The Steele dossier: A reckoning

CNN

By Marshall Cohen, CNN

When it came to light in January 2017, just days before Donald Trump took office, the so-called Steele dossier landed like a bombshell and sent shockwaves around the world with its salacious allegations about Trump and his supposed ties to Russia.

The central allegations, that Trump conspired with the Kremlin to win the 2016 election and that Russia had compromising information on him, were given a veneer of credibility because they originated from a retired British spy, Christopher Steele, who had a solid reputation.

But five years later, the credibility of the dossier has significantly diminished.

A series of investigations and lawsuits have discredited many of its central allegations and exposed the unreliability of Steele’s sources. They also raise serious questions about the political underpinnings of some key explosive claims about Trump by shedding new light on the involvement of some well-connected Democrats in the dossier, and separate efforts to prod the FBI to investigate ties between Trump’s campaign and Russia.

These revelations have triggered a reckoning around the Steele dossier, particularly in the wake of two recent indictments secured by John Durham, the special counsel appointed during the Trump administration to investigate the FBI’s Russia probe. Durham alleges that Steele’s primary source, a US-based foreign policy analyst, repeatedly lied to the FBI about where he got his information.

To be clear, multiple US government inquiries uncovered dozens of contacts between Trump campaign associates and Russians, which have since been acknowledged. The candidate himself and his closest advisers even welcomed the Kremlin’s interference in the election. Still, none of it added up to the collusion suggested in Steele’s memos.

Legitimate questions are now being raised about the dossier — how it was used by Democrats as a political weapon against Trump, how it was handled by the FBI and US intelligence agencies, and how it was portrayed in the mainstream media.

Democrats’ hidden hand revealed

Trump swiftly rejected Steele’s claims and said a “group of opponents … put that crap together.” Nearly five years later, it’s clearer than ever that he wasn’t too far off about the origins of the dossier.

Two special counsel investigations, multiple congressional inquiries, civil lawsuits in the US and the United Kingdom, and an internal Justice Department review have now fully unspooled the behind-the-scenes role that some Democrats played in this saga. They paid for the research, funneled information to Steele’s sources, and then urged the FBI to investigate Trump’s connections to Russia.

Mother Jones first revealed the existence of the dossier a few days before the 2016 election, and said the memos were part of an “opposition research project” underwritten by Democrats. Nearly a year passed before the full truth came out about the financing: The money flowed from Hillary Clinton’s presidential campaign to law firm Perkins Coie, to the research company Fusion GPS, and then ultimately to Steele, who got $168,000.

(Anti-Trump Republicans initially funded Fusion GPS’ research during the 2016 GOP primaries, but the Clinton campaign and Democratic National Committee picked up the tab before Steele got involved.)

But Democratic involvement in Steele’s work was much deeper than previously known. Court filings from the Durham inquiry recently revealed that some information in the dossier originated from Charles Dolan, 71, a public relations executive with expertise in Russian affairs who had a decades-long political relationship with the Clinton family. He has not been accused of any crimes.

Federal prosecutors said Dolan was in regular contact in 2016 with Steele’s primary source Igor Danchenko, 49, a Russian citizen and foreign policy analyst who lives in Virginia. Danchenko was indicted on November 4 for allegedly lying to the FBI about his dealings with Dolan and a fellow Soviet-born expat that he claimed was one of his sources.

Danchenko pleaded not guilty last week. In a statement to CNN, his defense attorney Mark Schamel said Durham is pushing a “false narrative designed to humiliate and slander a renowned expert in business intelligence for political gain.” Schamel also accused Durham of including legally unnecessary information in the 39-page indictment to smear Danchenko.

“For the past five years, those with an agenda have sought to expose Mr. Danchenko’s identity and tarnish his reputation while undermining U.S. National Security,” Schamel said. “…This latest injustice will not stand. We will expose how Mr. Danchenko has been unfairly maligned by these false allegations.”

