By Dan Christensen, FloridaBulldog.org
Much has been written about President Trump’s recent use of his pardon power – often as large sums of money changed hands – to erase the federal criminal convictions of fraudsters, politicians, police officers, thieves and money launderers; yet little public notice has been taken of Trump’s use of his power to pardon corporations.
So far, it doesn’t have the attention-grabbing pull of handing out clemency to big-name recipients like Rudy Guiliani, former White House Chief of Staff Mark Meadows or former Congressman George Santos, as Trump did last week. But granting a pardon or commutation to illicit businesses is a prerogative the president seems intent on wielding, given he’s already done it twice since retaking the White House in January.
“This could be an exponentially higher level of grift, granting pardons to corporations and undoing their restitution orders to the U.S. government or to private parties,” said Brett Kappel, a Washington, D.C. attorney and longtime national authority on campaign finance, lobbying and government ethics laws.
The issue has come into focus with the pending quest by the Florida corporation RVR Inc. for a functionally equivalent form of presidential forgiveness – pardons, at least traditionally, are confined to crimes. RVR, which has not been convicted or charged with any crime, is a recreational vehicle rental and sales company better known as Cruise America.
Cruise America/RVR is in the middle of an expensive civil court fight that began in 2019 when then-U.S. Secretary of Labor Alexander Acosta, a former U.S. Attorney in Miami, sued RVR, its Employee Stock Ownership Plan (ESOP) and its trustee, as well as its principal officers and sole shareholders — most notably Florida brothers Randall Smalley Jr. and Robert Smalley Jr. – in federal court in Arizona. The company’s principal place of business is in Mesa, AZ.
Randall Smalley, RVR’s chairman of the board, resides in Ocean Ridge. Robert Smalley Jr., listed as a director in corporate records, has an address at the Ocean Reef Club in Key Largo. The company was founded in 1972 by their father, Robert, a former CEO of Hertz Rent-a-Car.
The Cruise America dispute alleges the defendants violated the Employee Retirement Income Security Act (ERISA), focusing on how in 2014 the Smalleys and others set up an ESOP for RVR’s employees that purchased 100 percent of the company’s privately held shares, mostly owned by the Smalleys, for $105 million – an amount the Labor Department alleged was grossly excessive. The unique deal also left the Smalley brothers in control of RVR.
ESOP GROSSLY OVERPAID SMALLEYS FOR RVR
The plan trustee, Reliance Trust Company, settled in 2023 and paid $22.5 million to the ESOP’s participants.
After a 16-day bench trial that ended in August 2024, a judge concluded that RVR, the Smalleys and other defendants had violated federal benefits law, breached their fiduciary duty to the plan and are liable for significant damages. The judge determined the ESOP paid $105 million for a company worth $33 million.
The fight over the appropriate remedies to be assessed on the remaining defendants, including the Smalley brothers, continues. Clearly, though, tens of millions of dollars are at stake.
Randall Smalley did not return Florida Bulldog phone messages seeking comment. His brother could not be reached for comment. Their attorney, James T. Smith of the Philadelphia-based law firm Blank Rome, did not respond to requests for comment.
The Smalleys have had some big-name law firms representing them in court – Greenberg Traurig and more recently Blank Rome. In December 2024, Cruise America/RVR announced that it had named retired Miami U.S. District Judge Ursula Ungaro to its board of directors. She served on a “newly created Special Committee responsible for conducting an independent analysis of legal and other matters related to the Company’s Employee Stock Ownership Plan and the pending litigation with the U.S. Department of Labor.”
Ungaro declined to discuss what she did for the company regarding its pending ESOP litigation. She said, too, that she knows nothing about the lobbyists working on behalf of the Smalleys in Washington.
“I know they hired a lobbyist. That’s all I know,” she said in an interview last week.
Ungaro, who works as an arbitrator and mediator for JAMS, the large private provider of alternative dispute resolution services, has served on the boards of two other for-profit companies, the Miami-based biotech Longeveron (NASDQ:LGVN) and Bradford Holdings Inc., a privately held holding company that was not further identified in her public biographies.
Like most everything else in the federal courts, the Cruise America/RVR case was on hold through October and much of November due to the government shutdown.
