tornado Cash. A group of crypto investors brought a lawsuit against Treasury in September 2022, alleging that Treasury overstepped its authority in sanctioning Tornado Cash.

The sanctions faced strong pushback from the crypto industry, which argued that the sanctions open the door to limiting Americans’ usage of privacy software.

A third co-founder of Tornado Cash, Alexey Pertsev, was arrested in August 2022 on money laundering charges in the Netherlands.

Last May, the U.S. sanctioned North Korean digital currency mixing firm Blender.io, which the country allegedly uses to launder stolen virtual currency and support cyber crimes.

Blender is accused of helping Lazarus Group to carry out a $620 million digital currency heist in March, the biggest of its kind to date.

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Associated Press reporter Frank Bajak in Boston contributed to this report.

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August 23, 2023
ABC News – Breaking News, Latest News and Videos

An 86-year-old man accused of assuming his brother’s identity decades ago and using it to double dip on Social Security benefits has been convicted of identity theft and other charges

BANGOR, Maine — An 86-year-old man accused of assuming his brother’s identity decades ago and using it to double dip on Social Security benefits has been convicted of several charges, caught by facial recognition technology that matched the same face to two different identities, authorities say.

Napoleon Gonzalez, of Etna, assumed the identity of his brother in 1965, a quarter century after his sibling’s death as an infant, and used the stolen identity to obtain Social Security benefits under both identities, multiple passports and state identification cards, law enforcement officials said.

A U.S. District Court jury on Friday convicted him of charges including mail fraud, Social Security fraud, passport fraud and identity theft. He faces up to 20 years in prison at sentencing, with mail fraud carrying the greatest potential penalty of all the charges.

Gonzalez’s benefits were previously investigated by the Social Security Administration in 2010 for potential fraud and his benefits were upheld.

A new investigation was launched in 2020 after facial identification software indicated Gonzalez’s face was on two state identification cards.

The facial recognition technology is used by the Maine Bureau of Motor Vehicles to ensure no one obtains multiple credentials, or credentials under someone else’s name, said Emily Cook, spokesperson for the secretary of state’s office.

“When fraud is detected, the fraudulent transactions are investigated and referred for administrative and/or criminal proceedings. That is what happened with this case,” she said.

When confronted, Gonzalez claimed that he took on his deceased brother’s identity at the direction of the Air Force’s Office of Special Investigations while participating in an undercover operation in the 1960s, according to court documents. He later admitted to faking his death under his own identity and continued with his brother’s identity, the documents indicated.

Gonzalez remains free on bail. A sentencing date has not yet been set.

His lawyer didn’t immediately reply to an email from The Associated Press seeking comment.

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August 22, 2023
Kansas City Superfan ‘ChiefsAholic’ charged with stealing almost $700,000 in bank heists

KANSAS CITY, Mo. — A Kansas City Chiefs superfan known as “ChiefsAholic” and familiar for attending games dressed as a wolf in the NFL team’s gear has been indicted by a federal grand jury that accuses him of armed robbery and money laundering in a string of bank heists across four states that netted him almost $700,000.

Xaviar Babudar robbed six banks — and tried unsuccessfully three other times — and laundered the proceeds at casinos and sportsbooks, according to the U.S. attorney for the Western District of Missouri. The 19-count indictment handed down Wednesday replaces and supplements a criminal complaint filed against Babudar in May.

Babudar, 29, is scheduled to be arraigned on Friday, said his attorney, Matthew T. Merryman.

“It’s now the fourth quarter of the most important game of Xaviar’s life,” Merryman said in a statement emailed to The Associated Press. “And his legal team believes his innocence will ultimately be proven to the public and we are confident that once all of the facts are known that he will be redeemed in the eyes of his supporters, admirers and the Chiefs Kingdom.”

According to the U.S. attorney’s office, Babudar robbed banks and credit unions in Iowa, Nebraska, Tennessee and Oklahoma and used money to finance his Chiefs fandom. The charges include three counts of armed bank robbery, one count of bank theft, 11 counts of money laundering and four counts of transporting stolen property across state lines.

Babudar was active on social media as “ChiefsAholic” and was well known for attending home and road games dressed in his wolf costume. The indictment says he used some of the robbery loot to bet on the team to win the Super Bowl and for quarterback Patrick Mahomes to win the game’s MVP Award — bets that turned $10,000 into $100,000.

