A former Treasury Department official was sentenced to six months in prison on Thursday after she admitted to providing highly confidential banking documents to a BuzzFeed News reporter.
Natalie Mayflower Sours Edwards pleaded guilty in January 2020 to one count of conspiracy to make unauthorized disclosures of suspicious activity reports. These documents, known as SARs, are filed by banks to the federal government to alert authorities of potential criminal activity.
In a federal court hearing in New York City on Thursday, US District Judge Gregory H. Woods said it should have been “exceptionally clear” to Edwards “that violating her oath and exposing sensitive law enforcement information that could be used to help the bad guys and to tarnish the reputations and interests of innocent people was both illegal and wrong.”
Speaking in court ahead of her sentence being handed down, Edwards said she had taken an oath to protect the American people and “could not stand by aimlessly” when she saw corruption.
But, she added, “I do apologize for the disclosure of that information.”
Edwards — a former senior adviser at the Treasury Department’s Financial Crimes Enforcement Network, or FinCEN — will serve six months in prison, followed by three years of supervised release. She must surrender to the authorities by Aug. 2.
Her sentencing had been delayed because of the coronavirus pandemic.
In their criminal complaint against Edwards, prosecutors did not name BuzzFeed News or a specific journalist but instead cited a dozen stories authored primarily by BuzzFeed News reporter Jason Leopold in 2017 and 2018. The articles cited SARs and covered, among other things, wire transfers and payments linked to Donald Trump's 2016 campaign chair Paul Manafort, Russia’s embassy in the US, Russian agent Maria Butina, and the investigation of former special counsel Robert Mueller.
BuzzFeed News has neither revealed the identities of any confidential informants nor acknowledged whether Edwards was a source, until now, when she publicly said that she was the source.
Edwards was not charged with providing the SARs that formed the basis of the FinCEN Files, an investigative series published in September 2020 by BuzzFeed News in partnership with the International Consortium of Investigative Journalists and 108 newsrooms around the world. But in court documents, prosecutors have alleged that she gave Leopold the SARs at the heart of that investigation, which exposed how the global banking system enabled and profited from criminals, prompted global inquiries, and was used to push the successful passage of sweeping anti–money laundering legislation in the US.
In court on Thursday, Edwards’ attorney Stephanie Carvlin also linked the documents she had provided Leopold with the FinCEN Files series published by BuzzFeed News and the ICIJ.
Carvlin said Leopold had successfully “cultivated” Edwards as a source — an argument the judge accepted — because the Treasury employee had a “burning imperative in her mind” to expose wrongdoing after having gone through the whistleblower channels.
Following her court hearing on Thursday, BuzzFeed News spokesperson Matt Mittenthal issued a statement saying that it “strongly condemns” Edwards’ sentence:
Edwards is a brave whistleblower who fought to warn the public about grave risks to America’s national security, first through the official whistleblower process, and then through the press. She did so, despite tremendous personal risk, because she believed she owed it to the country she loves.
Thanks to her bravery, BuzzFeed News, along with the 108 media organizations of the International Consortium of Investigative Journalists, were able to publish the FinCEN Files, which revealed financial corruption on a global scale. That investigation has helped to inspire major reform and legal action in the United States, the EU, and countries around the world. BuzzFeed News has not acknowledged Ms. Edwards’ role in the project until today, after the judge sentenced her and after Edwards herself gave permission to acknowledge that she provided the SARs.
BuzzFeed News strongly supports the actions of whistleblowers and condemns efforts to prosecute them for bringing the truth to light.
According to their criminal complaint against Edwards, investigators identified her as a suspect through a “forensic review of government computer usage,” as well as reviews of her personal email and phone records for which they had obtained warrants. When she was arrested in October 2018, Edwards was said to be in possession of a flash drive onto which she’d saved SARs. Investigators also found a cellphone that contained messages between her and Leopold via WhatsApp, an encrypted messaging platform. During an interview with investigators, prosecutors said, she at first had denied having any contact with the news media but then confessed to providing SARs to Leopold.
