The Friends of Tom DeLay
What was the staff of the former majority leader up to anyway?
Apr 17, 2006, Vol. 11, No. 29 • By MATTHEW CONTINETTI
Every member of this House knows how important it is to have good staff. These are the people who run this institution from day to day. They are the people who do the grunt work, draft the bills, work long nights--all in service of the American people. And we, as Members of Congress, place our trust and careers in their capable hands every day.
IT WAS CALLED THE SAFE HOUSE. Rep. Tom DeLay, Republican of Texas and majority whip of the House of Representatives, frequently visited the townhouse his former aides had bought in January 1999 as a place to make fundraising calls and confer with advisers, according to news accounts. Situated at 132D Street, S.E., the house was only a few blocks from DeLay's suite in the Cannon Office Building.
A refuge for DeLay, the Safe House was also a hub of activity. DeLay's political action committee, Americans for a Republican Majority (ARMPAC), was headquartered there. The U.S. Family Network, a nonprofit with close ties to DeLay's former chief of staff, Ed Buckham, operated out of a small room in the back. And Buckham's consulting firm, the Alexander Strategy Group, which he ran with the help of his wife, Wendy, was there too. Technically, the U.S. Family Network owned the residence. In 2000, its value was assessed at more than $300,000.
Today, no doubt, the property is worth much more, though it no longer serves as a base for DeLay and his closest advisers. In April 2000, after Roll Call reported on the Safe House's location and tenants, ARMPAC and the Alexander Strategy Group vacated the property. Less than a year later, in January 2001, the U.S. Family Network shut down. The constituent parts of DeLay's political machine were dispersed around the capital, finding shelter on K Street, where lobbyists ply their trade, and in the Maryland and Virginia suburbs.
Now that machine will likely disappear for good. On Monday, April 3, in a 90-minute interview conducted in his home in Sugar Land, Texas, DeLay told Time magazine's Mike Allen that he is withdrawing from his reelection bid and plans to resign from Congress by summer. The race has "become a referendum on me," DeLay said.
Apparently that was a referendum he worried he would lose. On April 4, in a separate interview with a group of conservative journalists including The Weekly Standard's Fred Barnes, DeLay said the decision to withdraw came shortly after March 7, when he defeated Houston lawyer Tom Campbell in a Republican primary, 62 percent to 30 percent. "You get a sixth sense about this stuff," DeLay said, according to Byron York's account of the interview in National Review Online. "You know your district. . . . You don't need polls, but we ran a poll anyway. And the poll showed, basically, that I had a 50-50 chance of winning."
So, rather than risk losing a reliably Republican district to former Democratic congressman Nick Lampson, DeLay decided to change his legal residence to his Alexandria, Virginia, condominium, allowing Texas Republicans to choose another candidate. (Campbell has announced he will run to replace DeLay on the ballot; he faces numerous opponents, including DeLay's preferred replacement, Sugar Land mayor David Wallace.)
DeLay's sudden move, which shocked the political community, had a notable consequence: It pushed to the sidelines the March 31 news that DeLay's onetime deputy chief of staff, Tony C. Rudy, had pleaded guilty to conspiracy charges and pledged to cooperate with the ongoing investigation into congressional corruption stemming from the lobbying activities of Jack Abramoff. Over a period of several years, Abramoff defrauded six Indian tribes operating casinos of tens of millions of dollars, directing the tribes to donate to shell companies and nonprofits and hire close business associates, with whom he would split the graft.
Although Rudy's plea agreement refers to DeLay as "Representative #2," to date DeLay has not been accused of any improper behavior regarding Abramoff. DeLay says federal investigators have informed his lawyers that he is not a target in that investigation. He has pledged his cooperation, voluntarily delivering to the FBI task force some 1,000 emails. And he continues to deny any wrongdoing. But he is up to his armpits in scandal, and so are former members of his staff.
On October 3, 2005, a Texas grand jury empaneled by Travis County District Attorney Ronnie Earle indicted DeLay on charges of money laundering. The indictment, which came on the heels of a separate indictment on conspiracy charges, accuses DeLay and his co-conspirators of improperly funneling money into local elections in 2002. Republican victories in those elections enabled DeLay and his allies in the statehouse to push through a controversial redistricting plan that led to a historic GOP pickup of House seats in the 2004 elections. (Later this year, the Supreme Court is expected to rule on the legality of DeLay's plan.) DeLay, who awaits trial, says Earle, a prominent Democrat, is playing politics, and he denies all the charges.
On November 21, 2005, DeLay's former press secretary, Michael Scanlon, pleaded guilty to charges of conspiracy, and admitted that he and Abramoff had plotted to defraud their clients and influence members of Congress and officers of the executive branch. Released on a $5 million bond, Scanlon agreed to cooperate with investigators, pay $19.7 million in restitution to the tribes, and face a jail sentence of up to five years. He awaits sentencing.