ENTER THE LOBBYISTS
In September and October, however, the Smalleys opened a new front in their defense of Cruise America/RVR and themselves when they retained a pair of Washington lobbying shops with solid Republican credentials. Their job, as stated in their registration filings, is to “facilitate discussions on Department of Labor settlement,” according to their lobbying registrations filed with Congress.
Given that some of the lobbyists they’ve hired are connected enough to have direct access to Trump, they may well be seeking presidential intervention to get the Secretary of Labor to drop the case.
When it comes to pardons the Justice Department’s rules traditionally require a five-year waiting period after release from confinement or conviction if no prison time was given before an application can be filed. But under President Trump those rules and others appear largely to have gone out the window with the commercialization of pardon or pardon equivalent lobbying.
A lot of folks are getting in on the action. Trump cronies like Fort Lauderdale’s Roger Stone, through his company Drake Ventures, was paid $600,000 by cryptocurrency entrepreneur Roger Ver to lobby for a pardon. To date, no clemency has been granted.
Lobbying registration papers filed with Congress last month disclosed that former Miami-Dade County commissioner and ex-Hialeah mayor Esteban “Steve” Bovo, a partner in the Land O’Lakes-based lobbying firm Corcoran Partners as well as a vocal Trump supporter, is seeking a pardon for Santiago Alvarez. Alvarez, a wealthy 84 -year-old Cuban exile, pleaded guilty in 2007 to obstruction of justice in connection with the FBI’s investigation of the exile terrorist Luis Posada Carriles.
The lobbying firm representing the Smalleys that appears to have most influence with and access to President Trump is the newly formed 725 Strategies, whose principals include Nicholas Trainer and Justin Clark. Trainer served as director of battleground strategy for Trump in 2020 and was the White House director of regional political operations. Clark is another former top Trump campaign aide who served as director of intergovernmental affairs at the White House.
725 Strategies, based in Arlington, VA, was brought in to work for the Smalleys by MO Strategies of Carmel, IN. MO’s lobbyists are Martin Obst, the firm’s founder, and Kyle Walker, a former special assistant to the president.
Neither firm has reported any related income or expenses to date.
SMALLEYS AWAIT TRUMP’S MAGIC WAND
Their goal would appear to be to obtain an executive grant of clemency from Trump like the one obtained by HDR Global Trading Ltd. on March 27. The paperwork contains these words: “A full and unconditional pardon for those offenses against the United States individually enumerated and set before me for my consideration and remission of any and all fines, penalties, forfeitures and restitution ordered by the court.”
For the Smalleys those words would be as if a magic wand was waived above their heads, upending the court’s meticulous findings of wrongdoing and making a potentially enormous hit to their bank accounts vanish.
HDR Global is the legal name of the global crypto currency exchange BitMEX.
The day before Trump’s inauguration the company was fined $100 million for violations of the Bank Secrecy Act that included willfully failing to implement adequate anti-money laundering rules. BitMEX’s three co-founders all pleaded guilty in 2022 and each was fined $10 million and placed on probation for varying terms. Former CEO and founder Arthur Hayes, of Miami, was additionally sentenced to six months of home confinement. A fourth company official was also convicted.
On March 28, Trump granted executive clemency to BitMEX, Hayes and the three other men. “Thank you. @POTUS,” Hayes wrote on X the same day.
In an opinion piece in The Hill in April, constitutional law professor Kimberly Wehle wrote, “In what may be a first in American history, President Trump just expanded the presidential pardon power to include corporations.” Florida Bulldog could not identify anyone lobbying for HDR Global/BitMEX.
On March 29, Trump commuted the sentences of a second company, Ozy Media, and its founder and ex-CEO Carlos Roy Watson. And talk about a magic wand…Trump’s grant freed Ozy Media from a sentence of one year’s probation and $36.8 million in restitution to defrauded investors. Watson walked away from a sentence of nearly 10 years in prison and an order that likewise held him responsible for paying the $36.8 million in restitution.
Trump never explained why he thought Ozy Media and Watson were good candidates for such compassion.
But here’s what then-U.S. Attorney for the Eastern District of New York Breon Peace had to say after Watson was sentenced last December:
“Carlos Watson orchestrated a years-long, audacious scheme to defraud investors and lenders to his company, Ozy Media, out of tens of millions of dollars. His incessant and deliberate lies demonstrated not only a brazen disregard for the rule of law, but also a contempt for the values of honesty and fairness that should underlie American entrepreneurship.”
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