Reidblog [The Reid Report blog]

The two-year corruption probe of Miami Commissioner Michelle Spence-Jones yielded no criminal charges, but it did offer a rare glimpse of influence at work behind the scenes at Miami City Hall.

Witnesses told investigators how developers hired -- and fired -- consultants to curry favor with Spence-Jones when crucial votes were on the line, records show. Spence-Jones asked a developer to hire a former campaign staffer, and tried to steer another consultant to the firm, witnesses said.

Beyond the commissioner's role, the papers spotlight how private companies try to win votes by deploying the right mix of politically-connected consultants -- while treading gingerly around lobbying laws.

The Miami-Dade State Attorney's Office dropped its probe of the development deals last month, after investigators said they could find no evidence that Spence-Jones received any money or traded her vote for favors.

... Confounded by contradictory witnesses, the investigation unfolded like a children's game of telephone, with the whispers often leading back to one man: former City Manager Joe Arriola. In the spring of 2007, he recommended a Spence-Jones ally for a consulting job with a builder -- then called prosecutors weeks later with his suspicions of possible kickbacks.

''You know, you have no proof of this, but those are the rumors,'' Arriola told Assistant State Attorney Joe Centorino in an August 2007 interview, explaining why he came forward.

Over the course of the investigation, prosecutors chased vague rumors of payoffs and cronyism dating back to Spence-Jones' days as a City Hall staffer, the records show. Most tips were dead ends. Some leads were left unexplored.

''There were many inconsistencies -- which is code name for lies,'' said Spence-Jones attorney Richard Alayon.

A confidant of former Miami-Dade Commissioner Barbara Carey-Shuler has told prosecutors that he delivered cash payoffs to her from a prominent developer during the late 1990s, according to a newly released report.

Antonio Junior, 51, made the revelations to Miami-Dade public corruption prosecutors last fall -- too late to levy any possible criminal charges against Carey-Shuler because the statute of limitations had long run out, state attorney's office spokesman Ed Griffith said.

According to the report:

• Junior, a longtime Miami International Airport businessman, admitted to repeatedly accepting cash from late developer Lowell Dunn starting in 1997, with instructions to pay Carey-Shuler for her support of Dunn's projects. Junior said he gave the commissioner much of the cash -- including part of $30,000 Dunn gave him in the restroom of a Design District restaurant.

• Junior also said he funneled money to the commissioner after he landed -- with her help -- a piece of a controversial $25 million county contract to build the Martin Luther King county office building in the heart of Liberty City in 1999. The payments continued until about 2003, he said.

• Junior said his payments from the MLK deal to Carey-Shuler started when she began scribbling dollar amounts on small notes. Junior said he purchased so many money orders for Carey-Shuler that postal employees knew him on sight.

Junior detailed his relationship with Carey-Shuler in interviews with assistant State Attorney Richard Scruggs and investigator Robert Fielder late last year, just before pleading guilty to his role in an unrelated racketeering scheme at MIA. Their report was recently released at the request of The Miami Herald.

Ah, the good old statute of limitations ... Read the rest of that story here. And if you care to read more about the airport case in which Junior was implicated, here's a story from the Miami New Times back in 2005.

Now, a lot of folks in the Black community in South Florida are going to dismiss both of these stories as just further evidence that the Miami Herald hates Black elected officials, and is determined to take them down, one by one (you often here that from supporters of the late Art Teele, who famously believed that the Herald was out to get him.) And Carey-Shuler remains both popular and influential in Black Miami. That too, is the way things work 'round here.

Story three is a simpler tale -- of what looks for all the world like greed, and county collusion in screwing the little guy on behalf of a rich golden goose. It's long, published recently in Aviation Week, but well worth the read. Here's a clip:

The Miami-Dade County Airport and Seaport Committee meets once a month on Thursday mornings at 9:30 a.m. Present on April 16, 2009, was attorney Willie Gary, a famed trial lawyer whose victories in the courtroom (one of which, against Disney, brought in $240 million, according to a press release) provide him with the wherewithal to travel the world in a Boeing Business Jet named "Wings of Justice II."

On this day, Gary graciously sought a few moments of the committee's time in the interest of saving them some money. "These five minutes could save years of litigation," he said, along with "millions of dollars." His press release, issued later that day, upped the ante, citing "billion-dollar litigation."

Gary told committee chairman Dorrin De Rolle and the assembled commissioners, "Nobody needs this kind of fight" by way of informing them that a fight was what they would get. He was there representing his client, "Opa-Locka Flightline . . . the only African-American owned and operated FBO in the nation." He was there because his client was "not being treated fairly, plain and simple." Gary noted that if an airport receives federal funds, the law says there can be no discrimination. "We don't come seeking special privilege, but there should be no discrimination or favoritism, and that's the case we bring today," Gary said. "We must all operate under one set of rules."

What's at stake here are a group of vendors currently leasing space at the airport, and a big, well-off company, the Adler Group, run by a wealthy real estated developer named Michael Adler, who along with his company, is a major, major Democratic Party donor. The county gave Adler's company, AA Acquisitions, a 240-acre, 70-year lease at Opa-locka airport by the county, essentially making him the new landlord. Now, Adler wants the existing tenants out, so he can do some big time development at the airport, and the article alleges AA (with the county's blessing, or at least wihtout their resistance) is using rather ... let's say creative ... tactics to force them out. Of course, the deal means big money to the county at a time of economic hardship -- big, as in hundreds of millions of dollars. It's a sad story, and one in which it's doubtful the little guys will win.

Labels: corruption, Florida, local politics, Miami, Miami-Dade

Labels: Blago, corruption, illinios, Rod Blagojevich, scandals

Did Norm Coleman's financial problems compel him to turn to friends and GOP donors for help with his living situation?

That's what a new story out of Minnesota alleges. Friday morning, a local Fox News affiliate reported that at the time that Coleman allegedly received $75,000 in unreported payments from a prominent Republican businessman, he was also struggling to make payments for the restructuring of his home.

Good government officials wondered whether there was something more than coincidental to the financial exchange. And, indeed, there is other compelling -- and up to this point, unnoted -- evidence to suggest that Coleman was soliciting monetary favors from his GOP backers.

Around the same time that Coleman and/or his wife were allegedly receiving three $25,000 payments from businessman Nasser Kazeminy, the Senator was also getting cheaply discounted rent from a major Republican figure who served as his landlord in Washington D.C.

In July 2007 -- months after lawsuits assert that $75,000 was secretly funneled to the Colemans -- the Senator began paying $600 a month rent on his one-bedroom apartment on Capitol Hill, way below market value. His landlord, Republican operative and communications guru Jeff Larson, also was covering Coleman's utilities (under an apparent agreement that the Senator would be billed with an estimate once the year was over).

At the time, the D.C. arrangement raised a variety of eyebrows, mainly because Coleman had helped Larson secure millions in business related to the Republican Convention in St. Paul. The new revelations, however, suggest that the rent may have been more a favor that Larson was offering to Coleman than any sort of bribery.

Ah, bribery. Apparently, the FBI is looking into it. And the upshot is, if Coleman did take bribes, his corruption is a step beyond even Blago's colorful stuff, since in the latter case, there's no evidence (yet) that actual money or favors changed hands. So if Coleman does squeak through in the recount, which at this point is by no means certain, could we see our first indictment of a sitting U.S. Senator for the new year ... before the first quarter closes?

Labels: corruption, Norm Coleman, Republicans

Then-Sen. Lyndon Johnson (L) w. Sen. Everett Dirksen listening

Just days before the pivotal 1968 presidential election featuring Vice President Hubert Humphrey's bid to succeed him, President Lyndon Baines Johnson suspected Humphrey's Republican opponent, Richard Nixon, of political sabotage that he called treason, according to the final recordings of Johnson's presidency to be publicly released.

As Johnson tried to arrange peace talks between North and South Vietnam on the eve of the election, he and his closest advisers received information indicating that Nixon allies had asked that South Vietnam avoid peace talks until after the election, the tapes show.

Johnson and his advisers, Humphrey included, kept their concerns secret at the time. But given that Nixon defeated Humphrey by just 500,000 votes out of 73 million cast and that Nixon's suspected perfidy involved the unpopular war in Vietnam, there is ample cause to wonder how history might have been changed had the concerns Johnson voiced 40 years ago been made public.

The LBJ Library made those conversations public Thursday with the release of 42 hours of recordings made from May 1968 until the Johnson family left the White House in January 1969. ...

