www.FARA.us

On January 3, 2024, the Department of Justice announced that Barry Bennett and Douglas Watts entered into Deferred Prosecution Agreements.  Mr. Bennett owned and operated a consultancy named Avenue Strategies that contracted with and registered under FARA for the Embassy of Qatar.  As part of that work, Mr. Bennett and Mr. Watts formed an entity called Yemen Watch, LLC that ran a $773,000 public relations campaign designed to cast the Kingdom of Saudi Arabia in a negative light, which included social media posts, public opinion articles, a documentary series, direct mail pieces, and phone calls to Members of Congress.  Yemen Watch, LLC was neither registered under FARA itself nor disclose on Avenue Strategies’ FARA filings.  Mr. Bennett agreed to pay a $100,000 fine, correct Avenue Strategies’ FARA filings, and avoid FARA-registrable conduct for 18 months.  Mr. Watts agreed to pay a $25,000 fine and avoid FARA-registrable conduct for 18 months.  The Deferred Prosecution Agreements stipulated that charges would be dismissed if Messrs. Bennett and Watts complied with all terms.  These Deferred Prosecution Agreements highlight a few important potential developments:

• The Department of Justice appears to be more closely scrutinizing FARA filings.  Avenue Strategies, which effectively controlled Yemen Watch, LLC was already registered for the Embassy of Qatar.  And Avenue Strategies could be said to have disclosed the public relations campaign in vague terms.  The Department, though, seemed to object to the fact that: (1) the expense disclosures and narrative descriptions did not reference Yemen Watch, LLC; and (2) the public relations campaign did not feature disclaimers that tied back to the Avenue Strategies FARA registration.
• The Department of Justice may use deferred prosecution agreements more frequently moving forward.  The Department’s civil enforcement tools are limited and may evaporate altogether after a principal-agent relationship ends.  The Department may therefore see deferred prosecution agreements as a “third way” with respect to enforcement—an opportunity for the government to pursue a case and secure a penalty where civil enforcement is no longer an available option, without risking an unsuccessful criminal trial.
• Be careful throwing FARA-related “stones.”  Mr. Bennett submitted a complaint to the FARA Unit about FARA violations by various alleged Saudi representatives.  It is possible that Mr. Bennett landed on the Department’s radar because of this complaint.  In any event, the Department cited Mr. Bennett’s complaint to show that he had knowledge (and therefore the requisite level of mens rea) about FARA’s requirements.