Bannon charged with fraud over border wall

Steve Bannon, who was instrumental in US President Donald Trump's 2016 election win, was arrested on Thursday and charged with defrauding donors in a plan to privately fund a wall along the United States-Mexico border, prosecutors said.

Bannon, 66, who helped articulate the "America First" populism and opposition to immigration that have been cornerstones of Trump's term, pleaded not guilty, as did three other men charged.

Also charged on Thursday were Brian Kolfage, 38, Andrew Badolato, 56, and Timothy Shea, 49.

Bannon, a frequent critic of China, whom Trump fired from his post as White House chief strategist in August 2017, and the others were charged by federal prosecutors in Manhattan with conspiracy to commit wire fraud and conspiracy to commit money laundering.

Prosecutors accused the defendants of defrauding hundreds of thousands of donors through a $25 million crowdfunding campaign called "We Build the Wall". The wall was a signature issue in Trump's 2016 campaign.

Bannon and Kolfage are each accused of using hundreds of thousands of dollars of the money for personal expenses.

Bannon was arrested in Connecticut by agents from the prosecutor's office and the US Postal Inspection Service aboard a 45-meter yacht, according to a law enforcement source.

Bannon is being investigated by the FBI and the Securities and Exchange Commission over a private offering valued at more than $300 million to fund a media company that he is associated with, The Wall Street Journal reported on Wednesday.

At his hearing on Thursday, Bannon had his hands cuffed while he wore a white mask. He rocked back and forward as he sat in a holding cell at federal court in Manhattan.

The judge approved Bannon's release on a $5 million bond, secured by $1.75 million in assets.

Trump told reporters at the White House that he feels "very badly" about the charges but distanced himself from Bannon and the alleged scheme.

"I do think it's a sad event," the president said. "I haven't dealt with him at all now for years, literally years."

Bannon headed the right-wing Breitbart News website before joining Trump's campaign. An anti-globalist, Bannon has since promoted a variety of conservative causes and candidates in the US and abroad.

Lawyers for Bannon and the other men did not respond to requests for comment.

Other Trump associates who have been arrested or convicted include former campaign chairman Paul Manafort, longtime friend and adviser Roger Stone and former personal lawyer Michael Cohen.

Trump, in his quest to build the border wall, has faced court challenges, logistical hurdles and congressional opposition. His administration has completed 48 new kilometers of border fencing and replaced another 386 km of barriers along the 3,200 km border, government figures show.

The group connected to Bannon built two wall sections on private land in New Mexico and Texas, drawing criticism from local residents who said proper permits were not obtained. The Texas wall section has experienced erosion, a report last month showed.

"I know nothing about the project," Trump said Thursday, "other than ... when I read about it, I didn't like it. I said, 'This is for government, this isn't for private people,' and it sounded to me like showboating."

Trump also said he did not believe he had ever met the three others charged.

Agencies contributed to this story.