With an election hanging in the balance, however, there is added drama in the flurry of calls in late October and early November concerning Johnson's attempt to bring the North and South Vietnamese governments together for the first time to discuss peace.

On March 31, under heavy pressure from the anti-war wing of his Democratic Party, Johnson shocked the American people by saying he would not run for re-election or accept his party's nomination. Instead, Johnson endorsed Humphrey, who inherited the warmonger label critics had hung on Johnson.

To test the good faith of the North Vietnamese, Johnson ordered that all bombing in the north cease on Oct. 31 , six days before voters were to go the polls. The cease-fire gave the Humphrey campaign an immediate jolt — polls showed Nixon's 8-percentage-point lead had shrunk to 2 points.

The precise nature of any communication between Nixon's allies and the South Vietnamese government isn't revealed in the tapes — nor is the way Johnson and his advisers learned of them.

In the tapes, Johnson tells Secretary of State Dean Rusk: "It's pretty obvious to me it's had its effect."

In a segment aired at the news conference, Johnson tells Sen. Everett Dirksen , the Republican minority leader, that it will be Nixon's responsibility if the South Vietnamese don't participate in the peace talks.

"This is treason," LBJ says to Dirksen.

"I know," Dirksen replies, very softly.

Confronting Nixon by telephone on Nov. 3, Johnson outlines what had been alleged and how important it was to the conduct of the war for Nixon's people not to meddle.

"My God," Nixon says to Johnson, "I would never do anything to encourage the South Vietnamese not to come to that conference table." Instead, Nixon pledged to help in any way Johnson or Rusk suggested, "To hell with the political credit, believe me."

For Johnson and his top advisers, it wasn't a matter of whether Nixon was telling the truth but whether accusing Nixon of meddling would give the appearance that Johnson — rather than Nixon — was using the war to influence the election.

In the end, the South Vietnamese stayed away from the proposed peace talks. And Johnson listened to his advisers and suggested to Humphrey that he not use what he had learned.

"For God's sake, you want everybody to know you don't play politics with human lives, that we did what's right," Johnson tells Rusk on one of the recordings.

In several of the recordings, Johnson wonders what will become of a Democratic Party so riven by the war that it would not unite behind Humphrey.

"I'm sorry I let you down a little," Humphrey tells Johnson.

"No, you didn't; no you didn't," Johnson replies. "A lot of other folks (did), not you. You fought well and hard."

Labels: corruption, dirty politics, elections, LBJ, Lyndon Johnson, Richard Nixon, U.S. history, Vietnam

Met with Gov. Blagojevich for the first time in four years on Tuesday, and presented my qualifications and my record. ... The media saw me enter Gov. Blagojevich's office. ... The media saw me exit the governor's office.

I had no involvement whatsoever in any wrongdoing. I did not initate or authorize anyone to promise Gov. Blagojevich anything on my behalf

Labels: Blago, corruption, Illinois, Jesse Jackson Jr, Rod Blagojevich, scandals, Senate Candidate #5, U.S. Senate

Louisiana is the most corrupt state in the nation.

That’s according to an analysis of government data released today by Corporate Crime Reporter.

Louisiana (1), Mississippi (2), Kentucky (3), Alabama (4) and Ohio (5) are the top five most corrupt states in the country, according to the analysis.

Rounding out the top ten are Illinois (6), Pennsylvania (7), Florida (8), New Jersey (9), and New York (10).

“If you type the word ‘corruption’ into Google News, the vast majority of news stories that come up are from overseas,” said Russell Mokhiber, editor of Corporate Crime Reporter, a print weekly legal newsletter based in Washington, D.C. “But public corruption is booming right here in the USA.”

“There have been more than 20,000 public officials and private citizens convicted of public corruption over the past two decades,” Mokhiber said. “That’s an average of 1,000 a year for the last twenty years.”

Labels: corruption, Illinois, money and politics, scandals

Illinois Gov. Rod Blagojevich believed the billionaire owner of the troubled Tribune Co. news empire agreed to fire a top editor at his Chicago paper in exchange for a tax break worth over $100 million, federal prosecutors alleged Tuesday.

Executives at the Chicago Tribune did not fire the editor, John P. McCormick, whom prosecutors believe Blagojevich had targeted. In fact, during the alleged machinations between the governor and the paper's owner, the paper's editorial staff was actually cooperating with the federal probe into the governor which resulted in his arrest Tuesday, by holding from print an exclusive story that FBI agents had secretly recorded the governor's conversations.

In a statement released Tuesday afternoon, the Tribune Co. said "the actions of the company, its executives and advisors working on the disposition of Wrigley Field have been appropriate at all times," and that "no one working for the company or on its behalf has ever attempted to influence staffing decisions at the Chicago Tribune or any aspect of the newspaper's editorial coverage as a result of conversations with officials in the governor's administration." ...

Labels: corruption, Illinois, Rod Blagojevich

Rep. Jesse Jackson Jr. is “Senate Candidate 5,” who — through an emissary — allegedly offered to raise money for Gov. Blagojevich in return for being appointed as Barack Obama’s replacement in the U.S. Senate, sources tell the Chicago Sun-Times.

The alleged offering was caught on a wiretap secretly planted by the feds.

“In a recorded conversation on October 31, 2008, Rod Blagojevich described an earlier approach by an associate of Senate Candidate Five as follows: “We were approached ‘pay to play.’ That, you know, he’d raise me 500 grand. An emissary came. Then the other guy would raise a million, if I made him (Senate Candidate 5) a Senator,” the affadavit accompanying Blagojevich's criminal complaint states.

Speculation has centered that Jackson is Senate Candidate 5 since the complaint was released Tuesday. Jackson, who has aggressively campaigned for the Senate seat, told ABC news that he has not “been informed” by federal prosecutors that he is Senate Candidate 5.

Jackson said he is “not a target” of any probe, but the U.S. attorney’s office in Chicago has sought to interview him.

“I would like to do that as quickly as possible,” Jackson said.

In a statement last night, Jackson said, “I reject and denounce pay-to-play politics and have no involvement whatsoever in any wrongdoing.”

JJJ's name has been batted around the blogosphere, but it had been kind of knocked down yesterday. Now, it's back. Sounds like Dear Old Dad was handing down the family business. The inevitable conclusion here is that Jesse Sr. may have been the third party who would raise $1 million for Blago after Jr. came up with the first $500k. Nasty stuff. Looks like Marc Ambinder had it right, while TNR and TSG (and myself) got it wrong.

Previous:

• Obama's role in Blago's fall
• Burning questions: who is 'Senate Candidate #5"?
• The Chicago Five
• Nothng but sunshine
• The Blagojevich file
• Down goes Blagojevich

Labels: corruption, Illinois, Jesse Jackson Jr, money and politics, Rod Blagojevich, scandals

In a sequence of events that neatly captures the contradictions of Barack Obama’s rise through Illinois politics, a phone call he made three months ago to urge passage of a state ethics bill indirectly contributed to the downfall of a fellow Democrat he twice supported, Gov. Rod R. Blagojevich.

Mr. Obama placed the call to his political mentor, Emil Jones Jr., president of the Illinois Senate. Mr. Jones was a critic of the legislation, which sought to curb the influence of money in politics, as was Mr. Blagojevich, who had vetoed it. But after the call from Mr. Obama, the Senate overrode the veto, prompting the governor to press state contractors for campaign contributions before the law’s restrictions could take effect on Jan. 1, prosecutors say.

Tipped off to Mr. Blagojevich’s efforts, federal agents obtained wiretaps for his phones and eventually overheard what they say was scheming by the governor to profit from his appointment of a successor to the United States Senate seat being vacated by President-elect Obama. One official whose name has long been mentioned in Chicago political circles as a potential successor is Mr. Jones, a machine politician who was viewed as a roadblock to ethics reform but is friendly with Mr. Obama.

Beyond the irony of its outcome, Mr. Obama’s unusual decision to inject himself into a statewide issue during the height of his presidential campaign was a reminder that despite his historic ascendancy to the White House, he has never quite escaped the murky and insular world of Illinois politics. It is a world he has long navigated, to the consternation of his critics, by engaging in a kind of realpolitik, Chicago-style, which allowed him to draw strength from his relationships with important players without becoming compromised by their many weaknesses.

By the time Mr. Obama intervened on the ethics measure, his relationship with Mr. Blagojevich, always defined more by political proximity than by personal chemistry, had cooled as the governor became increasingly engulfed in legal troubles. There is nothing in the criminal complaint unsealed Tuesday to indicate that Mr. Obama knew anything about plans to seek money and favors in exchange for his Senate seat; he has never been implicated in any other “pay to play” cases that have emerged from the long-running investigation of the Blagojevich administration.