The indictment indirectly connected Dolan to the infamous claim that Russia possessed a compromising tape of Trump with prostitutes in Moscow, which became known as the “pee tape.” (Trump and Russia both denied the allegations.) According to the Danchenko indictment, in June 2016, Dolan toured the Ritz-Carlton suite where the alleged liaison occurred, and discussed Trump’s 2013 visit with hotel staff, but wasn’t told about any sexual escapades. It’s still unclear where those salacious details that ended up in the dossier came from.

Dolan was also indirectly linked in the indictment to still-unverified claims about Russian officials who were allegedly part of the election meddling. The indictment also suggested that Steele’s memos exaggerated what Dolan had passed along to Danchenko.

The indictment also says the dossier contained a relatively mundane item about Trump campaign infighting that Dolan later told the FBI he actually gleaned from news articles. Prosecutors say Dolan even lied to Danchenko about where he got the gossip, by attributing it to a “GOP friend” who was “a close associate of Trump.”

An attorney representing Dolan, Ralph Martin, declined to comment for this story because his client “is a witness in an ongoing case.”

Durham explicitly stated in the Danchenko indictment that the Clinton campaign didn’t direct, and wasn’t aware of, Dolan’s activities regarding the dossier. Clinton has said she only learned about the dossier when it was posted online, two months after the 2016 election. Senior Clinton campaign aides also said they found out about Steele’s work from press reports.

Clinton’s allies prod the FBI

The Danchenko indictment raises new concerns about the circular nature of portions of Steele’s work, and how it fit into a larger effort by Democrats to dirty up Trump. Clinton’s campaign funded the project, and we now know that much of the material in Steele’s memos ended up being mere political gossip. Steele then sent his explosive but unverified findings to the FBI and State Department.

While Steele was passing his tips onto the FBI in fall 2016, a Clinton campaign lawyer separately met with a senior FBI official and gave him information about strange cyberactivity between servers at the Trump Organization and Alfa Bank, the largest private bank in Russia.

The lawyer, Michael Sussmann, has since been charged with lying to the FBI during that meeting, for allegedly saying he wasn’t providing the dirt on behalf of any client, even though he ultimately billed that time to the Clinton campaign, and also billed them for other work he did on the server issue. Durham says Sussmann repeated this lie during a meeting with CIA officials in February 2017, where he told them about the server theory. Sussmann has pleaded not guilty.

The indictment says Sussman peddled the same material to a Slate reporter, who published a story right before the election. The story said reputable computer scientists uncovered unusual activity between servers belonging to the Trump Organization and the Moscow-based Alfa Bank, suggesting a secret backchannel.

The Trump Organization and Alfa Bank both denied there was a backchannel. The FBI investigated the underlying data and ruled out any improper cyber links by February 2017.

But after the Slate article came out, Clinton’s campaign went on a PR blitz, tying Trump to Russia. Clinton had already slammed Trump for months, for embracing Russia’s interference in the election, which included releasing hacked emails from Clinton’s campaign chairman and the Democratic National Committee.

Sussmann was a partner at the law firm Perkins Coie, which indirectly hired Steele. Both men separately went to the FBI in 2016 with dirt about Trump, though there’s no indication Sussmann knew about the dossier. (A 2019 Justice Department watchdog report pointed out that the FBI routinely accepts information from biased or dubious sources, and then investigators try to independently vet the material.)

After he was charged, Sussmann resigned from Perkins Coie. He declined to comment for this story.

Rumors, hearsay and fabrications

When the dossier burst into public view, much of the conversation revolved around Steele’s résumé: He worked undercover in Moscow, ran the Russia desk at MI6 headquarters, and maintained a network of sources in the country. This lent credibility to his findings, even though nobody, including CNN, was able to confirm the explosive allegations of collusion or the salacious “pee tape” claims.

In January 2017, CNN broke the story that senior US intelligence officials had briefed Trump and then-President Barack Obama about the dossier. CNN never published the dossier itself, but hours later, BuzzFeed posted the full 35 pages of Steele’s memos online for all to see. CNN said the author was “a former British intelligence operative, whose past work US intelligence officials consider credible.”

That was true. The FBI formalized Steele’s role as a confidential informant in 2013. He aided the FBI’s groundbreaking corruption case against dozens of FIFA soccer officials in 2015, and he also provided the FBI with reliable information about Russian oligarchs.