On January 3, in Washington, Abramoff pleaded guilty to three counts of fraud, tax evasion, and conspiracy. The next day, he flew to Miami, where he pleaded guilty to two counts of conspiracy and wire fraud in connection with his 2000 purchase of the SunCruz casino company. On March 29, a federal judge in Miami sentenced Abramoff to 5 years and 10 months in prison on those charges; he awaits sentencing for the crimes he confessed to in Washington.
Oddly, DeLay seems to make major announcements regarding his future just days after significant developments in the Abramoff investigation, only then to deny any connection to that investigation. On January 7, when he announced he would no longer seek to retain his post as House majority leader, Washington was still reeling from Abramoff's plea bargain. And last week, when DeLay announced his retirement, analysts were still chewing over the implications of Rudy's deal with prosecutors.
This tendency suggests there may be further major announcements from DeLay, because the Abramoff probe is far from over. There are 13 FBI field offices across the country where some two dozen full-time (and as many part-time) officers spend hours unraveling the threads connecting Abramoff's power networks, according to reports in Time magazine. In addition to the guilty pleas of Scanlon, Abramoff, and Rudy, Abramoff's business partner in the SunCruz fiasco, Adam Kidan, has also pleaded guilty in Florida to wire fraud and conspiracy.
Last October, the former director of the White House's procurement office, David Safavian, was indicted on five counts of making false statements and obstruction of justice. The government alleges that Safavian masked his dealings with Abramoff and lied to investigators about his relationship with the lobbyist. Safavian denies the charges. His trial is set for May 22.
Meanwhile, Republican representative Bob Ney of Ohio appears in Abramoff's, Rudy's, and Scanlon's plea agreements, where he is referred to as "Representative #1" or "Legislator #1." Separately, the plea agreements allege that Ney accepted a stream of gifts from Abramoff and his associates, including free meals at the lobbyist's restaurant, tickets to sporting events, and expensive golf trips, in exchange for official action. Ney denies all the charges and has said that he is a victim, not an accomplice.
Last October, federal prosecutors informed Ney that an indictment on charges of bribery was being prepared against him in connection with statements he entered into the Congressional Record in the fall of 2000, according to Susan Schmidt and James Grimaldi of the Washington Post. Those statements, critical of South Florida gambling impresario Gus Boulis and supportive of Abramoff business partner Kidan, aided Abramoff and Kidan's attempt to purchase SunCruz, which Boulis owned.
The SunCruz deal was an unmitigated catastrophe. (See my "Money, Mobsters, Murder," November 28, 2005.) In February 2001, Boulis was shot and killed on his way home from a business meeting. Last September, three men, all tied to organized crime families in New York and Miami, were arrested in connection with the murder; they await trial. One of those men, Anthony "Big Tony" Moscatiello, a former adviser to mob boss John Gotti who also spent 15 years as an FBI informant, has told southern Florida media that Kidan was aware of the plot to kill Boulis. Kidan denies this, and has not been charged in connection with the homicide.
This landscape of human wreckage, littered with the careers of former employees and associates, is central to Tom DeLay's legacy. And at its epicenter--and the place where the Abramoff investigation is almost certainly headed--is the townhouse at 132 D Street.
TONY RUDY is 39 years old. In 2003, the Hill newspaper called him a "lobbyist extraordinaire." He was born in Brooklyn and grew up in New Jersey, a talented athlete who loved to play hockey. In 1988, he graduated from the University of Massachusetts at Amherst with a degree in finance. Then he moved to Washington, where he found a job as legislative correspondent with California Republican congressman Dana Rohrabacher. Rudy spent four years toiling in Rohrabacher's office, eventually rising to press secretary, before leaving in 1992 to pursue a law degree from George Mason University in suburban Virginia.
In 1995, when he passed the Virginia bar, Rudy looked for a new job. He managed to land one of the most coveted staff positions in Washington: press secretary for the new majority whip, Tom DeLay. Rudy's job was to handle Texas media. But his star rose quickly. In 1996, DeLay named him general counsel, a position that Rudy held concurrently with his press duties.
To be on DeLay's staff was to be part of an influential family whose members were spread throughout government and the private sector. Over his 21 years in Washington, many have passed through DeLay's offices; the writer John Judis estimates the number at "about 300" on Capitol Hill and "about 75 more" who worked for the congressman's campaigns, his political action committees, and his charitable foundations. In addition, DeLay's lobbyist allies on K Street often served to magnify his power, functioning as a shadow staff that worked closely with his office to pass legislation and identify areas ripe for conservative reform.
One of those lobbyists was Jack Abramoff, who met DeLay in 1994. There are competing versions of how the two men were introduced. In one story, Rabbi Daniel Lapin, a friend of Abramoff's who runs Toward Tradition--a nonprofit "independent coalition of Jews and Christians seeking to advance America toward traditional, faith-based principles," according to its website--made the introductions. "It was just, 'Jack, meet Tom,'" someone told Seattle Weekly reporter Rick Anderson in May 2005. "Very informal at a D.C. dinner. Just people who see eye to eye."