Labels: corruption, Illinois, money and politics, Rod Blagojevich, scandals

Later on November 10, 2008, ROD BLAGOJEVICH and Advisor A discussed the open Senate seat. Among other things, ROD BLAGOJEVICH raised the issue of whether the President-elect could help get ROD BLAGOJEVICH's wife on "paid corporate boards right now." Advisor A responded that he "think[s] they could" and that a President elect . . . can do almost anything he sets his mind to." ROD BLAGOJEVICH states that he will appoint "[Senate Candidate 1] . . . but if they feel like they can do this and not fucking give me anything . . . then I'll fucking go [Senate Candidate 5]." (Senate Candidate 5 is publicly reported to be interested in the open Senate seat). ROD BLAGOJEVICH stated that if his wife could get on some corporate boards and "picks up another 150 grand a year or whatever" it would help ROD BLAGOJEVICH get through the next several years as Governor.

In other words -- if Blago doesn't get what he wanted, then he'd stiff the PEOTUS by appointing someone he didn't like -- Senate Candidate 5.

Just last week, on December 4, Blagojevich allegedly told an advisor that he might "get some (money) up front, maybe" from Senate Candidate 5, if he named Senate Candidate 5 to the Senate seat, to insure that Senate Candidate 5 kept a promise about raising money for Blagojevich if he ran for re-election. In a recorded conversation on October 31, Blagojevich claimed he was approached by an associate of Senate Candidate 5 as follows: "We were approached 'pay to play.' That, you know, he'd raise 500 grand. An emissary came. Then the other guy would raise a million, if I made him (Senate Candidate 5) a Senator."

On November 7, while talking on the phone about the Senate seat with Harris and an advisor, Blagojevich said he needed to consider his family and that he is "financially"
hurting, the affidavit states. Harris allegedly said that they were considering what would help the "financial security" of the Blagojevich family and what will keep Blagojevich "politically viable." Blagojevich stated, "I want to make money," adding later that he is interested in making $250,000 to $300,000 a year, the complaint alleges.

The Senate candidate whom Blago at one point thought that President-elect Obama seemed most likely to be supporting -- friend and adviser Valerie Jarrett, who later took herself out of the running and will be a White House Senior Adviser -- is discussed, as "Senate Candidate 1."

Jarrett referred ABC News to the Obama Transition Team for comment; they did not have one.

Ultimately, it appears that neither PEBO nor Jarrett were willing to discuss any of Blago's various notions of how he could sell them the seat. Talking to his chief of staff on November 11, Blago said he knew PEBO wanted Jarrett to get the Senate seat but “they’re not willing to give me anything except appreciation. F--- them."

Marc Ambinder speculates that it's Jesse Jackson Junior, given the timing of a meeting he had with Blago. But that doesn't seem right to me, since it's also clear from the complaint that Blago believed Obama was opposed to Candidate 5. I can't think of any reason why Obama would oppose Jesse Junior moving over to the Senate. As I reported for the print mag early this year, Obama's relationship with Jesse Senior may be fraught, but he's actually fairly close to Jesse Junior. And, presumably, their relationship grew stronger over the course of the campaign, during which Jesse Junior did yeoman's work for Obama, the least of which was slapping down his dad when he did something against Obama's interests.

The Smoking Gun, meanwhile, says that Candidate 5 is Emil Jones. Obama's relationship with Jones (who, btw, is a sworn enemy of Jesse Junior's) is much, much more complex. Yes, Obama famously cultivated Jones as his political godfather in the State Senate, but that's always seemed like one of those relationships that Obama was happy to leave behind in Springfield. Given some of the baggage that comes with Jones's old-school, machine ways--a number of his family members are on the public payroll, and he's worked hard to make sure his son inherits his legislative seat--I could see how Obama might not want Jones in Washington. What's more, Brad Plumer calls my attention to this post from the Capitol Fax blog, which points out that Jones was mentioned by Sun-Times columnist Michael Sneed a few days after Blago discussed leaking Candidate 5's name, and that Jones has a huge war chest, so it wouldn't be hard for him to come up with $500k.

Here's what we know. Candidate 5 is:

-"publicly reported to be interested in the open Senate seat"
- not who Blagojevich thought Obama wanted
- not someone with whom, by November 10, Blagojevich had a "long, productive discussion"
- someone with fundraising wherewithal who could produce something "tangible up front"
- someone Blago was "getting a lot of pressure" not to appoint
- someone with whom Blago had "a prior bad experience...not keeping his word"

The complaint also says that on November 10, Blagojevich told an advisor to leak to the Sun-Times's Michael Sneed that Blagojevich "is seriously considering Senate Candidate 5 for the open Senate seat" and that the advisor agreed to call the Sun-Times to leak the story, apparently false, that Blagojevich end of the conversation Advisor A agreed to call the Sun Times columnist to leak the story had a “long, productive discussion” with Candidate 5.

Sneed's November 14 column included this:

Sneed hears Gov. Blago, who will choose Obama's replacement in the U.S. Senate, privately feels there may be only one choice that makes sense: His buddy, outgoing Senate President Emil Jones.

Labels: corruption, Illinois, money and politics, news and politics, Rod Blagojevich, scandals, U.S. Senate

Should Mr. Blagojevich end up in prison, he will join predecessors including the following:

Republican George Ryan, who is currently serving a 6 1/2-year stretch in federal prison for racketeering and fraud. Blagojevich, along with Sen. Richard Durbin, has publicly supported an appeal to the White House for the commutation of Mr. Ryan's sentence.

Otto Kerner, a Democrat who was convicted in 1973 on 17 counts of bribery, conspiracy, perjury and other charges before being sentenced to three years in the pen. The federal prosecutor in that case, James Thompson, later ascended to the governor's chair and wound up getting his law firm to defend Ryan for free.

Dan Walker was convicted in 1987 -- years after leaving office -- of bank fraud. Serving from 1973 to 1977, with a reputation as a reformer, he was the last Democratic governor of the state before Mr. Blagojevich took office in 2003.

Lennington Small, a Republican, served from 1921 to 1929. He was indicted while in office for embezzlement related to actions taken when he was state treasurer. He was later acquitted; several of the jurors in the case ended up with state jobs.

Also, in one infamous case further down the chain, a former speaker of the state's House of Representatives and secretary of state, Paul Powell, was found after his death in 1970 to have had several million dollars in embezzled cash stashed in shoe boxes.

Mr. Powell, according to a Time magazine article at the time, had his own definition of success, believing that "there's only one thing worse than a defeated politician, and that's a broke one."

... was indicted in 1994 on 17 felony charges, including the embezzlement of $695,000 in taxpayer and campaign funds. The longtime House Ways and Means chairman plea-bargained his way down to two counts of mail fraud and served 17 months in a Wisconsin minimum-security prison.

Labels: corruption, Illinois, money and politics, news and politics, Rod Blagojevich

"He didn't do anything wrong," attorney Sheldon Sorosky told reporters after Blagojevich was arraigned. "A lot of this is just politics."

Blagojevich should be in the office Wednesday, Sorosky added.

So, reporters asked, he does not intend to resign?

"Not that I know of, no," said Sorosky, who added that the governor was "surprised" by the day's events.

Labels: Chicago, corruption, Illinois, money and politics, news and politics, Rod Blagojevich, U.S. Senate

Illinois Gov. Rod Blagojevich (left) and prosecutor Patrick Fitzgerald (right)

U.S. Atty. Patrick Fitzgerald said today that federal authorities arrested Democratic Gov. Rod Blagojevich this morning because the governor went on "a political corruption crime spree" that needed to be stopped.

Fitzgerald said secret tape recordings showed Blagojevich was attempting "to sell the U.S. Senate seat" that President-elect Barack Obama recently vacated. Fitzgerald said, "We make no allegations" that Obama was aware of any alleged scheming by Blagojevich.

The governor has the sole power to pick Obama's replacement under the state constitution.

"The conduct would make Lincoln roll over in his grave," Fitzgerald said, quoting Blagojevich as saying the Senate seat is "a bleeping valuable thing. You just don't give it away. ... I've got this thing and it's bleeping golden."

Fitzgerald called the corruption charges against Blagojevich "a truly new low."

Blagojevich wasn't against the corrupt deal for the Senate seat, he was against "being stiffed in the corrupt deal," Fitzgerald said.

