The Magazine

A Decade of Reed

From the June 27, 2005 issue: One Republican's long, lucrative march through the institutions.

Jun 27, 2005, Vol. 10, No. 39 • By MATTHEW CONTINETTI
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Abramoff, as all inside-the-Beltway types know, is the ex-lobbyist who, along with his partner, the public affairs specialist Michael Scanlon, convinced six Indian tribes to pay up to $82 million over three years in exchange for . . . well, actually, no one exactly is sure what Abramoff and Scanlon did for all that money. Which is a problem.

As Andrew Ferguson detailed in these pages last year (see "A Lobbyist's Progress," December 20, 2004), Indian tribes operating casinos would hire Abramoff to represent their interests in Washington, and Abramoff would tell the tribes that they'd be out of their minds if they didn't hire Scanlon, too. Probably Abramoff suggested this because disclosure laws require anyone who spends 20 percent or more of his billable hours browbeating lawmakers to register as a lobbyist. And once you register as a lobbyist, you must also disclose your clients, and how much they pay you. Until last fall, Abramoff was a lobbyist--from 1995 until 2001 at Preston Gates Ellis & Rouvelas Meeds LLP, then from 2001 to 2004 at Greenberg Traurig LLP--and thus his ability to bleed his clients in public, one likes to think, was limited by a sense of propriety.

Scanlon, however, was not a lobbyist, and so he never had to disclose his clients; never had to say how much he was charging them, either. And so, while the tribes paid millions of dollars directly to Abramoff's firm--the Mississippi Choctaws paid Preston Gates $2.4 million in the first half of 1999 alone--they would also pay Scanlon multiples of that. Scanlon would then send some of those millions back to Abramoff. The money piled up. Though exactly how much money, no one is sure.

Occasionally Abramoff and Scanlon would have to do something for the money, and that's where Ralph Reed enters the story. From 1999 until 2002, organizations affiliated with Scanlon and Abramoff paid Reed's company, Century Strategies, at least $4.2 million for "grass-roots" support--working the phones, compiling voter lists, writing ad copy, and so forth. Reed, who once said that gambling was a "cancer" on the body politic, who told National Journal in 2004 that he has been "opposed to gambling throughout my entire career," used the money to shut down casinos that threatened the business of the casinos paying Abramoff.

Reed first acknowledged that he had accepted fees from Abramoff-related firms last August, when his company issued the following statement:

Ralph Reed and Century Strategies have long been opposed to the expansion of casino gambling. Century Strategies was approached about assisting with a broad-based coalition opposed to casino gambling expansion, and we were happy to do so. Our firm recruited coalition partners, raised funds, and mobilized grass-roots citizens. Our work was legitimate, lawful, and effective. We helped to close illegal casinos that violated federal and state law. Greenberg Traurig also raised funds and recruited coalition members. Although we were aware that Greenberg had tribal clients, we had no direct knowledge of their clients or interests. At no time were we retained by nor did we represent any casino company.

All of the above is true--technically, and up to a point. Yes, Century Strategies was never "retained by," never "represented" a "casino company." Century Strategies was retained by people who were retained by a "casino company." The statement is also incomplete. It mentions only Greenberg Traurig. But it's now clear that Century Strategies was paid at least $1.8 million from Michael Scanlon's company, Capitol Campaign Strategies, and another $2.3 million from the American International Center--the "think tank" that Scanlon and Abramoff had set up in Rehoboth Beach, Delaware, two blocks from the ocean. Why didn't Century Strategies mention those disbursements?

In their conversations with me, members of Reed's office stressed that they have always "said the same thing" about where the money came from. They stressed, further, that Reed had been given assurances that the money he was paid came from Preston Gates's and Greenberg Traurig's general business revenues, not revenues from Indian casinos. Century Strategies has turned over tax documents and financial records to the lead congressional committee investigating Abramoff. Reed himself has pledged to cooperate with the investigation.