Carvlin had argued in a sentencing submission that the former Treasury official was a dedicated public servant who had previously worked for several government agencies, including the CIA. At the Treasury Department, Carvlin wrote, “she uncovered what she believed to be improper conduct” and became a whistleblower who went to the media only after feeling frustrated that her efforts to sound the alarm through official channels and Congress were going nowhere and that she was being retaliated against."
“Edwards not only believed that the people who were running Treasury were doing a very bad job, in her view some members of the Department were violating the law,” Carvlin wrote. “Policies and practices were putting American lives at risk.”
According to Carvlin, Edwards believed that the only way to get action on these problems was through Congress. Leopold encouraged Edwards to give him the SARs in part by telling her “that he was acting on behalf of Congressional staff members in seeking information from her,” Carvlin wrote. “He sought to arrange meetings for Dr. Edwards with members of Congress or their staff. Such meetings did take place. Leopold attended meetings with Dr. Edwards.”
These assertions, however, were disputed by BuzzFeed News. “While we are deeply grateful for Ms. Edwards blowing the whistle and revealing information of vital public importance, Jason Leopold always told Ms. Edwards that he was operating on behalf of BuzzFeed News, not on behalf of Congress or any other entity,” BuzzFeed News Editor-in-Chief Mark Schoofs said. “He did not arrange meetings for her with Congressional staff or attend any such meetings.”
Carvlin also wrote that Leopold’s alleged actions were not intended to excuse Edwards’ conduct: “Dr. Edwards provided Jason Leopold with SARs of her own volition. He did not force her or trick her. He used the material to publish articles. She read the articles and provided more SARs.”
Woods ruled that although Edwards may have initially tried to act as a whistleblower to spotlight perceived wrongdoing — something he said can be a “valuable service to the country” when done through proper channels — she allowed a journalist to “cultivate” her as a source to release confidential information.
“Of course, it’s not only the press that cultivate American officials, leveraging their grievances to obtain access to secret information,” he said. “The law says that you’re supposed to say no to all such efforts.”
Given Edwards’ years of service to the US government, her belief that she was trying to expose urgent problems, and other mitigating factors, her attorney asked for a sentence of time served.
But federal prosecutors asked for at least a six-month sentence and argued that Edwards’ offense was so egregious that the sentencing guidelines did not account for “the nature, circumstances, and scope” of her crime.
The prosecutors said her disclosures were “unparalleled in FinCEN’s history,” having sent approximately 50,000 documents, including 2,000 SARs, to Leopold over the course of a year and running searches within internal systems at his request.
They argued she was motivated in part by a desire to harm FinCEN and get promoted within her department — a claim she denied — and said she had imperiled investigations through her actions.
“It was the defendant who aided potential money launderers, terrorist financing networks, and other criminal actors by publicly disclosing the sensitive government analyses meant to assist in the detection and tracking of their conduct,” prosecutors wrote. “Blinded by her own apparent sense of self-righteousness, the defendant remains unwilling to acknowledge the gravity of what she did.”
Prosecutors also accused Edwards of repeatedly making false statements, lying to the FBI, and engaging in deceptive acts, such as creating a Twitter account under a pseudonym and using it to tweet that she was framed even after she had pleaded guilty under oath.
In his own submission, FinCEN Director Kenneth Blanco also asked the court to impose a “significant sentence of incarceration” on Edwards, arguing she had destabilized “the foundation of trust and secrecy” his investigators rely on.
“It is difficult to quantify how many sensitive, ongoing investigations were impacted by Defendant’s unauthorized SAR disclosures, or the extent to which important investigations or prosecutions were impacted or never initiated because of her release of confidential information,” Blanco said.
Woods said it was necessary to impose a “substantial meaningful sentence” in order to discourage others from committing similar crimes.