The remarks came at a news conference to discuss charges against Blagojevich and his chief of staff, John Harris. Blagojevich and Harris are scheduled to appear in court at 1:30 p.m. before U.S. Magistrate Judge Nan Nolan.

Robert Grant, FBI special agent in charge of the Chicago office, characterized Illinois' place in the pantheon of political corruption.

"If it isn't the most corrupt state in the United States, it's certainly one hell of a competitor," Grant said. "Even the most cynical agents in our office were shocked."

Grant said he called Blagojevich about 6 a.m. and told the governor two FBI agents were outside his door and that they had a warrant for his arrest.

After initially asking, "Is this a joke?" Grant said, Blagojevich was "very cooperative."

Grant said the arrest of Blagojevich should serve as notice that "business as usual will no longer be tolerated. That selling your office for personal gain is a thing of the past."

So what was on those wiretaps? For that, we go to The Smoking Gun:

DECEMBER 9--The criminal complaint filed today against Illinois Governor Rod Blagojevich contains a remarkable section detailing the Democratic politician's alleged attempt to cash in on his ability to fill the U.S. Senate seat vacated by President-elect Barack Obama.

Attached to the U.S. District Court complaint is an FBI affidavit, excerpted below, alleging that Blagojevich was caught on wiretaps noting that the Senate seat "is a fucking valuable thing, you just don't give it away for nothing." He was also recorded saying that unless "I get something real good," he would appoint himself to the vacancy. "I'm going to keep this Senate option for me a real possibility, you know, and therefore I can drive a hard bargain. You hear what I'm saying. And if I don't get what I want and I'm not satisfied with it, then I'll just take the Senate seat myself."

According to surreptitiously recorded conversations, Blagojevich spoke with associates about the possibility of trading the Senate post for either an ambassadorship or a Cabinet post. The politician, according to the affidavit sworn by FBI Agent Daniel Cain, "analogized his situation to that of a sports agent shopping a potential free agent to various teams."

During a wiretapped November 10 call, a frustrated and financially strapped Blagojevich referred to Obama as a "motherfucker" and said that he would not appoint an ally of the President-elect to the Senate vacancy if "I don't get anything." Referring to Obama, Blagojevich exclaimed, "Fuck him. For nothing? Fuck him." In a November 11 conversation, Blagojevich remarked that he knew Obama wanted Valerie Jarrett, a longtime confidante, to succeed him, "but they're not willing to give me anything except appreciation. Fuck them." Blagojevich, 51, and his chief of staff, John Harris, were arrested this morning on political corruption charges. While the affidavit does not specifically name the six prospective Senate candidates discussed by Blagojevic, Harris, and the governor's aides, it appears that several are easily identified. "Senate Candidate 1" is Jarrett. "Senate Candidate 2" is Illinois Attorney General Lisa Madigan. Emil Jones, an Illinois state legislator, is "Senate Candidate 5." And "Senate Candidate 6" appears to be J.P. Pritzker, a wealthy Chicago businessman. Additionally, Rahm Emanuel, the incoming White House chief of staff, is referred to in the affidavit as "President-elect Advisor."

TSG has the docs, too. And Fitz isn't done. He's now soliciting any new information that would-be informants would want to provide. How stupid was Blagojevich, by the way? He committed the new alleged crimes tied to the Obama Senate seat AFTER knowing he was already under investigation. Wow. Special election, anyone?

Labels: corruption, Illinois, money and politics, Rod Blagojevich

The stunning, early morning visit by authorities to the governor's North Side home came amid revelations that federal investigators had recorded the governor with the cooperation of a longtime confidant and had begun to focus on the possibility that the process of choosing a Senate successor to President-elect Barack Obama could be tainted by pay-to-play politics.

Blagojevich was taken into custody hours after the Tribune reported that the investigation into allegations of pay-to-play politics within his administration had been expanded to include his pending choice of a Senate replacement for Obama. The Democratic governor has said he expects to make a decision on the state's next senator in weeks.

Sources told the Tribune that investigators intensified their investigation into Blagojevich amid concerns that the process of choosing a new senator could be tainted. The actions by federal authorities came a day before Blagojevich's 52nd birthday.

The Tribune previously disclosed that federal investigators had recordings of Blagojevich. Those recordings were aided by the cooperation of longtime Blagojevich confidant and former congressional chief of staff John Wyma.

On Monday, Blagojevich said he has done nothing wrong in his stewardship of the state and challenged critics to record him because his discussions were "always lawful."

Updated at 9:17 a.m.: Blagojevich also was alleged to be using a favors list, made up largely of individuals and firms that have state contracts or received taxpayer benefits, from which to conduct a $2.5 million fundraising drive before year's end.

Even Blagojevich's recently announced $1.8 billion plan for new interchanges and "green lanes" on the Illinois Tollway was subject to corruption, prosecutors alleged.

The complaint repeatedly references conversations secretly recorded by federal authorities.

The criminal complaint alleges Blagojevich expected an unnamed highway concrete contractor to raise a half-million dollars for his campaign fund in exchange for state money for the tollway project. "If they don't perform, (expletive) 'em," Blagojevich said, according to the complaint.

Labels: corruption, Illinois, money and politics, Rod Blagojevich, scandals, U.S. Senate

AIG's executives were scolded on Capitol Hill ... and then they partied on, dude

Even as the company was pleading the federal government for another $40 billion dollars in loans, AIG sent top executives to a secret gathering at a luxury resort in Phoenix last week.

Reporters for abc15.com (KNXV) caught the AIG executives on hidden cameras poolside and leaving the spa at the Pointe Hilton Squaw Peak Resort, despite apparent efforts by the company to disguise its involvement.

"AIG made significant efforts to disguise the conference, making sure there were no AIG logos or signs anywhere on the property," KNXV reported.

(click here to see the full KNXV report)

A hotel employee told KNXV reporter Josh Bernstein, "We can't even say the word [AIG]."

A company spokesperson, Nick Ashooh, confirmed AIG instructed the hotel to make sure there were no AIG signs or mention of the company by staff.

"We're trying to avoid confrontation, keep our profile low," said Ashooh. "Some of our employees have been harassed."

You don't say... By the way those please were quite successful:

US Treasury Secretary Henry Paulson's decision to inject another US$27 billion into failed insurer AIG and raise the taxpayers' investment to $150 billion suggests he is more intent on helping his pals on Wall Street than protecting taxpayer interests.

AIG has solid businesses in industrial, commercial and life insurance, but like a lot of financial firms was attracted to easy profits writing credit default swaps on mortgage-backed bonds - so called collateralized debt obligations (CDOs).

AIG received fees to guarantee repayment of those mortgages, or the funds obtained through foreclosures when homeowners defaulted. Like most on Wall Street, AIG executives believed home prices would rise faster than household incomes forever, so these CDOs really bore little risk.

This credit default swap business was outside AIG's highly regulated, solid insurance businesses but was backed by the value of those businesses. Essentially, if the CDOs fell too much in value, AIG pledged the value of those businesses.

If an abnormal number of the mortgages failed, the held-to-maturity value of the CDOs would fall and obligations would trigger for AIG to post collateral. When that happened in 2007, AIG deposited cash or other liquid assets with the investors holding the CDOs. With the housing market so depressed by the summer of 2007, AIG could not raise enough cash to meet all its obligations.

On September 16, the Federal Reserve provided $85 billion in loans to AIG in exchange for warrants - the right to buy common stock - equal to 79.9% of the company.

AIG was to pay 8.5% above the benchmark London Interbank Offered Rate (Libor) for the first $85 billion. The insurer was to use the loans to honor obligations to holders of the credit default swaps, and AIG was to sell parts of its insurance businesses to repay the loans to the Federal Reserve. That loan proved inadequate, and the Fed advanced another $38 billion on October 9.

The $123 billion was not enough to finance AIG's short-term credit default swap obligations, and it cannot sell enough pieces of its good insurance businesses to pay back the Federal Reserve in the current environment.

Now, the Federal Reserve and Treasury are agreeing to restructure $60 billion of the original loan, lowering the interest rate to 3% above Libor and invest about another $27 billion in AIG. The interest rates on the loans were lowered, in part, because large shareholders complained about heavy-handed government action.

Company officials confirmed the company spent an estimated $343,000 to sponsor the 2008 Asset Management Conference. A spokesperson said much of the cost would be recouped from product sponsors at the conference.

KNXV said the president of AIG unit Royal Alliance Associates, Art Tambaro, stayed in a two-story Casita suite and worked out at the spa while others participated in seminars.

