WaPo:"'We set out to establish a democracy, but we're slowly realizing we will have some form of Islamic republic,' said another U.S. official familiar with policymaking from the beginning, who like some others interviewed would speak candidly only on the condition of anonymity. 'That process is being repeated all over.'"
--Josh Marshall
Admittedly, it's Saturday night. But this is a great question for collaborative research. And I suspect some of you are ready to dig in even now.
This passage comes, unrebutted, in today's Washington Post ...
DeLay's association with Abramoff clearly has become a concern for those in the majority leader's camp. In recent months, DeLay has been distancing himself from Abramoff. Earlier this year, DeLay told a group of conservative supporters at a private meeting that sometime shortly after SunCruz Casinos founder Konstantinos "Gus" Boulis was gunned down in Fort Lauderdale, Fla., on Feb. 6, 2001, he confronted Abramoff over his SunCruz involvement, according to people in attendance."Immediately, he had Abramoff called in and told him, 'I want no more dealings with you,' " said conservative activist Paul M. Weyrich, a longtime DeLay friend, recounting a speech DeLay gave to a conservative group earlier this year. "I think he felt blindsided by Abramoff" over the SunCruz affair, Weyrich said.
So DeLay has staked his game on February 6th, 2001, four and a half years ago.
There's a lot of information <$NoAd$> publicly available online. Political contributions, newspaper articles, party websites, etc. I suspect there's a lot out there about DeLay's post February 2001 chumminess with Abramoff. If you find examples, let us know.
--Josh Marshall
First time as farce, second time as farce too?
With President Bush again stating that force is still on the table against Iran, albeit only as the last resort, German Chancellor Gerhard Schroeder has kicked off his uphill reelection drive with an attack on President Bush's Middle Eastern belligerence.
All of this, of course, provides an uncanny replay of the build up to the US invasion of Iraq with the German Chancellor leveraging reelection on the axis of President Bush's warmongering.
(ed.note: My literary powers failed me when I tried to come up with a joke suitably humorous and grim to fully capture the ridiculousness of President Bush's continued insistence that he is willing to use force but only as a last resort. Perhaps someone out there can help?)
--Josh Marshall
There's more news out today about the investigation into Rep. Bill Jefferson (D) of Louisiana. The details are still sketchy, and somewhat contradictory as they emerge from articles in the Post and the Times-Picayune. But what now seems clear is that Jefferson got caught up in an FBI sting.
The Post suggests the sting centered on a high-tech start-up firm in Northern Virginia, while the hometown paper points to a much more complicated and muddled series of connections with foreign ties and trips to Africa and South America.
Whatever the details, and even if this is a sting, the two articles contain more than a bit of information that Jefferson might have gotten stung.
Sources told the Post, for instance, that one item seized in the raids on Jefferson's homes was "a large amount of cash that was kept in a freezer."
The Times-Picayune adds some details to that nugget, if pretty loosely sourced ...
Fawer [Jefferson's lawyer] disputed rumors since the raids that agents left Jefferson's Marengo Street home with a large amount of cash, perhaps as much as $500,000, and that they had timed their raids out of concern that in his then-impending trade mission to Brazil, Jefferson was providing himself an opportunity to move the money out of the country."That's just nonsense; it's not true," Fawer said. "I can't tell you there was no money seized, but it is not true that sums like that were taken either here or in Washington. I don't believe the money was in the six figures."
I'll be curious to hear when this investigation started or revved up.
--Josh Marshall
I just promoted a reader blog entry on this topic over at TPMCafe and I thought I'd raise it here too. Who's on the case when it comes to the flat tax? The FairTax Book, a piece of right-wing agitprop dedicated to abolishing the income tax and replacing it with sales taxes borne mainly by the middle class and the poor.
This certainly seems to be coming down the pike. But, like I said, who's on the case?
--Josh Marshall
Yet more backstory on Jack Abramoff, Adam Kidan and Gus Boulis and the unfortunate misunderstandings about Suncruz, from Forbes ...
But the deal was quickly mired in violence and controversy. Boulis allegedly threatened to kill Kidan, jumping over a desk and throwing punches; Kidan filed a restraining order. And in February 2001, Boulis was murdered at the age of 51 in a hail of gunfire in Fort Lauderdale, Fla. (See: "Going For Broke.")Shortly after the murder, both Abramoff and Kidan told Forbes they were out of the country when it happened. They said they had made themselves available to the police for questioning through lawyers. Yet as of yesterday, Fort Lauderdale police say Abramoff has eluded them. Though police said he is not a suspect, he is "definitely someone of interest" in the still ongoing investigation of Boulis' murder.
