Will the Oregon Department of Justice ever launch a criminal investigation into the Democrats’ misreported donation in 2022?

The Oregon Department of Justice has passed the one-year mark in its review of whether to open a criminal investigation into the Oregon Democratic Party for misrepresenting the donor who gave the party $500,000 in the final weeks of the 2022 election.

At the time, Democrats reported the money came from a Las Vegas-based payment processing company called Prime Trust. After The Oregonian/OregonLive asked about the transaction, the party said the money actually came from Nishad Singh, an executive at the disgraced cryptocurrency exchange FTX.

Under Oregon state law, it is a Class C felony to make or accept a campaign contribution under a “false name.”

Election officials in the Oregon Secretary of State’s office investigated the incident under the supervision of a director who had previously worked for the Democratic Party and forwarded possible criminal charges against Singh to the Oregon Department of Justice.

At the same time, Oregon’s then-acting Secretary of State Cheryl Myers – now the state’s deputy secretary of state – reduced the Democratic Party’s fine for misrepresenting the source of the donation from $35,000 to $15,000 and agreed not to pursue criminal charges. A state attorney had written in a legal opinion that the Democratic Party’s efforts to correctly identify its major donor were “flawed” and that “any other reasonable person would not have been satisfied with the level of diligence.” But the Secretary of State’s office eventually issued a press release saying, “The investigation found no clear evidence that the Oregon Democratic Party knew the true donor when it reported the donation.”

Last May, The Oregonian/OregonLive requested a copy of the State Department’s investigation to learn more about the scope of the probe and officials’ findings. The State Department’s office said it had turned over the investigative file to the Justice Department, and the Justice Department denied the news organization’s public records request, saying there was an ongoing criminal investigation.

Roy Kauffman, a spokesman for the Oregon Department of Justice, said last May that the agency had not ruled out opening a criminal investigation into the Oregon Democratic Party. “We have not yet made a decision on the scope of our investigation,” Kauffman wrote in an email.

On Wednesday, Kaufmann did not provide any new information. “Our work continues,” he wrote.

In March, FTX co-founder and CEO Sam Bankman-Fried was sentenced to 25 years in prison for defrauding hundreds of thousands of customers and investors by diverting their money to risky investments, large donations to both political parties, and a lavish lifestyle that included private jets and the purchase of expensive real estate in the Caribbean. Singh has pleaded guilty to fraud and, like other FTX executives, is awaiting sentencing. The U.S. government is working to recover the funds where possible.

Brad Martin, the party’s executive director, told The Oregonian/OregonLive in 2022 that Democrats accepted the money without knowing much about its origins. It was the largest donation they had ever recorded in Oregon’s campaign finance database. They used the funds to attack 2022 Republican candidate for governor Christine Drazan in the final days of the election. Martin did not respond to a text message seeking comment on the state’s ongoing review Wednesday afternoon.

The Oregon Democratic Party gave $500,000 to the U.S. Marshals Service on June 9, 2023, according to the state’s campaign finance system. On the same day, the campaigns of Gov. Tina Kotek, U.S. Sen. Ron Wyden and U.S. Sen. Jeff Merkley each donated $100,000 to the party. U.S. Rep. Suzanne Bonamici also donated $25,000, U.S. Rep. Earl Blumenauer gave $50,000 and U.S. Rep. Val Hoyle gave $15,000, according to the state.

Attorney General Ellen Rosenblum, who donated more than $100,000 to the Oregon Democratic Party from her campaign, recused herself from the Justice Department’s review last year. Rosenblum is not the only lawyer with close ties to both the Justice Department and the Oregon Democratic Party. Oregon Democratic Party attorney Harry Wilson of the Portland law firm Markowitz Herbold has joined with other attorneys at his firm and represented the state as a contracted assistant attorney general in several high-profile cases, including the lawsuit against software giant Oracle over the bankruptcy of Cover Oregon and the lawsuit against members of the notorious Sackler family over allegations that the family diverted money from the pharmaceutical giant Purdue.

Given Wilson’s work for the Democratic Party, Markowitz Herbold asked the Justice Department to repeal the professional rules that typically prohibit lawyers from representing clients whose interests might conflict.

“The interests of the DPO do not necessarily align with those of the state,” Markowitz’s attorney Lauren Blaesing wrote in a motion to the state to resolve the dispute. She noted that at the time of her letter, Secretary of State Shemia Fagan, a Democrat, was considering opening an investigation into the party’s misrepresentations regarding the $500,000 donor.

“We do not believe that there is a significant risk that our firm’s ability to represent the Data Protection Commissioner will be compromised by the firm’s responsibilities to the State in the Purdue, Wyatt, Willamette, Talmage, And Maney matters,” she wrote. “We can continue to represent the state fully, completely and conscientiously in the Purdue, Wyatt, Willamette, Talmage and Maney is important and our company can do the same for the data protection officer.”

Deputy Attorney General Lisa Udland signed the waiver.

—Hillary Borrud is an investigative reporter. Reach her at 503-294 4034, [email protected] or @hborrud.

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