Williams’s gift came in August 2011 — about two weeks after he met with a top state health official to pitch the benefits of his company’s health products at a meeting arranged by first lady Maureen McDonnell, according to people who know of the meeting.
Williams bought the watch at the urging of Maureen McDonnell, who admired Williams’s own Rolex and suggested that he buy her a similar one she could give to her husband, the people said. Her proposal occurred moments before the meeting she had arranged with the state official, according to one person familiar with the request.
The Rolex, engraved with the inscription “71st Governor of Virginia,” represents the first undisclosed gift known to have been used personally by McDonnell (R) among tens of thousands of dollars of undisclosed gifts given to the governor’s family.
A spokesman for the U.S. attorney’s office declined to comment. Jerry Kilgore, an attorney for Williams, declined to comment on the federal investigation, as did Star Scientific’s corporate attorney, Abbe Lowell. Tucker Martin, a spokesman for the governor, also declined to comment on the watch or the investigation.
Federal investigators have been probing a series of gifts that the political supporter gave to the McDonnells, including $15,000 to pay for the catering at his daughter’s wedding reception.
They are also investigating other money provided to Maureen McDonnell, as well as expensive designer clothing — some bought in 2011 in New York City — according to people familiar with the inquiry.
The shopping trip emanated from a social occasion with Williams and Maureen McDonnell shortly after the governor won election. The governor’s wife mentioned that she would need an inauguration dress, preferably one from the designer Oscar de la Renta, and would like Williams’s help getting one, according to two people familiar with her suggestion.
Williams agreed to buy one for her, but a top staffer to the governor advised Williams and the first lady that such a gift was not allowed. A year later, the first lady contacted Williams to propose that he take her shopping at Bergdorf Goodman, the people familiar with the shopping said. In that store, Williams purchased an estimated $15,000 in clothing for Maureen McDonnell, they said.
The governor is the subject of broad federal and state investigations into gifts given to him and his family and whether McDonnell took official action on behalf of anyone who gave gifts, people with knowledge of the investigations have said.
McDonnell said as recently as Tuesday that he has properly disclosed all gifts given to him.
Since taking office in 2010, McDonnell has disclosed receiving $9,650 in personal gifts — including private plane rides and a summer lake house vacation — from Williams and Star Scientific. According to state records, the company has contributed $108,452 to his campaign and political action committee.
The newly disclosed meeting with a top state official underscores the access the McDonnells extended to Williams when Star Scientific was introducing a new dietary supplement and was stressing in regulatory filings that its success was critical to reviving the company’s sagging finances.
The meeting with a policy adviser from the Virginia Department of Health and Human Resources had been arranged by Maureen McDonnell, people with knowledge of the meeting said.
Its purpose was to give Williams an opportunity to present research about the health benefits of Anatabloc, its new non-FDA-approved anti-inflammatory, and propose that Virginia consider examining whether its use could reduce state medical-care costs, they said.
Asked in March whether the governor or first lady ever indicated that Anatabloc could be used to lower medical costs in Virginia, a spokesman for the governor denied that they had.
“The governor and first lady never led an effort to lower health care costs in Virginia by encouraging the use of Anatabloc,” said spokesman Jeff Caldwell said in a written statement.
The meeting with the state official occurred during a summer of intense interactions between the McDonnells and Williams.
On June 1 — three days before the wedding — Maureen McDonnell flew to Florida, where she touted the potential benefits of Anatabloc before a gathering of doctors and investors interested in learning more about its key chemical.
There, one attendee said, she said she believed Anatabloc could be used to lower health costs.
Later in June, the McDonnell family vacationed at a lake house owned by Williams at Virginia’s Smith Mountain Lake, driving Williams’s Ferrari back to Richmond at the conclusion of the stay.
And on Aug. 30 — a few weeks after Williams purchased the Rolex — the McDonnells allowed Star Scientific to use the mansion for an event marking the formal launch of Anatabloc. The luncheon was organized by Maureen McDonnell but the governor also attended, he has said, to recognize the company for providing grants to public universities.
Virginia law requires that elected officials disclose all gifts they receive worth at least $50. It does not require that they disclose gifts given to family members or received from family members or personal friends.
McDonnell has cited the law in explaining why he did not disclose the $15,000 Williams provided for his daughter’s wedding, indicating the gift was a wedding present to his daughter.
He has repeatedly insisted that he complied with Virginia law regarding the disclosure of gifts and said Star Scientific has received no special benefits, including economic development grants, state contracts or board appointments, while he has been in office.
His spokesman has said the governor considers Williams and his wife “family friends.” He has known them for about five years, his spokesman said, a time frame that means they first met shortly before McDonnell’s 2009 campaign for governor.
According to a regulatory filing and the company’s Web site, Star Scientific has a corporate code of conduct that prohibits corporate officers or executives from providing gifts of value to public officials.
Alice Crites contributed to this report.