By Andy Sullivan
WASHINGTON (Reuters) - Greg Craig, a former White House counsel in the Obama administration, was charged on Thursday with lying about work he performed in 2012 for Ukraine in a case that grew out of Special Counsel Robert Mueller's Russia investigation.
Craig, 74, faces up to 10 years in prison for charges of making false statements and violating a lobbying law.
He is accused of lying to the Justice Department about his work on a 2012 report aimed at justifying the prosecution of a political enemy of Viktor Yanukovych, the Russian-aligned president of Ukraine at the time.
Craig's lawyers declined immediate comment.
Skadden, Arps, Slate, Meagher & Flom LLP, the New York law firm that produced the report, agreed in January to turn over the $4.6 million it was paid and retroactively register as a foreign agent, as part of a settlement with the Justice Department.
Skadden produced the 187-page report at the behest of Paul Manafort, the former chairman of Donald Trump's presidential campaign who is currently serving a 7 1/2-year prison sentence for lobbying violations and financial crimes.
Manafort was apparently happy with Craig's work.
"You are 'THE MAN,'" he wrote Craig in an email after the report received favourable media coverage, according to the indictment.
The report was meant to be an objective review of the Ukrainian government's prosecution of Yulia Tymoshenko, the country's former prime minister who was convicted in 2011 on corruption charges and sentenced to seven years in prison.
It was used by Yanukovych's government to justify Tymoshenko's pretrial detention to the European Court of Human Rights and influence U.S. lawmakers.
Yanukovich was one of Manafort's main lobbying clients.
According to the indictment, Craig covered up aspects of his work in order to avoid registering as a foreign agent under the Foreign Agents Registration Act, a rarely enforced law that was enacted in 1938 to counter Nazi propaganda.
Had Craig complied with the law, he would have been forced to reveal that the report was funded by a private Ukranian citizen, not the government, and disclose that Skadden was simultaneously helping out with Tymoshenko's prosecution on other charges.
"That would do enormous damage to the credibility" of the report, Craig wrote in an email to other Skadden attorneys, according to the indictment.
Craig privately had reservations about Tymoshenko's treatment but left them out of the report, the indictment said.
"Evidence of criminal intent - i.e., that she intended to commit a crime - is virtually non-existent," he wrote in a memorandum that was not included in the report, according to the charges.
The case stems from Mueller's 22-month investigation into whether Trump's presidential campaign worked with Russia to influence 2016 election.
That probe led to charges against 34 people, including Russian agents and former key Trump allies, but Attorney General William Barr said last month that Mueller did not find enough evidence to charge Trump or others with criminal conspiracy.
Barr also said that he decided there was not enough evidence to charge Trump with obstruction of justice. He is expected to release a redacted version of Mueller's final report to Congress next week.
(Additional reporting by Tim Ahmann and Nathan Layne; Editing by Doina Chiacu, Lisa Shumaker and Bill Berkrot)