A reporter had mentioned to me that <$NoAd$> Abramoff had quickly volunteered that he'd been out of the country when Boulis got whacked, so quickly in fact that at different times he mentioned different countries as the country he'd been out of the country in.
Now, when Forbes says "They said they had made themselves available to the police for questioning through lawyers" does that mean that they sent word through their lawyers that they were available for questioning? Or does it mean that their lawyers were happy to answer questions for their clients -- always of course the way cops like to do their questioning?
The Forbes piece also mentions the suit that Boulis' estate filed against them after he got rubbed out ...
The suit claimed that in the weeks before Boulis' death Kidan wrote three $10,000 checks to Anthony Moscatiello, a man once indicted for racketeering along with a brother of gangster John Gotti. (The case ended in mistrial.) Adding to the intrigue was Kidan's past: His mother was murdered in the doorway of her Staten Island home in an apparent robbery attempt. Chris Paciello, a Miami night club owner and a reputed associate of the Bonanno crime family, later pleaded guilty to the murder.
Small world.
--Josh Marshall
Theoretical physicists sometimes talk about alternative universes. But I think I just found one right here on my website.
You may have noticed that down there toward the bottom of the sidebar we've started running google ads in addition to the regular image ads we've been running for almost two years. Unlike our regular ads, we have no control over what text ads run with google on our site. And, perhaps more importantly, the advertisers don't control where they're appearing either.
It's all run by some algorithm that scans what I write about here and then tries to come up with ads that are in some way related to what I'm discussing.
So here's where we get to our alternative universe.
Now, I know there are a lot of people in this country who not only support President Bush but are deeply committed to him at various levels. But I must say that there's still some dissonance created for me when I see that Fox Bronze Art is now selling a Bronze bust of our 43rd president, mounted on black granite, and measuring 16x10x7 inches, for only $1,995.
And if I'm not mistaken, the casting is meant to represent his heroic moment flying on to the aircraft carrier to announce mission accomplished.
What a heroic moment that was.
I think I may get one for my desk here. Or perhaps one to put with the rest of my household gods.
Like I said, an alternative universe.
--Josh Marshall
Oh that's just great.
You know about the indictment of Jack Abramoff yesterday for his dealing relating to SunCruz, the casino boat operation down in Florida. And you also have heard about how Rep. Bob Ney of Ohio gave speeches on the floor of the House to help Abramoff (and his then-partner and now-fellow indictee) Adam Kidan squeeze Gus Boulis into selling them SunCruz. Boulis is the guy who later got whacked in the gangland hit after everything went sour.
But I at least didn't know that Abramoff was apparently trying to expand the SunCruz operation to Saipan, the US Pacific Island protectorate where he was best known for protecting owners of sweatshops from congressional efforts to clamp down on their system of indentured servitude.
This article from The Saipan Tribune spells out the details, the exciting news that laborers in Saipan would get jobs on the casino boats (one of which was supposed to be "deployed" by August 2001) and the even more exciting news that SunCruz would "create job opportunities for local workers who may also ask to be transferred to other company-operated floating casinos in the mainland US, Asia or the Carribbean."
I think the Brits had a system like that, didn't they?
Anyway, take a look.
(ed.note: Props to TPM Reader RS for the catch.)
--Josh Marshall
Another thought on the Abramoff story.
People tend to think of this story as the DeLay crew finally getting caught with their hands in the cookie jar. And some of the immediate causes of Jack Abramoff's troubles were some Indian elections that went bad for him. But there's another part to this story that will be important to keep an eye on.
There are many theories about who's leaking on who in generating all these revelations about Abramoff and his associates. But it's clear that a big factor in all of this -- a big factor in generating a lot of these stories -- is a division between different groups of ex-DeLay aides -- particularly, the one surrounding Abramoff (the one that has everyone rushing for the exits, if they can find an open door) and that around Ed Buckham.
--Josh Marshall
With Jack Abramoff under indictment, a number of readers have suggested that now he might flip and try to offer the feds some figures higher up the food-chain. (Remember, this indictment is not from the DC-based grand jury we've mainly been hearing about; it's a separate grand jury in Florida, tied to alleged fraud in the purchase of a casino boat line. Jack really gets around.)
But I hear it's a bit different. I hear Abramoff has already tried to do that, and been rebuffed. And this gets us into questions I think we'll be talking about a lot.
Why would he be rebuffed?