After receiving a check for his winnings, Babudar, who had been charged with robbing a Tulsa credit union and was out on bond, cut his ankle monitor and fled the state, the U.S. attorney said in a news release. He was arrested in California last month and remains in federal custody without bond, the release said.

“The government’s announcement today of its 19-count indictment provides an unfair and unjust portrayal of Xaviar,” Merryman said. “The truth is that since 2018 Xaviar Babudar, aka ‘ChiefsAholic’ has entertained, inspired, unified and motivated Kansas Citians, the Chiefs Kingdom and hundreds of millions of fans around the globe.”

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AP NFL: https://apnews.com/hub/nfl

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August 17, 2023
Ex-FBI counterintelligence official pleads guilty to conspiracy charge for helping Russian oligarch

NEW YORK — A former high-ranking FBI counterintelligence official pleaded guilty Tuesday to conspiring to violate sanctions on Russia by going to work, after he retired, for an oligarch he once investigated.

Appearing before a federal judge in New York City, Charles McGonigal, 55, said he was “deeply remorseful” for work he did in 2021 for the billionaire industrialist Oleg Deripaska.

McGonigal told the judge he accepted over $17,000 to help Deripaska collect derogatory information about another Russian oligarch who was a business competitor. Deripaska has been under U.S. sanctions since 2018 for reasons related to Russia’s occupation of Crimea.

McGonigal was also trying to help Deripaska get off the sanctions list, Assistant U.S. Attorney Rebecca Dell said, and was in negotiations along with co-conspirators to receive a fee of $650,000 to $3 million to hunt for electronic files revealing hidden assets of $500 million belonging to the oligarch’s business rival.

McGonigal pleaded guilty to a single count of conspiring to launder money and violate the International Emergency Economic Powers Act. He could face up to five years in prison. Judge Jennifer H. Rearden scheduled his sentencing for Dec. 14.

McGonigal, who lives in New York, is separately charged in federal court in Washington, D.C. with concealing at least $225,000 in cash he allegedly received from a former Albanian intelligence official while working for the FBI.

McGonigal was special agent in charge of the FBI’s counterintelligence division in New York from 2016 to 2018. He supervised investigations of Russian oligarchs, including Deripaska.

The U.S. District Court for the District of Columbia later affirmed the sanctions against Deripaska, finding there was evidence he had acted as an agent of Russian President Vladimir Putin.

McGonigal, who became choked up at one point as he described his crime, said Deripaska funneled the $17,500 payment he received through a bank in Cypress and a corporation in New Jersey before it was transferred into his bank account.

“This, as you can imagine, has been a painful process not only for me, but for my friends, family and loved ones,” McGonigal said. “I take full responsibility as my actions were never intended to hurt the United States, the FBI and my family and friends.”

In a release, Matthew G. Olsen, assistant attorney general of the Justice Department’s National Security Division, said, “McGonigal, by his own admission, betrayed his oath and actively concealed his illicit work at the bidding of a sanctioned Russian oligarch.”

“Today’s plea shows the Department of Justice’s resolve to pursue and dismantle the illegal networks that Russian oligarchs use to try to escape the reach of our sanctions and evade our laws,” he added.

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August 15, 2023
Hawaiian Electric’s stock slides 26% as S&P downgrades credit to junk on risk from Maui wildfire lawsuits

Hawaiian Electric Industries Inc.’s stock added to losses Tuesday, tumbling 26% after S&P Global Ratings downgraded its rating on the utility company to junk.

S&P Global Ratings cut its rating on the company HE to BB- and placed it on CreditWatch negative, meaning the rating agency could downgrade it again in the near term.

The devastating…

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August 15, 2023
Former Malaysian Prime Minister Muhyiddin Yassin acquitted of four graft charges

Former Malaysian Prime Minister Muhyiddin Yassin has been acquitted by the high court of four corruption charges, days after his opposition bloc expanded its influence in local elections

FILE – Malaysia’s former Prime Minister Muhyiddin Yassin poses for media outside courthouse, after charged with corruption and money laundering, in Kuala Lumpur, Malaysia, on March 10, 2023. Muhyiddin was acquitted by the high court of four corruption charges on Tuesday, Aug. 15, just days after his opposition bloc expanded its influence in local elections. (AP Photo/Vincent Thian, File)

The Associated Press

KUALA LUMPUR, Malaysia — Former Malaysian Prime Minister Muhyiddin Yassin was acquitted by the high court of four corruption charges on Tuesday, just days after his opposition bloc expanded its influence in local elections.

