WASHINGTON — As President Trump fumed in late 2018 over the progress his government was making on a border wall, an Air Force veteran’s pro-wall GoFundMe page would transform into a separate project, funded by private donations and guided by former Trump advisers, including Stephen K. Bannon.
Frustrated over the delays in Mr. Trump’s signature campaign promise, Brian Kolfage’s group, We Build the Wall, raised more than $20 million in weeks, largely on the promise of sidestepping the legal and political obstacles to building a border wall by using private funding.
But on Thursday, about a month after Mr. Trump publicly criticized the private construction effort, federal prosecutors in New York unveiled an indictment accusing the fund-raising campaign of ties to a scheme that “defrauded hundreds of thousands of donors.”
Federal authorities in the Southern District of New York say Mr. Bannon, one of the architects of Mr. Trump’s 2016 presidential campaign who later joined the group’s board, plotted with three other men: Mr. Kolfage, 38, from Miramar Beach, Fla.; Andrew Badolato, 56, a financier from Sarasota, Fla.; and Timothy Shea, 49, of Castle Rock, Colo. Kris Kobach, the former Kansas secretary of state who is listed as We Build the Wall’s general counsel on the group’s website, was not named in the indictment.
Mr. Kolfage, who on television frequently advocated building a border wall but criticized the federal government’s methods, repeatedly said he had promised his donors that he would not take any of the group’s funds for his own benefit. Prosecutors said that was false: Mr. Kolfage secretly took more than $350,000 in donations for his own personal use while Mr. Bannon, through an unnamed nonprofit organization, received more than $1 million from the group.
The criminal charges were the latest twist for a private group that had drawn the praise of some top Homeland Security and Border Patrol officials but prompted backlash over its connections to former advisers to Mr. Trump and its construction methods.
While the portions of the wall constructed by the federal government are well within the American side of the border on federally owned land or potentially splitting the farmlands of private landowners, portions of the privately run wall were built along the river bank of the Rio Grande. The potential environmental damage prompted legal challenges from environmental groups and the International Boundary and Water Commission, which manages the water relationship between Mexico and the United States.
Yet We Build the Wall drew praise from some administration officials, despite the group’s intent to privatize a function of government — border security — widely viewed as a federal responsibility. During a news conference in November in El Paso, Chad F. Wolf, the acting secretary of the Department of Homeland Security, and his top border officials welcomed the construction of the private project in New Mexico and Texas and said the barriers had proved to be effective. The briefing was highlighted on the Twitter page of Mr. Kolfage, who once ran a right-wing website that was eventually removed by Facebook.
“The government should be doing it, but it is not getting done. And we’re not trying to build the entire Southern border wall. This is a protest wall. The president supports it. D.H.S. supports it,” Mr. Kolfage told CNN in May 2019. “So we’ve had the blessing of our government to move forward with this project.”
But after reports in July showed signs of erosion along the privately funded barriers, Mr. Trump denounced the project on Twitter as something “only done to make me look bad.”
“It’s a very sad thing by Mr. Bannon,” Mr. Trump said on Thursday.
After Mr. Kolfage started the fund-raising campaign, promising to transfer the money to the federal government toward building the wall, it was revealed there was no mechanism to do so. He then said his group had determined that only $800,000 of the approximately $20 million raised at that point needed to be returned.
“No rules were broken,” Mr. Kolfage said in an interview last year. “Ninety-four percent of the donors we have been able to reach are opting in. We’ve reached 75 percent of all the donors so far.”
Donors, however, wondered what had happened to the money.
Harvey F. Garlotte, of Hattiesburg, Miss., who donated to the fund, was among those who complained when he received a refund of his $60 donation but not the $3 that he added as a tip for the organization. In a complaint to the Florida secretary of state in 2019, Mr. Garlotte wrote that he felt he had been swindled, noting that even though Mr. Kolfage lived in Florida, he could find no record of a charity registration for the group in that state.
“From my side of the road, Mr. Kolfage was simply using a hot-button topic, a very emotional topic, and his status as a wounded veteran, for selfish and self-serving reasons and personal financial gain,” Mr. Garlotte wrote in a complaint.
In an interview last year, Mr. Kobach, who did not return a request for comment on Thursday, said the group had received the president’s blessing.
Mr. Trump on Thursday tried to distance himself from the project. “I don’t like that project,” he said. “I thought it was being done for showboating reasons.”
Mr. Kobach had said the group would begin construction soon on its first section of the wall on donated property, most likely in Texas, and that the work could be completed cheaply and efficiently by the private sector.
Mr. Bannon subsequently held promotional events near El Paso to continue raising funds and highlighting construction of segments of the proposed wall. The group also hired a North Dakota company, Fisher Sand & Gravel, to construct the barriers and publicly celebrated its work. The Trump administration subsequently granted the same company a $400 million contract that is currently being investigated by the inspector general for the Defense Department.
In May, the company received another federal contract for $1.3 billion, which at the time was the largest contract issued for border wall construction.
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