Affidavit: Former SC Congressman Sanford invested in fraudulent scheme

CHARLESTON, SC (WCSC) - A South Dakota man linked to an admitted Russian covert agent is accused of obtaining at least $2.3 million from 78 people for bogus investments including former South Carolina governor and first district congressman Mark Sanford, according to documents unsealed Monday.

Businessman and conservative political operative Paul Erickson, of Sioux Falls, has pleaded not guilty to 11 counts of wire fraud and money laundering. An affidavit that had previously been blocked from public view alleges that he promised returns of up to 150 percent while spending the money on personal expenses such as motels, flights and college tuition for Maria Butina, Erickson's former girlfriend.

Although some of the accusations go back 20 years, the affidavit said Erickson came to the attention of the FBI in 2016 when a woman selling land in the North Dakota oil patch told authorities that a group of investors had paid Erickson $100,000 for the same land.

According to the affidavit, Sanford invested in the oil field scheme, but the affidavit didn’t detail how much money Sanford put in.

The investigation led authorities to conclude that Erickson ran fraudulent schemes involving two other primary businesses, the manufacturing of a specialized wheelchair and the construction of retirement homes around the country.

Erickson's attorney, Clint Sargent, did not immediately return a phone message left Monday by The Associated Press.

The charges against Erickson, 57, appear unrelated to the case of Butina, 30, who pleaded guilty in December to trying to infiltrate conservative political groups as a Kremlin secret agent. Butina said in her plea agreement that she "sought to establish unofficial lines of communication with Americans having power and influence over U.S. politics" and that Erickson helped her as she tried to use his ties with the National Rifle Association to set up the back channels.

Authorities say in one instance Erickson tried to convince a woman to invest in the specialized wheelchair by telling her that Sanford put money into the company. Instead, Sanford told the FBI that he invested in the wheelchair scheme, according to the affidavit.

Erickson promised the woman a return of between 125 and 150 percent on her investment, the affidavit said.

Erickson, described by one of his victims as a "charismatic gentleman," was national political director for Pat Buchanan's challenge to President George H. W. Bush in the 1992 Republican primary. He also was a media adviser to John Wayne Bobbitt, the Virginia man whose wife cut off his penis with a kitchen knife in 1993. And he joined with Jack Abramoff, a Washington lobbyist later imprisoned for corruption, in producing an anti-communist action movie

Erickson’s trial is currently scheduled for July.

Copyright 2019 WCSC. All rights reserved. Information from the Associated Press was used in this report.

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