In another story, first reported in Time magazine in January, DeLay and Abramoff met at a fundraiser when Ed Buckham, then DeLay's chief of staff, pulled the lobbyist toward the congressman and said that the two would be working together closely. However they met, DeLay and Abramoff enjoyed a rapport. "I have admired Tom DeLay and his family from the first meeting with him, and I still do to this day," Abramoff tells Vanity Fair's David Margolick in that magazine's April issue. "We would sit and talk about the Bible. We would sit and talk about opera. We would sit and talk about golf. I mean, we talked about philosophy and politics. I didn't spend a lot of time lobbying Tom for things, because the things I worked on were usually consistent with the conservative philosophy, and I knew Tom would be supportive."
For his part, DeLay famously called Abramoff one of his "closest and dearest friends in Washington." This might have been the sort of exaggeration one would expect from a talented veteran politician. And yet even the most cursory look at Abramoff's career reveals that the lobbyist focused his efforts on gaining influence inside the majority whip's office, taking the congressman on trips, and coordinating his advocacy with DeLay's top lieutenants.
Central to those efforts, it would seem, was the U.S. Family Network. The nonprofit has a controversial past, but it was only last December that the Washington Post first reported on its myriad Abramoff connections. In 1996, a $15,000 donation established the network, according to tax records obtained by the Post. Buckham was listed as the founder. The Mississippi Choctaw, a tribal client of Abramoff's, donated the $15,000. On March 25, 1997, Buckham and Rudy visited the Choctaw reservation in Philadelphia, Mississippi, which today sports two casinos, a spa, and a golf course. The trip lasted until March 27 and cost $3,000.
As it turns out, the U.S. Family Network and a slew of other Abramoff fronts like the Capital Athletic Foundation, the American International Center, and KayGold Inc., had highfalutin names but produced little or no actual work.
Instead, they served another function. For example, early in 1997, business holdings associated with the garment manufacturer Willie Tan, another Abramoff client, cut $50,000 in checks to the U.S. Family Network, according to the Post. Tan, the recipient of the largest labor fine in U.S. history, is a Chinese tycoon who owns clothing factories throughout the Commonwealth of the Northern Mariana Islands, a U.S. territory exempt from U.S. immigration, wage, and labor laws. Tan paid Abramoff millions of dollars to ensure that the exemption continued. And Abramoff was successful in doing just that.
According to the U.S. Family Network's ledgers, Buckham's wife Wendy was paid $10,000 of the Tan donation as part of her "commission." The financial relationship between the Buckhams and the U.S. Family Network--Wendy Buckham kept the books--was formalized on October 28, 1997, when Ed Buckham and the network agreed to a "letter of engagement."
According to its terms, the network would pay Buckham's lobbying firm, the Alexander Strategy Group, $12,000 a month starting in November 1997. Further, according to the letter--obtained by National Journal's Peter Stone--"a percentage of high-dollar fundraising not to exceed 15 percent" would flow to Buckham's company. In 1998, for instance, the Alexander Strategy Group claimed $20,000 in "commissions" stemming from Tan donations to the network.
The nexus between the U.S. Family Network, the Alexander Strategy Group, Buckham, and Abramoff was established while Buckham still served on DeLay's staff. That changed in late 1997, when Buckham resigned as chief of staff to head the ARMPAC fundraising operation, which also operated out of 132 D Street. DeLay had founded the political action committee in the years prior to the Republican Revolution. Between 1998 and 2004, ARMPAC raised over $14 million, according to John Judis in the New Republic.
When Buckham left, DeLay promoted Rudy to deputy chief of staff, and hired the young Michael Scanlon, who previously had served as press secretary to Illinois Republican congressman Mike Flanagan. The staff changes became effective in early 1998, around the time Buckham founded the Alexander Strategy Group. DeLay helped to secure one of Buckham's first clients, Houston-based energy giant Enron, which entered into a $750,000 contract with the former chief of staff's small consulting shop.
As a tax-exempt nonprofit, the U.S. Family Network was expected to spend most of its time and money on nonpolitical activity. In one fundraising letter, Tom DeLay described the outfit as a powerful grassroots organization committed to social change. This seems to have been a grossly inaccurate description of the group. In retrospect, it was little more than a piggy bank. In 1997, the network paid Buckham's wife, Wendy, a salary of $53,000. Tax records indicate the network paid for a $27,000 GMC truck that was registered to Buckham's home in suburban Maryland. And in 1998, the network leased a skybox at the MCI Center (now Verizon Center) for $149,000.
It is difficult to determine where the U.S. Family Network ends and the Alexander Strategy Group begins. From 1998 to 2002, Christine DeLay was an employee of the Alexander Strategy Group, yet she seems to have been paid out of commissions the Buckhams took from the network. Those payments amounted to around $3,000 a month.
Last November, the DeLays' attorney, Richard Cullen, told the Washington Post that Christine DeLay had been paid $115,000 over three years to, as the Post put it, "determine the favorite charity of every member of Congress." To date, there is no evidence that DeLay compiled a list of 535 charities.
Yet the money kept rolling in. On June 25, 1998, a London-based law firm, James & Sarch Co., issued a $1million check to the U.S. Family Network, the largest donation in the group's history and an extraordinary amount for a nonprofit with only one full-time staff member. Where the money came from is a mystery. The law firm that wrote the check no longer exists. David Sarch, one of the partners, is dead.