Labels: AIG, corruption, financial crisis, thieves, Wall Street

The $12.5 million sports complex and hockey rink that is the lasting monument to Palin's two terms as Wasilla mayor is also a monument to the kind of insider politics that dismays Americans of both parties. Six months before Palin stepped down as mayor in October 2002, the city awarded nearly a half-million-dollar contract to design the biggest project in Wasilla history to Kumin Associates. Blase Burkhart was the Kumin architect on the job—the son of Roy Burkhart, who is frequently described as a "mentor" of Palin and was head of the local Republican Party (his wife, June, who also advised Palin, is the national committeewoman). Asked if the contract was a favor, Roy Burkhart, who contributed to her campaign in the same time frame that his son got the contract, said: "I really don't know." Palin then named Blase Burkhart to a seven-member builder-selection committee that picked Howdie Inc., a mostly residential contractor owned at the time by Howard Nugent. Formally awarded the contract a couple of weeks after Palin left office, Nugent has donated $4,000 to Palin campaigns. Two competitors protested the process that led to Nugent's contract. Burkhart and Nugent had done at least one project together before the complex—and have done several since.

A list of subcontractors on the job, obtained by the Voice, includes many with Palin ties. One was Spenard Builders Supply, the state's leading supplier of wood, floor, roof, and other "pre-engineered components." In addition to being a sponsor of Todd Palin's snow-machine team that has earned tens of thousands for the Palin family, Spenard hired Sarah Palin to do a statewide television commercial in 2004. When the Palins began building a new family home off Lake Lucille in 2002—at the same time that Palin was running for lieutenant governor and in her final months as mayor—Spenard supplied the materials, according to Antoine Bricks, who works in its Wasilla office. Spenard actually filed a notice "of its right to assert a lien" on the deed for the Palin property after contracting for labor and materials for the site. Spenard's name has popped up in the trial of Senator Stevens—it worked on the house that is at the center of the VECO scandal as well.

Todd Palin told Fox News that he built the two-story, 3,450-square-foot, four-bedroom, four-bath, wood house himself, with the help of contractors he described as "buddies." As mayor, Sarah Palin blocked an effort to require the filing of building permits in the wide-open city, and there is no public record of who the "buddies" were. The house was built very near the complex, on a site whose city purchase led to years of unsuccessful litigation and, now, $1.3 million in additional costs, with a law firm that's also donated to Palin collecting costly fees from the city.

Dorwin and Joanne Smith, the principals of complex subcontractor DJ Excavation & Development, have donated $7,100 to Palin and her allied candidate Charlie Fannon (Joanne is a Palin appointee on the state Board of Nursing). Sheldon Ewing, who owns another complex subcontractor, Weld Air, has donated $1,300, and PN&D, an engineering firm on the complex, has contributed $699.

Ewing was one of the few sports-complex contractors, aside from Spenard, willing to address the question of whether he worked on the house as well, but he had little to say: "I doubt that it occurred, but if it did indirectly, how would I know anyhow?" The odd timing of Palin's house construction—it was completed two months before she left City Hall and while she and Todd Palin were campaigning statewide for the first time—raises questions, especially considering its synergy with the complex.

So ... I guess being a maverick involves ... cronyism, enriching oneself through one's office, and getting a brand new hockey rink AND a new house that the taxpayers pay you to live in? Who knew?

Labels: 2008 election, Alaska, candidates, corruption, cronyism, Sarah Palin, Todd Palin

Stevens' Washington office is shut down right now and no one is answering phone calls, and a spokesman in Alaska declined to answer questions. The Associated Press is reporting that the criminal charges are related to false reporting of hundreds of thousands in renovations to his Alaska resort home.

The indictment would be a stunning development in an extraordinary Senate career that has spanned four decades. Stevens is undoubtedly the most powerful politician in Alaska's 50 year history of statehood, but his relationships with contractors and lobbyists have come under intense scrutiny over the past year.

Another member of the party of personal responsibility down for the count... from the AP, via the WaPo:

Stevens, 84, has been dogged by a federal investigation into whether he pushed for fishing legislation that also benefited his son, an Alaska lobbyist.

From May 1999 to August 2007, prosecutors said Stevens concealed "his continuing receipt of hundreds of thousands of dollars worth of things of value from a private corporation." The indictment released Tuesday said the items included: home improvements to his vacation home in Alaska, including a new first floor, garage, wraparound deck, plumbing, electrical wiring; as well as car exchanges, a Viking gas grill, furniture and tools.

Justice Department officials were holding a news conference later Tuesday to discuss the charges.

More to come, to be sure.

The Justice Department is alleging that Stevens, who is 84, accepted gifts from oil-services company Veco in the form of material and labor to renovate his private residence in Alaska.

"These items were not disclosed" on Stevens' Senate financial-disclosure forms, according to Friedrich. ...

...The indictment alleged that Stevens received substantial home improvements to property he owns in Girdwood, Alaska; automobile exchanges in which the senator got new vehicles worth far more than the used vehicles he provided in return; and household goods. ...

... The indictment of Stevens is part of an ongoing federal criminal investigation in Alaska. There have been seven criminal convictions to date from the investigation. Former Veco Chief Executive Bill Allen and Richard Smith, the company's former vice president of community affairs and government relations, pleaded guilty in May 2007 to providing more than $400,000 in corrupt payments to Alaska public officials.

"I was more than a little tweaked to turn on CSPAN and see Alice Fisher giving the press conference on behalf of" the Justice Department in the Abramoff case, Jane Hamsher wrote January 4, 2006, in The Huffington Post.

"Alice Fisher should have recused herself from this matter long ago," Hamsher said. "Fisher is a Republican who in her former job was registered as a lobbyist for HCA, the healthcare company founded by Bill Frist's father.

Her appointment was also controversial due to the fact that like her boss Abu Gonzales, Fisher has no trial experience and with [James] Comey gone there would be no senior member of the Justice Department who was an experienced criminal prosecutor. But Senatorial oversight was dispensed with and BushCo. continued on its Brownie-esque rampage to replace experience with cronyism."

And Fisher's lack of trial experience clearly came in handy for the Bush-Cheney team. She was one of the DOJ officials who reviewed and rubber stamped torture techniques for the White House. From an Andrew Sullivan post on Jane Mayer's new book, “The Dark Side: The Inside Story of How the War on Terror Turned Into a War on American Ideals":

- The role of the torture lawyers in crafting the system is far more intimate than they have acknowledged. John Yoo, Michael Chertoff and Alice Fisher reviewed specific techniques which clearly amounted to torture and blessed them as fine to use, and then lied publicly and to Congress about their involvement. Yoo is said to have given his legal blessing to torture techniques and their application by DOD operatives on the squash court as he played rounds with Jim Haynes.

So we're likely well rid of her, and perhaps the wiser about why she suddenly vacated the premises. If she did indeed lie to Congress about her involvement in torture, all the Jack Abramoff prosecutions in the world might not have saved her from testifying, even at the Dems' sham hearings, and even though no one will likely ever be prosecuted for the various crimes committed by the current administration...

Labels: corruption, politicians, Republicans, Ted Stevens

The images on the tiny screen of Stephen Payne’s personal organiser told a clear story: this was a man with connections at the highest level.

One showed Payne uprooting dead trees side by side with George W Bush on the US president’s Texas ranch. Another depicted him skeet shooting next to Dick Cheney, the vice-president, and a third grinning for the camera alongside Condoleezza Rice, the secretary of state.

The man on the other side of the table from Payne at the Lanesborough hotel in central London last week appeared impressed by the contents of the BlackBerry. He was a familiar figure, a Kazakh politician Payne knew as Eric Dos.

Dos, whose full name is Yerzhan Dosmukhamedov, told Payne that he was representing another foreign political figure who was looking to meet the top people in the US government.

Dos had good reason for believing that Payne could make it happen. Payne has accompanied Bush and Cheney on foreign trips to the Middle East and Asia, and he sits on the influential advisory council to the Department of Homeland Security. Payne is also president of a lobbying company, Worldwide Strategic Partners (WSP), which specialises in connecting business and political interests with the US government.

Dos told Payne that the politician needing help was Askar Akayev, the former president of the central Asian state of Kyrgyzstan.

Akayev, who is in exile in Moscow after being ousted from power three years ago in a people’s revolt, was seeking an endorsement from senior US figures in order to help rehabilitate himself in the eyes of the world, Dos told Payne.

