Heist: Superlobbyist Jack Abramoff, His Republican Allies, and the Buying of Washington

Prologue

It certainly wasn’t the way that Republicans in Washington wanted to start the new year—especially an election year such as 2006.

But on a bright, chilly morning in early January, when disgraced superlobbyist Jack Abramoff exited U.S. District Court for the District of Columbia in downtown Washington, a number of prominent Republicans on Capitol Hill, in the city’s thriving lobbying community, and in the Bush administration were feeling high anxiety.

The threat to several GOP heavyweights was palpable from the plea bargain that a somber-looking Abramoff had just inked with federal prosecutors: in his sweeping plea deal, Abramoff had confessed to defrauding four casino-rich Indian tribes and others of almost $25 million, evading $1.7 million in federal taxes, and—most ominously—engaging in a conspiracy to bribe public officials. As part of his deal with the Justice Department, Abramoff, who at the time was forty-seven years old with a wife and five children, agreed to cooperate with a widening federal probe into corruption of government officials.

As Abramoff strode briskly to avoid the media swarm, reporters and camera crews jostled each other, straining to catch glimpses or snap pictures of the once-high-flying influence merchant whose lobbying larceny was already infamous. That day’s photos of Abramoff immediately became iconic and fodder for late-night television comedians: for the occasion, Abramoff had donned a black fedora and a black trench coat, which quickly drew comparisons to Hollywood images of mob chieftains. In the days that followed his plea, the press coverage was massive, with Abramoff appearing on the cover of Time, and The New York Times calling the influence-peddling scandal potentially one of the most explosive in Congressional history.

What many in the GOP had suspected and feared for months was now undeniable: Abramoff’s plea signaled that his decade-long fund-raising and influence machine, which mostly benefited GOP members, had become a political nightmare. In his plea agreement, Abramoff agreed to pay $25 million in restitution, mostly to the tribes, and the $1.7 million in back taxes that he owed. The three felonies that Abramoff pleaded guilty to carry a maximum penalty of thirty years, but the lobbyist is expected to wind up serving about one-third of that time, if he fulfills his pledge to cooperate fully with government investigators.

The disgraced lobbyist, whose career was characterized by extraordinary risk taking, ideological zealotry, and outsize greed, had been under intense federal scrutiny for almost two years. His plea that January day was the second one that Justice had notched in recent weeks. In late November 2005, Michael Scanlon, who had been a covert lobbying partner of Abramoff’s in his Indian casino work, pleaded guilty to fraud and conspiracy charges and was also cooperating with Justice investigators. Scanlon, thirty-five and a former press aide to Representative Tom DeLay when the Texas Republican served as House majority whip, agreed to pay the tribes $19.7 million in restitution.

A Justice Department statement of facts that was attached to Abramoff’s plea deal indicated that the lobbyist and his covert partner Scanlon had offered and provided a stream of things of value to public officials in exchange for official acts and influence and agreements to provide official action and influence. These things of value included, but are not limited to, foreign and domestic travel, golf fees, frequent meals, entertainment, election support for candidates for government office, employment for relatives of officials, and campaign contributions.

In a press conference after Abramoff’s plea, Assistant Attorney General Alice Fisher, who was head of the criminal division at Justice, pointed out that the corruption scheme with Mr. Abramoff is very extensive, and we will continue to follow it wherever it leads … We are going to expend the resources that are necessary to make sure that people know that government is not for sale.

Adding to his woes, Abramoff on January 4 pleaded guilty in Miami to separate charges of conspiracy and wire fraud. The lobbyist’s guilty plea involved a fraudulent $23 million wire transfer that Abramoff and a business associate, Adam Kidan, used in 2000 as proof of their down payment to swindle $60 million from lenders for their short-lived acquisition of Florida-based SunCruz Casinos. In late March 2006, Abramoff and Kidan, who himself had earlier pleaded guilty to similar charges as the lobbyist, were each sentenced to five years and ten months by a Florida judge for their crimes. But Abramoff and Kidan were allowed to remain free for at least ninety days to keep cooperating with federal investigators in the Washington public corruption probe.

