The US Department of Justice for the Eastern District of New York filed their sentencing memorandum today for the last of the six defendants in the NXIVM case, Kathy Russell.
The prosecution is recommending a sentence of six to 12 months for the former NXIVM bookkeeper.
Kathy Russell was known in NXIVM by her nickname, “Miss Kathy.” Russell pleaded guilty to one count of visa fraud.
The criminal conduct, according to the memo, was that:
“In 2014, [Russell] presented false documents to the United States Consulate in Mexico in connection with a NAFTA professional (TN) visa on behalf of Loreta Garza, a citizen of Mexico.”
A TN visa, the prosecution explained, enables Canadians and Mexicans to enter the United States to engage in professional business activities on a temporary basis. To obtain a TN visa, a prospective employer must provide a letter of employment detailing the professional capacity in which the individual will work in the United States and their compensation.
Russell, as Garza’s prospective employer, signed a three-page letter addressed to the United States consulate that stated that Garza was a management consultant that Nxivm hired to “analyze current marketing and sales activities… interpret strategic research and competitive intelligence… advise on direction, strategies, and promotional activities to drive product, customer growth, and quality.”
She did nothing of the sort, of course.
Russell’s letter stated that Garza’s “extensive experience in … marketing strategies for the Mexican market, in addition to her familiarity with our professional [NXIVM] development programs, makes her an ideal candidate for this temporary consulting position.”
Garza was a longtime, low-paid NXIVM employee. Before that, she was Nancy Salzman’s maid and personal gopher.
Russell was certainly aware, as she herself confessed, that Garza was not going to be employed as a consultant for NXIVM but would work for a Nxivm-based entity, Rainbow Cultural Garden, LLC (“RCG”), a nanny service for affluent NXIVM members.
Russell also knew that Garza would not be getting anywhere near the salary she claimed. In fact, Garza used the amounts paid to her to pay RCG employees, who did not report their income.
In other words, Miss Kathy lied.
Crimes Not Proven Can Be Used Against Miss Kathy
Apart from the crime of conviction, the prosecution alleged her participation in other “criminal schemes” in NXIVM.
Title 18, United States Code, Section 3661 permits a judge to consider any information about the defendant, none of which need be proven to anyone’s satisfaction except the judge in determining her sentence.
The section reads: “No limitation shall be placed on the information concerning the background, character, and conduct of a person convicted of an offense which a court of the United States may receive and consider for the purpose of imposing an appropriate sentence.”
The only limitation a judge has in sentencing a defendant is that he may not go beyond the maximum sentence for the actual crimes of conviction. In Russell’s case, she could get up to 10 years.
Sentencing Guidelines Are Only Guidelines
Citing Gall v. United States, 552 U.S. 38, 49 (2007) the prosecution quoted, “a district court should begin all sentencing proceedings by correctly calculating the applicable Guidelines range…. the Guidelines should be the starting point and the initial benchmark.”
The US Probation Department did a calculation of the Sentencing Guidelines in Miss Kathy’s case.
Here is how they calculated:
- Her felony comes with 11 points.
- Because she committed it not for her own personal profit [she did it for Raniere], three points were subtracted.
- the visa was used to facilitate commission of a felony, so four points were added.
- She pleaded guilty, meaning she accepted responsibility; so she got two points knocked off.
Her total score is 10. Since she has no prior criminal history, the Guidelines range is 6 to 12 months.
Other Alleged Crimes of Kathy Russell
Helping Daniela Illegally Cross the Border
According to the testimony of Daniela at the trial of Raniere, in 2004, Russell provided the 19-year-old Mexican native with a false sheriff’s card using the identity of the late “Lisa Chenoa.” Daniela impersonated the dead woman at the border crossing at Niagara Falls.
After making it safely across Russell drove Daniela to the Nxivm community in Clifton Park, New York.
Neither Daniela nor Russell was charged with this offense.
Though it is not yet a federal crime to remind someone of past favors in order to persuade them to do a future favor and join a threesome, the prosecution reminded the judge that, once again, according to Daniela, Russell inveigled her to join a threesome with Raniere and herself, reminding her of how she risked her neck to help her get back to the USA.
Daniela testified that she felt she “owed” Russell the favor and so consented.
Helping Daniela Hack Into Computer
Russell also allegedly participated in a scheme to install keylogging software on the computer of James Loperfido, an accountant who had worked for Joseph O’Hara, an attorney who had previously done work for Nxivm.
Russell invited Loperfido to Nxivm’s offices and distracted him as Daniela installed the keylogging software on his computer.