“Who does he want to meet with in Washington?” asked the American. Dos replied: “Well of course, maybe the president of the United States, vice-president Cheney, to speak maybe directly to explain the situation in central Asia . . . To give his side of the story. These kind of things.”

“I think that some things could be done,” said Payne, adding that seeing Bush himself might be more difficult. With barely a pause, he continued:

“I think that the family, children, whatever [of Akayev], should probably look at making a contribution to the Bush library.

“It would be like, maybe a couple of hundred thousand dollars, or something like that, not a huge amount but enough to show that they’re serious.”

... What Payne did not know was that the third person at the Lanesborough meeting last Monday was an undercover Sunday Times reporter. Nor did he know that the meeting was being recorded.

How to say ... "uh-oh..." Payne then went on to offer confabs with Dick Cheney, National Security Adviser Stephen Hadley, or maybe Condi Rice.

Before that happened, however, he acted as an adviser to Timur Kulibayev, the billionaire son-in-law of Nursultan Nazarbayev, the Kazakh president, and a man of considerable influence within the country.

Dos said that in the autumn of 2005 he had been asked by the Kazakh government, via Kulibayev, to arrange a visit by Cheney. The intention was to improve the country’s international standing.

Dos had spent several days negotiating with Payne. A deal was eventually agreed, he said, and he understood that a payment of $2m was passed, via a Kazakh oil and gas company, to Payne’s firm.

The following May, Cheney made a brief trip to Kazakhstan. His visit was remarked upon in the media at the time, both for the lavish praise which he publicly heaped on Nazarbayev and for the stark contrast between this and a speech he had made just a day earlier at a conference in Lithuania in which he had lambasted Russia for being insufficiently democratic. Now he was lauding Nazarbayev, who has effectively made himself president for life and in whose country it is an offence to criticise him.

“Why did Cheney castigate Russia’s imperfect democracy while saying not a word about Kazakhstan’s shameless travesty of the democratic system?” said one newspaper following the visit. “Cheney’s flattery of the Kazakh regime was sickening,” said another.

Dos believes some of the money paid to WSP may have found its way to “entities” connected to the Bush administration.

In order to test which channels might be available to foreigners seeking influence within the US, Dos agreed to approach Payne, at The Sunday Times’s request, with a fabricated story about Akayev wanting to rehabilitate himself in the eyes of the world. Akayev was not aware of the approach to Payne.

And that's "uh-oh" number two. So just what is the going price of the "honor and integrity" of the Bush White House? Which leads us to a very telling quote by Mr. Payne:

Following e-mail questioning from Dos about how Payne might pass on money paid to him by foreigners, Payne became increasingly cagey.

He said: “Anyone that tells you ‘I can deliver a US government action in exchange for specific funds’ is someone you will soon visit in prison . . . as that would be bribery in this country.”

Clink-clink. The Democrats in Congress, as is their wont to do, are "investigating." Add it to the list.

Labels: Bush administration, Bushies for sale, corruption, lobbyists, presidential libraries

Commissioner Michelle Spence Jones (third from the right) and

In police interview, pastor says he feels used

BY SCOTT HIAASEN [I wonder if that's Carl Hiaasen's son...]

The Rev. Gaston Smith sat in the Miami-Dade state attorney's office last October facing a veteran prosecutor and a pair of investigators with some uncomfortable questions about one of his parishioners: Miami City Commissioner Michelle Spence-Jones.
The investigators wanted to know about $8,000 in consulting fees that Smith paid Spence-Jones before she was elected in 2005. The money came from a $25,000 Miami-Dade County grant to Friends of MLK, a nonprofit organization the pastor ran.

Under questioning, the pastor said Spence-Jones, then an aide to Miami Mayor Manny Diaz, had urged him to create the nonprofit in the first place -- and that she had helped arrange the county grant without his knowledge. Smith said he felt like he had been used.

''It's almost like date rape,'' Smith told investigators, according to an interview transcript. ``I've been violated.''

The transcript was among more than 4,000 documents the state attorney's office released last week to defense lawyers for Smith, who was charged in January with stealing $10,000 in grant money for himself. The Miami Herald obtained these records under a publicrecords request.

Smith's statements -- secretly recorded by a Miami-Dade police detective -- cast a new light on the ongoing investigation of Spence-Jones. Prosecutors and police have been examining the commissioner's finances while also pursuing allegations of influence peddling since Spence-Jones joined the commission. ...

Prosecutors would not discuss the theory of their investigation of the commissioner. The transcript of the Oct. 9 meeting shows that prosecutor Richard Scruggs told Smith, ``Either you got taken advantage of or you're a co-conspirator.''

Nearly four months later, Smith, the pastor at Friendship Missionary Baptist Church in Liberty City, was arrested on one count of grand theft, accused of taking $10,000 in grant money through ATM withdrawals -- including a $500 withdrawal at a Las Vegas martini bar.

Smith's lawyer, Michael Tein, said Friday that the grant money went toward legitimate expenses. He said he believes his client was arrested in attempt to pressure him to provide more evidence against Spence-Jones -- but he insists his client has said all he knows.

Labels: corruption, Miami, politics

• End of the free ride?
• The REAL McCain scandal
• Back and forth

Labels: 2008 election, corruption, John McCain, presidential candidates

Pastor's arrest, payouts linked
BY SCOTT HIAASEN AND MICHAEL VASQUEZ
The arrest of a prominent Liberty City minister on theft charges Thursday was part of a continuing investigation into the financial dealings of Miami City Commissioner Michelle Spence-Jones.

The Rev. Gaston Smith, who was charged with misspending a $25,000 county grant to a nonprofit he ran, passed along $4,000 from that grant to a company owned by Spence-Jones' family, records show.

The checks are among a series of questionable payments to the first-term commissioner from public dollars set aside for urban redevelopment that police say began before she won her seat in November 2005.

During a press conference Friday announcing Smith's arrest, Miami-Dade Police said the two checks to Spence-Jones' company from the minister's charity, Friends of MLK, were among several payments under investigation. But police would not discuss these checks.

Smith's attorney, Michael Tein, said Spence-Jones received a total of $8,000 from Smith -- with half coming from his church -- as a consultant to help raise money for the charity.

Spence-Jones received at least one check while working on Mayor Manny Diaz's staff before she was elected to the commission.

Spence-Jones stressed late Friday that she had not been charged with any wrongdoing. ''Yes, they did go over there investigating me, but they found no illegal activities on my part -- and that's why nothing happened to me,'' she said.

Spence-Jones' attorney Richard Alayon said she had ''verbal permission'' to work for Smith's organization while on the city payroll. Suzanna Valdez, the mayor's chief of staff, said Spence-Jones' supervisor at the time ``did not authorize her to do outside work.''

Spence-Jones insisted Friday that she did obtain written approval from the mayor's office and filed the document with the city clerk. The city could not immediately provide that document Friday, but Spence-Jones noted that it was filed during a time when the clerk's office was relocating -- complicating its retrieval.

While on the commission, Spence-Jones has backed housing deals transferring city land to another nonprofit run by Smith, senior pastor at Friendship Missionary Baptist Church. Tein said the payments to Spence-Jones were unrelated to the land deals, and the city attorney found Spence-Jones had no conflict of interest. ...

... Detectives are chasing allegations that Spence-Jones asked a condo developer to pay $100,000 in consulting fees to two allies -- former County Commissioner Barbara Carey-Shuler and campaign advisor Barbara Hardemon -- to win her support. Hardemon and Carey-Shuler say they did nothing wrong.

Investigators are also examining $100,000 in county grants to Karym Ventures, a business owned by Spence-Jones' family.

The grants to both Karym Ventures and Friends of MLK were approved by Carey-Shuler in 2004 and funneled through the Metro Miami Action Plan Trust, a county-affiliated anti-poverty agency.

Friends of MLK was supposed to use its grant to help revitalize Martin Luther King Jr. Boulevard in Liberty City, county records show. But the contract also allowed for vague expenses including fundraising, community outreach and administrative costs. County officials say they never received receipts from Friends of MLK.

Miami-Dade Police Director Robert Parker said Smith used the money for ''his own personal gain,'' including hotel bills and plane tickets. More than $10,000 was taken out in ATM withdrawals over three months -- including a $500 withdrawal at a martini bar at the MGM Grand hotel in Las Vegas.

''Nothing shows any work done so far,'' Parker said.

Tein said Smith used the $25,000 as seed money to promote and expand the organization, in part by traveling to religious conferences. He said most of the cash withdrawals were used to pay an employee of Friends of MLK. Another $1,000 paid for a scholarship for a student at a train-conductor course in Jacksonville.