As part of the widening investigation into Abramoff’s influence peddling in Washington, a federal interagency task force led by the public intergrity and fraud sections at Justice was looking at more than a dozen members of Congress, Capitol Hill aides, and former aides turned lobbyists, as well as one ex–high level Interior Department official with whom Abramoff had lobbying contacts. In October of 2005, the Justice probe scored its first indictment when David Safavian, a onetime lobbying associate and friend of Abramoff’s who was made chief of staff at the General Services Administration in spring of 2002, was charged with obstruction of justice and lying to federal investigators. The charges related to Safavian’s statements to government officials denying any business dealings with Abramoff that he made prior to an expensive golf junket that the duo and several other GOP powerbrokers took to Scotland in August 2002. Safavian, who had become the government’s chief procurement officer when he was indicted, was found guilty by a federal jury in June 2006 of four counts of lying and obstruction of justice involving the Abramoff probe; he was slated to be sentenced in October of 2006.

Meanwhile, on March 31, 2006, Tony Rudy, who had served as deputy chief of staff to DeLay before joining Abramoff in 2001 in the lobbying trade, pled guilty to a one-count conspiracy charge. Rudy acknowledged that he did legislative favors for Abramoff in exchange for gifts and money—including numerous meals, luxury trips, and tens of thousands of dollars—while he worked in DeLay’s office, and he later offered gifts to public officials during his lobbying work. Similarly, in May 2006, Neil Volz, a former chief of staff to Republican Representative Bob Ney of Ohio, pleaded guilty to a single conspiracy charge that he too had accepted lavish gifts from Abramoff when he worked on Capitol Hill and had done legislative favors for Abramoff’s clients. Likewise, when he left Ney’s office in early 2002, and became a lobbying associate of Abramoff’s, Volz provided gifts to public officials in return for their legislative help, according to the plea.

Ney was at or near the top of federal investigators’ targets. This influential Ohioan was chairman of the House Administration Committee, which, among other areas, oversees lobbying, federal elections, and operations of the House. The committee chairman’s power to dispense perks to members earned Ney the nickname Mayor of Capitol Hill. Ney, according to the Abramoff plea bargains, agreed to help a few of the lobbyist’s clients by performing various acts, including introducing a measure aimed at reopening an Indian casino that was an Abramoff client, putting statements in the Congressional Record that facilitated the SunCruz acquisition, and awarding a lucrative contract to an Israeli telecom firm that Abramoff later represented to install antennas for wireless telephones in the House. According to a court document, these acts were allegedly performed in exchange for a stream of things of value, including a five-day lavish golf trip to Scotland in August 2002 with Abramoff, Safavian, and others, free meals at a posh Washington restaurant owned by the lobbyist, sports tickets, and campaign contributions. Abramoff and his former partners who struck deals with Justice all agreed to testify against Ney. In mid-January, in the wake of Abramoff’s plea bargain, Ney relinquished his chairmanship of the committee; but he steadfastly maintained that he was innocent and was duped by Abramoff. Ney earlier asserted that he was outraged by the dishonest and duplicitous words and actions of Jack Abramoff.

Significantly, federal investigators were also scrutinizing DeLay, the former House majority leader, who had taken three trips with the lobbyist to such far-flung locales as Scotland, Moscow, and the Northern Mariana Islands in the Pacific, and had often been a key ally of the lobbyist’s clients. Federal probers were focusing on two other GOP members: Senator Conrad Burns of Montana and Representative John Doolittle of California had supported measures to help some of Abramoff’s tribal clients and had also received sizable campaign contributions from the lobbyist’s Indian casino and other clients. All four members have said they did nothing improper.

The political fallout from the lobbying scandal accelerated after Abramoff’s back-to-back January pleas. Dozens of politicos, both Republicans and Democrats, scrambled to return or donate to charity campaign contributions from several tribes that Abramoff represented, and from the lobbyist himself, to avoid being tarred by accusations of political corruption in the upcoming elections. Many members of Congress and high-level Bush administration officials, including the president, took pains to condemn and distance themselves from Abramoff, even though published photos and documents belied some of these claims. Even before Abramoff’s plea was announced, Senator Burns proclaimed that he wished that the lobbyist had never been born. What’s more, congressional leaders of both parties quickly rushed to propose various lobbying reforms that seemed aimed at inoculating themselves from political attacks before the fall elections.

