WASHINGTON (BLOOMBERG) - Former national security adviser Michael Flynn pleaded guilty to lying to federal agents and is providing cooperation that promises to take Special Counsel Robert Mueller deep into Donald Trump's administration.
Speaking in court as part of his plea agreement, Flynn, 58, described a series of conversations with the Russian ambassador to the US, Sergey Kislyak, in late December as the Trump team prepared to enter the White House.
The talks were instigated by a "very senior member" of the Trump transition team. That person was Jared Kushner, the President's son in law and adviser, as reported by Bloomberg View columnist Eli Lake.
Flynn said he then asked the ambassador to help delay or defeat a UN security council vote.
About a week later, Kislyak reached out to Flynn about sanctions that the Obama administration had just imposed on Russia. Flynn said he called a senior transition team official at Trump's Mar-a-Lago resort for guidance, before asking Kislyak to moderate Russia's response, which Russia ultimately did. Then, he told the court, he called transition team members to tell them what had transpired.
Flynn now says he lied to the FBI about the substance of those conversations, but that he had fully informed the transition team of the talks.
"This shows a Trump associate negotiating with the Russians against US policy and interests before Donald Trump took office and after it was announced that Russia had interfered in our election," Senator Dianne Feinstein, a Democrat from California, said in a statement.
"It's critical that we determine whether Flynn spoke with the Russians on his own initiative and who knew and approved of his actions."
The plea is a major step for Mueller's quickly advancing investigation. Mueller has already charged Trump's former campaign chairman Paul Manafort and his deputy over their earlier business activities, and secured a guilty plea from George Papadopoulos, a campaign adviser who pursued Russia's help during last year's election. Papadopoulos is cooperating with the probe.
Stocks, which had been racing higher as Congress moves closer to passing tax reform, plunged on the news, along with the dollar. Treasuries, often viewed as the safest of investments, rallied.
Flynn, in a statement, said he accepts full responsibility for his actions.
"It has been extraordinarily painful to endure these many months of false accusations of 'treason' and other outrageous acts. Such false accusations are contrary to everything I have ever done and stood for," he said.
Ty Cobb, a lawyer for Trump's White House, pushed back on Flynn's claims.
"The false statements involved mirror the false statements to White House officials which resulted in his resignation in February of this year. Nothing about the guilty plea or the charge implicates anyone other than Mr Flynn," Cobb said.
In cooperating with Mueller's inquiry, Flynn is seeking leniency for himself and possibly his son, who worked with him in his private business. The charge doesn't delve into Flynn's work on behalf of Turkey, which is also under investigation, or his failure to promptly disclose such work to US authorities.
At the hearing, Flynn admitted to lying about contacts with Turkey. In admitting to false statements, he faced a maximum of five years in prison and a US$250,000 fine, but is likely to get no more than six months and US$9,500 under his plea agreement.
Flynn was forced to resign less than a month into Trump's term. The White House was warned by the Justice Department that Flynn could be subjected to blackmail because his dealings with Russians hadn't been disclosed.
After he left the administration, Flynn filed an updated foreign registration form showing that he hadn't disclosed multiple contacts and payments from foreign entities while serving as an campaign adviser to Trump starting in February 2016.
At the time, Flynn, a retired Army general, ran a consulting business called Flynn Intel Group. In one case, Flynn's company received US$530,000 from Inovo BV, a Dutch company working on behalf of Turkey's government, to lobby the US for extradition of a dissident cleric who has opposed President Recep Erdogan of Turkey.
He's also disclosed payments from RT, described in an unclassified US intelligence report as "the Kremlin's principal international propaganda outlet," and Kaspersky Government Security, a cybersecurity business that US authorities say works closely with Russia's main intelligence agency, the FSB.
The charge on Friday stems from various conversations between Flynn and Kislyak, including one in Trump Tower with Jared Kushner, Trump's son-in-law and senior adviser. Just days into Trump's administration, FBI agents asked Flynn whether he had talked with Kislyak about sanctions imposed by President Barack Obama in retaliation for Russia's election meddling.
Flynn, who as a private citizen during those conversations was barred from negotiating with foreign powers, told the agents that sanctions hadn't come up. The Justice Department informed the White House that Flynn's denial contradicted the contents of phone calls intercepted by intelligence agencies, potentially exposing him to blackmail by Moscow, the Washington Post has reported, citing unnamed current and former US officials.
Flynn resigned on Feb 13 after only 24 days on the job. In his resignation letter, he apologised to the President and Vice-President for giving them "incomplete information" about his interactions with the Russian ambassador.
The next day, Trump asked then-FBI director James Comey to drop the probe into Flynn, Comey has testified.
"I hope you can see your way clear to letting this go, to letting Flynn go. He is a good guy. I hope you can let this go," Comey said the President had asked. Even after Flynn's firing, Trump defended him publicly, calling him a "very good person" who had done nothing wrong.
The FBI's investigation of Flynn gave rise to the creation of a special counsel to oversee the wider Russia probe: Comey testified that after he refused to drop the investigation, he was fired. Soon after, Mueller was appointed as special counsel.
The charge against Flynn casts a renewed spotlight on Attorney-General Jeff Sessions. Sessions recused himself from any investigation into Russia's attempts to influence the 2016 election after Democratic lawmakers accused him of lying to Congress about his own conversations with Russian officials.
Flynn rose to the top of the military's intelligence apparatus during a 33-year career notable for both his battlefield successes and his breaches of the Pentagon's chain-of-command.
Flynn's military service stretched from the 1983 Grenada invasion, where he was a platoon leader, to stints as director of intelligence for the US Central Command, the Joint Chiefs of Staff and the International Security Assistance Force. He retired in 2014 after Obama fired him as director of the Defence Intelligence Agency.
Afterwards, Flynn started a private lobbying and consulting practice that did business in foreign countries including Russia and Turkey. Flynn didn't disclose those contacts and payments, as required, when applying for his security clearance to work in the Trump White House.
Top House Democrats have pointed out that Flynn failed to disclose a 2015 Middle East business trip tied to a plan to build nuclear plants in the region using money from Saudi and Russian investors. The Democrats called the omission a crime.
Flynn's son, Michael Flynn Jr, also worked for the consulting firm and is under investigation by the special counsel. The son gained attention during the 2016 president election for promoting conspiracy theories about Hillary Clinton on social media.