The week after President Trump's inauguration, national security adviser Michael Flynn forwarded a memo written by a former business associate and told his staff to fashion it into a policy for President Trump's approval, according to two people familiar with the exchange.
The proposal — to develop a "Marshall Plan" of investment in the Middle East — was being pushed by a company that Flynn said he had advised during the 2016 campaign and transition. The firm was seeking to build nuclear power plants in the region.
His advocacy for the project in the White House surprised some administration officials and raised concerns that Flynn had a conflict of interest. From August to December 2016, he said he served as an adviser to the company, IP3, reporting later on his disclosure forms that he ended his association with the firm just weeks before joining the administration.
To push the idea "in the first week of the administration without any policy process made no sense," said a person familiar with episode who, like others with knowledge of the incident, spoke on the condition of anonymity to describe internal discussions. "It was a business proposal in the form of a policy paper."
IP3 said in a statement that the memo did not make a specific request on behalf of the company.
A top House Republican last month referred questions Democrats have raised about Flynn's involvement in the project to special counsel Robert S. Mueller III.
Last week, Robert Kelner, an attorney for Flynn, shut down communications with Trump's legal team, a sign that Flynn may be willing to cooperate with the special counsel.
Kelner declined to comment. A spokesman for Mueller declined to comment. A White House attorney, Ty Cobb, declined to comment.
A White House official said the National Security Council staff handled Flynn's apparent conflict of interest appropriately. "They did their best to tamp it down," the official said.
IP3 said in a statement that the company never paid Flynn and that he did not accept its offer to serve as an adviser, despite his statement on the disclosure form that he held such a role.
However, Flynn advocated for a plan that would help the company after entering the White House, according to people familiar with the exchange. In late January, Robert "Bud" McFarlane, a co-founder of IP3 and a former adviser to President Ronald Reagan, laid out in an email to Flynn what he called a "Marshall Plan for the Middle East," IP3 officials said in a statement. The memo, which the company declined to provide but was described to The Post by someone who had read it, included a focus on nuclear nonproliferation, one of the IP3's selling points for its plan.
The memo was first reported upon by the Wall Street Journal.
Flynn forwarded the email to members of his National Security Council staff and instructed them to "essentially put it on White House letterhead and send it to the president for approval," according to a person with knowledge of Flynn's directions.
Some of those who worked with Flynn on the National Security Council were aware of Flynn's connection to IP3 and another company pursuing a similar project. John Eisenberg, a legal adviser to the council, worried that Flynn had a conflict and urged him to recuse himself from the project discussions, according to an administration official familiar with the conversations. Eisenberg declined to comment.
IP3 said that in his memo, McFarlane did not make a specific request on behalf of the company, adding it made sense to send it to Flynn because of his role overseeing national security policy.
"Mr. McFarlane was asked to prepare some thoughts on both NSC process and more specifically the Middle East, nuclear non-
proliferation concerns and Russia's aggressive movements in the Middle East," the company said. "He provided this to the NSC team at their request."
Some of Flynn's allies continued to pursue the idea, including one aide, Derek Harvey, whom he deputized to help work on the policy document, according to a person familiar with the efforts. Harvey did not return a request for comment.
It is unclear whether the proposal was ever presented to Trump. An administration official said the memo was not stored as a permanent record by the National Security Council. The idea to approve the use of U.S. nuclear technology on foreign soil lost momentum in the spring, the official said.
Before his association with IP3, Flynn served as an adviser from April 2015 until June 2016 to ACU Strategic Partners, which had its own plan to help build nuclear plants in the Middle East, in conjunction with Russian interests.
In June 2015, he traveled to Egypt and Israel on a trip paid for by ACU to promote the plan. Flynn later failed to disclose the trip in his security clearance renewal application in 2016, according to Democrats on the House Committee on Oversight and Government Reform, an omission they said may have violated federal law.
On Tuesday, the top Democrat on the oversight panel, Rep. Elijah E. Cummings (D-Md.), renewed his request for information from the White House about Flynn's activities. He also wrote a letter to McFarlane asking for all communications with Flynn, the Trump transition team and administration regarding the proposed plan for nuclear power plants in the Middle East.