Dennis Hastert Enters Not Guilty Plea in Federal Banking Case

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Summary: Dennis Hastert has pleaded not guilty to charges that accuse him of illegally structuring cash withdrawals to avoid detection and of lying to federal agents.

On Tuesday, Dennis Hastert pleaded not guilty to federal charges that allege he illegally structured bank withdrawals and lied to law enforcement about millions of dollars he promised to pay an individual for misconduct that happened several decades ago, the New York Times reports.

  

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Hastert was indicted on May 29.

Hastert, 73, stood before the judge, responding to questions with one-word answers. The court appearance was Hastert’s first time in public since the charges were announced in May. Dozens of reporters were waiting at the federal courthouse.

After the plea was entered, Hastert and his attorneys did not make additional statements. The charges are focused on financial transactions, but allegations of sexual misconduct have also crept up.

Hastert posted a $4,500 bond and was ordered to turn over his passport, remain in the continental United States, inform the court of any changes in address, and remove any firearms from his residence within two weeks. Additionally, he was ordered to avoid contact with any individual who may be a witness or accuser in his case.

The brief hearing lasted no more than 20 minutes. Hastert was indicted last month on charges of structuring cash withdrawals and lying to federal investigators in connection to what law enforcement has described as an arrangement to pay an individual, “Individual A,” $3.5 million to keep Hastert’s alleged misconduct against that individual quiet.

Allegedly, Hastert, who once taught and coached wrestling at a high school in Yorkville, Illinois, was paying a previous student to stay quiet about sexual abuse from decades ago. The indictment states that Hastert withdrew $1.7 million over the past four years to pay this former student. Hastert was a teacher and coach at in Yorkville from 1965 to 1981. Just last week, a woman stepped forward and accused Hastert of sexually abusing her brother, People adds.

The indictment does not include any charges of sexual abuse, likely because the statute of limitations has probably expired.

Specifically, Hastert is accused of withdrawing cash in increments of less than $10,000 to bank reporting requirements. Typically, these types of withdrawals are part of drug or money-laundering crimes, and usually also include charges of tax violations or embezzlement.

The indictment states that Hastert began withdrawing $50,000 sums of cash from several accounts back in June of 2010, and provided this cash to Individual A every six weeks. In total, 15 exchanges occurred. In April 2012, the banks, which must file transaction reports when withdrawals in excess of $10,000 are made, asked Hastert about the money he withdrew. A few months later, Hastert began withdrawing smaller sums of cash, also providing those to Individual A. Hastert withdrew $952,000 in 106 transactions. According to NBC News, Hastert’s attorneys will likely have a difficult time explaining why Hastert withdrew cash in so many transactions.

An ex-partner at Hughes, Hubbard & Reed LLP recently pled guilty to tax fraud.

Randall D. Eliason, a former assistant United States Attorney, said, “The most challenging thing about structuring is usually proving that the defendant knew about the regulations, because they often assert a defense of, ‘I had no idea.’” However, he said that the evidence in this case seemed “pretty compelling.”

Charles Stillman, a criminal defense attorney, said that if Hastert paid the money to Individual A without trying to hide it, the withdrawals would not have been illegal. He explained, “You’d think somebody would figure out that the banks are watching all of this,” he said. “One of the things that has fascinated me about this work I’ve been doing my whole life now is that some people just don’t get it. They engage in that sort of financial behavior without realizing there’s a consequence.”

Last December, Hastert was questioned by federal agents. Hastert explained that he felt unsafe with the banking system in the United States, and that he stored money elsewhere because of his concerns. He told investigators that he “kept the cash,” according to the indictment. Because of this statement, he was charged with lying to federal agents.

Each of the charges Hastert faces carry sentences of up to five years in prison and a $250,000 fine. Prosecutors have not said whether Individual A may face tax violation charges or even extortion charges.

Some experts have said that a lack of charges against Individual A is perplexing, whereas others said charges seem unlikely, since it appears that Individual A has cooperated with law enforcement and has been called a victim of “misconduct.”

During the hearing, Judge Thomas M. Durkin addressed potential conflicts, in that he donated $1,500 to Hastert’s campaign back in the early 2000s, worked with Hastert’s son, Ethan, and is the brother of Jim Durkin, who is the Republican leader of the Illinois House.

Judge Durkin was randomly assigned to the case. He said he would recuse himself from the case unless both sides waived any objections to his presiding over it.

Source: New York Times

Photo credit: NPR.org, rdeliason.com (Eliason), ballardspahr.com (Stillman)