Tein said Smith mixed the funds of his nonprofit agencies and his church, but that Smith has repaid Friends of MLK for much of the money.

''The pastor viewed the business of MLK as virtually the same business as the church,'' Tein said. ``They will never be able to show that Pastor Smith stole from MLK or anybody else.''

Tein said he met with State Attorney Katherine Fernandez Rundle less than two weeks ago in an effort to convince her Smith committed no crime. He believes detectives ''leapfrogged'' the prosecutor to make an arrest.

Labels: corruption, crime, Florida

In the rough and tumble of Alabama politics, the scramble for power is often a blood sport. At the moment, the state's former Democratic governor, Don Siegelman, stands convicted of bribery and conspiracy charges and faces a sentence of up to 30 years in prison. Siegelman has long claimed that his prosecution was driven by politically motivated, Republican-appointed U.S. attorneys.

Now Karl Rove, the President's top political strategist, has been implicated in the controversy. A longtime Republican lawyer in Alabama swears she heard a top G.O.P. operative in the state say that Rove "had spoken with the Department of Justice" about "pursuing" Siegelman, with help from two of Alabama's U.S. attorneys.

The allegation was made by Dana Jill Simpson, a lifelong Republican and lawyer who practices in Alabama. She made the charges in a May 21 affidavit, obtained by TIME, in which she describes a conference call on November 18, 2002, which involved a group of senior aides to Bob Riley, who had just narrowly defeated Siegelman in a bitterly contested election for governor. Though Republican Riley, a former Congressman, initially found himself behind by several thousand votes, he had pulled ahead at the last minute when disputed ballots were tallied in his favor. After the abrupt vote turnaround, Siegelman sought a recount. The Simpson affidavit says the conference call focused on how the Riley campaign could get Siegelman to withdraw his challenge.

According to Simpson's statement, William Canary, a senior G.O.P. political operative and Riley adviser who was on the conference call, said "not to worry about Don Siegelman" because "'his girls' would take care of" the governor. Canary then made clear that "his girls" was a reference to his wife, Leura Canary, the U.S. attorney for the Middle District of Alabama, and Alice Martin, the U.S. attorney for the Northern District of Alabama.

Canary reassured others on the conference call — who also included Riley's son, Rob, and Terry Butts, another Riley lawyer and former justice of the Alabama supreme court — that he had the help of a powerful pal in Washington. Canary said "not to worry — that he had already gotten it worked out with Karl and Karl had spoken with the Department of Justice and the Department of Justice was already pursuing Don Siegelman," the Simpson affidavit says. Both U.S. attorney offices subsequently indicted Siegelman on a variety of charges, although Leura Canary recused herself from dealing with the case in May 2002. A federal judge dismissed the Northern District case before it could be tried, but Siegelman was convicted in the Middle District on bribery and conspiracy charges last June. ...

Canary was appointed by President George H. W. Bush to serve in the White House as special assistant for intergovernmental affairs, and then named chief of staff of the Republican National Committee. Later in the 1990's he also worked closely with Karl Rove in a successful series of campaigns to get Republicans elected to Alabama's state courts.

In an interview with TIME, Simpson confirmed that the "Karl" cited in her sworn statement was Karl Rove. "There's absolutely no question it was Karl Rove, no doubt whatsoever," she said. She also said she has phone records to back up the date and duration of her phone calls.

Though Simpson's legal work primarily involved research for companies seeking federal government contracts, she says she also did "opposition research" on Siegelman as a volunteer in Riley's campaign in 2002. A lifelong G.O.P. supporter, she says she has long been friendly with Riley's son, Rob Riley, whom she met at the University of Alabama and worked with on various legal cases.

In her interview with TIME, Simpson said the participants in the conference call expressed growing concern that Gov. Siegelman would refuse to give up his challenge to the vote count. According to Simpson, Rob Riley said, "Siegelman's just like a cockroach, he'll never die, what are we going to do?" At that point Canary offered reassurance by citing Rove's news from Justice Department.

Simpson said she had long been troubled by the conference call conversation, and even consulted an official of the Alabama State Bar Association to determine whether she could disclose it publicly without violating her obligations as a volunteer working for the Riley campaign. She was told, she said, that she was free to speak of the matter.

Simpson said she grew more concerned about the matter after Siegelman's conviction last June. She says she told several friends about the conference call ; one of them, Mark Bollinger, a former aide to a Democratic attorney general in Alabama and in the Alabama Bureau of Investigation, has given his own affidavit, obtained by TIME, swearing that Simpson had told him of the conference call and Rove's alleged statements.

The federal investigation of Siegelman culminated in a criminal prosecution that became public not long after Siegelman announced that he would run again for governor of Alabama in 2006. Partly because of the investigation, Siegelman failed in his bid for the Democratic nomination.

So why hasn't this story hit the mainstream, television media? Could it be that reporters and senior management at the big three networks and their cable offspring are just too protective of, and close to, Karl and friends (every Washington reporter appears to be on a first name basis with him.) Could it be that they have decided, on their own, that Karl news isn't really news? It's too "inside the beltway," it won't go anywhere anyway (remember Plamegate?) Or maybe, they just assume that nobody cares.

Either way, stories like this are ones you only find linked to by blogs, or possibly on "Countdown." That, my friends, is why Karl Rove is untouchable. Not because his criminality isn't real or known, but because the Fourth Estate is playing on his team.

Other stories you won't hear on "Hardball" or the nightly news:

• Detainee abuse was well planned, and modeled on potential Cold War horrors (TIME)
• The Pentagon is seeking to revoke the honorable discharge of a vet who has turned against the war (RawStory)
• The U.S. says it doesn't negotiate with terrorists, and that Moqtada al-Sadr is a terrorist, and yet, the U.S. is seeking talks with al-Sadr
• 90 percent of U.S. vitamin supply is made in China
• U.S.-Russian relations are back to Cold War temperatures
• A year on, Katrina victims still in limbo

Labels: Bush administration, corruption, Gonzalesgate, Karl Rove, media, Republicans, U.S. attorneys

Labels: Bush administration, corruption, U.S. military, war profiteering

CIA analysts were still insisting, correctly, that there were no meaningful ties between al-Qaeda and Iraq, despite Tenet's acquiescence to Powell's request that Tenet sit behind him on camera as Powell wove his web of half- and un-truths at the UN. (Watching Tenet sit impassively as Powell spoke of a "sinister nexus" between al-Qaeda and Iraq was a tremendous blow to the morale of the courageous analysts who had resisted that particular recipe for cooking intelligence. As for their colleagues working on WMD, most of them had long since been pressured to cave in to Cheney's pressure during the dozen visits he made to CIA headquarters and were not as incensed.)

No trace had been found of weapons of mass destruction. In some quarters (even in the corporate press) the casus belli had morphed into a casus bellylaughi. Reports in Fox News that Saddam had somehow transported his WMD to Syria undetected (or maybe buried them in the desert) elicited widespread ridicule. Constant reminders of how difficult it is to find something in such a large country as Iraq - "the size of California" - were wearing thin. The attempt to associate uranium enrichment with the (in)famous aluminum tubes had, well, gone down the tubes. And the "mobile biological weapons laboratories," initially applauded by the president himself as proof the administration had found the WMD, turned out to be balloon-making machines for artillery practice, as the Iraqis had said. It was getting very embarrassing.

So this new challenge from Joe Wilson and his obnoxiously expert wife made for a very bad hair day. Cheney readily saw it as payback by honest CIA professionals for all the crass arm-twisting they had experienced at the hands of Cheney and kemosabe Libby. It is not hard to put oneself in Cheney's frame of mind as he witnessed the gathering storm.

Worst of all, the Iraq-Niger caper was particularly damaging, since it was tied directly to the office of the vice president. There was that unanswered question regarding who commissioned the forgery in the first place. And not even Judy Miller could help this time, since most thinking folks knew her to be a shill for the Bush administration.

And yet this insubordination, this deliberate sabotage, had to be answered. Something had to be done, and quickly, so that others privy to sensitive information about the litany of lies leading up to the war would not think they could follow Wilson's example and go to the press. ...

way back in early 2001 there was a pair of burglaries at the Niger Embassy in Rome and at the home of the Niger ambassador. Police investigating the crimes found that the only things stolen were official stationary and some official stamps, used to make documents official. A cleaning lady and a former member of Italy's intelligence service were arrested for the crimes. They were odd burglaries to be sure, since there is precious little one could use, or sell, such documents for, given the country involved. I mean, it might make sense to steal official stationary from the French Embassy in Rome, which a thief might use to finagle a pass to the Cannes Festival. But Niger?