But the once well-connected British spy had been out of the intelligence services for a while.

For starters, we now know that Steele’s primary source, Danchenko, wasn’t some deep-cover Kremlin insider. He was a DC-based think tank analyst with a Rolodex of Russians.

The FBI tracked down Danchenko and interviewed him a few times in 2017 while they scrambled to verify the dossier. Danchenko said the information he gave to Steele was mostly “hearsay,” “just talk,” “word of mouth,” and came from “conversations he had with friends over beers.” Danchenko also said Steele puffed up the memos and leaned too hard into the raw information he received, according to a bombshell 2019 report from Justice Department inspector general Michael Horowitz about the Russia probe.

Some of Steele’s sourcing disintegrates

The Danchenko indictment alleges that he lied to the FBI, and possibly Steele too, about another detail that became central to the dossier: where he heard there was a “well-developed conspiracy of cooperation” between Trump and the Kremlin.

In interviews with the FBI, Danchenko attributed the information to Sergei Millian, a Belarusian-American businessman who did some real estate work with the Trump Organization. The indictment also says Danchenko sourced the “pee tape” story, in part, to Millian. But Millian wasn’t the source, Durham says, contradicting press reports from 2017. (Some outlets recently corrected or clarified those reports.)

Millian has since said he was “framed” by Danchenko and has publicly denied that they ever spoke, though there is no indication in the indictment that Millian ever denied it to the FBI or under oath.

“This fraud destroyed my health, life, businesses and turned my American dream into (a) nightmare,” Millian told CNN in a statement, declining further comment.

A bipartisan Senate Intelligence Committee report released last year said Millian’s behavior during the 2016 election “resembles activities by a Russian intelligence officer or cooptee.” He has vehemently denied working for the Russian government.

Another Russian who Danchenko told the FBI was one of his sources said in a sworn affidavit in a civil case that she wasn’t the source for at least one claim that was attributed to her. The woman, publicist Olga Galkina, said she believes Danchenko told the FBI she was his source “to create more authoritativeness for his work,” according to court filings.

The indictment against Danchenko quotes emails where Galkina told Dolan she is a “big Hillary fan,” and hoped to land a job at the State Department after Clinton became president.

Taken together, these revelations about Dolan, Millian and Galkina raise grave questions about where Danchenko got his information, or if he perhaps made some of it up.

Attorneys for Danchenko didn’t respond to CNN’s request for an interview.

The Durham investigation is ongoing. He continues to use a federal grand jury in Washington, DC, signaling that he might be interested in bringing charges against additional defendants.

‘Underpinned by poor judgment’

It took five years of criminal investigations, civil cases and congressional reports to pull back the curtain on the flimsiness of the dossier. The big picture really came into focus in 2019 with the release of a Justice Department watchdog report.

That report described for the first time Danchenko’s many walk-backs in his FBI interviews. It also said FBI agents gave Steele mixed reviews, with some seeing him as a “person of integrity,” while others said he had a “lack of self-awareness” and was “underpinned by poor judgment,” even if he was acting in good faith.

The report also said the CIA viewed Steele’s material as an “Internet rumor.”

Last year’s bipartisan Senate report said “the tradecraft reflected in the dossier is generally poor relative to (US intelligence community) standards.” The blockbuster 966-page report also raised concerns that some of the material Steele put in his memos was Russian disinformation.

These revelations undermined Steele’s credibility — and led to renewed scrutiny and right-wing criticism of how many news outlets, including CNN, covered the dossier story.

Efforts to corroborate fall flat

Everyone but Steele talked about his work for nearly five years, but he finally broke his silence in an ABC News interview last month, shortly before Danchenko was arrested. (Steele and his company, Orbis Business Intelligence, declined CNN’s repeated requests for an interview.)

Steele defended his work and said he was right about three big takeaways from his memos: Russian spy agencies interfered in the 2016 election; Russian President Vladimir Putin approved the operation; and the goal was to help Trump and hurt Clinton.