Last December, two sources told Washington Post reporter R. Jeffrey Smith that the donation had come from Russian energy interests, probably executives of NaftaSib, a Russian oil company and Abramoff client. In 1997, Buckham visited Moscow as a guest of NaftaSib; a few months after his return (he flew back on the Concorde), the DeLays, Abramoff, and others went to Russia, where they played golf, saw the sights, and attended a banquet hosted by NaftaSib. The congressman and his staff had numerous contacts with Marina Nevskaya and Alexander Koulakovsky, NaftaSib's top brass, who both had ties to Soviet intelligence.
According to Smith's sources, the original plan had been for the donation to be made in cash, but that fell through. Christopher Geeslin, a Maryland pastor who was associated with the U.S. Family Network for several years, told Smith that Buckham had told him the money was part of a campaign to influence DeLay's vote on a pending International Monetary Fund bailout. Geeslin told the Post, "Ed told me, 'This is the way things work in Washington.'"
As it happens, almost all of the money that the U.S. Family Network raised over its relatively short life came from Abramoff's clients. And these donations were often directly linked to trips Abramoff arranged for DeLay and his staff. On July 31, 1998, for example, DeLay, his wife Christine, and his chief of staff Susan Hirschman left for the Choctaw casinos and golf course. This trip lasted until August 3 and cost $6,935. Buckham reportedly planned and facilitated the trip. On August 3, the U.S. Family Network booked a $150,000 donation from the Choctaws.
Rudy's promotion to deputy chief of staff put him closer to Abramoff, who sought to ingratiate himself with congressional staff members, pulling them toward his clients' positions and his personal lucre. In January, one source told Time magazine that, "for all intents and purposes, Tony worked for Jack." This source also said that Abramoff bought a personal hand-held device for Rudy in order to remain in nearly constant communication. The lobbyist and the well-placed staffer were linked at the hip.
Such a connection had its benefits. On October 26, 1998, Abramoff sent an email to Rudy requesting his help. In Guam, there was an upcoming gubernatorial election, and the Republican candidate, Joe Ada, was in danger of losing to the Democratic incumbent. "We want to know if there is any way to get Tom to call for an investigation of the misuse of federal funds on Guam by this governor," Abramoff wrote in the email, which was first obtained by the Wall Street Journal. "A press release and letter requesting an Inspector General (I guess from Interior?) to investigate these matters," Abramoff went on, "should have a major impact on the election next week."
Sure enough, later that day, DeLay's office issued a public rebuke of the Democratic governor, Carl Gutierrez, and sent a letter to the Department of the Interior calling for an inquiry. "The allegations and materials I reviewed," says the text of the letter, signed by DeLay, "point to serious corruption."
IN THE END, however, like many of Abramoff's lobbying efforts, the Guam campaign went nowhere. The Interior Department took no action; Ada lost; and while Gutierrez did eventually stand trial on corruption charges, he was acquitted.
On Guam, Rudy and Abramoff also worked with Scanlon, who was then 27 years old. Later, Rudy and Scanlon reportedly were to clash, but in 1998 they shared a common goal: impeaching President Clinton. That December, the two DeLay staffers worked furiously to whip the impeachment vote.
One day during the legislative battle, Scanlon wrote an email to his boss that first surfaced in reporter Peter Baker's The Breach. "God Bless you Tony Rudy," Scanlon wrote. "Are we the only ones with political instincts--This whole thing about not kicking someone when they are down is BS--Not only do you kick him--you kick him until he passes out--then beat him over the head with the baseball bat--then roll him up in an old rug--and throw him off the cliff into the pound[ing] surf below!"
Scanlon's literary style would later haunt him, when the Senate Indian Affairs Committee released thousands of emails he had sent to Abramoff in which he pilloried his tribal clients and referred to social conservatives as "wackos." Rudy's style was different. He was less abrasive. He earned people's trust.
In April 1999, when he was still DeLay's deputy chief of staff, Rudy and his wife traveled to Hilton Head, South Carolina, on an all-expenses-paid trip financed by lobbyists, according to Rudy's plea agreement. The agreement fails to specify who exactly paid for the trip, listing either "Abramoff, clients of Abramoff and clients of Lobbyist B"--who is Buckham--or "Abramoff's business interests." This trip was the first of many and, according to the plea agreement, the beginning of Abramoff's financial relationship with Rudy.
In August 1999, Rudy and his wife formed a company, Liberty Consulting. Lisa Rudy was the sole employee. Liberty Consulting seems to have been another version of the Alexander Strategy Group; most of its clients, like the group's, were clients of Abramoff. Rudy admits in his plea that he knew Buckham "shared some clients with Abramoff," and that he arranged for payments from Abramoff and Buckham to be made to Liberty Consulting. In all, the firm took in $86,000 while Rudy remained on DeLay's staff. It is unclear what services, if any, the firm performed for that money.
