Prosecutors say the politicians and fundraisers involved were unaware that the money originated overseas or that the names of the donors reported in official records obscured the true source of the funds.
Giuliani — who is not expected to testify — has denied wrongdoing, although he has come under close scrutiny in a related investigation of alleged violations of foreign-agent registration laws led by the same prosecutors overseeing the case against Parnas and overseen by the judge handling the current trial, J. Paul Oetken.
In April, the FBI raided Giuliani’s home and office, seizing phones and other electronics as part of the foreign-influence investigation.
The initial indictment returned against Parnas and three other men in October 2019 alleged that part of the scheme involved trying to influence U.S. officials to remove the then-U.S. Ambassador to Ukraine Marie Yovanovitch. Prosecutors quietly removed that allegation during a revision to the charges last year.
Giuliani was deeply involved in the effort to oust Yovanovitch, who was eventually recalled in May 2019. The episode, and a related effort to get Ukraine to announce an investigation into then-Democratic presidential candidate Joe Biden, led to Trump’s first impeachment by the House and ultimate acquittal by the Senate.
In recent weeks, prosecutors have sought to play down the roles Giuliani and Trump were likely to play in evidence and testimony at the trial, while defense attorneys warned the judge that those names would come up frequently and that many of the photos of the fundraising events in question show Giuliani or Trump.
In addition, at the request of defense lawyers and with the agreement of the prosecution, Oetken agreed to remove from the trial the count in the indictment that is most closely tied to Giuliani: the allegation that an anti-fraud business venture Parnas and co-defendant Igor Fruman started called “Fraud Guarantee” was itself a fraudulent scheme the men used to pay millions of dollars in their own personal expenses.
Fruman struck a deal with prosecutors and pleaded guilty in the case last month, although the plea bargain does not require him to cooperate with the investigation. He is awaiting sentencing.
Another man charged in the fraud scheme, Florida businessman David Correia, pleaded guilty last year and is serving a one-year sentence at a federal prison in North Carolina.
Giuliani has also sought to distance himself from the case, claiming that he was unaware of any illegal campaign donations or fraud on the part of Parnas or Fruman. However, it is clear he was far from a casual acquaintance of the pair.
The former mayor has acknowledged accepting a $500,000 consulting fee for work on the “Fraud Guarantee” business. In addition, Giuliani was close enough to Parnas to invite him to attend former President George H.W. Bush’s funeral in December 2018. Video and photos show Giuliani and Parnas arriving together to the ceremony at the National Cathedral in Washington, D.C.
Parnas’ lawyer Joseph Bondy said his client had extensive discussions with prosecutors and the FBI in an attempt to reach a plea bargain in the case, but no such deal was ever consummated. It is unclear whether Fruman intends to take the stand in his own defense, but if he does and contradicts any of his previous statements to prosecutors, they will be permitted to question him about his proffer to the government.
Parnas also faces a second challenge at the trial: The only remaining co-defendant who has not pleaded guilty, Andrey Kukushkin, is apparently planning to argue to jurors that there was never an agreement to make illegal campaign donations because Fruman intended all along to steal the money.
At a hearing last week, Oetken warned Kukushkin’s attorney Gerald Lefcourt that the claim wasn’t really a legal defense for his client, but the judge appeared to leave the door open for Lefcourt to try to push blame for any wrongdoing onto Parnas.