Decisions like that go right to the top. And since Abramoff's shenanigans are closely tied -- to be generous -- not just to members of Congress (DeLay, Ney, Burns, et al.) but to key GOP power players (Norquist, Reed, et al.) and quite probably Karl Rove himself, you can see why he (i.e., Abramoff) might have a harder time than your usual perp cutting a deal to implicate those above him.
That DC grand jury investigation of Abramoff can't go on forever. Eventually the lawyers at the Public Integrity Section will go to their bosses with some decisions about just who they want to indict. That's when Al Gonzales will have to show his cards.
--Josh Marshall
That's an interesting approach.
Charles Alfred Dreyling Jr., 24, was caught Wednesday trying to Delta Airlines jet bound for Attanta with a pipe bomb in his luggage. It was equipped so that it could be detonated with his cell phone.
When asked, Dreyling told investigators that he had made the bomb, but that it was for recreational purposes (blowing them up with friends in rural Oklahoma) and that he had forgotten that it was in his suitcase.
--Josh Marshall
We all know how powerful the web can be for raising political money. Well, if you're game, the Duke Cunningham Legal Defense Fund is apparently ready to accept your donation.
--Josh Marshall
Only yesterday, when I was reporting on Jack Abramoff's part ownership of now-bankrupt SunCruz -- a casino boat operation down in Florida -- I was told there was a decent chance Abramoff would get indicted for fraud some time soon in that case too. And mind you, this is a different case, a different grand jury, than the one looking into his other shenanigans in DC and elsewhere.
And sure enough, the AP just moved a story saying that Abramoff will be indicted later today.
For those of you keeping score, this is the casino boat company in which one of Abramoff's co-owners was later whacked in a gangland style hit after the things started to go South.
And yes, there's also a Conrad Burns connection. SunCruz was the company Abramoff used to bring Burns' staffers to the Super Bowl back in 2001.
--Josh Marshall
FEC Audit finds $300,000 of misreporting on the books of Rep. Tom DeLay's ARMPAC.
--Josh Marshall
A TPM Reader (who's a lawyer) asked whether it might not be the case that the RNC is paying Jim Tobin's legal bills in the New Hampshire phone-jamming case because they are under some legal or contractual obligation to do so.
Now, as I wrote earlier, it seems to me that the demonstrable evidence of Tobin's guilt, would absolve them of such an obligation. And, just to be clear, Tobin's defense doesn't seem to rest on his being innocent of the deeds in questions but rather on claims that no laws cover what he did or that he has immunity from prosecution. I'd be curious to hear from other lawyers with experience in this area what they think.
But the thing is, Tobin's legal bills -- $700,000 and counting -- are being paid by the Republican National Committee. And he wasn't working for the Republican National Committee. He was working for the National Republican Senatorial Committee. These are two different organizations. They may have a common interest in Tobin's silence. But I cannot see why the RNC has any obligation, legal or ethical, to foot the bill for Tobin's defense.
--Josh Marshall
Kathleen Sullivan, Chair of the New Hampshire Democratic party, speaks out about the latest on 2002 phone-jamming scandal and asks why the RNC is paying the ringleader's legal bills.
--Josh Marshall
Big News ... did I say Big News?
For years -- literally years now -- we've been telling you about the Republican election-tampering scam from New Hampshire on election day 2002. This was the case in which the state Republican party hired a company to jam the phones of Democratic and union phone banks doing get out the vote work on election day in what was expected to be a tight race between now-Sen. John Sununu and then-Gov. Jeanne Shaheen.
Election-tampering pure and simple.
The then-executive director of the New Hampshire Republican party and a consultant involved in the scheme are now doing time for their role in the caper. And though the DOJ has done about everything it can to drag its feet on the case, as we first reported last year the kingpin in the case, NRSC northeast regional director James Tobin himself was finally indicted.
Now, Tobin was then the Northeast Regional Director for the National Republican Senatorial Committee, working under then-Chairman Bill Frist. (Later he became the regional chairman of Bush-Cheney 2004; he stepped down when he was indicted.)
Frist has refused ever to answer questions about what he knew about the scam. And various RNC officials going back almost three years now have disavowed any knowledge of the case at all. Had nothing to do with it, just a rogue operation, etc.
And now, finally, we have proof that all along the RNC has continued to pay Tobin's legal bills -- already totalling more than $700,000 before the man has even gone to trial.