Muhyiddin, 75, said the high court struck down four charges of abusing his power to obtain 232.5 million ringgit ($50 million) in bribes for his Bersatu party. He was charged in March and still faces three charges of money laundering involving 200 million ringgit ($43 million).

“From the start, I have said that these are politically motivated charges. I have not done anything wrong … and today it has been proven that these were false allegations,” he told reporters outside the courthouse.

His lawyer, Hisyam Teh Poh Teik, said the court agreed with the defense contention that the charges were defective legally and lacked details on how the offenses were committed. With the collapse of the four main charges, Teh said they were confident the other three money-laundering charges would not stand. The graft charges revolved around the award of contracts to selected ethnic Malay contractors allegedly in return for bribes, and approving an appeal by a business tycoon over the cancellation of his tax exemption.

Prosecutors said they would appeal the court’s decision.

Muhyiddin is the second former leader charged with crimes after ex-Prime Minister Najib Razak, who received multiple charges after losing a 2018 general election. Najib began a 12-year prison term last year after losing his final appeal in the first of several graft trials.

Muhyiddin’s legal victory came just days after fiercely contested state elections returned the status quo. But his Malay nationalist Perikatan Nasional (PN) bloc, which includes a conservative Islamic party, further expanded its influence among the country’s majority ethnic Malays.

Prime Minister Anwar Ibrahim has rejected accusations that the charges against Muhyiddin were politically motivated and noted the investigations were carried out independently by the anti-graft agency. After taking power in November, Anwar ordered a review of government projects approved by past administrations including Muhyiddin’s government from March 2020 until August 2021. Anwar has said many of the projects were overpriced and awarded without tenders.

Two senior members of Muhyiddin’s Bersatu party were also charged with graft. The anti-graft agency also froze Bersatu’s party accounts.

Anwar and Muhyiddin fought for the premiership after November’s general election produced a hung parliament. Muhyiddin’s PN bloc received stronger-than-expected support from Malays, who account for two-thirds of Malaysia’s 33 million people. The king later appointed Anwar as prime minister after he formed a unity government with former rivals.

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August 15, 2023
Leader of Ecuadorian crime gang moved to maximum-security prison days after candidate’s killing

GUAYAQUIL, Ecuador — Authorities moved the leader of one of Ecuador’s most powerful gangs into a maximum-security prison Saturday, three days after the assassination of a presidential candidate who had denounced threats from the feared criminal.

President Guillermo Lasso said the relocation of Los Choneros leader Adolfo Macías, alias “Fito,” was meant “for the safety of citizens and detainees.”

The gang boss was moved out of a jail with lighter security into a maximum-security prison in the same large complex of detention facilities in the port city of Guayaquil.

“Ecuador will recover peace and security,” Lasso tweeted. “If violent reactions arise, we will act with full force.”

About 4,000 soldiers and police officers raided the jail where Macías was being held Saturday and seized weapons, ammunition and explosives. Corrections officials released images of the raid showing several prisoners, including Macías, who is serving a 34-year sentence for drug trafficking, organized crime and homicide.

Ecuador’s transformation into a major drug trafficking hub and the ensuing three-year surge of violence reached a new level with Wednesday’s assassination of Fernando Villavicencio during a campaign rally in Quito, the capital. The candidate, who was not a front-runner, was known for speaking up against drug cartels.

Authorities have not disclosed a motive for the killing. An Ecuadorian judge on Friday ordered preventive detention for six Colombian men described by authorities as being suspected of involvement in the slaying.

Villavicencio, 59, was one of eight registered candidates for the Aug. 20 presidential election. He had accused Los Choneros and Macías, whom he linked to Mexico’s Sinaloa cartel, of threatening him and his campaign team days before the assassination.

Villavicencio believed popular support would keep him safe.

“You’re my bulletproof vest. I don’t need one. You’re a brave people and I’m as brave as you are,” he said at a public meeting in the city of Chone, the heart of Los Choneros territory. “Bring on the drug lords. Bring on the hitmen.”

Interior Minister Juan Zapata on Thursday described the assassination as a “political crime of a terrorist nature” aimed at sabotaging the election.