In December 1999, Buckham and Scanlon--who was still DeLay's press secretary--went to the Marianas. They were there to help Abramoff's favored candidate win election as speaker of the commonwealth's House of Representatives. That candidate, Ben Fitial, had previously worked for Willie Tan, the factory tycoon who employed Abramoff. Rudy was aware of, and helped to coordinate, the visit. Buckham and Scanlon met with members of the Marianas legislature and determined that two of its members would side with Fitial if DeLay supported a variety of projects in their districts. After Buckham and Scanlon returned to the United States, the representatives they had met with--Alejo Mendiola and Norman Palacios--announced their support for Fitial, who was elected speaker in January 2000.
That month, Rudy arranged for another DeLay staffer to visit the Marianas alongside Scanlon, according to Rudy's plea agreement. The aide reportedly was Brett Loper. His job was to look around the commonwealth for opportunities for pork. He found some, and in May 2000 Congress passed an appropriations bill that made the construction of an airport on the Marianas island of Rota--home to Rep. Mendiola--a spending priority. In October 2000, in a separate appropriations bill, Congress directed $150,000 to a breakwater project on the Marianas island of Tinian, home to Rep. Palacios. In his plea agreement, Rudy admits that he "worked with others to secure certain appropriations projects for the [Marianas] which he knew would help Abramoff's lobbying business and that had been sought by Abramoff and Lobbyist B," aka Buckham.
In his plea agreement, Rudy also admits much else. In the spring of 2000, he arranged for a letter from DeLay opposing a postal-rate increase that would have cut into one of Abramoff's client's profits. Last week, DeLay told the group of conservative journalists that he had nothing to do with the letter, according to National Review's Byron York. "Frankly, what it sounds like from what I read in the media was that they were trading off of knowing that I would already be in those positions," DeLay said. "I have always opposed postal rate increases. So you know this one's coming up, DeLay's going to be against it, so I'm going to make some money off of it, telling so-and-so and so-and-so that I can get DeLay to be against it."
In March 2000, as Abramoff worked furiously with DeLay's office to scuttle the Internet Gambling Prohibition Act--which would have put one of his clients, eLottery, out of business--Michael Scanlon left DeLay's office to join Abramoff's team at Preston Gates Ellis LLP. DeLay and his senior staff, it seems, were crucial to Scanlon's hiring. "Scanlon--we didn't fire him, but we found him another job," DeLay told the conservative journalists last week.
The eLottery campaign was a triumph of Abramoff's lobbying style, coupling high-powered connections on Capitol Hill with the grassroots contacts he had fostered in over two decades of conservative activism. Throughout the fight, Rudy provided Abramoff with advice and an insider's perspective on legislative maneuvers. Meanwhile, Abramoff instructed eLottery to pay millions of dollars to social conservative groups, telling those groups that the Internet gambling ban would actually increase gambling overall. For the most part, the social conservatives were unaware of who was funding their efforts, as Abramoff passed eLottery's money through a variety of nonprofit conduits.
In May 2000, Abramoff arranged for DeLay and Rudy to accompany him on his annual trip to St. Andrew's golf course in Scotland. A nonprofit, the National Center for Public Policy Research, on whose board Abramoff sat, nominally paid for the trip. But the funds the National Center used originated from eLottery, which cut a $25,000 check to the group on May 25, the day Abramoff's junket departed, according to Susan Schmidt and James Grimaldi's reporting in the Washington Post.
By the summer of 2000, DeLay had still not said how he would vote on the gambling prohibition bill. But Rudy's sympathies were well known to the Preston Gates lobbyists: He wanted to help Abramoff defeat the measure. On June 8, less than a week after returning from Scotland, Rudy sent a wireless message to Abramoff that read: "911 gaming," according to Schmidt and Grimaldi. Later, Rudy suggested that Abramoff arrange for a meeting with Speaker of the House Dennis Hastert of Illinois and Majority Leader Dick Armey of Texas. Abramoff forwarded Rudy's suggestion to his staff. "Message from Tony Rudy," Abramoff wrote. "Don't share it please. However we should take his advice."
That month, Abramoff began to pay Rudy's Liberty Consulting a monthly stipend of $5,000. In June, he paid $10,000. Some of this money was passed through yet another nonprofit. "Rudy was aware that Abramoff arranged for at least one of his clients to make donations to the nonprofit and that this money was used to make payments to [Rudy's] wife," according to the plea agreement. Rudy had provided favors to that client--unnamed in the plea agreement, though in all probability eLottery. The nonprofit was Rabbi Daniel Lapin's Toward Tradition, according to Peter Stone in National Journal.
Slowly, Rudy was morphing into a sort of consigliere to Abramoff, who listed the DeLay aide as a reference in his fraudulent loan application for the purchase of SunCruz casinos. And Rudy lent more than his name. On June 15, 2000, he accompanied Abramoff to the U.S. Open in Pebble Beach, California, alongside Adam Kidan and employees of Foothill Capital, Abramoff and Kidan's lenders. A few weeks after that trip, Rudy arranged for DeLay's office to send SunCruz's owner, Boulis, a U.S. flag that had been flown above the Capitol.