This one is simply a no-brainer. Yes, an organization may be morally or even legally obligated to pay an employees legal bills for trouble they got in to in the course of their work. But that doesn't apply if he broke laws and was acting without authorization and in express contravention of his employers' wishes. It's true that Tobin hasn't been convicted yet. But his guilt or innocence -- in the colloquial sense of the terms -- is not at issue. His defense has centered entirely on claims that his acts didn't violate any laws or that he has immunity for various reasons.
Put simply, the fact that the RNC is paying Tobin's legal bills means either that he was acting under authorization or, frankly, that they're trying to keep him quiet. There's really no other reasonable explanation of this.
Reporters from the big news outlets have never taken this story very seriously. And they've never found the time to press Bill Frist to answer even the most basic questions about this, despite the fact that Tobin was working for Frist when this happened.
Now's the time.
If you'd like to find out more about the backstory on this, here's a list of our reporting on it going back to 2003. If you'd like to discuss, we'll be discussing it in this thread.
--Josh Marshall
I've posted my run-down of the relationship between Sen. Conrad Burns (R-MT) and Jack Abramoff over at TPMCafe. Burns says he's barely ever spoken to Jack, but ... well, you'll see.
--Josh Marshall
The esteemed Mr. Pincus does some subtle and delicate correcting of the record which some others, who shall remain nameless, had willfully muddled.
And some so nearby!
--Josh Marshall
Just another thread of the Abramoff story, <$NoAd$> from the Miami Herald, April 26th, 2005 ...
In 2000, [Gus] Boulis sold [casino boat company] SunCruz to a partnership of Washington-based businessmen, including Jack Abramoff, the now infamous lobbyist who was surreptitiously funneling Indian casino millions to key congressmen, including the supposedly anti-gambling Republican leader, U.S. Rep. Tom DeLay. A congressional inquiry revealed that Abramoff, then vice chairman of SunCruz, used SunCruz casino money to bring staffers of key Republican congressional leaders to the 2001 Super Bowl.Meanwhile, Boulis claimed that Abramoff and Adam Kidan had shorted him $23 million. There were reports of fisticuffs between Boulis and Kidan. Kidan took out a restraining order to keep Boulis away.
The restraining order became moot on Feb. 6, 2001, when Boulis was gunned down in a mob-style hit. The murder was never solved.
SunCruz, meanwhile, foundered into bankruptcy. Abramoff sued Kidan for the $60 million he claimed the deal cost him.
Kidan, if I'm not mistaken, turns out to be one of the Abramoff 'associates' who for one reason or another dropped five grand on Sen. Burns leadership PAC a few years back, though I guess that was before Jack sued the guy for 60 mill ...
(ed.note: We're discussing the Burns-Abramoff link in this thread.)
--Josh Marshall
If you don't want to miss any Sen.Burns-Jack Abramoff stories in the Billings Gazette, they've helpfully put together this special Burns-Abramoff shenanigan page at their website.
--Josh Marshall
Rep. LaTourette (R) too stupid to remain in Congress?
I suspect over the next weeks and months we're going to have a number of stories like this one, in which a lawmaker's excuse for switching their vote on CAFTA is picked apart and proved to be a laughable dodge. But Rep. Steve LaTourette's may turn out to be a classic.
LaTourette, of Ohio's 14th district, was a down-the-line opponent of CAFTA, which made a lot of sense for his northeast Ohio district. But on the day before the vote, Rep. LaTourette received a call from Tom Chieffe, the president of a furniture manufacturer from the district. Chieffe told the congressman that his company was getting socked hard by tariffs on Central American plywood. And the Ohio jobs at his company were on the line.
Rising to the challenge LaTourette got on the phone to US Trade Rep. Rob Portman, who himself just retired from his seat representing Ohio's 2nd District (the one the Hackett race was in). Portman sent over some papers outlining the rough tariffs on Central American plywood. And as a result, says LaTourette, he reluctantly agreed to change his vote to 'Yes' on CAFTA.
The only problem, according to this article in the Cleveland Plain Dealer is that there aren't any tariffs on Central American plywood.
US government statistics say American businesses paid a total $4,700 in tariffs last year on Central American plywood. And even that was apparently paid by mistake.
Here's what the Plain Dealer said about the Portman bamboozle ...
Portman's office acknowledges giving LaTourette a paper that made it appear CAFTA would eliminate the 8 percent tariffs. It defended its actions in interviews with The Plain Dealer over the last week, saying the existing plywood exemptions were not as sweeping as those offered under CAFTA. "And this locks in the benefits and therefore locks in the supply" of plywood, said Matt Niemeyer, Portman's congressional affairs liaison.Yet figures from the International Trade Commission, an independent panel, and the Census Bureau, citing tariff collections, show that to be an unnecessary distinction in the claim that tariffs were jeopardizing a big corporation.