He pointed to the US intelligence community’s landmark 2017 report that said Russia meddled in the election at Putin’s orders to help Trump. US intelligence agencies had examined the dossier but didn’t rely on his findings for their report.

But Steele’s findings on Russian election-meddling, which were ahead of the curve at the time, now seem more like prescient geopolitical observations rather than insider information. Plus, his final and most consequential takeaway — that Trump’s campaign worked hand-in-hand with the Kremlin — was essentially debunked by special counsel Robert Mueller’s sweeping investigation.

CNN reported in February 2017 that US investigators had corroborated some of the communications detailed in the dossier, citing multiple current and former US law enforcement and intelligence officials.

The CNN report said US investigators were able to confirm the time, place and people involved in some of the conversations between foreign nationals mentioned by Steele. The story said CNN couldn’t confirm if those conversations were about Trump, and the sources told CNN that the corroborated information had nothing to do with the salacious claims in the dossier.

The sources also told CNN that the corroboration gave investigators “greater confidence” in the credibility of some aspects of the dossier, which the FBI was still actively investigating at the time.

Two years later, the Justice Department watchdog said only limited information was corroborated from the dossier relating to “time, location, and title information, much of which was publicly available.”

Horowitz’s watchdog report, released in December 2019, also said much of the material in the dossier about Trump and his campaign “could not be corroborated” and that “certain allegations were inaccurate or inconsistent” with subsequent FBI findings.

But Horowitz said the FBI determined that Steele’s big-picture conclusions about Russian meddling were “consistent with known efforts by Russia to interfere in the 2016 U.S. elections.”

What’s right? What’s wrong?

Looking at the big picture, Steele was right that Russia used “trusted agents of influence” to target Trump’s inner circle. And he was correct to suspect there were secret contacts between Trump aides and Russian officials, even though Trump denied any Russian ties. But Steele was wrong about so many of the key details.

Despite a worldwide hunt for the Trump “kompromat,” no tapes ever emerged, and the Danchenko indictment puts the source of that underlying claim into doubt.

There is no proof of something in the dossier that would’ve been a smoking gun for collusion — that Trump’s longtime personal attorney Michael Cohen went to Prague in 2016 to coordinate with Russian officials about their anti-Clinton hacking efforts. The watchdog report said the FBI concluded that these claims “were not true.” Even after Cohen turned on Trump and started helping Mueller, and implicated his former boss in an illegal campaign finance scheme, Cohen always denied the Prague allegations.

The dossier said Trump campaign chairman Paul Manafort and foreign policy adviser Carter Page led the collusion efforts. But this was never verified by any government investigations. Mueller found that both men had extensive contacts with Russian agents, but he couldn’t verify that Page met with the specific Kremlin officials as alleged in the dossier.

The Mueller report said there wasn’t evidence of a criminal conspiracy to collude.

Five years on, Steele continues to defend his work. He told ABC News that “the evidence suggests” there was collusion, that he believes Cohen traveled to Prague after all, and that the compromising tape of Trump with Russian prostitutes “probably” exists.

“I stand by the work we did, the sources that we had, and the professionalism which we applied to it,” Steele said in the interview with ABC News.

Origins of the Russia probe

Democratic officials, the media and Internet conspiracy theorists initially hyped Steele’s work. But as his credibility waned, Trump started exaggerating Steele’s influence, and pushed the lie that the dossier triggered “the entire Russia probe.”

In truth, the dossier played a remarkably limited role in the Russia investigation.

Four US government reports concluded that the probe began in July 2016, two months before the FBI team handling the inquiry even learned about the dossier.

(After a lengthy review, Horowitz said there was a legal basis to open the Russia probe, and that the process was free of political bias. However, Durham publicly rebuked Horowitz and said he disagreed with some of Horowitz’s conclusions, leading to criticism that his own work is politically motivated.)

Mueller’s team interviewed Steele, but largely ignored the dossier as they found dozens of links between the Trump campaign and Russia. Mueller’s report didn’t say all that much about the dossier, and he didn’t attribute any findings to Steele.

And there’s no indication that the dossier influenced Mueller’s successful criminal prosecutions against six Trump campaign associates: Manafort, Cohen, Roger Stone, Rick Gates, retired Lt. Gen. Michael Flynn and George Papadopoulos.

