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LaRouche criminal trials

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United States v. LaRouche refers to the prosecution and conviction of controversial American political activist Lyndon LaRouche and several of his associates on charges of mail fraud, conspiracy and tax evasion. LaRouche was sentenced to a prison term of fifteen years which began in 1989. He was paroled in 1994 after serving five years.

By the 1980s LaRouche and Helga Zepp-LaRouche had built a extensive political network, including the Schiller Institute in Germany, headed by Zepp-LaRouche, with branches in several other countries. The International Caucus of Labor Committees claimed to have affiliates in France, Italy, Sweden, Canada and several South American countries. In Australia LaRouche operatives took over an older extreme-right group, the Citizens Electoral Councils (CEC), and regularly contest elections. The LaRouche organisation published a weekly newspaper, The New Federalist, and a weekly newsmagazine, Executive Intelligence Review. At one time there was a LaRouche publishing house, Benjamin Franklin Books, which issued a steady stream of works by LaRouche and his followers. The real membership of LaRouche's organisation is not known.

The size of the LaRouche empire led to investigations of the source of its apparently extensive financial resources. The LaRouche organisation devotes much of its energy to the sale of literature and the soliciting of small donations at airports and on university campuses. It also solicits donations by phone. More seriously, however, LaRouche was accused of fraudently soliciting "loans" from vulnerable elderly people.

The First Trial

In October 1986, over 400 armed officers of the FBI, IRS, other federal agencies, and Virginia state authorities raided the LaRouche headquarters in Leesburg in search of evidence to support the persistent accusations of fraud and extortion made against LaRouche. This led first to the indictment of LaRouche and others on June 30, 1987 in Boston, on one count of conspiracy. The trial commenced on December 17 of that year, before Boston Federal Judge Robert E. Keeton. There were numerous revelations, including a search, authorized by Judge Keeton, of the personal files of Oliver North. This search produced a May 1986 telex from Iran-Contra defendant General Richard Secord to North, discussing the gathering of information to be used against LaRouche. After this memo surfaced, Judge Robert Keeton ordered a search of Vice President George Bush's office, for documents relating to LaRouche. The judge declared a mistrial on May 4, 1988, saying the unexpected length of the trial due to numerous delays made it unlikely that enough jurors would be left at the end to render a verdict.

Before disbanding, the jurors polled themselves and found all defendants, including LaRouche, "not guilty." According to the Boston Herald of May 5, 1988, one of the jurors described the poll: "It seemed some of the government's people caused the problem, adding that the evidence showed that people working on behalf of the government 'may have been involved in some of this fraud to discredit the campaign.'" The National Law Journal called the Boston mistrial a "stinging defeat" for the government; LaRouche commented, "I was cheated out of an acquital." A retrial in Boston was scheduled, but a new case in Virginia came first.

The Second Trial

On October 14, 1988, LaRouche and six associates were re-indicted in the so-called "Rocket Docket" of the U.S. District Court for the Eastern District of Virginia located in Alexandria, Virginia, and charged with conspiracy and mail fraud; LaRouche was also charged with conspiring to hide his personal income since 1979, the last year he had filed a federal tax return. On December 16, 1988 a federal jury convicted LaRouche and his associates, and LaRouche was sentenced to fifteen years in prison, of which he served five.

Unlike Judge Keeton, who devoted three weeks to jury selection, Alexandria Judge Albert V. Bryan spent two hours. This contributed to the result that most jurors in the Alexandria trial were present or former government employees. Jury Foreman Buster Horton was the U.S. Department of Agriculture liason to the Federal Emergency Management Agency (FEMA). Judge Bryan also granted a motion in limine, which barred the defense from presenting the material they had presented in the Boston trial.

The prosecution alleged that LaRouche and his staff solicited loans with false assurances to potential lenders and showed "reckless disregard" of the facts. Assistant U.S. Attorney Kent Robinson presented evidence that LaRouche's organisation had solicited US$34 million in loans since 1983. LaRouche supporters claim the amount that was not repaid was $294,000, but according to testimony in the Virgina case, reported by the Washington Post (12/17/1988), the amount of funds not repaid by 1987 topped $25 million. The most important evidence was the testimony of lenders, many of them elderly retirees, who had lost thousands of dollars in loans to LaRouche that were never repaid. Several witnesses were LaRouche followers who testified under immunity from prosecution.