Neither Daniela nor Russell was charged with this crime.
Faking it for Adrian
In approximately 2015, Russell participated in a scheme in which Adrian sought and illegally obtained an L1 visa application based on the claim that he was employed by Sagitta LLC, a company based in Clifton Park, New York, purportedly affiliated with Adrian’s father’s rock-drilling company in Mexico.
Adrian actually worked in video production for Moving Pixels, a company owned by Clare Bronfman. He paid rent to Nancy Salzman.
As part of the scheme, Russell, Bronfman, and Salzman arranged for Adrian to be paid through Sagitta LLC for work performed for Moving Pixels. Adrian submitted false Sagitta LLC invoices and paystubs as part of the scheme.
Russell, Adrian, Bronfman and Salzman were not charged with this crime.
Getting an Apartment for Camila
Though it is likely not illegal, the prosecution mentions Russell’s role in renting the townhouse Camila resided in.
In 2011, when Camila was 21, Russell leased 120 Victory Way, a property in Clifton Park, New York, under the assumed name Kathleen O’Sullivan.
Russell told the landlord a fictitious story—that “she had received a lot of money after her husband died” and would pay the rent upfront in cash and in full, which she did.
For the next seven years, until Raniere was arrested and Camila left for Mexico, Russell leased the property. It is not known where the money came from, but the property was used to house Camila, who had a secret sexual relationship with Raniere.
The prosecution admits they do not know if Russell was aware of the relationship between Camila and Raniere, who is 30 years her senior.
Concluding Thoughts of the Government
The prosecution notes that “for years, the defendant facilitated Keith Raniere’s criminal conduct and furthered his schemes. She was willing to undertake nearly any task assigned to her, from transporting a teenager across the Canadian border with a false identification card to defrauding United States immigration authorities by signing and presenting false documents in support of a visa application.
“The defendant was not the most culpable member of the criminal enterprise charged in this case, but her willingness to obey Raniere’s directives without question caused real and significant harm to others.”
Will She Repudiate Vanguard?
This question may make all the difference in whether Miss Kathy goes to prison and for how long.
Will she denounce Keith Raniere?
Russell was the last co-defendant to plead guilty. The Probation Department’s Presentencing report does not indicate, according to the prosecution, whether Russell continues to support and remain loyal to Raniere.
The prosecution is blunt: Loyalty to Raniere and Nxivm is the litmus test of incarceration.
The prosecution writes, “As the need for specific and general deterrence is of particular concern in this case, the government respectfully submits that the defendant’s efforts at rehabilitation and expressions of remorse,[i.e. repudiation of Raniere] if any, warrant significant consideration by the Court at the sentencing hearing.”
Prosecution Wants Her in the Can for up to a Year
The prosecution wants Russell to spend some time in prison. They requested that the judge sentence her within the guidelines range.
They wrote, “The government respectfully submits that the nature and circumstances of the offense, as well as the need for deterrence, weighs in favor of a sentence of imprisonment” and “respectfully submits that a sentence within the applicable Guidelines range is sufficient, but no greater than necessary, to achieve the goals of sentencing in this case.”
It will be up to the judge and possibly Kathy to decide whether it is really necessary for a sixty-plus-year-old woman, who certainly poses no threat to society and could be easily monitored by probation, has to endure actual incarceration.
Kathy can reduce her chances of spending time in a cage by telling the judge in no uncertain terms that she was wrong to do the lying and fraudulent activities she was convicted of, and if she did do the other things mentioned that those too were wrong.
She will do even better if she tells the judge the devil, Raniere, made her do it.
Russell is scheduled to be sentenced on October 6th.
I hope things go well for Kathy. If she can take help, maybe this will be a good experience for her. I hope so.
I’m currently thinking 12-18 months for this one.
The judge is a sucker for ladies –
I’ll take your wager!
I am thinking Kathy gets 3 to 6 months
Biden lets in a million illegal aliens.
They are not tested for Covid at all.
Kathy Russell brings in one illegal alien and could get six to 12 months.
America has one rule for the peasants like Kathy Russell and another rule for the evil corrupt treasonous elites like the Biden Crime Family.
Shadowstate, you’re starting to sympathize with NXIVM. Soon there’ll be room in your heart for your favorite pimp.
Sounds like Shadow ate some fruit from the poisoned tree….
America does not need a legal system that applies one set of rules to the rich and powerful and another to the peasants.
I had believed you to be a student of history.
Throughout the history of human civilization, there have been two classes of people. Don’t be so naive!
