Republicans Probe Russian Interference – in U.S. Energy Market, Fossil Fuel Industry

By Craig Bannister | July 7, 2017 | 3:43pm EDT
Kremlin Palace

( -- U.S. House Science, Space, and Technology Committee Chairman Lamar Smith (R-Texas) and Energy Subcommittee Chairman Randy Weber (R-Texas) have sent a letter to U.S. Department of Treasury Secretary Steven Mnuchin requesting that the Department investigate allegations that Russian state-sponsored entities interfered in the U.S. energy market, by using shell companies to funnel “tens of millions of dollars” of Russian funds to radical environmental groups opposed to fossil fuels.

“If you connect the dots, it is clear that Russia is funding U.S. environmental groups in an effort to suppress our domestic oil and gas industry, specifically hydraulic fracking,” said Rep. Smith.

Smith further said the Russians apparently have used shell companies as part of their “elaborate scheme” to disrupt the U.S. energy market: “They have established an elaborate scheme that funnels money through shell companies in Bermuda.  This scheme may violate federal law and certainly distorts the U.S. energy market.” 

The existence of Russian meddling is widely-documented, the letter says:

“U.S. presidential candidates, European officials, and the U.S. intelligence community have all publicly noted that Russia and its government corporations are funding a covert anti-fracking campaign to suppress the widespread adoption of fracking in Europe and the U.S.—all in an effort to safeguard the influence of the Russian oil and gas sector.”

“Recent news reports reference a ‘U.S. intelligence community's [Office of the Director of National Intelligence] report on Russian activities in the presidential election’ that contains ‘clear evidence that the Kremlin is financing and choreographing anti-fracking propaganda in the United States.’"

Indeed, media outlets such as Business Insider. have documented the money trail.

These reports, the letter says, show that a Bermuda-based shell company, Klein Ltd., apparently is funneling “tens of millions of dollars” to a U.S.-based group, the Sea Change Foundation, which reportedly gives it to environmental activist groups like the Sierra Club to “execute a political agenda driven by Russian entities":

“According to the reports, entities connected to the Russian government are using a shell company registered in Bermuda, Klein Ltd. (Klein), to funnel tens of millions of dollars to a U.S.-based 501 (c)(3) private foundation, the Sea Change Foundation (Sea Change). This money appears to move in the form of anonymous donations. Sea Change then passes the money originating in Russia to various U.S. 501 organizations such as the Sierra Club, League of Conservation Voters Education Fund, and others. These funds are dispersed as grants that will be used to execute a political agenda driven by Russian entities. The purpose of this circuitous exchange of foreign funds is to shield the source of the money.”

“Klein is a Bermuda-based corporation apparently established to act only as a pass through for foreign funds. Klein, according to reports, was formed in March 2011, by two attorneys of a Bermuda based law firm, Wakefield Quin. 10 The firm provides a number of services, including those necessary to facilitate the operations of a shell company like Klein.”

In just two years, Klein allegedly funneled $23 million to Sea Change in an effort to fight U.S. carbon-based energy, the letter says:

“According to Sea Change's IRS Form 990, Klein contributed $23 million to Sea Change in 2010 and 2011 amounting to 49% of total contributions that Sea Change received in that time period.   Klein's contributions to Sea Change are not by chance. Sea Change's founder and president Nat Simons, is appropriately positioned to give the Russian funds to environmental groups that push back on U.S. domestic fracking and gas advancements. Nat Simons has said the mission of Sea Change is to facilitate the transfer of money and advance a shift away from carbon-based energy.”

“The strategy of Sea Change is to apply domestic political pressure using its deep pockets — with most of the funding coming from Russia. Sea Change provides funding grants to well-known environment activist groups like Sierra Club Foundation, League of Conservation Voters Education Fund, Natural Resources Defense Council Inc. and many similar organizations.”

The letter concludes by requesting a full investigation of these allegations and cites federal statutes that may have been violated.

Read full letter to Treasury Sec. Mnuchin here.

MRC Store