Judge Albert V. Bryan granted a motion in limine, ruling that the defense would not be permitted to discuss, or even allude to, the fact that the U.S. Department of Justice filed, on April 20, 1987, an unprecedented involuntary bankruptcy petition against two LaRouche-controlled publications companies on whose behalf the loans had been solicited. Federal trustees were placed in charge of the companies, and they immediately suspended repayment of loans to creditors (who were, for the most part, political supporters of the LaRouche movement). On October 25, 1989, Judge Martin V.B. Bostetter ruled that the government's bankruptcy action was illegal. Bostetter said the government acted in "objective bad faith" and the bankruptcy was obtained by a "constructive fraud on the court." Thus the argument of the defense, that the decision to not repay the loans was made by government trustees and not by the defendants, was never presented to the jury. It was also never heard by an appellate court.

LaRouche was convicted on eleven counts of mail fraud connected to fundraising issues, and also of violating tax laws by hiding his income and failing to file tax returns. LaRouche claimed he had no income, but before and during the involuntary bankruptcy period, LaRouche lived at a 200 acre Virginia estate with a pond and horse ring, owned by a LaRouche supporter. In all the LaRouche group spent over US$4 million on Virginia real estate during this period, according to trial testimony reported in the Washington Post (12/17/1988).

LaRouche's chief fund-raiser, William Wertz, was convicted on ten mail fraud counts. LaRouche's legal adviser, Edward Spannaus, and several other fundraising operatives were convicted of conspiracy to commit mail fraud. Michael Billington received a 77 year sentence for "conspiracy to fail to register as a securities broker." [1] LaRouche denied all the charges, calling them "an all-out frame-up by a state and federal task force," and said that the federal government was trying to kill him. "The purpose of this frame-up is not is not to send me to prison. It's to kill me," LaRouche said. "In prison it's fairly easy to kill me... If this sentence goes through, I'm dead." This proved to be a false prediction: LaRouche was released in 1994.

Former U.S. Attorney General Ramsey Clark supported LaRouche's claims that his prosecution was politically motivated. In 1995 he wrote to Attorney-General Janet Reno: "I bring this matter to you directly, because I believe it involves a broader range of deliberate and systematic misconduct and abuse of power over a longer period of time in an effort to destroy a political movement and leader, than any other federal prosecution in my time or to my knowledge." [2]

(Clark, who was Attorney-General under Lyndon Johnson, has since become a regular radical critic of U.S. government actions. He has supported, among others, Slobodan Milosevic, alleged war criminal Radovan Karadzic, an alleged leader of the Rwandan Genocide, as well as Native American political prisoner Leonard Peltier and antiwar activist Father Phillip Berrigan. A 1999 article in Salon.com described him as "the war criminal's best friend," and "the tool of left-wing cultists.")

Dr. Friedrich August Freiherr von der Heydte, Professor of Constitutional and International law at the University of Mainz in Germany, wrote the following on the case:

On closer examination of the behavior of the U.S. authorities toward LaRouche, there emerge strong parallels to the infamous Dreyfus Affair in France, which has gone down in history as a classical example of a political trial....Just as LaRouche was, the French Capt. Alfred Dreyfus was deprived by the structure of the trial procedures, of any opportunity to prove his innocence, and facts critical for his defense were excluded from the trial.

LaRouche and his associates maintained their innocence. After the release of LaRouche from prison, full page advertisements calling for him to be exonerated (paid for by the LaRouche movement) appeared in papers such as the New York Times and Washington Post (see text of the statement.) Among the signators were Arturo Frondizi, former President of Argentina; figures from the 1960s American Civil Rights Movement Amelia Boynton Robinson, Dick Gregory, Al Sharpton, James Bevel, and Rosa Parks; former Minnesota Senator and Democratic Presidential Candidate Eugene McCarthy; 31 former U.S. Congresspersons, including Mervyn Dymally, who chaired the Congressional Black Caucus; and artists such as classical vocalist William Warfield, and violinist Norbert Brainin, former 1st Violin of the Amadeus Quartet.

In a separate statement endorsing LaRouche for president, classical violinist Norbert Brainin wrote:

Perhaps LaRouche's greatest quality is his passion for seeking the truth and fighting for it even if it means going to prison..."
--Prof. Dr. Norbert Brainin, O.B.E., London, England, December 13, 1991

LaRouche's supporters maintain that a worldwide conspiracy framed him, and that this conspiracy has attempted to assassinate him at least three times. They also maintain that, due to the motion in limine that was granted by Judge Bryan in the Virginia case, the jury never heard LaRouche's actual defense: that the involuntary bankruptcy imposed by the federal government was the sole factor which prevented repayment of loans.

The jury forman in the Virginia case, however, told the Washington Post (12/17/1988) that it was the failure of LaRouche aides to repay loans that swayed the jury, and that the jury "all agreed [LaRouche] was not on trial for his political beliefs. We did not convict him for that. He was convicted for those 13 counts he was on trial for."

