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IRS agent charged for leaking Michael Cohen transactions to porn star attorney Michael Avenatti

By Jon Dougherty

A San Francisco-based IRS agent was charged Thursday by the Justice Department for illegally leaking former POTUS Trump attorney Michael Cohen’s overseas financial transactions to California-based attorney Michael Avenatti, who once represented porn star Stormy Daniels in a suit against the president.

IRS analyst John C. Fry, 54, who has worked for the agency since 2008, was charged with handing over Suspicious Activity Reports (SARs) pertaining to Cohen.

The Justice Department said in a charging statement:

The criminal complaint charges Fry with violating 31 U.S.C. § 5322(a), which prohibits unauthorized disclosure of information from SARs.  Fry appeared before the U.S. Magistrate Judge Laurel Beeler in federal court in San Francisco on February 21, 2019.  He was released on a $50,000 bond.  Fry’s next scheduled appearance is scheduled for March 13, 2019, at 9:30 am, before U.S. Magistrate Judge Joseph C. Spero for preliminary hearing or arraignment on indictment.

An investigation by the Treasury Inspector General for Tax Administration (TIGTA) found that Fry logged into the FinCEN and Palantir networks in May 2018 from his work computers, then conducted several searches “related to the taxpayer who was a New York attorney,” the statement said.

Fry then reportedly gave the SAR information to Avenatti.

“On May 8, 2018, the attorney used a public Twitter account to circulate a dossier releasing confidential banking information related to the taxpayer and the taxpayer’s company,” the statement said.

“The SAR information that was passed to the Los Angeles attorney was published in the Washington Post on May 8, 2018.  The Los Angeles attorney put Fry in contact with an investigative reporter in New York which led to confirmation of the confidential banking information and an interview, which was published in The New Yorker on May 16, 2018,” DoJ noted further.

Fry did not enter a plea when he appeared in court. According to CNN, “In recent weeks, Fry’s hearing date was pushed back several times as federal prosecutors were engaged with Fry’s attorney on plea negotiations, according to a person familiar with the talks. As of Thursday, Fry declined to plead to felony charges in exchange for probation.”




Banks are required by statute to file SARs for suspected dubious financial transactions. Fry told The New Yorker‘s Ronan Farrow in May 2018 that not all of Cohen’s SARs were available, that some were missing.

In May 2018, Bloomberg hinted that the leaker was probably a low-level IRS employee because apparently, the news agency was not aware that there are a number of legitimate reasons why the SARs would not appear in databases. For one, they could have been put in a restricted status because they had become part of a federal probe.

That turned out to be the case. According to the Justice Department complaint, two SARs were not available for viewing by registered users of the FinCEN system due to the fact that they were related to a sensitive open investigation.

Avenatti would release a seven-page dossier in which he mistakenly included two incorrect “Michael Cohens” thanks to Fry’s information.

Cohen has been convicted for a series of crimes that include tax evasion, financial fraud, and campaign finance violations tied to a scheme to pay off women who claimed to have been involved in decade-old affairs with POTUS Trump.

Cohen is supposed to report to prison in May.

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