American prosecutors in the sex cult racketeering case of NXIVM founder Keith Raniere claim Canadian co-defendant Clare Bronfman, the Seagram’s heiress, has been paying the legal fees of their fellow defendants and even witnesses, and allegedly advising them to keep silent.
This is a “potential conflict of interest” that is “compounded” by the fact that Bronfman is not just a benefactor, but also a defendant, United States attorney Richard P. Donoghue claims.
The main concern, he writes, is that this payment arrangement could affect the defence counsel’s advice about whether to seek leniency by cooperating with the government, and whether to testify in their own defence, “where such testimony might implicate Clare Bronfman.”
Actor Allison Mack exits the U.S. District Court for the Eastern District of New York following a status conference, June 12, 2018 in the Brooklyn borough of New York City. Drew Angerer/Getty Images
Bronfman, Raniere, and their four co-defendants in this federal prosecution, including the actor Allison Mack, are accused of what prosecutors describe as a “long-running racketeering conspiracy, among other crimes.” Charges include sex trafficking, identity theft, tax evasion, and involuntary servitude. Salacious details of the group’s rituals have emerged over recent months, including an alleged practice of branding the skin of women recruited as sex slaves.
The letter to the judge, sent last Friday and seen by the National Post, says the lawyer fees for all defendants other than Bronfman “have been, and will continue to be, paid from an irrevocable trust to which Clare Bronfman is the primary contributor.”
Advertisement It claims the government has been in contact with the lawyers for the trustee, who confirmed the funds were paid according to certain guidelines, but declined to turn over the trust’s documents to the government.
“The government has learned that the legal fees of multiple witnesses and potential witnesses are also being paid by Bronfman or the trust, and that there have been efforts to pay the legal fees of other witnesses,” the letter reads.
One witness, for example, told the government that, after she received a subpoena to testify before a grand jury, a lawyer for one of the defendants put her in touch with another lawyer who said Bronfman was covering his fees. This lawyer allegedly instructed the witness to invoke the Fifth Amendment, which grants a right against self-incrimination, and if she did not, he “would not feel comfortable continuing to represent” her. When the witness asked whether she could simply pay his fees herself, the lawyer said his fees were “expensive,” the letter reads. He said he could refer her to another lawyer instead.
“These concerns are not merely theoretical,” the letter reads. “If similar conditions are being placed on Bronfman’s co-defendants, expressly or otherwise, the advice provided by their counsel might be similarly affected.”
The letter says the U.S. Department of Justice is bringing this information to the court’s attention because it it obliged to and so that the court can conduct its own inquiry, as required by law. It also asks the court to remind defendants that, if they cannot afford counsel, the court will provide it. It is also not clear how the trust’s payment of legal fees is being prioritized, the letter says.
Bronfman, 39, is reported to have a personal wealth of nearly $200-million. She is part of the Canadian Bronfman family that made its fortune with the Seagram’s liquor distillery business. Her older sister Sara was also deeply involved in NXIVM, so much that their father Edgar Sr., who died in 2013, reportedly made efforts to rescue them from what he called a “cult” and to protect their inheritances after they lost millions in investment schemes.
The defendants in this case include Raniere, Bronfman, the actor Allison Mack, Kathy Russell, Lauren Salzman and her mother Nancy Salzman. Sara Bronfman is not charged.
All have pleaded not guilty.
The prosecutors’ letter says conflicts can arise when a lawyer is paid by a third party, known as “benefactor payments.” It quotes case law saying that these arrangements “may subject an attorney to undesirable outside influence” and raise questions “as to whether the attorney’s loyalties are with the client or the payor.”
These quotes are stock phrases in conflict of interest allegations, and have been used in cases about everyone from an alleged al Qaeda plotter to mob boss John Gotti.
No hearing on this matter has yet been scheduled. The case continues.