The John Train Meetings

LaRouche supporters contend that high profile reports on LaRouche that appeared in the American media in the mid-1980s are the result of a deliberate campaign devised at series of meetings held in the early 1980s, prior to the criminal prosecution of LaRouche (see United States v. LaRouche.) A variety of both left-wing and right-wing opponents of LaRouche attended these meetings. The nature of these meetings is disputed.

File:King berlet.jpg
Dennis King and Chip Berlet

The participants allegedly included reseachers Berlet and Dennis King; John Rees, of the Maldon Institute; Roy Godson, a consultant to the National Security Council and President's Foreign Intelligence Advisory Board; Mira Lansky Boland, of the Anti-Defamation League and former employee of the CIA; at least one representative of Freedom House; Richard Mellon Scaife, a wealthy Pittsburgh businessman and prominent funder of right wing causes; and several journalists from major national media outlets, including NBC-TV producer Pat Lynch, Readers Digest, Business Week, The New Republic and The Wall Street Journal.

LaRouche supporters make much of these meetings (see the link to the Quinde Affidavit below), maintaining that they were planning sessions to produce a wave of hostile press coverage, intended to make criminal prosecutions credible. According to a sworn affidavit submitted by Herbert Quinde, a reporter for LaRouche's Executive Intelligence Review, he conducted interviews with 3 participants, Michael Hudson, Sol Sanders and Chip Berlet. Quinde then described meetings at the Manhattan home of investment banker John Train, which Quinde claimed were for the purposes of discussing anti-LaRouche strategy (see [3]). LaRouche supporters claim that further confirmation that these meetings took place was provided by sworn testimony by the ADL's Mira Lansky Boland on May 24, 1990 before the Commonwealth Court in Roanoke, Virginia.

Berlet counters that there was no discussion of a coordinated anti-LaRouche campaign at the meeting he attended, which he characterizes as essentially a debate between conservatives and progressives concerning LaRouche intelligence-gathering activities, and antisemitism and fascistic politics. Left-wing critics of LaRouche were asked by right-wing critics to present and defend their claims about LaRouche. They were also there to protest to protest the fact that LaRouche agents were supplying information about LaRouchite political enemies on the left (and right) to the Reagan administration—including the National Security Council and Central Intelligence Agency—a relationship that some conservatives close to the Reagan administration felt was inappropriate and sought to terminate.

According to Berlet and King, the LaRouche supporters try to use the meeting to distract attention from the convictions of LaRouche and his associates. Berlet offered to let LaRouchite Quinde hire a lawyer to obtain any government documents on Berlet available under the federal Freedom of Information Act, so long as all documents were made public. Quinde and the LaRouchites rebuffed the offer. Berlet notes that the meeting he attended (contrary to the Quinde affidavit claim) was held after the Boston grand jury was called to hear testimony regarding illegal LaRouchite fundraising practices, so that meeting could not have been the genesis of the government criminal investigation.

LaRouche supporters allege that the actual impetus for the investigation was a series of letters written by Henry Kissinger to William Webster in 1982[4], and that meetings at Train's home were intended to generate a wide variety of allegations against LaRouche in the media, so that a criminal prosecution could become credible. There is no evidence that concretely supports this claim.

Supporters of LaRouche further claim that news coverage that was highly critical of LaRouche, describing him variously as a fascist, communist, racist, anti-Semite, cult leader, and conspiracy theorist was a direct result of a coordinated strategy coming out of these meetings. However a check of published articles shows that similar charges against LaRouche had been published in commercial and alternative newspapers and magazines for many years.

Much of the public scrutiny of LaRouche followed the high profile 1986 victory of NCLC members Mark Fairchild and Janice Hart in Illinois' Democratic primaries for statewide offices, a victory that resulted in others on the Democratic ticket, most notably gubernatorial candidate Adlai Stevenson III, deciding to drop off the ticket and run as candidates for a de facto party. NBC-TV broadcast two programs in April of that year, produced by alleged "John Train Salon" participant Pat Lynch, which repeated her earlier characterizations of LaRouche's ideas, and went on to accuse LaRouche of plotting the assassination of Henry Kissinger. NBC then broadcast programs in March and December 1986 claiming that LaRouche had been responsible for the assassination of Swedish Prime Minister Olof Palme.

Larouche critics agree that the Illinois election victories were important, but they counter that it was publicity about this situation that prompted editors to run stories about LaRouche (including allegations about illegal financial operations) not some vast conspiracy as claimed by LaRouche supporters.



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