You should really read the article, for comedy value if nothing else. It leaves only two real possibilities: the more likely one that LaTourette was himself in on the cover story that is now revealed to be completely ridiculous or he is such a simpleton that he simply can't be trusted to represent the 14th district.
Admittedly, there is the third possibility that LaTourette was both in on it and a hopeless simpleton, as evidenced by the fact that he thought no one would ever find out that these tariffs don't exist.
--Josh Marshall
For those of you trying to come up to speed on the DeLay/Abramoff story, here's our quick run-down on six of the top cronies in the mix.
--Josh Marshall
Duke Update from the North County Times: "With his legal defense costs estimated to reach as much as $1.5 million, embattled U.S. Rep. Randy "Duke" Cunningham has asked the Federal Election Commission for permission to use the money in his campaign account to pay the bill."
--Josh Marshall
Good stuff in this post from Michael Crowley over at The New Republic blog ... Someone should forward it to a few of those station execs in Montana who are getting bamboozled by Republican lawyers into pulling those ads about Sen. Conrad Burns' cozy ties to Jack Abramoff.
As Crowley makes clear, there's no question that those donations from Abramoff's Indian tribe clients were actually organized, handled and dictated by Abramoff himself.
Come to think of it, I really wonder whether the folks in charge of organizing the GOP's 'Jack Who?' campaign next year want to invite such close scrutiny into how Abramoff handled his clients' political donations.
One way or another, check out the post.
--Josh Marshall
You may have thought that Rep. Duke Cunningham (R) would stop regaling us with tales of his high-living congressional lifestyle now that he's decided not to run for reelection next year. But you can't count Duke out so quickly.
Last Friday the Union-Tribune ran a new and admittedly slightly complicated piece on Duke's high-flying ways.
You may know that under congressional rules, lawmakers can take a flight on a company-owned private jet and reimburse the company in question only at the price of a single first-class commercial air ticket, though of course fare on a private jet is vastly more expensive.
This is a legal and bipartisan practice that is its own special little scandal in itself -- of which we'll say more in a future post.
Now, there's a defense contractor named Brent Wilkes. He has a company called ADCS Inc. And as you might expect, the operation has been on the Duke gravy train in recent years. In fact, things are going so well that Wilkes also has Group W Advisors, a DC-based lobbying firm. And, yes, perhaps it goes without saying that before Duke's sugar-daddy Mitchell Wade set up the now-notorious MZM, Inc., he was an employee of ADCS.
As you'll see in a moment, if nothing else, Wilkes seems to be a true innovator in the vertical integration of the congressional pay-for-play industry.
And as part of that, let's get to Group W Transportation, Wilkes' private air carrier.
I'm always a little worried about travelling on planes owned by tiny companies. But if you think that's bad, Group W only owns one-sixteenth of a plane!
Now, that doesn't sound too airworthy. And maybe like me, when you first read that, you were thinking you'd end up at 20,000 feet just flying on half a wing or maybe a nose cone. But actually it's not that bad. Basically Group W owns one-sixteenth of a plane in what amounts to a time-share arrangement like some people do with vacation houses. Group W owned fifty hours a year on a Lear jet. (Recently, they upgraded to an eighth of a plane.)
But here's where the Duke fun gets started. According to the piece in the Union-Tribune a very large proportion of that time went to ferrying around members of Congress. Just to recap, the idea behind the charter jet reimbursement rule is that some corporation will lend a congressman or congresswoman its jet to get back to Washington or to fly to a fundraiser. But as part of lathering up lawmakers like Duke, Wilkes seems to have set up his own little mini-airline mainly, if not exclusively, to provide coast to coast air taxi service for members of Congress he's trying to get favors from. As an example, writes the paper, "During one weekend campaign swing in July 2003, DeLay used at least a quarter of Group W's 50-hour annual allotment on the jet."
But the most frequent flyer on the friendly skies of Group W was none other than Duke Cunningham.
--Josh Marshall
GOP gets one Montana TV station to pull Burns-Abramoff ad. Station owner says ads will come down if Democrats do not remove the claim that Burns took Abramoff money.
--Josh Marshall
It seems the GOP really doesn't like those ads Montana Democrats are running in the state explaining Sen. Conrad Burns' (R) ties to Jack Abramoff. So they're taking up that increasingly familiar Republican campaign tactic: threaten the stations' campaign managers with a lawsuit if they don't stop running the ads. Crooks & Liars has a copy of the letter.
