The Oregon Department of Justice has crossed the one-year mark on its review of whether to open a criminal investigation into the Democratic Party of Oregon for misreporting the donor who gave the party $500,000 in the final weeks of the 2022 election.
At the time, Democrats reported the money was from a Las Vegas payment processing company called Prime Trust. After The Oregonian/OregonLive inquired about the transaction, the party said the money was actually from Nishad Singh, an executive at the disgraced cryptocurrency exchange FTX.
Under Oregon law, it is a Class C felony to make or accept a campaign contribution under a “false name.”
Oregon elections officials in the Secretary of State’s office, overseen by a director who previously worked for the Democratic party, investigated the incident and referred a potential criminal case against Singh to the Oregon Department of Justice.
At the same time, Oregon’s then-Acting Secretary of State, Cheryl Myers — who is now Oregon’s deputy secretary of state — slashed the fine on the Democratic Party for misreporting the source of the donation from $35,000 to $15,000 and agreed not to pursue a criminal case. A state lawyer had written in a legal memorandum that the Democratic Party’s efforts to correctly identify their huge donor were “lackluster” and “any other reasonable person would not have been … satisfied” with the amount of due diligence. But the Secretary of State’s office ultimately issued a press release stating that “the investigation did not find clear evidence that the Democratic Party of Oregon knew the true donor when they reported the contribution.”
Last May, The Oregonian/OregonLive requested a copy of the Secretary of State’s investigation to learn more about the scope of the inquiry and what officials found. The Secretary of State’s office said it had turned the investigation file over to the Department of Justice, and the Department of Justice declined the news organization’s public records request citing an ongoing criminal investigation.
Roy Kaufmann, a spokesperson for the Oregon Department of Justice, said last May that the agency had not ruled out opening a criminal investigation of the Democratic Party of Oregon. “We have made no determination as to the scope of our inquiry,” Kaufmann wrote in an email.
On Wednesday, Kaufmann did not offer any new information. “Our work is ongoing,” he wrote.
In March, Sam Bankman-Fried, the co-founder and CEO of FTX, was sentenced to 25 years in prison for defrauding hundreds of thousands of customers and investors by diverting their money to make risky investments, give big donations to both political parties and support a lavish lifestyle with private jets and purchases of expensive real estate in the Caribbean. Singh has pleaded guilty to fraud and is awaiting sentencing, as are other FTX executives. The U.S. government has been working to recover the funds where possible.
Brad Martin, the party’s executive director, told The Oregonian/OregonLive in 2022 that Democrats accepted the money without knowing much about its origin. It was the largest donation they ever recorded in Oregon’s campaign finance database. They used the funds to attack the Republican candidate running for governor in 2022, Christine Drazan, in the final days of the election. Martin did not respond to a text message requesting comment Wednesday afternoon about the state’s ongoing review.
The Democratic Party of Oregon turned $500,000 over to the U.S. Marshals Service on June 9, 2023, according to the state’s campaign finance system. The same day, the campaigns of Gov. Tina Kotek, U.S. Sen. Ron Wyden and U.S. Sen. Jeff Merkley each donated $100,000 to the party. U.S. Rep. Suzanne Bonamici also donated $25,000, U.S. Rep. Earl Blumenauer gave $50,000 and U.S. Rep. Val Hoyle gave $15,000, according to the state.
Attorney General Ellen Rosenblum, who has contributed over $100,000 from her campaign to the Democratic Party of Oregon, last year recused herself from the justice department review. Rosenblum is not the only lawyer with close ties to both the Department of Justice and Democratic Party of Oregon. The attorney for the Democratic Party of Oregon, Harry Wilson of the Portland firm Markowitz Herbold, has joined other lawyers from his firm in representing the state as a contracted special assistant attorney general on multiple high profile cases, including suing software giant Oracle over the failure of Cover Oregon and suing members of the notorious Sackler family over allegations the family siphoned off money from pharmaceutical company Purdue.
In light of Wilson’s work for the Democratic Party, Markowitz Herbold asked the justice department to waive the professional conduct rule that normally prohibits lawyers from representing clients whose interests might be adverse to each other.
“The DPO’s interests do not necessarily align with the state’s interests,” Markowitz attorney Lauren Blaesing wrote in a request for the state to waive the conflict, noting that at the time of her letter, Secretary of State Shemia Fagan, a Democrat, was considering whether to open an investigation into the party’s misreporting of the $500,000 donor.
“We do not believe there is a significant risk that our firm’s ability to represent the DPO is limited by the firm’s responsibilities to the state in the Purdue, Wyatt, Willamette, Talmage, and Maney matters,” she wrote. “We can continue to fully, completely, and diligently represent the state in the Purdue, Wyatt, Willamette, Talmage, and Maney matters and our firm can do the same for the DPO.”
Deputy Attorney General Lisa Udland signed the conflict waiver.
—Hillary Borrud is an investigative reporter. Reach her at 503-294 4034, hborrud@oregonian.com or @hborrud.
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