As Abramoff went after SunCruz, the battle over Internet gambling continued on Capitol Hill. On July 11, Rudy wrote to Abramoff: "I think we should get Weyrich"--conservative activist Paul Weyrich--"to get like 10 groups to sign a letter to Denny and Armey on gaming bill." On July 13, the Reverend Lou Sheldon, a prominent social conservative and beneficiary of Abramoff's largesse, met with DeLay in the majority whip's offices. Sheldon told DeLay that he opposed the Internet Gambling Prohibition Act. Shortly after meeting with Sheldon, DeLay decided that he would also oppose the bill. Four days later, on July 17, 2000, the gambling ban was defeated, 25 members short of the two-thirds majority required for passage under House suspension rules.
Later that summer, one day in August 2000, Rudy hosted a bachelor party in Abramoff's suite at the Washington Redskins' FedEx Field.
By the end of 2000, Rudy was angling for a job outside government. Abramoff was also looking for a change. He had decided to switch law firms and move to the Washington offices of Miami-based Greenberg Traurig. Abramoff asked Rudy if he would like to join him at the new firm. Rudy accepted.
DeLay was devastated by the news. He had high regard for Rudy, and had come to trust him as a friend and ally. On December 15, 2000, the congressman entered remarks on Rudy's departure into the Congressional Record. "Mr. Speaker," DeLay said, "I rise today to pay tribute to a friend and colleague who, after eight years of service to the House of Representatives, is moving on."
After emphasizing the important role staff members play in American politics, DeLay continued:
I am very lucky. I have always been blessed with great staff. But every once in a while a truly special person comes along and inspires and energizes an office. I was lucky enough to have one of the best, one of the most committed, one of the brightest staffers on Capitol Hill working for me for the past five and a half years. His name is Tony Rudy.
Rudy, DeLay went on, had many qualities:
One of the things that I have always admired about Tony is his real commitment to the conservative agenda. He is not in Washington, D.C., for power or personal gain. He is here because he believes in what he is doing and because of his desire to make America a better place. And his commitment was on display every day as he moved through my office like a whirlwind, pressing staffers to do more, to work harder. He is personally responsible for the passage of much good legislation, but more importantly he was on the lookout for bad legislation.
"Tony's departure is a personal loss for me," DeLay concluded. "But I know that it is the right thing for him to do. I wish him the best in his new career and I wish him and his family all the joy and happiness in the world. After all of Tony's hard work for me and the American people, they truly deserve it."
There was another encomium to Rudy. On December 20, 2000, the Saipan Tribune, owned by Willie Tan, reprinted excerpts from DeLay's remarks, under the headline "A Tribute to Tony Rudy, a Good Friend and a True Believer." "Tony has been the most helpful staffer for the CNMI in its history," the Tribune's publisher, John S. DelRosario Jr., wrote. "He is going to join Mr. Jack Abramoff at the new firm." Rudy, DelRosario went on, was a "superhero."
A few weeks later, Rudy showed up for work. He was now--officially--part of Team Abramoff.
IN ONE SENSE, however, Rudy never actually left DeLay's side. Throughout that first year of his job, though forbidden by federal lobbying regulations to have official contact with his former colleagues, he routinely met with, and spoke to, members of DeLay's staff on behalf of his new clients, sometimes working out of the congressman's offices. "Rudy was not shy in selling his access to DeLay," a former aide told National Journal's Peter Stone in January. And this perpetual entanglement seems to have proven fruitful.
On January 3, 2001, DeLay entered the text of an editorial from the December 27, 2000, issue of Indian Country Today into the Congressional Record. The editorial praised the Mississippi Choctaw, now a client of Rudy's and Abramoff's at Greenberg Traurig. "Self-reliance and not government dependency is the secret to prosperity," DeLay said. "But there is no need to tell [Choctaw] Chief Martin that fact. He has lived his life promoting the economic vitality of his people and they have reaped the benefits of his progressive thinking. I salute Chief Martin for all he has done to further the cause of freedom--for his people and for our nation."
That month, Rudy used his connections to secure DeLay's support for "legislation providing for reparations payments to certain U.S. citizens and from assets in the United States of foreign companies and governments," according to Rudy's plea agreement. Also beginning that month, and lasting through October 2002, Rudy arranged for clients to pay "a nonprofit public policy organization" a total of $55,000--$17,000 of which was then kicked back to Liberty Consulting.
Rudy was beginning to think like his new boss. On September 21, 2001, he sent Abramoff an email, which has since been released by the Senate Committee on Indian Affairs. "There are a few Senate staffers I would like to help reward," he wrote. "Would the Choctaws or Coushatta donate like 10K to pay for a trip?" (The Choctaw and Coushatta were both Indian casino clients.)
"A trip where?" Abramoff replied.
Rudy answered that members of New Hampshire senator Bob Smith's staff had "expressed an interest in" a "hunting and fishing resort 3 hours south of Texas."
"I don't see how we can sell them on that," Abramoff shot back, referring to the tribes.
