Treasury Senior Adviser Pleads Guilty in Manafort Leaks Case

(Bloomberg) -- A former U.S. Treasury Department senior adviser admitted she illegally provided confidential suspicious transaction reports involving Paul Manafort and others to a BuzzFeed journalist, giving President Donald Trump’s administration a victory in its battle against leaks.

Natalie Mayflower Sours Edwards, 41, pleaded guilty to leaking information about payments involving Manafort, Trump’s former campaign manager, and his deputy, Rick Gates, for about a year before she was arrested in 2018. Prosecutors didn’t identify the journalist to whom she gave the reports, but articles cited in court papers were from BuzzFeed.

Edwards, of Quinton, Virginia, had access to the Suspicious Activity Reports due to her position as a senior-level adviser at the department’s Financial Crimes Information Network, or FinCEN, which probes money laundering by studying data about financial transactions.

Edwards’ parents, husband and daughter sat behind her in tears as she entered her plea before U.S. District Judge Gregory Woods in Manhattan. Under an agreement with prosecutors, she faces as long as six months in prison when she is sentenced on June 9. She could have faced as much as five years behind bars if convicted at trial.

“I am sorry for what I have done,” Edwards said.

U.S. Crackdown

The charges marked an escalation in a Justice Department crackdown on leaks. The government previously targeted former National Security Agency contractor Reality Winner, who pleaded guilty to giving a top-secret report on Russian hacking to The Intercept and received more than five years in prison, and former Internal Revenue Service analyst John Fry, who admitted leaking SARs involving former Trump lawyer Michael Cohen. Fry is set to be sentenced Wednesday in San Francisco.

In a statement, Manhattan U.S. Attorney Geoffrey Berman said Edwards “abused her position of trust” by leaking the reports. “Maintaining the confidentiality of SARs, which are filed by banks and other financial institutions to alert law enforcement to potentially illegal transactions, is essential to permit them to serve their statutory function, and the defendant’s conduct violated the integrity of that critical system and the law.”

Financial institutions are required to file SARs within 30 days of detecting an incident -- such as cash transactions of $10,000 or more or those involving certain entities -- that might signal money-laundering, tax evasion or other criminal activities.

When Edwards was first charged, Marc Agnifilo, her lawyer, defended her actions as civic whistle-blowing, saying she was being prosecuted for “doing the right thing.” On Monday, Agnifilo said Edwards’ belief that she was serving the greater good wasn’t a legitimate defense and that’s why she close to plead guilty.

Critical Facts

“She was of the view that certain critical facts weren’t being handled the right way by the government agencies whose responsibility it is to handle these things,” Agnifilo said, adding “She did something that I think would be near and dear to your hearts -- she went to the media.”

Apart from her leaks concerning Manafort and Gates, Edwards also passed along SARs concerning Prevezon Holdings Ltd., a Russian company accused of money-laundering activity, and Maria Butina, a supposed gun enthusiast who pleaded guilty in 2018 to acting as a Russian agent.

At the time of her arrest, Edwards had a flash drive containing SARs and a phone that contained encrypted communications with the reporter, prosecutors said. She admitted leaking the documents but denied knowing the material would be published.

Manafort was convicted in August 2018 of lying to tax authorities about tens of millions of dollars he earned as a political consultant in Ukraine and misleading banks about his financial health to get loans. He later pleaded guilty to conspiring to lobby illegally for Ukraine, along with laundering money to support a lavish lifestyle and tampering with witnesses. He’s serving a combined term of 7 1/2 years in a Pennsylvania prison.

Gates, who pleaded guilty and became a star witness for Special Counsel Robert Mueller, was ordered last month to serve 45 days behind bars for his crimes despite a request from prosecutors that he be spared from prison.

The case is U.S. v Edwards, 19-cr-64, U.S. District Court, Southern District of New York (Manhattan).

To contact the reporter on this story: Chris Dolmetsch in Federal Court in Manhattan at cdolmetsch@bloomberg.net

To contact the editors responsible for this story: David Glovin at dglovin@bloomberg.net, Peter Blumberg, Anthony Lin

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