US backtracks on Russian spy suspect offering sex for access
By ERIC TUCKER and CHAD DAY
Monday, September 10
WASHINGTON (AP) — Federal prosecutors are backtracking on their allegation that a Russian woman accused of working as a secret agent offered to trade sex for access, according to a Justice Department court filing.
Prosecutors had earlier accused Maria Butina, a gun rights activist in U.S. custody on charges she worked as a covert agent and tried to establish back-channel lines of communication to the Kremlin, of offering to exchange sex for a position with a special interest organization.
The salacious allegation, which immediately escalated the public interest in the case, was based on a series of text messages to and from Butina and other information that prosecutors say they had obtained.
But in a new court filing late Friday, prosecutors said they misinterpreted the messages. They said “even granting that the government’s understanding of this particular text conversation was mistaken,” there is other evidence to support keeping Butina in custody as the case against her moves forward in Washington.
Butina, 29, was arrested in July and accused of gathering intelligence on American officials and political organizations. Prosecutors say she used her contacts with the National Rifle Association and the National Prayer Breakfast to develop relationships with U.S. politicians and gather information for Russia. They also say she used her role as a student at American University in Washington as a cover for her activities.
The case is being handled by the U.S. attorney for the District of Columbia and not by special counsel Robert Mueller, who has been leading an investigation into possible coordination between Russia and Donald Trump’s Republican presidential campaign as well as Russian interference in the 2016 U.S. election. The filing came ahead of a status hearing in her case scheduled for Monday.
Butina’s lawyer, Robert Driscoll, had strongly denied the accusation and said the government had relied on an “innocuous” 3-year-old text message exchange between Butina and a longtime friend, assistant and public relations professional for a gun rights group that she had founded.
The individual, identified in court papers only as DK, had said in the text that he didn’t know what Butina would owe him after he took her car for an insurance renewal and government inspection. She replied, “Sex. Thank you so much. I have nothing else at all. Not a nickel to my name.”
In a court filing last month, Driscoll said that the sex comment was clearly a joke and that Butina is friends with DK’s wife and child and treats him like a brother. He said there is no evidence that the two ever had sex.
“The impact of this inflammatory allegation, which painted Ms. Butina as some type of Kremlin-trained seductress, or spy-novel honeypot character, trading sex for access and power, cannot be overstated,” Driscoll said.
In an interview with The Associated Press on Sunday, Driscoll said, “I’m happy the government walked back their false allegation.”
Butina has pleaded not guilty to the charges of conspiracy and acting as an unregistered foreign agent for Russia. Driscoll has denied that Butina is a Russian agent, calling the case “overblown.” He has said his client was merely a student who wanted to see a better relationship between the U.S. and Russia and sought to network with influential people in American politics.
There was nothing covert about her work, Driscoll said, noting several news stories about her over the past several years.
The sexual allegation was only a small part of the evidence presented by prosecutors in arguing to jail Butina. Prosecutors largely argued that she posed an “extreme” flight risk and raised the prospect of her being swept out of the country by Russians using their diplomatic immunity to shield her from U.S. law enforcement. The U.S. does not have an extradition treaty with Russia.
Prosecutors have said her activities in the U.S. were being directed by a Russian official, identified by Driscoll as Alexander Torshin. He is a senior official in the Central Bank of the Russian Federation, a former lawmaker and a member of the NRA since 2012.
Prosecutors say Torshin was Butina’s handler, but Driscoll has said he was only a friend and mentor with whom Butina traveled openly when he visited the U.S.
Torshin was also among a number of Russian businessmen and officials sanctioned this year by the U.S. Treasury Department for their ties to Russian President Vladimir Putin and for their part in “advancing Russia’s malign activities.”
Prosecutors have said they also found evidence that Butina has had contact with Russian intelligence.
FBI agents photographed her dining with a diplomat suspected of being a Russian intelligence agent. They found she had contact information for people suspected of being employed by Russia’s Federal Security Services, or FSB, the successor intelligence agency to the KGB. They also found notes in her home referring to a potential job offer from the FSB.
The notes were found among the belongings of her boyfriend, conservative political operative Paul Erickson, who is referred to as “U.S. Person 1” in court papers that allege he was Butina’s channel for establishing ties with the NRA.
Prosecutors have questioned the authenticity of Butina’s romantic relationship with Erickson, who is in his mid-50s. Driscoll has disputed the government’s characterization of the relationship.
Driscoll said during a hearing this summer that Butina cooperated with a federal fraud investigation into Erickson in South Dakota.
Erickson has not been charged with any crimes.
