This Dennis Hastert case is growing more confounding.
The former Speaker of the House was indicted a few weeks ago in a case that was widely reported for its allegations that Hastert paid hush money to a sexual abuse victim. Yet Hastert was not charged with sexual abuse, nor was anyone charged with extortion.
Hastert crime #1: Structuring
Instead, the feds got Hastert on financial improprieties. Federal law requires mandatory bank reporting of any withdrawal of funds over $10,000. This law, in place since the 1970s, is designed to alert law enforcement to possible money laundering or tax evasion. Withdrawing one’s own money for lawful purposes is not a crime, but the government gets to know about it.
Most people of means are aware of this reporting requirement. To avoid it, some will withdraw smaller amounts, say, $8,000 or $9,000 at a time. When this is done repeatedly, banks tip off the feds to look for “structuring” – the crime of knowingly avoiding the bank reporting laws in just this way.
Structuring is the first crime Hastert is accused of – taking out less than $10,000 repeatedly in order to avoid bank reporting. Even though the money was his own, and even though the purpose of the withdrawal appears to be lawful, the way Hastert is accused of doing this violates the law.
Blackmail vs. lawful settling of claims
A side note about extortion. Threatening to expose someone unless money is paid is extortion, a crime. Threatening to sue someone unless money is paid is common, lawful and something my law firm and other firms do frequently. It’s simply settling claims.
We don’t know what went on between Hastert and his alleged sex abuse victim. ABC News reports that a woman claims that her brother, then a high school student, was sexually abused by Hastert decades ago. Her brother died in 1995 from AIDS.
But Hastert’s recent federal indictment, which I have read in its entirety, accuses him of withdrawing the funds to pay for both compensation and confidentiality between 2010 and 2014. Are we talking about different victims? That’s unclear at this time. But paying to compensate a victim for his injuries and also asking for confidentiality is typical in a settlement of a sexual abuse claim. And lawyers do not have to be involved for it to be legal. So we can’t be sure based on the facts known today whether Hastert settled a claim or was blackmailed.
If Hastert simply settled a claim, he would have done better to issue a one-time payment to his victim, above board. The victim would have been required to pay taxes on most or all of that settlement, and other than that, the federal government would not have been concerned with it. However, the fact that he was withdrawing cash probably indicates this was not a properly handled legal settlement.
Hastert crime #2: Lying to law enforcement
Hastert’s second legal problem is his alleged lying to authorities when he was asked the purpose of the cash withdrawals, telling them he liked to have cash on hands as he didn’t trust banks. Sure. He had the right to remain silent but unwisely chose otherwise — lying to law enforcement is a crime. In many cases, it’s not the crime, it’s the cover-up which undoes people. See: Martha Stewart, Scooter Libby.
What really happened with ‘Individual A’?
Despite the actual charges filed, the real question people want the answer to is: did Hastert have sexual relations with an underage victim many years ago? A high school student could be 18, so we can’t be sure what he did was illegal. (Certainly it is morally reprehensible for a high school wrestling coach to engage in sex with his teenaged student, regardless of age.) But even if the student was legally underage, the statute of limitations would have long since expired. Hastert was under no threat of criminal prosecution in 2010 when he began paying the money.
That Hastert agreed to pay $3.5 million to “Individal A,” according to the indictment, strongly indicates guilt. Unless a victim comes forward, or Hastert himself discloses what happened, we may never know. But Hastert appears to have created this situation by taking advantage of a young boy; it appears he has lived under the cloud he created ever since.