Giuliani Associate’s Brother Under Scrutiny in Campaign Case

(Bloomberg) -- U.S. authorities investigating associates of President Donald Trump's personal lawyer Rudy Giuliani for campaign finance violations suspect the brother of one may also have been involved, a prosecutor said in court Friday.

Government officials have yet to sign off on a bail agreement for defendant Igor Fruman because his brother Steven is a co-signer on the bond. Authorities have been demanding additional information about Steven Fruman's finances to determine whether he or his businesses were involved in violations alleged in a four-count indictment unsealed last month.

“Steve Fruman could be involved in some of the conduct charged in the indictment,” Assistant U.S. Attorney Nicolas Roos said during a hearing in federal court in Manhattan at which Igor Fruman unsuccessfully sought more lenient conditions on his bail.

Igor Fruman and co-defendant Lev Parnas are accused of hiding the source of funds used to make donations to a political action committee that supports Trump and with using foreign funds to make donations to other election campaigns. Both men worked with Giuliani in trying to dig up political intelligence on Joe Biden and his son in Ukraine. Both have pleaded not guilty and have been released to home confinement with GPS monitoring.

Fruman and Parnas, both naturalized U.S. citizens, allegedly played a role in another incident House Democrats are pursuing in their inquiry over the president's possible impeachment. Parnas is accused of using donations to press a congressman at the time, Pete Sessions of Texas, to push for Marie Yovanovitch to be recalled as U.S. ambassador to Ukraine. Trump recalled Yovanovitch from her post in May.

‘False Statement'

Roos added that Steven Fruman made a “false statement” twice to officials about his involvement in a business connected to the campaign donations. The business is a limited-liability company. Its specific nature and alleged involvement in the matter weren't disclosed.

A lawyer for Igor Fruman, Todd Blanche, denied that Steven Fruman intended to mislead the officials. No attorney for Steven Fruman was present.

Igor Fruman and Parnas were arrested at an airport near Washington last month as they sought to board a plane with one-way tickets to Austria. Blanche said they weren't trying to flee the country and simply hadn't purchased returns because they didn't know when they were coming back.

Fruman had asked the judge to lift his confinement and GPS monitoring. Prosecutors opposed the request, noting Fruman has substantial overseas business ties, political connections and income that he could rely on if he chose to flee.

Among his business interests, according to prosecutors, is a stake in a luxury lifestyle company that operates a hotel, beach club, night club and retail stores. Fruman received $21 million in revenue through business bank accounts in the last three years. Roos also noted that Fruman and Parnas booked their flight the day after they told Congress they would not cooperate in the impeachment inquiry.

But Blanche, Fruman's lawyer, said his client had every intention of returning to the U.S., noting he has lived in the U.S. for 25 years and has three school-age children. “There's absolutely zero evidence that Mr. Fruman was leaving the country with no intent to come back,” Blanche said in court.

To contact the reporter on this story: Christian Berthelsen in New York at cberthelsen1@bloomberg.net

To contact the editors responsible for this story: David Glovin at dglovin@bloomberg.net, Steve Stroth

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