Read prosecutors’ court filing: http://apne.ws/rIV3Yy7
Read Butina’s argument for release from jail: http://apne.ws/4I6nHlA
Opinion: Emerging Market Meltdown Is More Than a Tantrum
By Desmond Lachman
As the emerging market currency meltdown spreads from Argentina and Turkey to Brazil, India, Indonesia and South Africa, the optimists — who did not anticipate this meltdown in the first place — now dismiss it as a mere tantrum. By this, they mean that it is likely to be a passing phenomenon much as was the case with the Bernanke emerging market taper tantrum back in 2013.
It is hoped U.S. policymakers will not be quite as dismissive of the emerging market economies’ present currency weakness as the optimists seem to be. This is especially so considering that these economies now constitute more than half of the global economy and have been the main engine of world economic growth. If, as is all too likely, the present currency crises in Argentina and Turkey are a harbinger of a marked slowdown in emerging market economic growth, that could have serious implications for the world economic outlook.
One reason to think that the present emerging market currency weakness is not a passing phenomenon is that all too many of these economies have fundamental economic and political vulnerabilities. While in an environment of ample global liquidity those weaknesses did not matter much, they did matter as soon as the Federal Reserve began to raise interest rates in earnest and as soon as the dollar started to appreciate. Investors no longer needed to stretch for yield abroad, and they now could once again become more discriminating in taking on risk in the emerging market economies.
With their large external deficits, their weak public finances and their turbulent politics, countries like Argentina and Turkey stood out among those emerging market countries most vulnerable to a change in the global liquidity environment. However, they were hardly alone. Other important emerging market economies like Brazil and South Africa, too, had the shakiest of public finances and they too had real political strains as they approached forthcoming general elections. This makes those countries as well as Argentina and Turkey highly vulnerable to any further increase in U.S. interest rates and to any further dollar strengthening.
Sadly, there is every reason to think there will be serious contagion from Argentina, Brazil, South Africa and Turkey to those emerging market economies that might have stronger economic and political fundamentals than this group of countries. Experience from previous emerging market currency meltdowns strongly suggests that, when investors suffer large losses on a few emerging market positions, they tend to reduce their overall exposure to the emerging markets as an asset class. This often involves selling investments of those emerging market countries that have sounder economic fundamentals and more liquid asset markets.
As George Soros never tires of reminding us with his theory of reflexivity, when markets move a lot they can create new economic conditions. In the context of a generalized emerging market selloff, this could mean that those countries with formerly strong economic fundamentals can have those fundamentals severely undermined by a sharp weakening of their currencies and by a large increase in their borrowing costs. If interest rates have to be raised to defend their currencies and that induces an economic recession, budget positions that were once strong could be seriously undermined. That in turn could further scare off investors.
Earlier this year, Federal Reserve Chairman Jerome Powell confidently asserted that the emerging market economies would weather well the Fed’s move to gradually normalize U.S. monetary policy. I hope he has been paying close attention to the unfolding economic crises in Argentina, Brazil, South Africa and Turkey. Maybe then, the Federal Reserve will not get caught flatfooted in responding to an emerging market crisis that has the real potential to derail the global and U.S. economic recoveries.
ABOUT THE WRITER
Desmond Lachman is a resident fellow at the American Enterprise Institute. He was formerly a deputy director in the International Monetary Fund’s Policy Development and Review Department and the chief emerging market economic strategist at Salomon Smith Barney. He wrote this for InsideSources.com.
Opinion: Who’s Afraid of the Federalist Society?
By Michael Graham
Just hours after President Trump announced his pick of Brett Kavanaugh for the Supreme Court, Senate Minority Leader Chuck Schumer took to the floor to denounce the choice because Trump picked him “from a list of 25 people who were vetted and approved by the Federalist Society.”
Soon after, New Jersey Democratic senator Bob Melendez joined in: “I cannot support a nominee culled from the right-wing wish lists of the Federalist Society.”
During the Senate Judiciary Committee’s first day of hearings on Kavanaugh’s nomination, Sheldon Whitehouse of Rhode Island said the Federalist Society had recommended his nomination, as it had that of Neil Gorsuch. “That should give every senator pause,” Whitehouse said.
All of which has inspired many Americans to ask: What the heck is the Federalist Society?
Far from being a semi-secret society conspiring against the U.S. justice system, the Federalist Society is actually a high-profile organization comprising 68,000 conservative and libertarian law students, attorneys and academics. Founded in 1982 by students at the law schools of Harvard, Yale and University of Chicago, it now boasts student chapters at more than 200 law schools and an additional 60-plus lawyer chapters in 80 cities around the country.
What is it about the Federalist Society that makes Senate Democrats “pause”? The organization has grown into an important networking tool for promoting the careers of rising young attorneys and jurists who share its “originalist” view of the Constitution. (Originalism is the belief that the Constitution should be applied based on the original understanding of the text at the time the Constitution was written or amended, as opposed to a “living document” whose meaning comes from the context of the moment.)
