Tuesday, April 11, 2006

Report: DeLay's Exit Doesn't Close The Curtain On The Republican Culture of Corruption

Republicans may be breathing a sigh of relief with the news that Tom Delay is stepping down from Congress.

However, the culture of corruption that he and his friends last is going no where. That legacy will long outlast Delay.
It's not like John Boehner is going to do anything about it! (He has already said he is against ethics reform)
With the news that embattled former Republican House Leader Tom DeLay won't seek re-election, as some of his former top aides and lobbyists associated with his office are under federal investigation or have already pleaded guilty to charges, Republicans in Congress are hoping that DeLay's exit will close the curtain on the Republican culture of corruption. But, DeLay's departure is just the tip of the iceberg. According to the Los Angeles Times, the "ongoing Justice Department investigation of influence-peddling in Washington - which already has led to guilty pleas by former GOP lobbyist Jack Abramoff and two onetime DeLay aides - is a political powder keg that could explode with new indictments at any time." [Los Angeles Times, 4/5/06]

Republicans in Washington are also worried about how their culture of corruption will affect elections in November. According to Knight-Ridder, DeLay's "decision to retire from Congress will do little to help his embattled party retain control of the legislature in November's elections and won't erase his image as a poster child for corruption." [Knight-Ridder, 4/5/06]

Democratic National Committee Communications Director Karen Finney issued the following statement on the ever-growing Republican culture of corruption:

"While Tom DeLay's departure is a critical first step, it doesn't close the curtain on the Republican culture of corruption. DeLay is just the tip of the iceberg. From the pending investigations of convicted GOP super-lobbyist Jack Abramoff and a number of DeLay's former aides, to Bill Frist's insider trading problems, to the Duke Cunningham debacle and conviction, and the numerous scandals enveloping the Bush White House, the Republican culture of corruption unfortunately remains in Washington.

"This November, the American people will have a clear choice between Democrats who offer a bold vision based on honest leadership and real security, and Republicans who can only offer more of the same Republican culture of corruption and incompetence."

DeLay: We Changed "The Culture" Of Washington

Yesterday, on CNN, when Former House Republican Leader Tom DeLay said that Republicans in Washington "were effective in changing the culture of this town," he was quite right. [CNN, 4/4/06] Republicans in Washington have made their culture of corruption the norm on Capitol Hill, the White House and K Street.

Rudy Pleaded Guilty in Abramoff Investigation; DeLay Named As Representative #2 In Plea. On March 31, 2006 former DeLay staffer and Abramoff associate, Tony Rudy, pleaded guilty in connection with the continuing federal corruption investigation into Abramoff's lobbying practices. Rudy's agreed to cooperate with the investigation, and his plea agreement contained numerous references to DeLay and the actions of his staff. [Factual Basis for the Plea of Tony C. Rudy, 3/31/06]

Scanlon Pleaded Guilty In Abramoff Investigation; Former Prosecutor Said Scanlon's Cooperation "Crucial" To Investigation. Former DeLay aide Michael Scanlon was Jack Abramoff's business partner. Scanlon is now cooperating with investigators looking into Abramoff and a host of other DeLay associates. "Scanlon's cooperation is crucial to helping prosecutors prove that any favor to a lawmaker was in explicit exchange for an official act, said Leonard Garment, an attorney for President Nixon during Watergate. 'Scanlon presumably is in a position to say that it. . . was a quid pro quo, that if you vote a certain way or introduce a certain bill, I will pay you money or give you a brace of tickets to a Washington Redskins game. That is the way a case is proved.'" [Washington Post, 11/20/05]

Abramoff Pleaded Guilty To Corruption Charges Agreed To Cooperate With Prosecutors. On January 3, 2006 former Republican mega-lobbyist Jack Abramoff pleaded guilty to conspiracy, mail fraud, and tax evasion. In his plea agreement Abramoff agreed to testify and cooperate with the ongoing federal corruption investigation centered around his lobbying activity. [United States of America v. Jack Abramoff; Plea Agreement, 3/1/06]

Abramoff Lobbying Team Had "Extensive Access" to Bush Administration Officials. According to his lobbying firm's billing records, Jack Abramoff and his Marianas Islands lobbying team had almost 200 contacts with Bush Administration officials. The records include meetings with Cheney policy advisers Ron Christie and Stephen Ruhlen, Attorney General Ashcroft at the Justice Department, White House intergovernmental affairs chief Ruben Barrales, U.S. Trade Representative Robert Zoellick, Deputy Interior Secretary Steven Griles and others. While records show that many of the meetings were handled by Abramoff’s lieutenants, Abramoff personally with Top Interior Department officials, "whose Office of Insular Affairs oversees the Mariana Islands and other U.S. territories." [AP, 5/6/05]