Anyone, who believes the law has ever been applied to all people equally might as well go sing Kumbaya around the campfire.
The rules that are applied to Kathy Russell should also be applied to America’s leaders.
I agree: Trump should be indicted immediately for his pivotal role in the January 6th insurrection.
100 percent Spot On.
U.S. Department of Justice
United States Attorney Eastern District of New York
JMS:TH 271 Cadman Plaza East
F. #2017R01840 Brooklyn, New York 11201
September 29, 2021
The Honorable Nicholas G. Garaufis United States District Judge
United States District Court 225 Cadman Plaza East Brooklyn, New York 11201
Re: United States v. Kathy Russell
Criminal Docket No. 18-204 (S-4) (NGG) (VMS)
Dear Judge Garaufis:
The government respectfully submits this letter in advance of the defendant Kathy Russell’s sentencing, which is scheduled for October 6, 2021 at 11:00 a.m.
On April 19, 2019, the defendant pleaded guilty to a single count of a superseding information, which charged that between February 2014 and March 2015, she committed visa fraud in violation of 18 U.S.C. § 1546(a). The government respectfully requests that the Court impose a sentence within the applicable U.S. Sentencing Guidelines (“U.S.S.G.” or “Guidelines”) range of 6 to 12 months’ imprisonment.
I. Background and Criminal Conduct
The facts underlying the offense conduct in this case are set forth in the Presentence Investigation Report (“PSR”) prepared by the United States Probation Department on February 28, 2020 and the Addendum to the PSR prepared on October 16, 2020.1
1 The Court is familiar with the factual background and offense conduct in this case, having presided over the six-week trial of Kathy Russell’s co-defendant Keith Raniere. The following factual summary is intended to provide an overview sufficient to situate the government’s arguments with respect to Russell’s sentencing.
As set forth in the PSR, the defendant participated in unlawful efforts to secure immigration status for non-citizens so that they could enter or remain in the United States and work in one or more Nxivm-affiliated organizations. PSR ¶¶ 18-36.
In 2014, the defendant presented false documents to the United States Consulate in Mexico in connection with a NAFTA professional (TN) visa on behalf of Loreta Garza, a citizen of Mexico.2 PSR ¶ 25. The defendant signed a three-page letter addressed to the United States consulate that falsely stated that Garza was a management consultant for Nxivm, and that Garza had been hired to “observe, research, and analyze current marketing and sales activities,” “assess existing and potential market opportunities and interpret strategic research and competitive intelligence” and “advise on direction, strategies, and promotional activities to drive product, customer growth, and quality,” among other responsibilities. The letter further stated that Garza’s “education and extensive experience in the development of marketing strategies for the Mexican market, in addition to her familiarity with our professional development programs, makes her an ideal candidate for this temporary consulting position.” These statements were false when submitted. As the defendant was aware, Garza was not employed as a management consultant but managed a separate Nxivm entity, Rainbow Cultural Garden, LLC (“RCG”), which employed caretakers fluent in other languages to care for children. Garza used the amounts paid to her to pay RCG employees, who did not report their income, and RCG did not report the payroll for state employment taxes. Garza was subsequently recruited into the “first line” of DOS, a secret organization led by Keith Raniere.
As set forth in the PSR and as reflected in trial testimony, the defendant also participated in other criminal schemes at Keith Raniere’s direction:
In 2004, the defendant met Daniela, then nineteen years old, at the Canadian border and provided Daniela a false sheriff’s identification card bearing the name “Lisa Chenoa,” and drove Daniela across the border into the United States and back to the Nxivm community in Clifton Park, New York. Later, the defendant reminded Daniela of her assistance in transporting Daniela across the United States border while Raniere invited Daniela to engage in sexual activity with the defendant. PSR ¶ 20. Daniela testified at trial that she felt that she “owed” the defendant. Trial Transcript (“Tr.”) at 2419.
2 A TN visa is a visa category enabling citizens of Canada and Mexico to enter the United States to engage in professional business activities on a temporary basis. In order to obtain a TN visa, a prospective employer must provide a letter of employment detailing the professional capacity in which the individual will work in the United States and their anticipated compensation. Lawyers, accountants, engineers, scientists and management consultants, among others, are the types of professionals eligible to seek admission into the United States as TN nonimmigrants. See 8 C.F.R. § 214.6.
The defendant participated in a scheme to install keylogging software on the computer of James Loperfido, an accountant who had worked for Joseph O’Hara, an attorney who had previously done work for Nxivm, in order to monitor Loperfido’s computer activity. The defendant invited Loperfido to Nxivm’s offices and distracted him as Daniela installed the keylogging software on his computer. PSR ¶ 50.
