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Verdict watch begins in trial on ‘We Build the Wall’ fraud

Summations for Timothy Shea concluded Tuesday with smoking-gun evidence: texts from a group chat in which Shea appears well aware that he and the other organizers of a crowdfunding effort called We Build the Wall were breaking the law.

MANHATTAN (CN) — A federal jury began deliberations Tuesday afternoon at the end of a three-day trial on the fraudulent fundraiser called We Build the Wall started by former President Donald Trump's former political strategist Steve Bannon.

While Trump's pardon of Bannon voided related charges against him, the government built a case alleging that Colorado real estate agent Timothy Shea conspired with the former Breitbart News executive and with Air Force veteran Brian Kolfage and Florida venture capitalist Andrew Badolato to line their pockets with funds they solicited through a purported charity called We Build the Wall that was supposed to fulfill Trump's infamous campaign promise to build a wall on the U.S.-Mexico border.

We Build the Wall raised some $25 million in private donations on GoFundMe but built just 3 miles of fencing along the border. According to their indictment, Bannon and Kolfage alone used more than $1 million in We Build the Wall donations to pay for a boat, a 2018 Land Rover Range Rover, a golf cart, jewelry, cosmetic surgery and other assets.

In the wake of Bannon’s pardon and his co-conspirators’ guilty pleas, Shea alone went to trial last week. During the prosecution’s two-hour closing argument this morning, Assistant U.S. Attorney Nicholas Roos told jurors that the "smoking gun" exists in Shea’s text messages.

“We need a solid fucking plan ... otherwise we go to prison," Shea said in one message to Kolfage, Badolato and his wife — words that Roos referenced repeatedly to jurors.

“If it comes out we hired ourselves, it will be bad,” Shea makes plain in another text in the group chat. “We need to create a company I hired you. I’m paying you for a service ... consulting.”

Roos told jurors that Shea deleted these text messages on his phone before turning over devices to investigators who were still able to retrieve the electronic communications. “He very much knew his words would convict him," the prosecutor said

This is because We Build The Wall repeatedly and falsely assured the public that the campaign’s president, Kolfage, would “not take a penny in salary or compensation” and that “100% of the funds raised ... will be used in the execution of our mission and purpose,” privately building Donald Trump’s desired “big, beautiful wall” along the U.S. Southern border.

Prosecutors say that, despite such assurances, Shea created a shell company, the intentionally “vague-sounding” Ranch Property Marketing and Management, that created fake invoices and backdated payment requests to funnel hundreds of thousands of dollars in We Build the Wall donation funds to himself and his partners in the scheme.

If these invoices to intermediary companies were legitimate business expenses, Roos told jurors Shea could have legally written off hundreds of thousands of dollars of tax liability on his IRS return. Tim Shea didn't do that, the prosecutor continued, because “Tim Shea didn’t want the heat."

Roos explained that that Kolfage and Shea cooked up scheme to pull money from the border-wall donations in late 2018 after Facebook cracked down on fake news accounts, which dried up their stream of advertising revenue from Kolfage's conservative news website, Freedom Daily.

Shea owns an energy drink company called Winning Energy whose cans bear a cartoon superhero image of Trump. The beverage was marketed to the former president’s fan base as containing “ultra-hydrating liberal tears.”

Prosecutors showed evidence that Shea misappropriated $34,000 from We Build the Wall to buy 50,000 cans of the Trump-themed beverage. Though he and Kolfage “papered it as a loan,” the government questioned what kind of loan doesn't come with interest. “No repayment, no collection, that’s how you know it wasn’t a real loan,” Roos said.

Shea’s attorney John Meringolo did not call any witnesses in the trial, instead choosing to rest his brief defense last Thursday on about a dozen exhibits entered into evidence, including a pixelated video of We Build The Wall board member Kris Kobach speaking at one of the border wall construction sites.

Kobach, an anti-immigration hardliner and former Kansas Secretary of State, was not named in the indictment and did not testify at trial, but the prosecutors included a stipulation stating that Kobach, who served as general counsel for We Build the Wall, was unaware of any payments from We Build the Wall to Kolfage.

“The defendant and Kolfage hid things from him,” assistant prosecutor Robert Sobelman said during rebuttal on Tuesday afternoon, referring to Kobach’s statement. “There’s nothing in that stipulation that’s helpful to defense.”

During the start of the defense’s 90-minute summation on Tuesday, Meringolo wielded a poster-sized paper pad directing jurors to a messy, hand-drawn flow chart that read “Common sense = reasonable doubt = not guilty.”

Shea’s attorney spontaneously insisted at points during his closing argument that the conspiracy counts should not stick since Shea did do some real estate and social media work in connection with We Build the Wall. 

“There’s money going back and forth. That’s reasonable doubt,” Meringolo exclaimed loudly several times.

Meringolo also insisted there was nothing “nefarious” about Shea incorporating Ranch Property Management in Wyoming, where state privacy laws allowed him to run the LLC anonymously.

“It wasn’t a shell company, it was a single-member LLC,” Meringolo insisted.

“In this country, you can do whatever you want with after-tax dollars,” Shea’s lawyer also argued in closing summations.

Shea’s trial was expected to run through the middle of June, but concluded much faster without the previously anticipated testimonies from Bannon and Kobach.

At the time of Bannon’s arrest in 2020, which occurred on a 150-foot yacht owned by Chinese billionaire Guo Wengu, Trump tried to distanced himself from his onetime adviser.

“I haven’t been dealing with him for a very long period of time,” Trump told White House reporters.

As for the fundraiser We Build the Wall, Trump noted: “I don’t like that project. I thought it was being done for showboating reasons.”

Shea, 51, is charged in a superseding indictment with conspiracy to commit wire fraud, conspiracy to commit money laundering and falsification of records. Each of the three criminal counts carries a maximum penalty of 20 years in prison.

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