--Josh Marshall
More on the Sen. Conrad Burns - Jack Abramoff backstory, from the Billings Gazette.
--Josh Marshall
More tales of Jack.
The Montana Democratic party is running this television commercial which highlights Sen. Conrad Burns (R-MT) still little discussed ties to power lobbyist Jack Abramoff. This AP article gives more details.
--Josh Marshall
A TPM Reader takes a stab at the $9,000 <$NoAd$> check mystery ...
Regarding the Jack Abramoff/Guam Superior Court embroglio, I think you're barking up the wrong tree. There probably is some illicit "structuring" going on, but it's likely by the Guam court officials, not Abramoff. This is all surmise, of course, but anyone who has ever had "signature authority" in a corporation usually also has had dollar limits on that authority (that is, a limit on how much they can authorize without sending it to a superior/supervisor).Sure enough, when you look at the Guam procurement code, section 5213 states, "Small Purchases. Any procurement not exceeding the amount established by regulation may be made in accordance with small purchase procedures promulgated by the Policy Office, provided, however, that procurement requirements shall not be artificially divided so as to constitute a small purchase under this Section."
Now, your posts mentioned that the Guam Supreme Court is trying to do something that, evidently, the Superior Court judges or administrators disagree with. The Superior Court people may not want to come right out and ask for $300,000 to lobby against the Supreme Court people (Guam's a small place, maybe it's bad politics, who knows?), and so they use administrative procedures to mask what they're doing. How much do you want to bet that the "amount established by regulation" is $10,000? Assuming that's the case, if you wanted to hide a procurement contract in plain sight, you'd make sure that the payments were each below the "amount established by regulation" in order to avoid having to make a procurement request up the chain of command.
Note, by the way, that the procurement code prohibits exactly that conduct. Thus, if Abramoff or his intermediary in California was aware of that, they could be accessories to some kind of violation in Guam, but without doing further research, it would be impossible to know that for sure.
More on this to come.
--Josh Marshall
More on that money funnelled to Jack Abramoff from Guam.
To recap the details, Abramoff's clients in Guam paid him $324,000 in 36 separate checks for $9,000. They didn't pay it to him directly but used a Laguna Beach, California attorney, Howard Hills, as the cut-out. The Guam clients sent the money to Hills; Hills sent it on to Abramoff, etc.
Now, as we also noted, the $9,000 number jumps out because it's just shy of $10,000. And banks must report all transactions over $10,000 to federal regulators.
I was curious whether bundling payments like this is a crime even if there's no other criminal activity tied to the transaction. And the answer seems to be: absolutely.
The law in question is 31 USC 5324(a). The relevant language reads: "No person shall, for the purpose of evading the reporting requirements ... structure or assist in structuring, or attempt to structure or assist in structuring, any transaction with one or more domestic financial institutions."
For the non-lawyers among us, the crime of "structuring" is put into more colloquial English in this government Bulletin on financial crimes: "Designing a transaction to evade triggering a reporting or recordkeeping requirement is called “structuring.” Structuring is a federal crime, and must be reported by filing a Suspicious Activity Report (SAR)."
The bulletin provides this example: "A customer breaks a large transaction into two or more smaller transactions. A man wants to conduct a transaction involving $12,000 in cash. However, knowing that the cash threshold of more than $10,000 for filing a CTR would be met, he conducts two cash transactions of $6,000 each."
Sounds familiar, doesn't it?
Now, as you know, I'm not a lawyer. And though I've discussed this matter with several lawyers over the course of the day, it's certainly possible that there's some detail I've missed which makes the cited law not apply.
There seems to be some conflict, for instance, between lawyers and bank officers who've written in over whether the law in question applies to checks or only to cash, bank orders, etc. (And if the federal law in question doesn't apply, what explains the $9,000 increments?)
But from what I've been able to glean so far at least, this looks like a textbook example, pretty much on its face, of a federal crime -- in which each of the three parties (Anthony Sanchez, Howard Hill and almost certainly Jack Abramoff) participated.
As I wrote earlier, I'd very much like to hear from any lawyers or financial services professionals who can shed more light on these issues discussed above.
Late Update: The more I hear on this, the more I'm wondering whether the law doesn't apply to ordinary garden-variety checks, as opposed to cash or bank notes, etc., if only because it's so hard to believe these guys ever could have gotten away with something so obvious. One TPM Reader, for instance, writes: "That is a puzzling number, but I don't think it directly violates a law. The law you cite is designed to monitor cash transactions, to help control various forms of laundering. It sounds like the $9,000 transactions were all done by check--and a $9,000 check is not at all unusual. It does raise questions, though, about how the money was reported as income ... just because it is unusual to break money into regular small amounts not tied to any kind of time or performance ..." In any case, as I said, whoever can shed some light on this...
