Crowe Pays For His Pay-To-Play Plan

Crowe Pays For His Pay-To-Play Plan

Robert Crowe, a partner at Nelson Mullins Riley & Scarborough, has agreed to pay $95,000 to settle a lawsuit issued by the Securities and Exchange Commission (SEC). The SEC had alleged Crowe acted as a player in a pay-to-play plan orchestrated by State Street Bank and Trust Co. soliciting improper campaign donations. Crowe, joined Nelson Mullins in 2009 from WolfBlock, and is a former co-chairman for finance of the Democratic National Committee. He was represented in the case by attorney W. Stuart Dornette of Taft Stettinius & Hollister.  Crowe was accused of filtering campaign contributions for Ohio’s then-deputy state treasurer, Amer Ahmad, through his personal account and reimbursing other individuals for contributions made in their own names.

The SEC claimed Crowe sent a backdated invoice for purported mentoring services to cover a wire transfer payment into his account for the campaign contributions. The attorney settled the case without admitting any wrongdoing because he wanted to move on with his life and avoid the expense of a trial, confident it wouldn’t be the best plan.  He has been ordered to pay disgorgement of $16,000, interest of approximately $3,900 and a civil penalty fee of $75,000.  The judgment was filed on Tuesday, May 2nd, in Ohio federal court.  Crowe’s lawyer, Arthur McMahon III, stated at the beginning of the case that the SEC allegations are “patently untrue”, and, “Moreover, nothing the SEC has alleged would constitute securities fraud, a breach of the SEC’s pay-to-play rules or a violation of any other rule the SEC has authority to enforce.”

The ordeal began after the SEC had alleged Crowe entered into an underhanded agreement to help State Street Bank make the contributions to Ahmad in exchange for public pension contracts. He was accused of agreeing to a plan to filter the campaign money through his personal bank account, essentially facilitating a pay to play scheme. Crowe’s attorneys had stated he knew nothing about the Ohio official’s crooked plans to ultimately gain from his political position.  They also argued the SEC was wrongly trying to make a case of securities fraud out of an alleged violation of state campaign finance law.  Nelson Mullins general counsel James Gray provided a statement in an earlier interview. “It is important to remember that the complaint filed by the Securities and Exchange Commission contains allegations against Mr. Crowe that have not yet been proven in court,” he said. “We have no information regarding his response to the allegations, nor would it be proper to comment on his defense to these charges.”

Dornette said State Street Bank had been Crowe’s client, and he was asked to make the political contributions. The bank and a former bank officer involved in the transactions settled related SEC allegations for substantially higher amounts in January 2016. The bank, in turn, decided to settle for $12 million and the officer settled for nearly $275,000. With the admission of the bank and its employees, Crowe’s not guilty plea was a weak one and settling became the best option.  

Sources:

Nelson Mullins partner settles SEC suit claiming he helped pay-to-play scheme

SEC alleges Nelson Mullins partner served as conduit in pay-to-play scheme