DeLay Continued With Gingrich's K Street Project Despite Admonishment. In 2001, DeLay pushed for the Electronics Industry Association to hire former Rep. Bill Paxon (R-N.Y.) instead of former Rep. Dave McCurdy (D-Okla.). The plan was part of DeLay's push to load K Street power lobbying firms with Republicans. In 2004, DeLay re-launched his K Street Project. "After privately fuming for years, DeLay sat down with a group of his top lieutenants two weeks ago to figure out how to get GOP lobbyists to contribute the maximum $4,000 allowable to vulnerable Republican candidates, as well as giving the $25,000 limit to the National Republican Congressional Committee." [Roll Call, 3/12/01, Roll Call, 2/11/04]

DeLay Admonished By House Ethics Committee For Involvement In K Street Project. According to Roll Call, "DeLay's endeavor to force the Electronics Industry Association to back off its choice resulted in unwanted publicity and a formal admonishment of the Texas Republican by the House Ethics Committee." DeLay continues to try to frontload K Street with GOP lobbyists even though he was admonished by the House Ethics Committee in 2001 for doing just that. [Roll Call, 3/12/01, Roll Call, 2/11/04]

TRMPAC Indicted On Illegal Campaign Donations. "A grand jury has indicted a political action committee formed by U.S. House Majority Leader Tom DeLay and a Texas business group in connection with 2002 legislative campaign contributions. The five felony indictments against the two groups were made public Thursday. . . The charge against Texans for a Republican Majority alleged the committee illegally accepted a political contribution of $100,000 from the Alliance for Quality Nursing Home Care." On September 13, Jim Ellis and John Colyandro were personally indicted on charges of conspiracy to violate Texas campaign finance laws. [AP, 9/8/05; AP, 9/13/05]

DeLay Indicted For Work With TRMPAC. On September 28, 2005 House Majority Leader Tom DeLay was indicted on charges of conspiring to violate campaign law. DeLay was later re-indicted on the original charge of conspiracy and on money laundering. The indictments were in connection with DeLay's TRMPAC political action committee that was instrumental in electing Republicans to the Texas legislature, leading to the off year redistricting of Texas' congressional boundaries [AP, 10/4/05]

TRMPAC Laundered $190,000 of Corporate Money Through the RNC. TRMPAC contributed $190,000 to the Republican National State Elections Committee on September 20, 2002 that included corporate money. Within two weeks, the RNSEC contributed the same amount back to TRMPAC targeted candidates. [CQ Weekly, 3/20/2004; San Antonio Express-News, 3/15/2004; Austin American-Statesman, 2/26/2004; FEC, 4/8/2004; Texas Ethics Commission, 4/8/2004]

Abramoff and Ney Hit the Road. Jack Abramoff's Capitol Athletic Foundation paid for the chartered jet that flew at least six people -- including Abramoff and Ney to St. Andrews, Scotland and London in August 2002. According to House rules, members of Congress are not allowed to receive trips that are paid for by lobbyists. Abramoff also paid for members of Ney's staff to travel to the Commonwealth of the Northern Marianas, as well the Super Bowl in Tampa. [Washington Post, 9/28/04; Plea Agreement between DOJ and Abramoff, 1/3/06]
Ney Awarded Contract To Abramoff Client Through 'Highly Politicized Process.' In 1999, the House of Representatives decided to place a series of cell phone antennas in the Capitol and House Office Buildings, in order to improve cell phone coverage. LGC Wireless was awarded the contract, and LGC proceeded to work with Capitol officials for a year on a plan for the implementation of the new system. In 2001, Ney became Chairman of the House Administration Committee. Soon after, LGC was removed from the project and replaced by Foxcom Wireless, an Israeli telecommunications company and an Abramoff client. Foxcom had paid Abramoff $280,000 for lobbying and had donated $50,000 to Abramoff's charity, The Capitol Athletic Foundation. [Washington Post, 10/18/05]

Ney Attacked Boulis in the Congressional Record on Behalf of Abramoff. "FEC records show that Abramoff and three men associated with him in a Florida-based casino cruise line called SunCruz each donated $1,000 to Ney on March 15, 2001, the same day he used the Abramoff skybox. Ney had been helpful to them the year before, when Abramoff and a partner, Adam Kidan, were embroiled in acrimonious efforts to buy SunCruz. In an unusual step, Ney criticized the cruise line's owner, Gus Boulis, in statements placed in the March 30, 2000, Congressional Record, putting pressure on Boulis to sell; he then praised Kidan as SunCruz's new owner when the sale went through." [Washington Post, 12/26/04]