The Federalist Society’s success advancing the originalist legal theory has been nothing short of dramatic. University of California, Berkeley, law professor John Yoo, a former Justice Department official in the George W. Bush administration, recently said: “When Antonin Scalia first joined the Supreme Court, originalism was a laughingstock at elite law schools. By the time of his death, any elite school that didn’t have at least two or three serious originalists on its faculty was itself a laughingstock.”
And while the organization’s successes are relatively recent, George Washington University law professor David Fontana notes that its ideas have been around for a while. “The idea of ‘originalism’ goes back at least as far as Chief Justice John Marshall’s opinions in the early 19th century,” Fontana wrote at the Daily Beast. “Justice Hugo Black was known in the 20th century as a leading originalist.”
In other words, it’s part of the legitimate and healthy debate over how America’s judges should approach and apply the law. But these mundane facts haven’t stopped Senate Democrats portraying the Federalist Society as some dark and dangerous force from the fringe of American jurisprudence.
The last time the Senate considered filling a vacancy on the high court (with Neil Gorsuch’s nomination in 2017), Senator Whitehouse demanded the Judiciary Committee hand over any and all documents related to the Federalist Society’s executive director. Whitehouse and fellow Democratic senator Dick Durbin of Illinois even attacked the organization as a kind of judicial Svengali seducing a willing President Trump into doing its bidding.
But claims that it’s a “shadow group” secretly pulling strings behind the scenes just don’t hold up. Far from on the fringe, every justice now sitting on the nation’s highest court has spoken at Federalist Society events, including liberal icon Justice Ruth Bader Ginsburg.
And it doesn’t stop there. The Federalist Society’s student branch held its national jamboree in February 2005 at Harvard Law School. According to attendees, then Harvard dean — and future Supreme Court justice — Elena Kagan began her welcoming remarks by roaring in her famous New York accent, “I love the Federalist Society!”
She went on to add, “You are not my people,” which drew a big laugh and a loud ovation. While Kagan reminded the group that she and they disagreed philosophically, at no point did she scold it for trying to secretly hijack our nation’s judicial system.
Republican senators have been critical of the performance of their Democratic counterparts during the committee hearings on Kavanaugh’s nomination. Sen. Lindsey Graham of South Carolina, for example, objected to characterizing the hearings as a “circus” because, he said, “that’s unfair to circuses. Circuses are entertaining and you can take your children to them.”
The most common explanation for the Democrats’ performance is that Kavanaugh is such a strong nominee that they’re forced to resort to theatrics, rather than questioning his resume.
Far from believing he is outside the judicial mainstream, the American Bar Association said Kavanaugh is “unanimously well qualified” for the Supreme Court.
None of this explains Democrats’ attacks on the Federalist Society, or their suggestion that the organization’s recommendations of judges is somehow suspect. Perhaps they’re aware that, the same week Washington was obsessed with the Kavanaugh “circus,” the GOP-controlled Senate confirmed President Trump’s 68th judicial nominee.
All of whom had the support of the Federalist Society.
A vote is expected to confirm Kavanaugh to the court later this month, and after a week of hearings, analysts widely expect him to win the Senate’s approval, as no missteps were made.
ABOUT THE WRITER
Michael Graham is political editor of NH Journal. He is also a CBS News contributor. You can reach him at email@example.com. He wrote this for InsideSources.com.
Strengthening Florence likely to pose serious threat to US East Coast later this week
All interests along the United States East Coast are being put on alert for a potential strike from Hurricane Florence during the second half of the week.
AccuWeather Global Weather Center – SEPTEMBER 9, 2018 – Confidence is increasing among AccuWeather meteorologists that Florence will pose a serious direct threat to part of the Eastern Seaboard this week.States of emergency have been declared in North Carolina, South Carolina and Virginia due to possible impacts from the storm.
Florence, currently a Category 1 hurricane, is expected to regain major hurricane status (Category 3 or higher) as it continues to track westward and enters a favorable environment for intensification early this week. Florence became the first Category 4 hurricane of the 2018 Atlantic season last week, but later weakened due to a zone of strong wind shear and cooler waters.
Seas to become dangerous well ahead of Florence
Large swells will propagate outward hundreds of miles away from the center of the storm this week. The swells will make for rough seas along and well off the U.S. East Coast, Bermuda, the northern shores of the Caribbean islands and the south- and southeast-facing shores of the Canada Maritimes, according to AccuWeather Senior Meteorologist Alex Sosnowski.
Said AccuWeather Hurricane Expert Dan Kottlowski, “Resident and interests living along and near the Carolina coast and even up toward the Virginia Capes should closely monitor Florence and be ready to put their hurricane plan in place. If you do not have a hurricane plan in place, do so immediately.”