The snap election was called after Lasso, a conservative former banker, dissolved the National Assembly by decree in May, acting to avoid being impeached over allegations that he failed to intervene to end a faulty contract between the state-owned oil transport company and a private tanker company. Lasso isn’t running in the election.

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August 12, 2023
US, UK, and Canada sanction Lebanon’s former central bank governor over corruption allegations

BEIRUT — The United States, United Kingdom, and Canada slapped sanctions Thursday on Lebanon’s embattled former central bank governor and a handful of close relatives and associates over allegations of corruption, the U.S. Treasury Department said.

Riad Salameh, 73, ended his 30-year tenure on July 31 under a cloud of investigation and blame for his country’s historic economic crisis.

France, Germany, and Luxembourg are investigating Salameh and close associates over alleged financial crimes, including illicit enrichment and the laundering of $330 million. Paris and Berlin issued Interpol notices on Salameh in May, though Lebanon does not hand over its citizens to foreign countries.

“Salameh abused his position of power, likely in violation of Lebanese law, to enrich himself and his associates by funneling hundreds of millions of dollars through layered shell companies to invest in European real estate,” a U.S. Treasury Department statement said.

The statement said the U.S. coordinated the sanctions with the U.K. and Canada and that assets connected to Salameh would be frozen. The U.S. also sanctioned Salameh’s son Nady, brother Raja, close associate Marianne Hoayek and “former partner” Anna Kosakova. The U.K. sanctioned the same list of people except Nady Salameh, and Canada sanctioned only Salameh, his brother and Howayek.

Salameh has repeatedly denied allegations of corruption, embezzlement, and illicit enrichment. He insists that his wealth comes from inherited properties, investments and his previous job as an investment banker at Merrill Lynch.

Salameh’s lawyer did not immediately respond to a request from The Associated Press for comment on the sanctions.

U.S. officials said Salameh allegedly hid his identity through Panama shell companies and a trust in Luxembourg in a scheme where he purchased shares in a company his son Nady worked for as an investment advisor. He then sold those shares to a Lebanese bank regulated by the Central Bank, which the U.S. Treasury said was a conflict of interest and likely violated a Lebanese law that banned central bank employees from profiting from private businesses .

Raja has been accused of supporting his brother’s embezzlement through a brokerage firm he owns called Forry Associates Ltd, which the U.S. Treasury described as a shell company based in the Virgin Islands.

Howayek, meanwhile, was accused of transferring hundreds of millions of dollars to the Salamehs from her bank account, which was “far more” than what could be accounted for with her central bank salary.

Nady Salameh was sanctioned as “the publicly registered officer” of companies registered in Luxembourg that purchased high-end real estate worth tens of millions of dollars through subsidiary companies in Belgium and Germany.

France-based Kosakova was accused of using funds funneled from Forry to purchase luxury properties in Paris, including apartments in high-end neighborhoods, and an office building on the touristic Champs-Elysées avenue for the central bank as a “continuity of operations” center.

Salameh is also being investigated in Lebanon. The Lebanese judiciary had taken his passports and imposed a travel ban soon after receiving the Interpol notices.

Salameh has has criticized the European probe and said it was part of a media and political campaign to scapegoat him.

Once hailed as Lebanon’s guardian of financial stability, Salameh has been among the officials most blamed for policies that led to the country’s economic crisis, which has decimated the value of the Lebanese pound by around 90% against the U.S. dollar and sparked triple-digit inflation.

Lebanon has not appointed a new central bank governor, but a vice governor, Wassim Mansouri, has been named acting governor. The crisis-hit country has also been without a president for almost a year and is run by a caretaker Cabinet with limited functions.

“The only way to put Lebanon on the path to much-needed economic recovery is for its leaders to stamp out corruption and implement real reforms.” the UK’s minister of state for the Middle East, Lord Ahmad of Wimbledon, said in a statement from the Foreign, Commonwealth and Development Office announcing the sanctions.

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August 10, 2023
Prison probably isn’t the end of the political road for Pakistan’s ex-Prime Minister Imran Khan

ISLAMABAD — Former Prime Minister Imran Khan, Pakistan’s popular opposition leader, is now an inmate at a high-security prison after being convicted of corruption and sentenced to three years.

