Maryland lawyer indicted in scheme to obtain millions in Somali government assets,

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By Ann E. Marimow

Tuesday December 8, 2020

More than a decade ago, Bethesda lawyer Jeremy W. Schulman began working to reclaim millions of dollars belonging to the government of Somalia from accounts frozen during the country’s years of political turmoil. Now, Schulman is facing the possibility of decades in prison after the government accused him of defrauding the people he was claiming to help.

Prosecutors say Schulman, who was indicted last week on federal fraud charges, exploited connections to the Somali government and pretended to officially represent the war-torn country’s interests to enrich himself. His lawyers say that the Justice Department has it wrong and that Schulman was a trusted adviser and advocate of the Somali people.

 

Schulman, 47, made an initial appearance Monday before U.S. Magistrate Judge Gina L. Simms and through his lawyer pleaded not guilty to the charges. The hearing was held by videoconference in U.S. District Court in Maryland because of the pandemic. 

“We firmly believe the Department of Justice is misinformed and has been derelict in its responsibility to thoroughly investigate and identify all exculpatory evidence,” Schulman’s legal team said in a statement provided by attorney Paul W. Butler.

“We are confident that when permitted an opportunity to tell his story, Mr. Schulman will be wholly vindicated of any criminal conduct, let alone fraud.”

Prosecutors tell a different story of fake documents, misrepresentations and a five-year scheme to gain control of $12.5 million. Schulman did not have authority to act on behalf of the East African country, prosecutors say, and instead forged letters to present to banks and other financial institutions.

When the Somali Democratic Republic collapsed in the early 1990s amid a civil war, the Central Bank of Somalia asked banks around the world to freeze financial assets belonging to the government to prevent withdrawals until a stable government returned to power. Some accounts came under control of the Office of the New York State Comptroller. The Federal Reserve Bank of New York also held gold and currency belonging to Somalia.

The 11-count indictment, returned by a federal grand jury in Maryland last week, outlines a conspiracy carried out by Schulman, an unnamed former leader of the Central Bank and that person’s relative, Abdiaziz Hassan Amalo of Maryland, among others. The former bank official had been appointed as an adviser to the transitional Somali government in 2009, but prosecutors say Schulman inflated the official’s position and authority and inserted “deceptive or incorrect information” into documents to gain access to the assets.

As a result of the alleged scheme, Schulman personally received more than $880,000 at the end of 2013, an increase of more than $400,000 from his compensation the previous year, according to the 31-page indictment.

In one instance, prosecutors say, Schulman and Amalo forged a letter purporting to be from the attorney general of the Republic of Somalia in an attempt to get funds from a bank, which held more than $1.5 million in assets. After several drafts, the indictment says Schulman congratulated Amalo on his “great work” and emailed the forged letter to the bank in August 2010.

 

 

Amalo wrote to Schulman, according to the indictment, “I’m glad we got this time right. Make the Magic happen on those banks now LOL!!!”

Amalo was arrested and charged with bank fraud and false statements in 2017. His case is still pending and his lawyer had no comment.

In June 2013, one of the banks and the New York comptroller conditioned the release of the assets on official certification from the U.S. State Department.

Schulman’s lawyer said that his efforts were “fully transparent” and that he had the authority to act on behalf of the Somali government. His team worked “tirelessly to assist a nation desperately in need of financial resources to ensure the government’s recovery from nearly two-decades of civil war,” Schulman’s lawyer said in the statement.

But the indictment says a State Department lawyer made clear in messages to Schulman that its certification did not permit Somalia’s president to delegate his authority to receive the funds to any third person, including to Schulman, and that any communication had to come directly from the president.

Even so, the indictment says, Schulman continued to communicate with the New York comptroller about releasing the assets without disclosing the instructions he had received from the State Department.

At the time of the alleged conspiracy, Schulman worked for the law firm Shulman Rogers. In a statement Monday, the firm said it is cooperating with the Justice Department and has had no association with Schulman since he left in 2016.

“The firm was not the subject of the investigation or the indictment. The indictment expressly states that the alleged actions were done without the firm’s knowledge. In fact, when the firm is mentioned (Law Firm A), the indictment makes clear the firm was deceived by Mr. Schulman, and that Mr. Schulman concealed his alleged activities from the firm,” according to the statement.

Schulman is a founding partner of the Bethesda-based law firm Schulman Bhattacharya and chairman of the firm’s commercial litigation and arbitration group. Schulman touts his Somalia-related work on the firm’s website, noting his representation of the government on matters including an investigation of financial corruption allegations asserted by the United Nations Monitoring Group for Somalia and Eritrea.

He previously worked at firms in Washington and New York. A graduate of State University of New York at Buffalo School of Law, Schulman began his career as a clerk to Judge John M. Steadman of the D.C. Court of Appeals.

Schulman is also listed as a member of the honorary council and a former trustee of the Round House Theatre in Bethesda.

Lawyers expect a three-week jury trial, and Schulman’s attorney asked the judge not to impose domestic travel restrictions.

Schulman has “many ties to the community, sufficient assets and a successful, active legal practice,” Butler said. “He needs to continue with his very successful career while he confronts this matter.”