--Josh Marshall
Yesterday we noted this article in the Los Angeles Times which suggests that in 2002 the White House may have removed a United States Attorney who was about to begin an investigation into the lobbying activities of Jack Abramoff in the overseas territory of Guam. And Karl Rove appears to be directly tied to the decision-making -- at least on the man's replacement.
In that article, though, there's also this passage ...
In 2002, Abramoff was retained by the Superior Court in what was an unusual arrangement for a public agency. The Times reported in May that Abramoff was paid with a series of $9,000 checks funneled through a Laguna Beach lawyer to disguise the lobbyist's role working for the Guam court. No separate contract was authorized for Abramoff's work.
Certainly not the most efficient way to pay the bill, especially since it totaled more than $300,000. Here's the passage in the earlier article referenced by the Times ...
In 2002 Abramoff was retained by the Guam Superior Court to help fight a judicial reform bill pending before Congress. It was an unusual arrangement for a public agency. No separate contract was authorized, and Abramoff's lobbying fees were disguised in a series of small checks funneled through a California lawyer under an existing contract, records and interviews show.The middleman, Laguna Beach lawyer Howard Hills, said in an interview that he backed out of his role after processing 36 separate checks in $9,000 increments totaling $324,000.
The transactions now are under investigation by the Guam Public Auditor's office.
In May 2002, Superior Court administrators were trying to stop legislation that would give the Guam Supreme Court authority over the Superior Court.
The bill's supporters at the time, such as Guam's congressional delegate, Robert A. Underwood, said the measure was needed to prevent undue political influence on the judiciary and also to clarify the authority of the Supreme Court.
Foes, led by Superior Court Chief Justice Alberto C. Lamorena and court administrator Anthony Sanchez, objected to Congress interfering with a Guam domestic matter. But they received an unexpectedly hostile reception at a hearing in Washington on May 8, 2002.
According to Hills' account, the court officials, licking their wounds over lunch, decided to call in Abramoff, known for his political ties to Rep. Tom DeLay (R-Texas), who was the House whip at the time.
The California lawyer, a former Reagan administration official, was acting as a consultant to the Guam Superior Court. Hills said the Guam contingent walked a few blocks to Signatures, the Washington restaurant they knew was owned by Abramoff.
At an impromptu meeting, Abramoff said he could help, Hills said. The lobbyist also told the Guam officials that DeLay and House Republican leaders would find abhorrent any interference by Congress in a local court dispute.
Hills withdrew, he said, thinking his services no longer were required. Instead, Hills said, he soon found himself helping to conceal Abramoff's agreement with the Guam court.
Rather than create a new contract for Abramoff, the Guam Superior Court hired the lobbyist under Hills' original consulting contract. No public disclosure was required and, according to Hills' account and e-mails reviewed by The Times, the unusual billing system was created.
One e-mail from Sanchez to Hills on May 23, 2002, asked "can you please send me 22 individual invoices at no more than $9K for May payments.... Very important." Sanchez used the e-mail address "nobodyonguam."
In another e-mail dated Sept. 30, 2002, Sanchez ordered Hills not to talk about the arrangement. Hills said he forwarded all of the $9,000 payments to Abramoff.
Eventually, Hills said, he called a halt to the arrangement and refused to submit any additional bills on Abramoff's behalf. That also ended the string of payments, prompting Abramoff's complaint to Sanchez.
As I said, a rather unorthodox method of payment. And the pattern was clearly no accident, as shown by Sanchez's direction to "send me 22 individual invoices at no more than $9K for May payments." The additional detail here is that federal law requires banks to report funds transfers of over $10,000. (The change to this amount is relatively recent; but I'm pretty sure it predates late 2002.)
Thus, it seems very hard to come up with a reason for this odd pattern of payment other than as an attempt to conceal the transaction from federal authorities. And of course using Hills as a cut-out allowed Abramoff to avoid filing the requisite lobbying disclosures.
I'd be curious to <$NoAd$>hear from lawyers with relevant experience what they make of this arrangement.
--Josh Marshall
We just started the second edition of our new TPMCafe Book Club this mornign.