But the scandal’s political repercussions were even more far-reaching due to Abramoff’s long-standing and close ties to several prominent leaders of the conservative movement. Abramoff’s rise in Washington had been facilitated by two stars in the conservative firmament: Grover Norquist, the combative antitax activist who ran Americans for Tax Reform, and Ralph Reed, the perennially youthful-looking ex-leader of the Christian Coalition turned corporate and political consultant. Both men had been Abramoff’s political allies for almost a quarter century and both played helpful roles in his Indian casino work and benefited financially. For Reed, who was making his first run for elective office and campaigning to become Georgia’s lieutenant governor, the lobbying scandal had already become an albatross.

Given Abramoff’s wealth of connections and ignominious fall from power, it’s not surprising that political leaders on the right and in the GOP felt a mixture of sadness, betrayal, and fear. For his part, the lobbyist seemed remorseful for his actions. At the close of his court appearance in Washington on January 3, a grim-looking Abramoff made a brief statement acknowledging his sorrow. All of my remaining days, I will feel tremendous sadness and regret for my conduct and for what I have done, he said, speaking in a subdued voice. I only hope I can merit forgiveness from the Almighty and from those I have wronged or caused to suffer.

But Abramoff, whose years as a Washington lobbyist were distinguished by a vaunting ambition and manic drive, quickly and publicly voiced other emotions that undercut his contrition. Within weeks of his plea, Abramoff told a Vanity Fair writer that despite his mistakes and errors of judgment—which he attributed largely to his style of operating at breakneck speed—I was the best thing [the Indians] had going. And elsewhere in that interview and other statements, Abramoff vacillated between expressing feelings of guilt and boasting about his powerful GOP friends and numerous lobbying accomplishments. Yet feeling scorned by his longtime high-powered political friends, Abramoff wryly quipped to Vanity Fair that you’re really no one in this town, unless you haven’t met me.

Abramoff’s rise and fall is partly a tale of greed gone wild. It’s also a tale of political corruption that the lobbyist spawned through an extraordinarily powerful influence machine that his clients bankrolled. Ultimately, the scandal has shed new light on the potentially toxic mix of money and politics: the corruption schemes that Abramoff fostered have highlighted the often hidden ways that campaign cash and lobbying favors exert influence over decision making in Washington.

The legal and political ramifications of the scandal are likely to play out for months in the courts, in the 2006 elections, and beyond. Many of the frauds that Abramoff and his associates committed are transparently clear; other aspects of the scandal are still murky and unfolding.

Yet the scandal’s far-reaching impact was underscored by the sudden and stunning announcement of Tom DeLay on April 3, just three days after Rudy’s plea deal, that he planned on retiring from Congress in June 2006. Whatever the ultimate legal outcome of the criminal inquiry, the political repercussions have already sent shock waves through sizable segments of the conservative movement that Abramoff long championed, even while he was spreading an ethos of greed and deceit.

ONE

Double-Dealing

When Jack Abramoff flew into El Paso in February 2002, he was greeted by the Tigua Indians as a potential savior. At least that’s how Carlos Hisa, a soft-spoken and boyish-looking leader of the Tigua tribe, initially regarded the well-connected Republican lobbyist from Washington.

It was a difficult time for Hisa, the tribe’s lieutenant governor, and other leaders of the thirteen-hundred-member Tiguas, a Native American Indian tribe who have been in the El Paso area since 1680. The tribe’s fortunes had taken a big hit just days before Abramoff’s arrival, when a federal court ordered that a highly profitable casino that the Tiguas had been running since 1993 be shuttered.

A lobbyist renowned for his prodigious fund-raising talents and high-level GOP contacts on Capitol Hill and with the Bush administration, Abramoff arrived at the Tiguas’ headquarters with a pitch to help get their casino reopened that was hard to resist.

