WASHINGTON • The United States Justice Department has charged former Fugees rapper Prakazrel "Pras" Michel and wealthy Malaysian businessman Low Taek Jho, popularly known as Jho Low, with conspiring to steer illegal foreign campaign funds into the 2012 presidential election.
According to the unsealed indictment, Low directed the transfer of about US$21.6 million (S$29.5 million) between June and November 2012 from foreign entities and accounts to Michel to be funnelled into the US election while disguising it as legitimate campaign contributions.
The indictment did not reveal the identity of the presidential candidate. However, Michel, who is a US citizen, was a well-known supporter of former Democratic President Barack Obama, and federal election records show that he contributed money to political committees that supported Mr Obama's 2012 re-election campaign and other Democratic committees.
Under federal election law, it is a crime for foreign nationals to make political contributions in US federal, state or local elections.
Michel and Low, the Justice Department alleged last Friday, conspired to circumvent the law, in part by steering foreign money from Low through "straw contributors" who purported to make legal contributions in their own names.
In doing so, the indictment said they hoped they could "buy access to, and potentially influence with, a candidate, the candidate's campaign and the candidate's administration". Low remains at large.
"Mr Low has never made any campaign contributions directly or indirectly in the US and he unequivocally denies any involvement in or knowledge of the alleged activities," a spokesman for Low, through his lawyers, said in a statement.
Low faces separate criminal charges in the US in connection with a multibillion-dollar scandal at Malaysian state fund 1Malaysia Development Berhad (1MDB). Low has been identified by Malaysian and US investigators as a central figure in the alleged theft of about US$4.5 billion from 1MDB.
In the election funding case, Michel appeared in a federal court in Washington for his arraignment.
US Justice Department spokesman Peter Carr confirmed that Michel pleaded not guilty to the charges, and will return to federal court in Washington for a hearing on Thursday.
Michel and Low were each charged with one count of conspiracy to defraud the United States government and for making foreign and conduit campaign contributions. Michel was also charged with one count of a scheme to conceal material facts and two counts of making a false entry in a record in connection with the conspiracy.
In addition to allegedly using straw donors to funnel money from Low to one political committee, Michel made about US$1.1 million in donations to another committee in his own name and the name of his company, thereby masking that the money was coming from Low, the indictment said.
The dates and numbers for those donations in the indictment match with federal fund-raising disclosures made by Black Men Vote, a super political action committee that was supportive of Mr Obama's re-election efforts in battleground states.
The case over campaign financing is not the first time that the US Justice Department has linked Michel and Low.
In a civil forfeiture action announced in November last year, it said that Michel and a former Justice Department employee opened multiple US bank accounts to receive tens of millions of dollars in funds from overseas accounts controlled by Low.