Jump to October 2001. A few weeks after the 9-11 attacks, Italian Prime Minister Silvio Berlusconi, accompanied by his ministers of defense and intelligence, made a visit to the White House. There he reportedly handed over the forged Niger documents (they were on Niger government stationary, and had Niger government stamps!), which appeared to be receipts for uranium ore, made out to Saddam Hussein. Now forget the matter of why either Hussein or Niger's government would want paper receipts for such an illegal transaction, and forget the matter of how Hussein would have transported 400 tons of yellow dust across the Sahara to his country without somebody noticing. The simple fact is that Bush's own intelligence experts at the CIA and State Department promptly spotted the forgeries, and they were dumped.

We know this because we know, from the likes of onetime National Security Council counterterrorism head Richard Clarke and former Treasury Secretary Paul O'Neill, that Bush was pushing for war with Iraq almost as soon as he finished reading My Pet Goat following the attack on the Twin Towers. Surely if the White House had even thought those Niger documents might be legit, they would have leaked or broadcast them all over creation.

They didn't. The documents were deep-sixed, and mentioned to no one.

But according to some dedicated investigative reporters at the respected Italian newspaper La Repubblica, they resurfaced before long at a very suspicious meeting. This meeting occurred in December 2001 in Rome, and included Michael Ledeen, an associate of Defense Department Undersecretary for Policy Douglas Feith and a key figure in the White House's war-propaganda program, Larry Franklin, a top Defense Intelligence Agency Middle East analyst who later pleaded guilty to passing classified information to two employees of the America Israel Public Affairs Committee (AIPAC), convicted Iraqi bank swindler Ahmed Chalabi, then head of the CIA-created Iraqi National Congress, and Harold Rhode of the sinister Defense Department Office of Special Plans, that office set up by the White House and Defense Secretary Donald Rumsfeld under Feith's direction to manufacture "evidence" to justify a war on Iraq. Also at this peculiar meeting were the heads of the Italian Defense Department and of SISMI, the Italian intelligence agency.

According to La Repubblica, it was at that meeting that a plan was hatched to resurrect the forged Niger documents, and to give them credibility by recycling them through British intelligence.

And that is what Bush was referring to when, in his 2003 State of the Union address, he famously frightened a nation by declaring, "The British government has learned that Saddam Hussein recently sought significant quantities of uranium from Africa."

Bush lyingly implied that this was new information, when in fact he knew--had to know--that the "evidence" in British hands was the same set of documents he had been offered by Berlusconi almost a year and a half earlier, which had been declared to be bogus. ...

Labels: 110th Congress, Bush administration, corruption, Dick Cheney, Iraq, lies, Patrick Fitzgerald, Plamegate, Republicans, Scooter Libby, Valerie Plame, war, worst president ever

Labels: Alberto Gonzales, attorney general, Bush administration, corruption, Pearl Harbor Day massacre, Republicans, U.S. attorneys

WASHINGTON - The nation's top two law enforcement officials acknowledged Friday the FBI broke the law to secretly pry out personal information about Americans. They apologized and vowed to prevent further illegal intrusions.

Attorney General Alberto Gonzales left open the possibility of pursuing criminal charges against FBI agents or lawyers who improperly used the USA Patriot Act in pursuit of suspected terrorists and spies.

The FBI's transgressions were spelled out in a damning 126-page audit by Justice Department Inspector General Glenn A. Fine. He found that agents sometimes demanded personal data on people without official authorization, and in other cases improperly obtained telephone records in non-emergency circumstances.

The audit also concluded that the FBI for three years underreported to Congress how often it used national security letters to force businesses to turn over customer data. The letters are administrative subpoenas that do not require a judge's approval.

"People have to believe in what we say," Gonzales said. "And so I think this was very upsetting to me. And it's frustrating."

"We have some work to do to reassure members of Congress and the American people that we are serious about being responsible in the exercise of these authorities," he said.

Under the Patriot Act, the national security letters give the FBI authority to demand that telephone companies, Internet service providers, banks, credit bureaus and other businesses produce personal records about their customers or subscribers. About three-fourths of the letters issued between 2003 and 2005 involved counterterror cases, with the rest for espionage investigations, the audit reported.

Shoddy record-keeping and human error were to blame for the bulk of the problems, said Justice auditors who were careful to note they found no indication of criminal misconduct.

Still, "we believe the improper or illegal uses we found involve serious misuses of national security letter authorities," the audit concluded.

The House Judiciary Committee requested a host of documents from the White House today related to the administration's firing of a group of U.S. attorneys. The committee is also seeking to interview at least one current official in the White House's counsel's office, William Kelley, Deputy Counsel to the President, and former White House counsel Harriet Miers. (Former USA for Seattle John McKay has told reporters that, in a meeting with Kelley and Miers, he was asked about accusations that he had "mishandled" an investigation of Democratic voter fraud in the 2004 Washington gubernatorial election.)

The committee sought the documents in a letter to White House counsel Fred Fielding signed by Chairman John Conyers (D-MI) and Subcommittee Chairwoman Linda Sanchez (D-CA). By next Friday, March 16th, the committee wants all records of communications within the White House regarding the firings, all records of communications with members of Congress concerning the fired attorneys, the names of any members of Congress who were advance notice of the firings, and the names of anyone in the White House who was involved in the firings.

Griffin, according to BBC Television, was the hidden hand behind a scheme to wipe out the voting rights of 70,000 citizens prior to the 2004 election.

Key voters on Griffin’s hit list: Black soldiers and homeless men and women. Nice guy, eh? Naughty or nice, however, is not the issue. Targeting voters where race is a factor is a felony crime under the Voting Rights Act of 1965.

In October 2004, our investigations team at BBC Newsnight received a series of astonishing emails from Mr. Griffin, then Research Director for the Republican National Committee. He didn’t mean to send them to us. They were highly confidential memos meant only for RNC honchos.

However, Griffin made a wee mistake. Instead of sending the emails — potential evidence of a crime — to email addresses ending with the domain name “@GeorgeWBush.com” he sent them to “@GeorgeWBush.ORG.” A website run by prankster John Wooden who owns “GeorgeWBush.org.” When Wooden got the treasure trove of Rove-ian ravings, he sent them to us.

And we dug in, decoding, and mapping the voters on what Griffin called, “Caging” lists, spreadsheets with 70,000 names of voters marked for challenge. Overwhelmingly, these were Black and Hispanic voters from Democratic precincts.

The Griffin scheme was sickly brilliant. We learned that the RNC sent first-class letters to new voters in minority precincts marked, “Do not forward.” Several sheets contained nothing but soldiers, other sheets, homeless shelters. Targets included the Jacksonville Naval Air Station in Florida and that city’s State Street Rescue Mission. Another target, Edward Waters College, a school for African-Americans.

If these voters were not currently at their home voting address, they were tagged as “suspect” and their registration wiped out or their ballot challenged and not counted. Of course, these ‘cages’ captured thousands of students, the homeless and those in the military though they are legitimate voters.
We telephoned those on the hit list, including one Randall Prausa. His wife admitted he wasn’t living at his voting address: Randall was a soldier shipped overseas.

Randall and other soldiers like him who sent in absentee ballots, when challenged, would lose their vote. And they wouldn’t even know it.

And by the way, it’s not illegal for soldiers to vote from overseas — even if they’re Black.

But it is illegal to challenge voters en masse where race is an element in the targeting. So several lawyers told us, including Ralph Neas, famed civil rights attorney with People for the American Way.

Griffin himself ducked our cameras, but his RNC team tried to sell us the notion that the caging sheets were, in fact, not illegal voter hit lists, but a roster of donors to the Bush-Cheney reelection campaign. Republican donors at homeless shelters?

Over the past weeks, Griffin has said he would step down if he had to face Congressional confirmation. However, the President appointed Griffin to the law enforcement post using an odd little provision of the USA Patriot Act that could allow Griffin to skip Congressional questioning altogether.

• 
  The case of the Gonzales Seven

Labels: Alberto Gonzales, Bush administration, corruption, FBI, Gonzales seven, Justice Department, Pearl Harbor Day massacre

• Crazy in Scarborough Country
• Something just ain't right
• Nine fingered salute
• Monkey business
• In your face
• Flashback: McGovern's warning

Labels: CIA, corruption, Dusty Foggo, Hookergate

Labels: CIA, corruption, Hookergate