#117: Prominent Lobbyist Accused of Payroll Fraud

Welcome to Court Watch #117. We’ll get to our weekly docket roundup that includes heavy metals in your Thin Mints, Sony hating the Trojans’ TikToks, a future 51st state resident attacking our energy sector (is this a declaration of war?), NFL player’s Ponzi scheme, and why footnotes are actually important very shortly. But first, let’s talk about a unreported case out of the Eastern District of Virginia that caught our eye.

Vicki Iseman, the prominent lobbyist who drew controversy during the 2008 President Election campaign for her ties to late-Senator John McCain, was accused by prosecutors of falsifying records in an effort to receive ineligible paycheck protection programs (PPP) loans for her lobbying firm.

Prosecutors with the U.S. Attorney’s Office of Eastern Virginia say Iseman submitted altered IRS paperwork to receive two PPP loans worth more than a hundred thousand dollars for her firm, Iseman & Associates. Under federal law, firms that earn 50% or more of their revenue from lobbying activities are prohibited from receiving PPP loans. The case is a civil matter and no criminal charges have been filed against Iseman.

According to the complaint, Iseman filed paperwork with the IRS in 2019 affirming that “lobbying” was her firm’s “principal business or profession.” Prosecutors also said Iseman had allegedly disclosed in federally-required reports to Congress that the firm’s revenue from lobbying surpassed the 50% threshold. 

In 2008, Iseman sued The New York Times after the paper published a story which touched on campaign staffers’ concerns about Iseman’s relationship with then-presidential candidate John McCain. Iseman dismissed her lawsuit against the New York Times without a monetary payment after the parties purportedly agreed to a reader’s note on the piece. (Disclosure: Court Watch’s editor has freelanced for the New York Times for a number of years).

The complaint filed this week alleges that Iseman asked her staff in the fall of 2020 to research whether the firm was eligible for a loan under the paycheck protection program. Several months after the staff informed her that the firm was not eligible because of its lobbying practice, Iseman purportedly applied for a $55,687 loan at Bank of America. Court records state that one of the documents she submitted in support of the loan was the IRS form identifying “lobbying” as the firm’s primary business. The case against Iseman has not previously been reported on. 

According to court filings, when Bank of America did not immediately approve the loan, Iseman allegedly became convinced that it was because of the form that stated “lobbying.” The complaint says she soon withdrew the application and submitted a second one the day after with an altered IRS form that listed “public affairs” instead. Prosecutors say Bank of America approved the loan and an additional one for $51,625.03 that required even further certification reportedly by Iseman that the loan would not be received by a lobbying firm.

A request for comment to an online contact form Iseman & Associates website was not returned. Court Watch also reached out to an email address associated with Iseman that was identified as hers in lobbying disclosure forms submitted to the U.S. Senate. A public affairs official with the U.S Attorney’s office for the Eastern District of Virginia “respectfully declined to comment.”

The Docket Roundup

• PACER/ECF is such a bad platform that judge’s literally have to change the nature of the lawsuit in order to make a high-profile docket available to the public.

• A Texas man reportedly threatened to “slit the throats of Secret Service agents and their families.”

• The FBI arrested a Department of State desk officer on his way home from allegedly taking pictures of classified materials at the Department’s headquarters. According to the complaint, beginning in 2022 the desk officer sent pictures of sensitive materials to people he met online in return for money.

• “While the IRS’s well-compensated attorneys sit in their offices crafting convoluted legal arguments designed to block Plaintiff from her day in court, Plaintiff—a mother of three small children—has been left jobless, facing eviction, and struggling to survive while forced to fight this pro se” so begins a David v. Goliath motion by a fired IRS employee let go for being a probationary employee.

• “We’re in a dark place,” says a federal judge discussing ongoing threats.

• A man being detained in Louisiana and set for removal is suing Columbia University

• Kudos to Judge Sweazea for kindly walking through a pro-se litigant’s next steps. The legal system can be confusing so it’s nice to see some grace. 

• Sony Music and other record companies are suing the University of Southern California over TikToks posted by its sports teams.

• The self-described ‘anti-woke’ bank that went belly up is being accused of some shady dealings with a Chicago law firm. 

• A new lawsuit alleges that “extensive testing” of Girl Scout Cookies found heavy metals in 100% of the tested cookies.

• The FBI arrested a disgruntled Black substitute teacher for allegedly mailing letters threatening teachers, administrators, and students at a California elementary school he was fired from for reportedly targeting Black students and hitting one with a cane.

• A judge ruled in a case brought by CREW that DOGE is FOIA-able.

• Maine State House Representative Laurel Libby is suing the House’s speaker after it voted to censure her for posts she made on social media about transgender participants in sports. All of Maine’s federal judges recused themselves from the case.