Hisa and other tribal leaders, who had worked hard for months to stave off the casino’s closing, were naturally interested, since the casino was vital to the tribe’s welfare and employment.

At its peak, Speaking Rock Casino employed about eleven hundred people and generated almost $60 million a year in revenue, making it the economic mainstay for the small Tigua community. Most nights of the week and on weekends, the casino did a brisk business and was packed with patrons who poured in from nearby El Paso and other smaller towns to play the thirteen hundred slot machines or table games such as poker and blackjack.

Surrounded by palm trees, the adobe-style light brown Speaking Rock was more than just a profitable venture: a large chunk of the revenues from the one-story casino was channeled into badly needed health, education, and housing programs. One ambitious project that the casino largely underwrote was a $20 million state-of-the-art wellness center: it offered everything from a diabetes prevention and treatment program to karate classes for children to a modern Olympic-size swimming pool and other recreational facilities.

During the years the casino was operating, the tribe’s unemployment rate, which had previously hovered around 50 percent, was close to zero. The casino also enabled the tribe some years to pay each tribal member between $8,000 and $15,000, and made possible health insurance for many Indians who would otherwise have received little or no medical care. In short, Speaking Rock had been an economic boon to the long-struggling tribe. Most of the tribe lives in a checkerboard-style development on some four hundred acres of land just a mile or two from the Mexican border and about half an hour’s drive from downtown El Paso.

After researching the lobbyist’s background, Hisa and other tribal leaders were impressed. Abramoff’s résumé read like a who’s who of the GOP power elite. At the time, he was one of the hottest lobbyists in Washington and had received extensive and favorable press coverage. An Orthodox Jew and onetime Hollywood filmmaker who turned to lobbying right after the GOP captured Congress in 1994 during the Clinton administration, Abramoff had been lionized in front-page stories in The Wall Street Journal and The New York Times. The articles had detailed his herculean fund-raising work for GOP leaders such as Tom DeLay of Texas, who had once helpfully referred to Abramoff as one of my closest and dearest friends.

Abramoff’s roots in the conservative movement were deep. He counted among his oldest and closest friends two pillars of the network: Grover Norquist and Ralph Reed. Both men were confidants of Karl Rove, the Bush administration’s political guru, and had been close allies of the lobbyist since the early 1980s, when Abramoff chaired College Republicans and they served successively as his chief lieutenants. Hisa was also impressed that Abramoff worked at Greenberg Traurig, an elite law and lobbying firm, one of whose Florida-based lawyers had been instrumental in helping the Bush campaign in 2000 win its legal battles in the Sunshine State.

A stocky, well-built man in his early forties who had once been a star weight lifter at Beverly Hills High School, Abramoff initially promised that he would do pro bono work. The lobbyist had a smooth, polished style about him, and he informed the Tiguas that their casino’s closing was outrageous; in one e-mail to a tribal consultant he referred to the gross indignity perpetuated by the Texas state authorities. Further, Abramoff boasted that he had already found some members of Congress who would correct the injustice, citing a couple of senators willing to ram this through.

But to achieve that goal for the tribe, Abramoff urged the tribe to hire Michael Scanlon, former spokesman for DeLay turned public relations and grassroots consultant, whom he had introduced to the tribal council at a meeting on February 12. The lobbyist and his PR associate had flown into El Paso on a privately chartered Gulfstream II jet. Abramoff and Scanlon came to the meeting with the Tiguas sharply dressed: both wore dark pin-striped suits. A lanky, athletic man of about thirty with a reputation as a glib and fast-talking salesman, Scanlon received rave reviews from Abramoff: Scanlon was touted by the lobbyist as a go-to guy and the preeminent expert in grassroots politics, whose expertise would quickly ratchet up local pressures on Congress to ensure that Speaking Rock would reopen. Moreover, Abramoff assured the council that they would be hiring Scanlon independently. Unlike Abramoff’s pledge to work for free, Scanlon readily acknowledged that his work would be expensive, and a few days later he followed up with a written plan that he felicitously dubbed "Operation Open