This week we have author Larry Diamond talking about his new book Squandered Victory, essentially an insider's account of the poor planning, mismanagement and incompetence that bedevilled the Coalition Provisional Authority in Iraq. Diamond is a foreign policy hand with an expertise in democratization and, I think, also a Democrat. But he's a fellow at the Hoover Institution at Stanford. And through that connection, he became friends with Condi Rice.
It was Rice who contacted him about six months after the end of the war to ask if he'd go to Iraq as an advisor to the CPA.
The book is his story of what he saw there. And he's just started the discussion of the book this morning.
If you'd like to join in and ask Diamond your own questions, stop by.
--Josh Marshall
The Wall Street Journal oped page -- the folks who brought you 'Karl Rove, Whistleblower' -- have unearthed the evidence of liberal bias in Bob Novak's on-air meltdown last week. Only Novak was sent to the penalty box, not Carville! And after all, Carville provoked him, right?
Actually, what's interesting here is that even if Novak was trying to re-prove himself as a tough guy in the eyes of the Journal hyenas, they seem to have gotten the message that he's not able to defend himself.
In any case, one other thing jumped out at me about the Journal's quick-and-dirty piece. Writes the Journal: "But far from "watching" Mr. Novak, we've defended him while the rest of the press corps has assailed him for doing his job and breaking the news about Valerie Plame's role in getting her husband Joe Wilson a job as a CIA consultant."
Now, I grant you that keeping tabs on all the falsehoods on the Journal oped page would amount to a Sisyphean task. But here we seem to have a bonus falsehood wrapped into the larger campaign of falsehood. "A job as a CIA consultant." Did Wilson ever have a job as a CIA consultant? I think that implies being paid. Whatever else one can say about the man, his trip to Niger or anything else, I believe there is an uncontested and never questioned record that the man was never paid anything but the expenses of the trip.
This is simply another intentional inaccuracy meant to support the larger inaccuracy that the fact-finding trip was a boondogle put together by his wife.
Lies beget lies and yet more lies. And eventually you have a whole oped page.
--Josh Marshall
Switchboard call log update.
Last night I asked if folks with experience at the White House could give us some sense whether the Rove claim about the call logs was credible (see post below).
I heard from a number of readers, nearly all of whom did not find it credible, for various reasons.
However, the person I heard from who is in the best position to know (personal experience, etc.) told me that in fact that is how the log system operates and thus that the claim that the call was not logged because it came in through the switchboard is credible. So until I hear otherwise I think at least that very narrow question is settled.
--Josh Marshall
More posts a little later this morning. For now, check out this Abramoff update from yesterday.
--Josh Marshall
This passage comes at the end of Mike Isikoff's piece on who will have authority over the Fitzgerald investigation now that Deputy Attorney General James Comey has left for the private sector ...
Fitzgerald recently called White House aide Karl Rove's secretary and his former top aide to testify before the grand jury. They were asked why there was no record of a phone call from Time reporter Matt Cooper, with whom Rove discussed the CIA agent, says a source close to Rove who requested anonymity because the FBI asked participants not to comment. The source says the call went through the White House switchboard, not directly to Rove.
My understanding is that <$Ad$> this issue is becoming a key one for whatever it is that Fitzgerald is trying to prove. But is this credible? Do White House phone logs not get kept just because they come in through the White House switchboard? I've never worked there of course. But that seems hard to believe. There's really little point in keeping logs unless they are at least fairly comprehensive -- you look back and you know who you did talk to, when, and who you didn't. And lots of calls must come in through the switchboard.
So this is a question to various friends and sometime sources who've worked this White House and others. Does this switchboard call story make sense to you?
--Josh Marshall
Here, for no particular reason other than that I was cleaning out my desk, is my own special piece of "Jeff Gannon" history (certainly destined for the TPM archives) ...
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Given to me by the man himself, during President Bush's acceptance speech at last year's Republican National Convention.
--Josh Marshall
Drudge says Mike Allen of the Post has accepted a job covering the White House for Time.
If true, it's a huge loss for the Post. The daily political press is filled with more than a few time-servers and many more who have difficulty seeing beyond the narrow minutiae of what they're covering or the iron chains of conventional wisdom. But Allen is consistently good, day in and day out, in most all the ways I can think of to judge a political reporter.
I fear though that this isn't just a loss for the Post but also a loss for me and everyone else who counts on good political reporting. I know I'll hear from my friends at the news weeklies about this. But it's not clear to me that the sort of daily and detailed coverage of the big political stories of the day -- that he excels at -- can be duplicated in the very different, and sometimes sanded-down, big-picturish format of the weekly news magazine.
--Josh Marshall