In approximately 2015, the defendant participated in a scheme in which Adrian sought and obtained an L1 visa application based on the claim that he was employed by Sagitta LLC. Sagitta LLC, a company based in Clifton Park, New York, purported to be an affiliate of Adrian’s father’s rock-drilling company in Mexico, but in fact existed solely as a vehicle for obtaining Adrian’s visa. Id. Adrian in fact worked in film production for Moving Pixels, Inc., a company owned by Clare Bronfman, and paid rent to Nancy Salzman. PSR ¶ 31. As part of the scheme, the defendant, Bronfman, and Nancy Salzman arranged for Adrian to be compensated through Sagitta LLC for work that he actually performed for Moving Pixels, Inc. Id. Adrian was provided with false Sagitta LLC invoices and paystubs as part of the scheme. Id.
II. Applicable Law
“[A] district court should begin all sentencing proceedings by correctly calculating the applicable Guidelines range. As a matter of administration and to secure nationwide consistency, the Guidelines should be the starting point and the initial benchmark.” Gall v. United States, 552 U.S. 38, 49 (2007) (citation omitted); see also United States v. Booker, 125 S. Ct. 738, 743 (2005) (although the Guidelines are advisory, district courts are still “require[d] . . . to consider Guidelines ranges” in determining a sentence).
Significantly, however, the Court “may not presume that the Guidelines range is reasonable. [It] must make an individualized assessment based on the facts presented.” Gall, 552 U.S. at 50. Title 18, United States Code, Section 3553(a) provides that, in imposing sentence, the Court shall consider (1) the nature and circumstances of the offense and the history and characteristics of the defendant; and (2) the need for the sentence imposed (A) to reflect the seriousness of the offense, to promote respect for the law, and to provide just punishment for the offense; (B) to afford adequate deterrence to criminal conduct; and (C) to protect the public from further crimes of the defendant.
Title 18, United States Code, Section 3661 directs the Court to consider all relevant conduct and information about the defendant when sentencing him or her: “No limitation shall be placed on the information concerning the background, character, and conduct of a person convicted of an offense which a court of the United States may receive and consider for the purpose of imposing an appropriate sentence.” As a result, “the court is
virtually unfettered with respect to the information it may consider.” United States v.
Alexander, 860 F.2d 508, 513 (2d Cir. 1988).
III. Sentencing Guidelines
The government agrees with the Probation Department’s calculation of the Guidelines, which is also set forth in the plea agreement, as follows:
Base Offense Level (§2L2.1(a)) 11
Less: Offense Committed Other Than For Profit (§ 2L2.1(b)(1) -3
Plus: Visa Used to Facilitate Commission of a Felony Offense (§ 2L2.1(b)(3)) +4
Less: Acceptance of Responsibility -2
Based on a total offense level of 10 and a criminal history category of I, the applicable Guidelines range is 6 to 12 months’ imprisonment.
The government respectfully submits that a sentence within applicable Guidelines range of 6 to 12 months’ imprisonment is necessary to meet the goals of 18
U.S.C. § 3553(a). The offense conduct reflects that for years, the defendant facilitated Keith Raniere’s criminal conduct and furthered his schemes. She was willing to undertake nearly any task assigned to her, from transporting a teenager across the Canadian border with a false identification card to defrauding United States immigration authorities by signing and presenting false documents in support of a visa application.
The defendant was not the most culpable member of the criminal enterprise charged in this case, but her willingness to obey Raniere’s directives without question caused real and significant harm to others.3 For example, in approximately August 2011, the defendant leased 120 Victory Way, a property in Clifton Park, New York, under the assumed name Kathleen O’Sullivan. Tr. at 3331-32. The defendant told the landlord a fictitious
3 The defendant was the last of Raniere’s co-defendants to plead guilty, and the PSR does not specifically indicate whether the defendant’s support and loyalty to Raniere and Nxivm continues. As the need for specific and general deterrence is of particular concern in this case, the government respectfully submits that the defendant’s efforts at rehabilitation and expressions of remorse, if any, warrant significant consideration by the Court at the sentencing hearing.
story—that “she had received a lot of money after her husband died” and would pay the rent upfront in cash and in full. Id. For the next seven years, until September 2018, the defendant leased the property at Raniere’s direction, and Raniere used the property to house Camila, with whom he had a secret and abusive sexual relationship. Although the defendant may have been unaware of the relationship, her actions—and blind loyalty to Raniere—facilitated the abuse of Raniere’s victims.