It’s the most dramatic twist yet in months of political and legal wrangling between Khan and his political rivals since he was toppled in a parliamentary no-confidence vote in April 2022.

Khan’s party said it will appeal what government critics describe as a flimsy case, aimed at removing the former cricket star from politics ahead of a general election meant to be held this fall. The government defended the conviction as lawful and denied that Khan is a victim of political persecution.

If the conviction stands, the 70-year-old Khan would be prohibited by law from running for office or leading Pakistan Tehreek e-Insaf, the party he founded in the 1990s. However, polls indicate a strong election showing for PTI, and Khan’s imprisonment could further boost its standing.

WHAT WAS THE CASE AGAINST HIM?

An Islamabad court ruled Saturday that Khan failed to report income from gifts he received from foreign dignitaries and heads of state while he was in power. In Pakistan, government leaders are allowed to keep such gifts after leaving power, in exchange for paying a portion of the value for them.

The court said Khan sold some of those gifts and failed to state those earnings in a report last year to Pakistan’s election commission. The court convicted Khan of corruption, handed down a three-year sentence and fined him 100,000 rupees, or roughly $350.

Shortly after the verdict, Khan was detained at his home in the eastern city of Lahore and taken to a high-security lockup in the town of Attock, about an hour’s drive from the capital of Islamabad.

WHAT OTHER CASES ARE PENDING AGAINST KHAN?

Since Khan’s ouster, more than 150 cases have been filed against him by various government agencies on charges ranging from contempt of court to terrorism and inciting violence.

Critics say this flurry of legal filings is part of an attempt by the governing coalition to sideline Khan, who as opposition leader has been able to mobilize huge crowds of loyal supporters.

The government, in turn, portrays Khan as a corrupt trickster who has employed legal maneuvers to stay out of prison. The government has backers in Pakistan’s powerful military, which has controlled the country for much of its 75-year history.

HOW IS THIS ARREST DIFFERENT?

Khan is being held in Attock, a notorious lockup for convicted militants and violent criminals. Officials familiar with conditions there said he has his own cell with a fan and separate bathing facilities, a step up from the prison’s generally harsh conditions. The officials spoke on condition of anonymity because they were not allowed to brief the media.

This is in marked contrast to Khan’s brief detention in May, after he was dragged from a court hearing on a different set of corruption charges by anti-graft officials. The Supreme Court intervened swiftly, declaring the detention illegal. Khan was allowed to stay at a guest house in a police compound and could receive visitors while the legal arguments over his detention played out. Khan eventually returned to Labore, where his car was showered with rose petals.

WHAT HAPPENS NEXT?

The Supreme Court could overturn Khan’s conviction and sentence on appeal — an outcome that political analyst Imtiaz Gul believes is likely.

“There was absolutely no solid case against Imran Khan, who had to face this conviction because of a technical mistake,” said Gul, who heads the Center for Research and Security Studies, an Islamabad-based think tank.

Information Minister Marriyum Aurangzeb claimed in a statement defending the conviction that support for Khan is eroding.

“He may deceive a few naive, gullible supporters, but the general public now recognizes his true nature,” she wrote. “His pretense has been stripped away, revealing the face of an individual who evaded the law, exploited state gifts for trivial profits.”

If Khan’s conviction stands, he won’t be able to lead his party into an election because those with criminal convictions are barred from running for office. But even from behind bars, he could wield significant political influence.

After his detention in May, his supporters demonstrated their ability to disrupt public life. Tens of thousands of Khan loyalists rampaged through cities, some of them destroying military and government property. The government cracked down, detaining more than 7,000, with some prosecutions still ongoing.

By comparison, the reaction to Khan’s arrest this weekend was much more muted, possibly because of fears of another crackdown. His calls for peaceful protests failed to rouse widespread support.

WHAT IS THE POLITICAL FALLOUT?

Prime Minister Shehbaz Sharif is likely to dissolve parliament in the coming weeks, possibly paving the way for elections by mid-November. The government could delay the vote by several months if it decides to redraw constituencies based on recent census results.

Khan’s imprisonment could win him and his party greater electoral support. It would also feed into the political persona he created after losing power — that of a fearless campaigner for Pakistan’s disadvantaged.

“The next elections are likely to be held without active participation of Imran Khan, but even from jail, he has the potential to effectively run a campaign for his candidates,” said political analyst Azim Chaudhry.

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August 6, 2023