Florence may bring significant impacts to U.S. East Coast
Florence is expected to be as strong as a Category 4 hurricane by the time it makes its closest approach to the United States from Wednesday to Thursday. AccuWeather Hurricane Expert Dan Kottlowski said that a Florence landfall along the U.S. East Coast is becoming more likely, with the Carolinas at greatest risk late this week. The exact track of the storm will determine which locations receive the worst of Florence’s damaging winds, heavy rain and storm surge flooding.
Where are Helene and Isaac headed in the Atlantic?
Tropical Storms Isaac and Helene have joined Florence in the Atlantic Basin.
AccuWeather Global Weather Center – September 9, 2018 – Two new tropical storms have emerged in the eastern Atlantic Ocean and one could threaten some of the Caribbean Islands this week.
Tropical Storm Isaac and Tropical Storm Helene have joined Florence in the Atlantic Basin.
Helene, which is located off the west coast of Africa, has brought tropical-storm-force conditions to the Cabo Verde Islands over the weekend. Farther west, Isaac will track toward the Lesser Antilles this week.
“There is a growing consensus that this system could threaten the Lesser Antilles during the middle or latter part of the week,” AccuWeather Hurricane Expert Dan Kottlowski said.
Isaac track through Thursday
Environmental conditions across the Atlantic will be favorable for strengthening as it tracks toward the islands.
“There is a significant chance this storm may become a hurricane along the way,” AccuWeather Senior Meteorologist Alex Sosnowski added.
Regardless of strength, seas will become rough and dangerous for bathers and boaters along the east-facing portions of the islands as early as Wednesday.
Hurricane Florence Moving Westward: Potentially Catastrophic Situation for U.S. East Coast, with Flood Risks Further Inland
AccuWeather Global Weather Center – September 9, 2018 – With Florence regaining hurricane status with winds of 75 mph as of midday Sunday, September 9, 2018, all interests along the United States East Coast are being put on alert for a potential strike from Hurricane Florence during the second half of the week.
AccuWeather meteorologists are increasingly concerned Florence will pose a serious direct threat to part of the Eastern Seaboard this week. States of emergency have been declared in North Carolina, South Carolina and Virginia due to possible impacts from the storm.
People in the Carolinas to Virginia may face a very dangerous, potentially catastrophic situation. Florence is expected to strengthen into a major hurricane moving over very warm waters as it approaches the coast late in the week. Indications are that storm may be very slow moving, and could even stall over the region. This would bring not only powerful winds and devastating storm surge, but a prolonged period of heavy, flooding rains to the region leading to widespread major flooding.
AccuWeather experts advise everyone in the region spanning northern Georgia to the Middle Atlantic coast to make action plans in case this storm approaches them later this week, and warn people living away from the coast to be prepared if the storm moves further inland. Visitors to the Carolina coast who may not be familiar with severe weather risks in these areas should be hyper-aware of storm developments and heed all warnings.
Rainfall well away from the coast will pose a serious flooding risk, especially if the storm is slow-moving. Inland flooding is the leading cause of lives lost in tropical systems, and this would be a major risk here given the mountainous terrain in parts of North Carolina and Virginia.
This summer’s unusually persistent wet weather pattern in parts of the east has left the ground saturated in many areas, and rivers and streams continue to run at levels well above normal. AccuWeather meteorologists warn that it won’t take much additional rain to create significant flooding. As correctly forecasted and then reported on by AccuWeather, rainfall totals in the parts of the eastern U.S. set records during the summer months. AccuWeather meteorologists also note that the saturated ground will increase the potential for trees to blow over in tropical winds, which could increase the risk for damage and power outages.
Florence path into Friday
Should Hurricane Florence threaten, AccuWeather experts strongly urge people in potentially affected areas to consider a plan that encompasses where to go and what to do. Some considerations for such an action plan might include:
Knowing where the nearest shelter will be in case of an evacuation (and if pets are welcome). If people do not feel safe as the storm approaches, AccuWeather advises they do not need to wait until an official evacuation order to get to safety.
Setting aside insurance documents and proof of home/land ownership and any other important papers in case of a ”grab and go” circumstance.
Taking photographs of the interior and exterior of your home or business to document for insurance purposes.
Making a family or employee communications plan.
Stocking up on enough supplies to last at least a few days in the case of sheltering in place.
Planning for the care of pets.
“Now is the best time to plan before a disaster threatens,” said Dr. Joel Myers, Founder and President of AccuWeather. ”It is imperative that people and businesses have access to a reliable source to track the storm’s progress, and communicate and execute an emergency action plan to keep people safe and out of harm’s way as well as a plan and the necessary supplies to secure and protect property in advance. I would strongly advise anyone who may be impacted to download the free AccuWeather app, which can be set to provide severe weather notifications, or track the storm as it develops on AccuWeather.com.”
Myers said this advance planning should be considered by anyone in a hurricane-prone area and especially those at risk for Florence to ensure people and business remain focused and in control should the unthinkable occur.
About AccuWeather, Inc. and AccuWeather.com
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