• Nonprofits are suing Citibank to release billions of dollars in environmental grants that the bank froze following threats made by EPA Administrator Lee Zeldin to investigate the grant contracts.

• A Leidos contractor assigned to a U.S. Navy ship was charged with possession of child pornography.

• By a large margin, you all hated our song choices last week, skipping choosing Seamus or Peter’s picks and instead opting for the “this is atrocious” option. We are concerned we have readers that lack musical taste. So you lost your choice this week. But here at Court Watch, we like to find the hidden gems that could an winning answer for a D.C. bar pub quiz, so we’ll let you still enjoy the music stylings of our favorite Cable News anchor/musician, OJ Trop (Omar Jimenez of CNN) 

• The Canadian man who attacked several energy stations and the Keystone Pipeline in South Dakota was sentenced to twenty-five years in prison.

• A firefighter in South Carolina who was fired after being reported for publicly shaming OnlyFans content creators on Facebook now claims the fire department retaliated against him for First Amendment-protected speech. The case exhibits are a wild ride.

• Media Matters wants a San Francisco federal court to move Musk and Twitter’s case against them out of Texas’s Northern District.

• The feds seized almost a million dollars from a Connecticut residence after police officers responded to a domestic violence incident in which a man allegedly pointed a gun at his pregnant girlfriend’s stomach. Court records say officers then figured out the man made the money by ordering from DoorDash and allegedly scamming the drivers.

• A former brand director at NPR claims its attorneys mishandled her visa application and fired her to cover up their mistakes.

• A disgruntled “budtender” at a dispensary is suing over the weed chain’s tip pool policy.

• Seven athletic directors from Prince George's County, Maryland have filed a lawsuit against the county’s board of education for reportedly not paying them properly to teach in addition to their AD-related duties.

• An ex-dark-web drug dealer who prosecutors say sold counterfeit Oxycodone pills containing fentanyl has filed paperwork to plead guilty.

• Two Jewish lawyers are suing the Michigan Attorney Grievance Commission for “weaponizing the Commission and the rules of professional conduct” after the suit says they were investigated following the lawyers’ complaint that a judge’s actions and rulings were antisemitic. 

• The Trump Administration wants to vacate a 44 year old consent decree that governs some hiring practices for the U.S. government. 

• A pro se plaintiff alleges that Elon Musk “hacked into my phone, streaming device and computer” to communicate with him. The plaintiff says he does “not wish to press criminal charges but will need compensation” of $484 million “for the content and inspiration I provided.”

• Law enforcement says an alleged bank robber semi-confessed “via excited utterance” in the middle of being Mirandized.

• Footnotes are important.

• A Philadelphia parent was charged for purportedly making racist threats to an employee at a child welfare agency.

• NACDL, the ACLU, the Electronic Frontier Foundation, and the Mississippi Office of the State Public Defender filed a joint brief arguing for the court to allow them to file amicus briefs in the tower dump appeal. We’ve been on this story since the start.

• Crypto scammers are now telling folks their computers and wifi have been hacked in order to steal money.

• A twenty-eight-year-old Iraqi refugee who was a legal permanent resident in Houston pled guilty to providing material support to ISIS.

• Investigators reportedly uncovered a Chinese human smuggling operation in Miami.

• Speaking of smuggling: Four Dominican men were sentenced to between 8 and 12 months for attempting to smuggle 100 tropical birds out of the U.S.

• Meth dealers at your bowling alley might even be worse than nihilists.

• A former NFL and Clemson linebacker was sentenced to 30 months in prison after pleading guilty to running a Ponzi scheme that stole more than $8 million.

• America First Legal Foundation wants to know whether the GAO is FOIA-able.

• North Carolina’s Middle District is looking for a new magistrate in Durham.

• A passenger on an American Airlines flight was arrested for purportedly sexually assaulting the woman who sat next to him.

• The two alleged Russian operators of the cryptocurrency Garantex were indicted on money laundering charges. 

• A cemetery Ponzi scheme?

• Main Justice needs to brush up on its modern political theory.

• One defendant in a child exploit case saw the writing on the wall, reportedly telling officers, “At the end of the day, I’m guilty as hell” (Sensitive content warning).

• Someone in San Francisco had $150 million worth of crypto stolen via the LastPass hack. The forfeiture complaint gives insight into how the Secret Service tracks how hackers transfer money over currencies and accounts. Forbes has the writeup.

• A sports agency would like its laptop back from a fired agent who is also being sued by a former client, a professional dirtbike racer, for purportedly stealing $600,000.

Thanks for reading. A closing friendly tip as you build your March Madness brackets this weekend: pick the University of Nebraska Omaha to go deep. While it may be our first time in the Big Dance, the Mavericks will be the Cinderella team of the tournament. As with all things Court Watch, you read it here first.