But Rudy could see how. A "thank you trip," he wrote, "for the approps we got."
"Smith's people didn't get us the approps for Choctaw," Abramoff responded. "But good try!:)"
Rudy was unpersuaded. He wrote back: "But how would Coushatta know? :)"
Rudy never got his "thank you." But there were other rewards. In February 2002, Abramoff arranged for the Mississippi Choctaw to pay a total of $25,000 to Liberty Consulting. The payments were made in monthly installments from February to July. And sometime around April 2002, Rudy and Abramoff instructed a "distilled beverages company" that it ought to contribute $20,000 to "a nonprofit public policy group in Washington, D.C." They failed to tell the company that the "public policy group" then funneled $8,000 of the contribution to Rudy's Liberty Consulting.
Money was everywhere. In 2001, after the SunCruz debacle, Abramoff faced terrible debt. Boulis had been murdered, Kidan was out of control, and the casino cruise line faced bankruptcy. As rich as he was, Abramoff had nowhere near the amount of cash it would take to pay back the $60 million loan he had received to purchase SunCruz. The first cracks in his armor were beginning to appear.
But he had a way out. He contacted Scanlon, who had left his employ to start a public relations firm, Capitol Campaign Strategies. Together, the two concocted a scheme by which Abramoff would direct his Indian casino clients to hire Scanlon's firm for "grassroots" consulting. Scanlon would then charge the clients incredibly high fees in return for little work. Since public relations firms, unlike lobbying firms, do not have to disclose their clients or revenues, no one would be able to see Abramoff and Scanlon's profits, which they split under an arrangement they called "Gimme Five." Together, over several years, the two convinced six tribes to pay them a total of over $60million.
The high point--or low point--of the Gimme Five scheme occurred in 2002, when Abramoff convinced the Tigua tribe of El Paso, Texas, to hire Scanlon to reopen their casino, which had been closed at the order of the Texas attorney general, now-U.S. senator, John Cornyn. The irony was that, unbeknownst to the Tigua, Abramoff and Scanlon had colluded to shut down the casino in behalf of a competing tribe just months before.
Rudy was part of the effort to reopen the Tigua casino, for which the tribe was paying Scanlon's company $4.2million. It was Rudy who worked with Rep. Bob Ney's office to insert a provision into an election reform bill that would allow the Tigua to restart their business. Rudy had worked with Ney before. In March 2001, he secured Ney's assistance in supporting legislation that would have allowed the Marianas to continue labeling their clothing "Made in the USA" without being subjected to U.S. wage and labor regulations, according to Rudy's plea agreement.
In the summer of 2002, Abramoff wanted Ney to accompany him on his annual golf sojourn to Scotland. Rudy's job was to arrange funding for the trip. In courting donors, Rudy would often tout his connections to Tom DeLay. On June 6, 2002, Rudy asked a client to contribute $25,000 to the Capital Athletic Foundation, Abramoff's nonprofit "charity" (less than 1 percent of its revenue went to legitimate charitable causes). Rudy told his client that the foundation was DeLay's favorite charity.
Earlier that same day, Abramoff wrote Rudy: "Did you get the message from the guys that Tom [DeLay] wants us to raise some bucks for the Capital Athletic Foundation?" He went on:
I have six clients in for $25K. I recommend we hit everyone who cares about Tom's requests. I have another few to hit still. It's a tax deductible foundation doing some issues education (they do NO lobbying at all), so it's easier (though it did not matter to the tribes). I think that, if we can do $200K, that would be good.
Rudy said okay.
"Great!" Abramoff wrote. "Can you email Petras on the Sag Chip request (it'll look better coming from you as a former DeLay COS). We'z gonna make a bundle here."
Later, Rudy himself would write the email to Chris Petras, the Saginaw Chippewa representative, requesting a donation of $25,000 to the Capital Athletic Foundation. The request came, Rudy wrote, from "a public official." The implication was that the official was DeLay.
On June 20, Rudy wrote an email to another Greenberg Traurig lobbyist, Todd Boulanger, asking him to remind Petras of the request.
But Boulanger didn't know what Rudy was talking about. "What is this?" he replied.
"Jack wants this," Rudy wrote.
"What is it? I never heard of it," Boulanger said.
"It is something our friends are raising money for." Then Rudy forwarded the exchange to Abramoff.
"Sh-t!" Abramoff replied. "I did not want you to bring Todd into this!!! Don't you see that we have a problem now?"
The problem was that an outsider had learned about Abramoff's side projects. Yet there seems to have been no consequence to the leak. In August 2002, the golf trip went ahead on schedule. Attempts to reopen the Tiguas' casino failed. Abramoff and Scanlon kept the $4 million.
The lobbyists' income had reached absurd levels. In March of 2002, Scanlon, engaged to another former DeLay staffer, spent $4.7 million (in cash) on a mansion in Rehoboth Beach, Delaware. When he traveled, Scanlon flew in a private jet. Rent for his apartment at the Ritz-Carlton in Washington's West End was $17,000 a month. He owned five properties, including two other homes in Washington worth $1.2 million, the $1.6 million beach house that served as the "headquarters" of the American International Center--a "think tank" that existed only on paper--and a beachfront property in St. Barts in the Caribbean. For his part, Abramoff expended vast amounts of energy trying to keep all the parts of his empire from flying apart and crashing to the ground.
