Five things to know about George Santos’s indictment

Rep. George Santos (R-N.Y.) faces criminal charges — and potential jail time — over three alleged schemes that accuse him of misleading campaign donors, fraudulently receiving unemployment benefits and lying on financial disclosures.

After being arrested on Wednesday on 13 federal charges, Santos made his first appearance in front of a judge in a Central Islip, N.Y., courthouse, where he pleaded not guilty.

“I’m going to fight my battle. I’m going to deliver. I’m going to fight the witch hunt. I’m going to take care of clearing my name, and I look forward to doing that,” Santos told reporters outside the courthouse.

Here are five things to know about the indictment:

Prosecutors accuse Santos of misleading donors

Legal experts suggest the first scheme, which accuses Santos of misleading political donors for his personal benefit, comprises the bulk of the congressman’s exposure.

At the direction of Santos, an unnamed political consultant purportedly persuaded donors to make contributions to a company that Santos controlled. Donors were told false information about the company and that their funds would be independent expenditures used to purchase television advertisements to bolster Santos’s campaign, according to the indictment.

Prosecutors say Santos instead transferred $74,000 from the company to his personal accounts in October and used it for personal benefit, including purchasing luxury designer clothing, making credit card payments and transferring funds to personal associates. On Wednesday, Santos denied that he used campaign donations to purchase expensive suits.

“I’m not aware that we have had another situation where a sitting officeholder has been indicted for basically running a fraudulent scam to defraud their own donors. That is something new,” said Daniel Weiner, director of the Brennan Center’s Elections and Government Program and a former senior counsel at the Federal Elections Commission.

Rather than directly bringing campaign finance charges, the Justice Department (DOJ) instead charged Santos with wire fraud and money laundering in connection with the alleged scheme.

Weiner said the strategy illustrates how campaign finance laws have not kept pace with the changing political landscape.

“You’ve got the proliferation of disinformation, and that inevitably seeps into both campaign ads and campaign fundraising solicitations,” he said. “The specific set of laws post-Watergate that was set up to regulate campaign fundraising doesn’t really speak to that. But there is this broader set of federal laws around fraud and around defrauding consumers and others that arguably does touch these issues. That is not very commonly deployed by DOJ, and again, I think that this is in some ways a somewhat groundbreaking case.”

Sterling Marchand, a partner at Baker Botts who advises clients on election law, noted that campaign finance charges generally would have required proving Santos knew he was violating the law.

“Campaign finance carries its own set of penalties, but that’s not what they’re doing here,” Marchand said. “They’re going under wire fraud, and I think in a lot of ways that is much easier to prove.”

Santos allegedly fraudulently received unemployment benefits

The second scheme outlined in the indictment accuses Santos of fraudulently receiving more than $24,000 in unemployment benefits during the pandemic.

Santos applied for benefits in June 2020, falsely claiming that he was unemployed since March, when the pandemic shut down normal life, according to the indictment.

Prosecutors allege Santos received benefits through April of the following year, despite receiving a $120,000 salary as a regional director at a Florida-based investment firm.

“They seem to be going for not necessarily creative or stretch charges. It seems to be the ones that are going to be, at least on the face of the indictment, more easy to prove with concrete, tangible evidence,” said Marchand.

Federal prosecutors unveiled charges against Santos the same week that the House is scheduled to vote on a bill — which Santos is a co-sponsor of — that would incentivize states to recover fraudulently paid unemployment benefits, a charge that the congressman is now facing.

Santos signed on as a co-sponsor of the bill in March.

Asked outside the courthouse why he would apply for unemployment benefits when he had a job and was making a salary, Santos told reporters the allegation was false.

“This is inaccurate information, and I will get to clear my name on this,” Santos said. “During the pandemic, it wasn’t very clear. I don’t understand where the government’s getting their information, but I will present my facts.”

House GOP leaders on Wednesday rejected the notion of Santos’s sponsorship undermining the message of the legislation.

“In America, there’s a presumption of innocence but they’re serious charges,” House Majority Leader Steve Scalise (R-La.) said of the indictment. “He’s gonna have to go through the legal process, but we’re gonna continue to root our fraud, and there’s lots of it.”

Prosecutors say Santos lied on financial disclosures 

The third scheme revolves around House financial disclosures that Santos filed for each of his two congressional campaigns.

During his first, unsuccessful candidacy, prosecutors allege that Santos on a May 2020 disclosure overstated one income source while failing to disclose $25,403 in income from an investment firm.

When he successfully ran for Congress two years later, prosecutors say Santos again made false statements on his disclosure forms.

Santos is accused of falsely stating that he earned a $750,000 salary and between $1 million and $5 million in dividends from a firm he owned. The indictment further alleges Santos falsely claimed he owned a checking account worth between $100,000 and $250,000 and a savings account with deposits totaling between $1 million and $5 million.

Indictment did not include GoFundMe allegations

The indictment notably did not mention an accusation that Santos helped raise thousands of dollars in a 2016 GoFundMe for a veteran’s dog who needed cancer treatment, only to steal the funds. Santos has denied the allegations.

“You could see a superseding indictment that adds those,” cautioned Chris Mattei, a former federal prosecutor who specializes in financial corruption.

“I would suspect that the U.S. attorney will indicate that the investigation is ongoing. So I don’t think the fact that those charges relating to that activity don’t appear in this indictment means that he doesn’t have any criminal exposure for them,” he continued.

Santos will continue to serve, but could face jail time

Santos’s indictment carries no immediate consequences for his congressional tenure.

According to House rules, lawmakers who are indicted on a felony that carries a sentence of two or more years are still eligible to serve in the chamber, but they should resign from committee assignments and step aside from party leadership.

Santos, however, stepped down from his committee assignments in January amid his mounting controversy, and he does not currently serve in House GOP leadership.

Outside the courthouse on Wednesday, a defiant Santos told reporters that he has no plans to step down.

“I will not resign,” he said following his arraignment, later adding “I believe I’m innocent.”

And Santos is not facing pressure from House GOP leadership to do so — the top Republicans in the chamber stopped short of calling for Santos to resign on Wednesday, despite the bipartisan calls for Santos to abdicate his seat or be expelled.

“As I’ve said from the very beginning on questions on this subject, this legal process is going to play itself out,” Stefanik said Wednesday morning. “Unfortunately, this is not the first time a member of Congress from either party has been indicted. There are a set of rules and, as the majority leader stated, he voluntarily had stepped down from his committees.

McCarthy echoed that sentiment, telling reporters “he could go through his time of trial, we’ll find out how the outcome is.”

In the meantime, however, Santos faces several years of potential jail time.

The top charge of wire fraud carries a maximum jail time of 20 years. The judge can decide to make any sentences run concurrently if Santos is convicted on multiple counts.

Mattei, based on the preliminary information available, suggested the sentencing guidelines would recommend a jail sentence of between two and four years.

“It’s going to be impossible for Santos to synthesize in a rational way all the different lies he has told,” said Mattei. “And that’s I think one of the real benefits of having multiple charges in an indictment like this, is that the lies themselves aren’t consistent with one another.”

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