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Edwards Groups Under Scrutiny

In this Nov. 11, 2008 file photo, former Democratic presidential candidate John Edwards speaks at Indiana University in Bloomington, Ind. Edwards, who has acknowledged a federal inquiry into his campaign funds, said in a statement obtained by The Associated Press on Sunday, May 3, 2009, that he is confident no campaign funds were used improperly. He says he has made people and information available to resolve the issue in a timely manner.
In this Nov. 11, 2008 file photo, former Democratic presidential candidate John Edwards speaks at Indiana University in Bloomington, Ind. Edwards, who has acknowledged a federal inquiry into his campaign funds, said in a statement obtained by The Associated Press on Sunday, May 3, 2009, that he is confident no campaign funds were used improperly. He says he has made people and information available to resolve the issue in a timely manner. (Michael Conroy - AP)

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By Alec MacGillis
Washington Post Staff Writer
Tuesday, May 5, 2009

As John Edwards, the former Democratic senator, prepared for his second presidential run, he paid for his advisers and burnished his image through a collection of political action committees and nonprofit groups.

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Now those groups are among the potential targets of a federal investigation into Edwards's finances as he continues to face the fallout from his affair with a videographer who documented his travels. Since Edwards admitted the affair last year, questions have swirled about the $114,000 that one of his organizations paid to the woman, and about money that a wealthy supporter paid to help move her and her baby from North Carolina to California.

Edwards acknowledged over the weekend that a federal investigation was underway. "I am confident that no funds from my campaign were used improperly," he said. "However, I know that it is the role of government to ensure that this is true. We have made available to the United States both the people and the information necessary to help them get the issue resolved efficiently and in a timely matter. " A spokeswoman for the U.S. attorney's office in Raleigh, N.C., declined to comment.

The investigation adds to the troubles faced by Edwards, who has all but withdrawn from public view since admitting the affair in August. His hopes of joining President Obama's Cabinet fell away. His family's considerable wealth is invested mainly with Fortress Investment Group, a hedge fund that has fared particularly poorly in the economic downturn. His wife, Elizabeth, who is battling breast cancer, is publishing a memoir in which she describes the pain caused by the affair and declares the videographer, Rielle Hunter, "pathetic."

Edwards's political action committee, One America, paid Hunter a total of $114,000 for videos she shot to show Edwards's offbeat side as he traveled the country in 2006 promoting his anti-poverty plans. The last of those payments, for about $14,000, was made in April 2007, right around the time that Edwards's campaign paid One America, which was nearly out of funds at that point, about $14,000 for what was listed as a furniture expense.

Experts on campaign finance law say investigators are probably looking at whether false reports were filed on how funds from Edwards's campaign or an affiliated group were spent, and whether any money was passed from the recipient to Hunter.

"If there is an attempt to cover up the true purpose of an expenditure, that could potentially be a big problem," said Sheila Krumholz, director of the Center for Responsive Politics.


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