But the dossier did play a major role in the investigation into Page, the lower-level Trump foreign policy adviser, and helped the FBI secure a warrant to wiretap him after he left the campaign in September 2016.

Tainted FBI wiretaps

The fallout from the dossier was largely contained to the Page surveillance. But when internal investigators looked under the hood, they found catastrophic issues.

Before the dossier, investigators already considered applying for a warrant under the Foreign Intelligence Surveillance Act to wiretap Page’s communications, but they weren’t sure if they could establish probable cause. The dossier’s explosive claims about Page’s alleged meetings during his recent trip to Moscow “pushed it over” the line, a lawyer involved in the case told the Justice Department watchdog.

The FBI included snippets of Steele’s reporting in the FISA application, along with other information, like details of Page’s previous interactions with Russian spies, and the fact that he suggested to an FBI informant that he had an “open checkbook” from the Kremlin. The secretive FISA court approved the warrant in October 2016, as well as three subsequent renewal requests, meaning Page was wiretapped for about one year.

In April 2017, CNN was first to report that the FBI included some material from the dossier in the FISA applications. The article said prosecutors would only have done this “after the FBI had corroborated the information through its own investigation,” according to officials familiar with the process.

It’s now clear that this level of verification never materialized. The watchdog report said Steele’s claims about Page “remained uncorroborated” when the wiretaps ended in 2017.

Page was never charged with any crimes, and Mueller said his investigation “did not establish that Page coordinated with the Russian government” to meddle in the election, which was a far cry from the FBI’s initial assertions in FISA applications that Page “is an agent of a foreign power” who was “collaborating and conspiring with the Russian Government.”

The inspector general examined the FBI’s handling of the FISA applications and found that there were widespread mistakes, omissions and errors that deeply undermined the integrity of the process. In response, the Justice Department declared that the final two FISA warrants against Page were legally invalid.

But even Durham, who has been accused of cherry-picking an unfair narrative to undermine the Russia probe, hasn’t said in his recent indictments, spanning 66 pages, that the FBI or Mueller ever relied on Steele for anything beyond the Page surveillance.

Partial vindication for Trump

Critics of the Russia probe — conservative pundits, Republican lawmakers and Trump himself — took a victory lap after the inspector general blasted the Page FISA applications.

That’s because the inspector general’s report confirmed what many of them had argued all along, including in a highly disputed memo from GOP Rep. Devin Nunes: That there were systemic problems with the FBI surveillance of someone tied to the Trump, and the Steele dossier was improperly used to influence part of the Russia probe.

But the report refuted the more outlandish conspiracy theories that Trump, Nunes and other Republicans pushed about the Russia probe. The report said the FISA process, while flawed, wasn’t intentionally abused and wasn’t politically biased. And the report debunked Trump’s lie that the FBI planted spies in his campaign.

The latest Durham indictments also injected new life into Russia probe skeptics.

After wall-to-wall coverage of the Steele dossier, public opinion was quickly locked in on the question of collusion. Many Democrats clung to hope that the dossier was true. Most Republicans denounced it as a deep state hoax. Post-Mueller polling found that about half of Americans believed Trump was guilty of collusion.

Mueller and a bipartisan Senate inquiry concluded that Trump’s team welcomed Russian help, and tried to coordinate on a few fronts, but it didn’t come to fruition.

But so much suspicion was fueled by Trump’s massive cover-up about Russia.

Trump and his team systematically lied about almost every aspect of the Russia probe. (At the start, they falsely denied any contacts with Russians.) After so many of their denials were disproved, they repeatedly shifted their story. Trump repeatedly undermined and obstructed Mueller’s investigation.

All the while, Trump heaped praise on Putin. He infamously took Putin’s side at the 2018 Helsinki summit by agreeing with Putin’s lie that Russia didn’t try to help Trump win in 2016, leading many to wonder if Trump was compromised after all.

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CNN’s Ben Krolowitz, Pamela Brown and Zachary Cohen contributed to this story. Graphics by CNN’s Janie Boschma.