As the spread of the coronavirus limits travel and shutters archives, investigators are looking to pandemic-proof repositories of evidence. One such source springs from the Foreign Agents Registration Act (‘FARA’), US legislation devised over 80 years ago to root out Nazi propagandists.

Shelved for decades as unfit for purpose, a recent surge in high-profile FARA prosecutions has drawn attention to an archive of thousands of filings which shed light on the hidden US activities of foreign interests. The filings, which detail the engagement of agents by those foreign parties, offer regular and fulsome accounts of their activities. Even in lockdown, agents seeking to influence US government and public opinion through social media, emails or articles must still register.

Often mischaracterised as a tool to solely uncover geopolitical manoeuvres, disclosures under FARA make for a happy hunting ground for financial investigators in a range of situations:

• Mapping corporate structures: FARA statements require agents to outline the nature of their client’s business. This may include details of corporate structure (including in some cases otherwise confidential structures offshore), the identity of key executives, proxies, addresses and shareholding percentages.
• Smear campaigns: FARA requires PR firms to disclose a list of the articles and social media posts commissioned, press releases sent and events organised. Disputes seldom play out solely within the confines of the courtroom and these disclosures may uncover the source and scope of a black PR campaign running alongside litigation or arbitration.
• Terms of engagement: agents are required to disclose copies of their engagement letter where such a document exists. These letters often go into fine detail, containing schedules of expected services and terms of payment, in some cases capturing instructions that were not intended for public consumption. FARA can also capture sub-agreements between agents and their contractors, exposing what can be a murky undercurrent of sales agreements for confidential data and pay-to-play journalism.
• US jurisdiction: the act of registering points towards a US nexus. This could open avenues for US legal solutions: identifying a transaction made in US dollars, for example, can open the door to a Section 1782 application and, with it, a significant amount of financial and banking data from third party sources.

Famous for its vague parameters, FARA captures a range of actors in its scope. A “foreign principal” includes foreign companies and individuals outside the US, as well as a foreign political party or government. The list of registered principals in FARA’s database runs the gamut from authoritarian states to European chocolatiers trying to influence US policy.

Moreover, there is no minimum threshold for these activities to qualify: even a single meeting or email with a US official could trigger FARA.

FARA’s inbuilt exemptions include one for lawyers engaged in the legal representation of a foreign client. The scope of this exemption has formed a battleground between an increasingly activist Department of Justice (‘DoJ’) on the one hand, and law firms on the other. Recent DoJ guidance states that that the exemption does not cover a law firm’s PR activities associated with their representation, nor does it allow for informal, off the record interactions with government agencies.

Once confident of their compliance with FARA, law firms are likely to lead a push back against the DoJ. First, the definition of what is “legal representation” will be a developing area of law, with an inevitable effect on how advisors and consultants employed by lawyers are defined. Second, the DoJ’s renewed appetite for FARA-related prosecutions may offer an opportunity for litigants able to expose deficiencies in their counterparties’ FARA filing obligations. Our investigations can provide clients with evidence of their opponents’ undisclosed activity – from orchestrated PR campaigns to instances of exemption-flouting behaviour – which could be grounds for the DoJ to launch an investigation.

The sheer extent of the information housed – a growing library of over 16,000 registrations – marks a significant step towards financial accountability and transparency in US-based commercial activities.

Although exemptions for lobbyists and lawyers render FARA’s reach incomplete, political and financial investigations continue to reap the benefits of the Act’s ever-replenishing archive. While there is little to indicate that FARA has limited the impact of foreign influence in the US, it shines a light on a service economy that many would prefer to keep hidden.

Update: In May 2021, the government published a consultation regarding the proposed Foreign Influence Registration Scheme (FIRS), broadly seen as the UK’s answer to FARA. The focus of the scheme, still in a nascent stage, is on state-based threats, defined as ‘overt and covert action which falls short of general armed conflict but nevertheless seeks to undermine or threaten the safety and interests of the UK.’ FIRS would regulate activities ‘directly commissioned by a foreign state, as well as activities that have been directed by an individual or entity that is subject to foreign state influence or control’, and such regulated activities would include ‘lobbying, the funding of political campaigning, the work of think tanks, political communications and public relations’. Some ministers and pressure groups have campaigned for the list of FIRS registrable agents to be as broad as possible, extending into the investigative sector – or ‘research firms’ – as well as ‘PR consultants, reputation managers, law firms, and banks’.

For more information please email enquiries@raedas.com