February 4, 2023

By MICHAEL R. SISAK and ERIC TUCKER (Associated Press)

NEW YORK (AP) — A former senior FBI counterintelligence official who investigated Russian oligarchs has been charged with secretly working for one in violation of U.S. sanctions. The officer was also charged in a separate indictment with taking cash from a former foreign security officer.

Charles McGonigal, the special agent in charge of the FBI’s counterintelligence operations in New York from 2016 to 2018, is accused in an indictment released Monday of working with a former Soviet diplomat and Russian interpreter on behalf of Oleg Deripaska, a Russian billionaire allegedly referred to as “the big guy” and “the customer” in the code.

McGonigal, who oversaw and participated in investigations into Russian oligarchs, including Deripaska, campaigned to have sanctions lifted against Deripaska in 2019 and took money from him to investigate a rival oligarch in 2021, the Justice Department said.

The FBI was investigating McGonigal and said they were willing to go after one of his own. Nonetheless, the indictment is an unwelcome headline for the FBI at a time when the FBI is embroiled in separate, politically-charged investigations — President Joe Biden and former President Donald Trump’s handling of classified documents — due to rising Republicans in Congress commit to investigating high-profile FBI and Justice Department decisions.

McGonigal and interpreter Sergey Shestakov were arrested Saturday — McGonigal after landing at John F. Kennedy International Airport and Shestakov at his home in Morris, Connecticut — and being held at a federal prison in Brooklyn. Both pleaded not guilty on Monday and were released on bail.

McGonigal, 54, and Shestakov, 69, are charged with violating the International Emergency Economic Powers Act and conspiring to commit money laundering and money laundering. Shestakov is also accused of making material misrepresentations to the FBI.

McGonigal “has had a long, distinguished career with the FBI,” his attorney Seth DuCharme told reporters as he walked out of court with McGonigal following his arraignment.

“This is obviously a worrying day for Mr. McGonigal and his family, but we will review the evidence, we will review it closely, and we have great faith in Mr. McGonigal,” said DuCharme, the former Brooklyn chief attorney.

Lawyers for Shestakov and Deripaska received messages asking for comment.

McGonigal was separately charged in federal court in Washington DC with concealing at least $225,000 in cash he allegedly received from a former Albanian intelligence agent while he was working for the FBI.

The indictment does not charge or characterize the payment to McGonigal as a bribe, but federal prosecutors say that while concealing the payment from the FBI, as an FBI overseer he took actions aimed at the former intelligence official’s financial advantage.

Among other things, they suggested that a pharmaceutical company should pay the man’s company $500,000 in return for scheduling a business meeting with a representative of the US delegation to the United Nations.

In a bureau-wide email Monday, FBI Director Christopher Wray said McGonigal’s alleged behavior “is utterly inconsistent with what I see from the FBI’s men and women, who demonstrate through their actions every day that they have the trust of the… deserve publicity.”

The US Treasury Department added Deripaska to its sanctions list in 2018 for alleged ties to the Russian government and the Russian energy sector amid Russia’s ongoing threats against Ukraine.

In September, federal prosecutors in Manhattan charged Deripaska and three associates with conspiring to violate US sanctions by plotting to ensure his child was born in the United States.

Shestakov, who worked as an interpreter for federal courts and prosecutors in New York City after retiring as a diplomat in 1993, helped connect McGonigal to Deripaska, according to the indictment.

In 2018, while McGonigal was still working for the FBI, Shestakov introduced him to a former Soviet and Russian diplomat who acted as an agent for Deripaska, the indictment says. This person is not named in court documents, but the Justice Ministry says he was “rumored to be a Russian intelligence officer in public media reports.”

According to the indictment, Shestakov asked McGonigal for help in getting the agent’s daughter an internship in the New York City Police Department’s counterterrorism and intelligence units. McGonigal agreed, prosecutors say, telling a police department contact, “I have an interest in her father for a number of reasons.”

According to the indictment, a police sergeant subsequently reported to the NYPD and the FBI that the woman claimed to have an “unusually close relationship” with an FBI agent, who she said gave her access to confidential FBI files. The sergeant said it was “unusual for a college student to receive such special treatment from the NYPD and FBI,” the indictment said.

After leaving the FBI, McGonigal went to work as a consultant and investigator for an international law firm to reverse Deripaska’s sanctions, a process known as “delisting,” according to the 2019 indictment.

The law firm paid McGonigal $25,000 through a Shestakov-owned company, prosecutors say, although work was ultimately disrupted by factors including the COVID-19 pandemic.

In 2021, according to the indictment, Deripaska’s agent hired McGonigal and Shestakov to dig up dirt on a rival oligarch Deripaska was fighting for control of a major Russian company, in exchange for $51,280 upfront and $41,790 a month paid through a Russian bank were paid to a New Jersey company owned by McGonigal’s friend. McGonigal kept his friend in the dark about the true nature of the payments, prosecutors say.

McGonigal is also accused of withholding from the FBI key details of a trip he made to Albania in 2017 with the former Albanian intelligence operative, who is said to have given him at least $225,000.

Once there, McGonigal met Albania’s prime minister, according to the Justice Department, and urged caution in granting Russian front companies drilling licenses for oil fields in the country. McGonigal’s Albanian contacts had a financial interest in these decisions.

In an example of how McGonigal allegedly confused personal gain with professional responsibility, prosecutors in Washington say he “caged” the FBI’s New York office to launch a criminal lobbying investigation, which identified the former Albanian intelligence official as a confidential human source should serve.

McGonigal did so, prosecutors claim, without disclosing his financial ties to the man to the FBI or the Justice Department.

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Eric Tucker reported from Washington. Jim Mustian and Larry Neumeister in New York contributed to this report.

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Follow Michael Sisak on Twitter at twitter.com/mikesisak and Eric Tucker at twitter.com/etuckerAP. Submit confidential tips by visiting https://www.ap.org/tips/.

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