In July 2002, Rudy left Greenberg Traurig to join Buckham at the Alexander Strategy Group. There, Rudy and Buckham continued to share clients with Abramoff. But there was an important difference. Theirs was a small operation that wanted to stay out of the news.
Buckham had been very much in the news in 1999, when the U.S. Family Network came under attack after it took a $500,000 check from the National Republican Congressional Committee (NRCC). The NRCC had also hired Buckham as a consultant. Explaining the decision, NRCC deputy chairman Dan Mattoon told Roll Call, "Ed is a well-known person on Capitol Hill. Ed is clearly very close to Tom DeLay, as I am close to Tom DeLay. But Ed has a lot of other issues in dealing with the religious community and (the) pro-family community that go beyond Tom DeLay."
Tax records show that $300,000 of the $500,000 check from the NRCC was rerouted to another group, Americans for Economic Growth, which used the funds to pay for radio ads in battleground House districts during the 2000 election season. But Democratic objections to the donation led to heightened media scrutiny of the U.S. Family Network and Buckham's fundraising/lobbying operation, which, in turn, led to some unexpected results.
On April 17, 2000, the president of the U.S. Family Network, Robert Mills, resigned. Mills was a long-time DeLay ally, having run the congressman's 1996 reelection campaign. Prior to his work for DeLay, Mills held a job at the Council for Government Reform. Roll Call had uncovered documents showing that Mills had admitted embezzling $35,000 from the council, however, which resulted in his leaving the house at 132 D Street. But life goes on. Shortly after Mills's departure, Buckham chose his replacement: Brooke Gambrell, a 27-year-old former beauty queen.
On May 3, 2000, the House Democratic Congressional Campaign Committee filed an unusual civil suit against DeLay, accusing him of money laundering. The suit was filed under the federal government's RICO Act, used to combat racketeering and extortion. Exhibit A was the U.S. Family Network. DeLay's spokeswoman, Emily Miller, denied all accusations of wrongdoing. But the legal and public relations fight had a profound effect on the U.S. Family Network.
One day in January 2001, the network held its final board meeting. There, at the request of an unnamed "gentleman who donated the largest amount of money to USFN," the board decided to pay $150,000 to something called the Dorothy Joan Morris Foundation, according to minutes of the meeting obtained by the Washington Post's R. Jeffrey Smith. The money, according to U.S. Family Network documents, was for "program services related to prayer."
Curious about what the Dorothy Joan Morris Foundation was, Post reporter Smith tracked down its incorporation papers, which said the foundation was located in a Frederick, Maryland, strip mall. A company called Foundation Ministries Inc. owned the foundation, according to the incorporation papers. Foundation Ministries is run out of the Buckhams' home in Frederick.
Smith further discovered that Dorothy Joan Morris is the 79-year-old mother of Roger Albanese, who was formerly Ed Buckham's assistant. Reached by telephone, Morris told Smith that she and her husband live in a trailer home in Las Vegas, Nevada. She never gave permission for her name to be used, Morris went on. She never knew about the $150,000 payment. She never saw any money. "What right does he have to put that in my name?" Morris said, referring to Buckham. "It's fishy."
In April 2001, a few months after the U.S. Family Network closed shop, and a few weeks before going to trial, both plaintiff and defendants agreed to withdraw the RICO suit against DeLay. As part of the deal, the NRCC agreed to pay a $280,000 fine to the FEC. The crisis abated. But others would spring up in its place.
Little is known about what went on behind the doors of the Alexander Strategy Group when Tony Rudy arrived to work there in 2002. Even less is known about the firm's operations between the day of Rudy's arrival and January 9, 2006, when the firm closed shop. Buckham will not speak to reporters, nor will Rudy, whose plea agreement speaks for itself.
It is known, however, that, of the $3.02 million in revenue that the U.S. Family Network collected, the Buckhams received $1,022,729. And it is likely that we will learn more about what DeLay's staff was up to in the coming months. In February, the Justice Department issued a subpoena for the U.S. Family Network's records. Buckham, mentioned as "Lobbyist B" in Rudy's plea deal, is a probable target of the investigation, and is no doubt under considerable pressure to strike a deal of his own.
But questions remain. To date, DeLay says he has been shocked and saddened at the allegations made against his former staff, but that he had no knowledge of any wrongdoing. Yet all of these activities occurred while he sat at the helm of one of the most powerful congressional offices in American history. Could DeLay not see what was happening around him? Was he unable to detect that he was a pawn in a criminal enterprise that netted its conspirators millions of dollars? How could he possibly have been that bad a manager?
Last week, at one point in his exclusive interview, Mike Allen asked DeLay whether he had ever done anything immoral.
"We're all sinners," he said.
Matthew Continetti is a staff writer at The Weekly Standard and the author of The K Street Gang, available April 18.