Thomas Noe: Bush Pioneer, Under at Least Six Separate Investigations. Noe was tapped by the Voinovich Administration to manage a portion of the Ohio Workers' Compensation Bureau's pension funds. "He also happened to be a dealer in rare coins. And in 1998, the Ohio Workers' Compensation Bureau agreed to invest in a rare-coin fund that he controlled as a way to hedge its holdings in stocks and bonds, an investment that experts have called highly unorthodox. Mr. Noe's lawyers said that as much as $13 million of the state's $50 million investment in his two funds could not be accounted for. Mr. Noe, meanwhile, has become the focus of at least six investigations or audits involving either his handling of the coin investments or his campaign fund-raising. Federal investigators are also looking into his contributions to President Bush's 2004 campaign as a 'Pioneer,' raising more than $100,000." [New York Times, 5/28/05]

Noe was Regional Chairman of Bush Cheney Campaign and Frequently Spoke with Rove. As a regional chairman of the campaign, Mr. Noe had frequent contact with Karl Rove, the architect of the President's re-election. And Ohio, it turned out, was the pivotal state in the election, narrowly pushing President Bush to victory. [Toledo Blade, 4/28/05]

Noe Under Federal Investigation for Making Illegal Donations to Bush Campaign. According to FEC regulations, individuals can only donate $2,000 to a presidential candidate in the primary and another $2,000 in the general election. Noe is under investigation for possibly laundering additional contributions through other individuals, to skirt campaign finance rules. According to the Toledo Blade, "Gregory A. White, U.S. attorney for the Northern District of Ohio, confirmed that his office, in conjunction with the FBI, is looking into Mr. Noe. . . 'We have publicly confirmed the investigation of Mr. Noe in relation to some campaign contributions,' Mr. White said. He said the investigation has been ongoing for a couple of months, but declined to comment on its details. Officials with the U.S. Justice Department in Washington are aware of the investigation." [Toledo Blade, 4/28/05]

Frist Subpoenaed By SEC On Suspicion That He Violated "Insider Trading Laws." Senate Majority Leader Bill Frist "has been subpoenaed to turn over personal records and documents as federal authorities step up a probe of his July sales of HCA Inc. stock, according to sources familiar with the investigation. The Securities and Exchange Commission issued the subpoena within the past two weeks, after initial reports that Frist, the Senate's top Republican official, was under scrutiny by the agency and the Justice Department for possible violations of insider trading laws." [Washington Post,10/13/05]

Cunningham Sold His Home to a Nevada Company Associated with Mitchell Wade, Who Resold It For a $700,000 Loss. In late 2003, Republican Congressman Duke Cunningham sold his Del Mar home for $1.675 million to 1523 New Hampshire Avenue LLC, a Nevada company for which Mitchell Wade is a corporate officer. The Nevada company shortly put the house back on the market. County property records show that it sold about eight months later for $975,000 ---- a $700,000 loss. A local title company studied local sales and found that the average sales price was $1.12 million, more than $500,000 less than what Wade paid for Cunningham's home. [North County Times, 6/13/05, 6/28/05]

Wade Was Also President of MZM, A Defense Contractor. Mitchell Wade also is president of MZM Inc., a defense-contracting firm located in Washington, D.C. MZM's address in Washington, D.C. is 1523 New Hampshire Avenue. [North County Times, 6/13/05; http://www.mzminc.com/contactus.cfm]

Defense Contracts Were Awarded To MZM Without Competition. MZM had 56 contracts totaling more than $68.5 million in fiscal year 2004. The contracts were mostly awarded without competition through a process known as "blanket purchase agreements." The General Services Administration awarded MZM a five-year, $250 million blanket-purchase agreement in 2002 that allow MZM to shop its services to any U.S. government agency, with considerably less oversight and competition than the normal bidding process until 2007 or until it reaches its $250 million cap. [San Diego Union-Tribune, 6/21/05, 6/25/05]

Safavian Arrested In Connection With Abramoff Probe. The Bush Administration's chief contracting and procurement official at OMB, David Safavian was arrested on charges of making false statements to an ethics official, making false statements to the General Services Agency's Inspector General, and obstruction of a GSA-IG investigation. [Washington Post, 9/20/05; DOJ Release, 9/19/05]

Ralph Reed: Bush Pioneer (2000) and Ranger (2004), Named In Investigation Of Abramoff Payments. The Indian affairs committee, as part of its ongoing investigation of Jack Abramoff, subpoenaed Reed. In addition; investigators are looking into a $4 million payment that Abramoff made to lobbyist Ralph Reed, a key player in the president's reelection operation who raised more than $300,000 for Bush's two presidential campaigns. [Washington Post, 4/27/05, 4/22/05]