Smartmatic, the electoral technology company that sued Fox News for defamation, is now facing an increasing list of criminal charges against some of its executives. This includes a new allegation from federal prosecutors that an illicit fund used to bribe foreign officials was partially financed with profits from the sale of voting machines in Los Angeles.
New details about the criminal case emerged this month in court documents from Miami, where the company’s co-founder, Roger Pinate, along with two Venezuelan colleagues, were accused last year of bribing officials in the Philippines in exchange for a contract to assist with that country’s 2016 presidential elections. Pinate, who no longer works for Smartmatic, pleaded not guilty.
To strengthen the case, federal prosecutors are seeking to present evidence that, they argue, shows part of the nearly $300 million that Los Angeles County paid to the company to modernize its voting systems was diverted to a fund controlled by Pinate through the use of shell companies overseas, false invoices, and other methods.
Smartmatic has not been accused of breaking any laws, nor have U.S. prosecutors charged the company or its executives with manipulating election results. Similarly, no allegations of irregularities have been made against Los Angeles County officials, nor have they indicated that they were aware of the alleged bribery scheme. County officials assert they were not.
However, the case against Pinate is ongoing as Smartmatic files a $2.7 billion lawsuit accusing Fox of defamation for spreading false claims that the company helped rig the 2020 U.S. presidential elections. Fox contends it was legitimately reporting on allegations of public interest.
Smartmatic claimed that the new filing from the Department of Justice was filled with “misrepresentations” and “disconnected from reality.” “Let’s be clear: Smartmatic wins clients because we are the best at what we do,” the company stated in a press release. “We operate ethically and always comply with all laws, both in Los Angeles County and all jurisdictions where we operate.”
Fox Questions Smartmatic’s Deals in Los Angeles
Nonetheless, Fox has turned to the courts to obtain more information about Los Angeles County’s dealings with Smartmatic. The network has long sought to use bribery allegations to undermine Smartmatic’s narrative about its business prospects—a key component in calculating any potential damages—and portray it as a scandal-ridden company, sunk by its own legal troubles rather than by Fox’s broadcasts.
Based in South Florida, Smartmatic was founded over two decades ago by a group of Venezuelans who achieved early success working for the late Hugo Chávez’s government, a proponent of electronic voting. The company later expanded globally, providing voting machines and other technologies to facilitate elections in 25 countries, from Argentina to Zambia.
It was awarded the contract to assist with the elections in Los Angeles County in 2018. This contract, which Smartmatic continues to manage, gave the company a significant position in what was then a rapidly expanding U.S. electoral technology market.
However, Smartmatic has stated that its business plummeted after Fox News gave President Donald Trump’s lawyers a platform to portray the company as part of a conspiracy to steal the 2020 elections.
Fox eventually issued a piece refuting the accusations following complaints from Smartmatic’s lawyers, but has vigorously defended itself against the defamation lawsuit in New York.
“Faced with an imminent financial collapse and a formal charge, Smartmatic saw a litigation windfall in Fox News’ coverage of the 2020 election,” Fox’s attorneys stated in court filings.
Smartmatic has disputed Fox’s characterization in the court documents as “lies” and “another attempt to divert attention from its long campaign of falsehoods and defamation.”
Los Angeles County Secretary Testifies on Gifts and Trips
As part of its effort to investigate Smartmatic’s work in Los Angeles, Fox has filed a lawsuit to compel Los Angeles County Secretary Dean Logan to provide public records regarding his dealings with Smartmatic’s U.S. subsidiary.
Fox’s attorneys also questioned Logan in a deposition about a dinner that a Smartmatic executive invited him to at the exclusive member-only club and restaurant Magic Castle in Los Angeles, and about a trip to Taiwan that was paid for by Smartmatic. Logan made the trip in 2019 to oversee the manufacturing of equipment from a Smartmatic supplier. U.S. prosecutors claim the supplier was deeply involved in the alleged bribery scheme in the Philippines. The five-day trip included first-class airfare, hotel accommodation, and numerous meals, as well as time for sightseeing, Fox claimed.
“The travel itinerary shows it wasn’t an inspection or financial audit. It was a waste,” Fox stated in court documents.
Logan, who did not report the gifts in his financial disclosure, claimed in 2023 that the meal at Magic Castle was a “social occasion” unrelated to business and that he was not obligated to report the trip to Taiwan because his visit was covered by the contract.
Mike Sanchez, a spokesperson for Logan’s office, stated in a press release that the bribery allegations are unrelated to the company’s work for Los Angeles County and that the county was unaware of how the revenues from its contract would be used. “All of Smartmatic’s work has been evaluated to ensure compliance with the contract terms,” Sanchez added, and as soon as Pinate was indicted, he and the other defendants were prohibited from doing business with the county.
Regarding the trip to Taiwan, Sanchez indicated another county official accompanied Logan, and both made several on-site visits and detailed reviews of the electoral technology products required before production began. Logan’s wife accompanied him on the trip, but their expenses were covered by the couple, the spokesperson added.
“Unfortunately, this is an attempt to use the County as a tool in two serious legal actions in which it is not a part,” Sanchez stated.
Smartmatic has reached out-of-court settlements in two other defamation lawsuits filed against conservative media outlets Newsmax and One America News Network over their coverage of the 2020 U.S. elections. The terms of the settlements were not disclosed.
Prosecutors Claim Bribe Paid in Venezuela
U.S. prosecutors in Miami have also accused Pinate of secretly bribing Venezuela’s electoral chief, who was in office for a long time, by gifting her a luxurious home with a pool in Caracas. Prosecutors allege that the house was transferred to the electoral chief in an attempt to mend relations following Smartmatic’s abrupt exit from Venezuela in 2017, when the company accused President Nicolás Maduro’s government of manipulating electoral results for a constituent assembly that merely aimed to validate the results.
Smartmatic has denied the bribery allegations, stating that it ceased all operations in Venezuela in 2017 after denouncing the government and has never attempted to re-establish business there. “There are no illicit funds or donated houses,” the company declared. Instead, it accused Fox of blaming victims and trying to utilize frivolous court documents to further defame us, distorting unfounded accusations from the Department of Justice.
