Federal investigators last year looked into whether Matthew G. Whitaker, as an advisory board member of a Miami patent company accused of fraud by customers, played a role in trying to help the company silence critics by threatening legal action, according to two people with knowledge of the inquiry.
Whitaker, named this week by President Trump as acting attorney general, occasionally served as an outside legal adviser to the company, World Patent Marketing, writing a series of letters on its behalf, according to people familiar with his role.
But he rebuffed an October 2017 subpoena from the Federal Trade Commission seeking his records related to the company, according to two people with knowledge of the case.
The FTC alleged in a 2017 complaint that the company bilked customers with fraudulent promises that it would help them market their invention. The FBI has also investigated World Patent Marketing, the Wall Street Journal reported Friday.
Whitaker was not named in the FTC complaint. World Patent Marketing, without admitting fault, settled the case for more than $25 million earlier this year, according to court documents.
Justice Department officials declined to comment on Whitaker’s handling of the FTC subpoena.
In a statement, Justice Department spokeswoman Kerri Kupec said, “Acting Attorney General Matt Whitaker has said he was not aware of any fraudulent activity. Any stories suggesting otherwise are false.”
Whitaker’s connection to World Patent Marketing came as a surprise to both senior Justice Department and White House officials, several officials said.
In their investigation, FTC staff had sought to learn more about the role played by the company’s advisory board members, including Whitaker, a former U.S. attorney whose role was prominently highlighted by the company in news releases and marketing materials.
The company said the board would help review inventors’ ideas to maximize their ability to get rich, according to promotional materials and former customers.
In truth, the board did not meet and rarely reviewed inventors’ ideas, according to court documents.
Whitaker, however, appeared to act at times as an attorney for the company, according to people with knowledge of his role.
Whitaker has told officials he served in a limited capacity as an outside legal adviser to the company and provided occasional advice when asked but that he was not part of the day-to-day operations, according to a Justice Department official, who spoke on the condition of anonymity because of the sensitivity of the case.
When the FTC subpoenaed Whitaker for his records related to the company in October 2017, he failed to provide any information, telling investigators that he was busy at that time moving from Iowa to Washington for a new job, according to people with knowledge of the case.
At the time, Whitaker was preparing to assume a new post: chief of staff to then-Attorney General Jeff Sessions.