Donald Trump pardoned Jonathan Braun, a convicted drug smuggler, on his last day in office.
Meanwhile, the DOJ hoped to use Braun in a separate probe into the predatory-lending business.
Braun's commutation meant the DOJ lost the leverage it needed to get him to cooperate, the NYT reported.
Donald Trump's pardoning of a convicted marijuana smuggler with ties to the Kushner family threw a wrench in the Justice Department's larger probe into the predatory-lending industry, The New York Times reported.
On his last day in office, Trump pardoned Jonathan Braun, a Staten Island resident who at the time was serving a 10-year prison sentence for money laundering and running an international marijuana smuggling ring.
Braun's pardon came while Trump's Justice Department was working out its own deal with Braun to fast-track his sentence in exchange for his cooperation with a separate DOJ probe into the predatory-lending or merchant-cash-advance industry.
In the merchant-cash-advance business, lenders offer cash-strapped borrowers, such as small businesses, financing with high interest rates and fees. These terms can often leave borrowers in a vicious cycle of debt.
Braun was convicted of drug smuggling in 2011, but a law-enforcement official told the Times under the condition of anonymity that Braun was released from jail after a year and a half in custody as part of a plea deal to cooperate with investigations into other high-profile drug smugglers.
Although he was placed under house arrest, Braun was largely able to live as a free man for reasons still unknown, the Times reported. He spent nearly the next decade leading a predatory-lending operation as a "principal" of Richmond Capital group, prosecutors said in court documents seen by Business Insider.
Prosecutors accused Braun of harassing and sending threats to his clients. Braun, for example, told one merchant not to "fuck with him" and threatened, "I know where you live. I know where mother lives," prosecutors said.
In eight years, Braun advanced about $80 million, targeting desperate small-business owners and setting interest rates often higher than 1,000% yearly, Bloomberg reported.
In a telephone interview with the Times, Braun denied any wrongdoing as a lender.
Years after his 2011 drug-smuggling conviction, Braun was sentenced to 10 years in a New York prison despite cooperating with investigators. He began his sentence in 2020, according to the NY attorney general.
But Braun's hand in the lending industry made him a valuable asset to the Justice Department since the US attorney's office in Manhattan was investigating the wider predatory-lending business, the Times reported.
With Braun's experience, the DOJ hoped to cut out a deal with the convicted smuggler by commuting his sentence in exchange for providing information on other predatory lenders and possibly wearing a wire, the Times reported.
That deal would fall apart after Trump pardoned Braun in January 2021.
Braun was a member of the inaugural class of the Kushner Yeshiva High School in Livingston, New Jersey, which the Kushner family funded, the report said.
As a member of the first freshman class, Braun was classmates with Jared Kushner's youngest sister, Nicole, the Times reported.
One merchant-cash-advance dealer told the Times that Braun's cousin, Isaac Wolf, told him Braun's father sought help from Kushner's father, Charles, to secure a pardon.
On his last day in office, Trump pardoned Braun, releasing a statement that misspelled Braun's first name, despite calling for drug dealers to receive the death penalty a year later at a Pennsylvania rally.
"Every pardon application went through a vigorous vetting and review process overseen by the Office of the Pardon Attorney and various White House departments, including the counsel's office," a Trump spokesperson said in an email to Insider. "President Trump acted upon their recommendations that were based off each individuals' circumstances."
The Braun family also retained Alan Dershowitz, a member of Trump's legal counsel, during the impeachment proceedings in 2020.
Dershowitz told the Times that Braun's father regularly called him, saying he was "so upset my son is still in prison" and asked what the attorney could do to help.
The lawyer told the publication he could not recall what he did for Braun but that his involvement could have just been a phone call.
"I believe God made it happen for me because I'm a good person, and I was treated unfairly," Braun told the Times, adding that his supporters sought several avenues to get him out of prison.
A spokesperson for the US Attorney's Office in Manhattan could not be reached for comment during the weekend.
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