The government respectfully submits that the nature and circumstances of the offense, as well as the need for deterrence, weighs in favor of a sentence of imprisonment within the applicable Guidelines range.
For the reasons above, the government respectfully submits that a sentence within the applicable Guidelines range is sufficient, but no greater than necessary, to achieve the goals of sentencing in this case.
Respectfully submitted, JACQUELYN M. KASULIS
Acting United States Attorney
By: /s/ Tanya Hajjar Tanya Hajjar
Assistant U.S. Attorney (718) 254-7000
cc: Counsel of Record (by ECF)
To be perfectly honest, no matter if these ladies serve a combined one thousand years or three days, I think the most effective punishment will be the public exposure of having done Vantard. That would be up there with having an inlaw who is a rapper or something.
Being associated with NXVIM is going to have long lasting consequences, both personal and professional.
The fallout from NXVIM is astounding. Lives and careers were destroyed. If Keith Raniere had ambitions beyond his own personal gratification, this could have been much worse. I suspect that many other crimes remain unknown or unproven, and that there are people that are relieved they were not caught.
Kathy Russell is a pathetic tool, but she is also a very sick, Raniere enabler.
What was left out of this article:
• Kathy Russell coerced and blackmailed “Daniela” into a 3-way with Raniere.
• Russell had to have some idea about Raniere and all three sisters. Russell was an insider
• If my memory serves me correct, Kathy Russell, once acted as a chauffeur for Raniere, who would sit in the back of a car with Dani and her sister. According to Dani, Raniere would make-out and put his hands down her sister’s pants during the car ride. And people say “Kathy” was in the dark? Give me a break!
• Kathy helped cook the NXIVM books and helped Nancy hide millions from the government. Too bad the IRS isn’t involved.
In short, no one should feel bad for Kathy Russel. She well deserves some time in jail.
In this particular article, Frank was much too kind and magnanimous to Kathy Ballerina.
Kathy Russell presents as either an old lady dressed as a little girl. Or a little girl dressed as an old lady.
I can’t decide…
Or an old lady doll made by a little girl?
Regardless. Kathy gives me the creeping shivery shimmy shivs . Like an actual skin crawly shuddery shake it off.
Oh God. That was BEFORE I remembered that young Daniela had to menage a puke with Kathy & Raniere.
10 years! For being so gross!
Read “The Glass Menagerie ” by Tennessee Williams for a complete profile of our NXIVM ballerina.
“The Glass Menagerie” was a an excellent albeit depressing read. Damn good!
Tell me that our fave ballerina could not have been Laura. Several times over.
You nailed it!
I can still remember reading the story 35 years ago.
Brilliant observations about Kathy’s presentation. From my experience with her, she is closest to the “old lady doll made by a little girl”! So strange and eerie, but it rings true.
Anonymous @ 4:41 pm. Thank you for your feedback. That’s the one then.
Here is a childhood photo of Kathy, for your viewing pleasure:
Wasn’t ChaKa a singer in Prince’s backup band?
She deserves eight years in prison.
She’s a career criminal. My favorite was her delivering the paper bag stuffed with cash that she delivered as a year’s rent for one of Raniere’s harem.
She made a career of perjury and cooking the Nxivm books. A professional criminal.
“Certainly poses no threat to society”? A perjurer, a dishonest accountant, a career criminal who deliberately mishandled multi-million dollar accounting? This does no harm? I beg to differ.
Where are the rest of the indictments? Mark Vincente? Vancouver Nippy and wife?
Frank, you know where the bodies are, dig them up and demand the government do something
Crazy notion the government has: prostitute yourself and you walk, stand up for yourself and go free
Kathy, rat out the mule(s) who hid and took the money. That will get you out of prison. You know who laundered and hid the money. Just expose them and save your own hide. They have never had your back. Stop protecting theirs.
What about preventing her from ever doing MLM or nxivm-related activities ever again? Nancy, Lauren, and Michelle continue with it….even after guilty pleadings and international scorn. These people have no shame and no idea that what they did was wrong. They keep doing it. Nancy will EM and NLP fellow inmates and others when she gets out. Lauren will continue to help nxivm members and Michelle brazenly still does nxivm work with Kim Constable. What mechanisms are in place by the court to stop them from continuing nxivm under a different brand?
Shadowstate, Nutjob, Nice Guy and an OSA agent walk into a bar?
They all agree Nancy Russell is getting railroaded by the feds.
And then they meet up with three lesbians and a rabbi…