By Ryan White, TPM Cafe
September 26, 2005
Another week, another hurricane, and another Abramoff associate in hot water--though this time it's a fresh face who's making their debut on the Week in Corruption.
The Office of Management and Budget's (OMB) former procurement chief, David Safavian, was arrested on Sept. 19th for lying to officials and obstructing a Justice Department investigation in connection to his relationship with Jack Abramoff. Safavian accompanied Abramoff on an August 2002 golf junket to Scotland--a trip that also included Ralph Reed and Bob Ney--and asked for permission to accept the free airfare, claiming in an email to a GSA ethics official that "[t]he host [Abramoff] is a lawyer and lobbyist, but one that has no business before GSA (he does all of his work on Capitol Hill)." Safavian twice later repeated this claim, once in a late March-early April questioning by the GSA Inspector General, and again in a 2005 email to the Senate Indian Affairs Committee.
As emails have shown, Safavian worked with Abramoff both before and after the Scotland trip on affairs that did involve the GSA, the federal agency that manages federal land and property. Safavian aided Abramoff in his efforts to acquire 40-acres of GSA-managed land in Silver Spring, MD, and also in changing development regulations on the Old Post Office building in DC, which, according to FBI special agent Jeffrey Reisig, would help Abramoff give "tribal clients a competitive advantage in efforts to lease and develop the building." In an email exchange one of Abramoff's colleagues asked Abramoff about Safavian's presence on the golf trip, "Why Dave?... Business angle?" to which Abramoff replied in bold, "Total business angle. He is new chief of staff at GSA." Safavian claims he will fight the three-count criminal complaint "vigorously." He previously worked with Abramoff in the 1990s at the law firm Preston Gates Ellis & Rouvelas Meeds, and with Grover Norquist at Janus-Merritt Strategies LLC.
In other Abramoff news, Tyco's general counsel Timothy Flanigan, in a statement to the Senate Judiciary Committee, said that Abramoff boasted he could help the company fight taxes aimed at offshore corporations because "he had contact with Mr. Karl Rove," and "had good relationships with members of Congress," including Tom Delay. A Silver Spring-based company, Grassroots Interactive, was given $2 million by Tyco at Abramoff's behest, $1.5 million of which Abramoff promised to repay after a Tyco investigation found that, according to Flanigan, the $2 million was "diverted to entities controlled by Mr. Abramoff" and wrongfully spent. Flanigan's statements came during his confirmation hearing as President Bush's nominee for deputy Attorney General. Yesterday the Washington Post reported that Edward Miller, a "top aide" to Robert Ehrlich (R-MD), was subpoenaed last summer by a federal grand jury for his efforts in establishing Grassroots Interactive, and has been "cooperating" with the federal investigation ever since.
It seems that claims made by Adam Kidan's lawyer less than a month ago that Abramoff and Kidan will not testify against each other might not hold up much longer. In court documents filed in the SunCruz Casinos lawsuit, Abramoff blames Kidan for not telling Abramoff of his past business failures and disbarment, and said of the loan papers used to buy the SunCruz, "[h]ad I known these facts about Kidan, I would never have signed." (For those of you in need of an Abramoff-Kidan refresher course, the Associated Press has a useful timeline of all the important events).
The other big ethics news of the week centers around Senate Majority Leader Bill Frist, who sold all his stock, as well as his family's, in the family owned HCA Inc., the nation's largest private hospital chain. Frist asked for his stock to be sold on June 13th, and by July 8th his family's stock had been sold in entirety as well. On July 13th HCA said its second quarter earnings would be less than expected, and its stocks fell by 8.85 percent. Since Frist had "blind assets" in HCA--to relieve him of the conflict of interest that could come from crafting healthcare legislation--exactly how much he had invested in the company is unknown, but his 2004 financial disclosure puts this amount between $6.7 million and $36.5 million. On Thursday the SEC requested information from Frist, and on Friday a federal probe of the sale expanded by asking for information from both Frist and HCA.
Developers in Colorado enlisted the help of Tom Delay in building a massive ski resort on 288-acres of land that requires approval from the Forest Service. The developers tried to get "midnight riders" attached to bills in the House Appropriations Committee that would have given the developers permissions to begin construction immediately rather than waiting for federal approval (which is expected to be decided upon in November). One of the developers, Texas billionaire Joe "Red" McCombs, wrote to Delay in 2002 saying "We would have never gotten to first base without your help," and "I understand there may be an opportunity for the Amendment on another bill, like energy, and you know we will do whatever we can to help... Thanks for all you've done."
In Kentucky, Gov. Ernie Fletcher's appointed Merit Systems task force announced it is considering decriminalizing portions of the state personnel law, which, incidentally, 9 members of Fletcher's administration have been indicted for violating. Fletcher has already pardoned these 9, although there has been no ruling yet on these charges. One task force member resigned last month after calling into question the task force's legitimacy, and recently the Deputy Attorney General said the preliminary recommendations are a "step backwards for Kentucky."
Finally, the watchdog group Citizens for Responsibility and Ethics in Washington (CREW) will issue a report on Monday entitled "Beyond Delay: The 13 Most Corrupt Members of Congress" (the LA Times was given an advanced copy and has a preview of the report). The list includes: Sen. Bill Frist (R-TN), Sen. Conrad Burns (R-MT), Sen. Rick Santorum (R-PA), House Majority Whip Roy Blunt (R-MO), Richard W. Pombo (R-CA), Randy "Duke" Cunningham (R-CA), Maxine Waters (D-CA), Bob Ney (R-OH), Tom Feeney (R-FL), William Jefferson (D-LA), Charles Taylor (R-NC), Marilyn Musgrave (R-CO), and Rick Renzi (R-AZ).