A onetime congressional staffer who became a top partner to lobbyist Jack Abramoff pleaded guilty yesterday to conspiring to bribe a congressman and other public officials and agreed to pay back more than $19 million he fraudulently charged Indian tribal clients.
The plea agreement between prosecutors and Michael Scanlon, a former press secretary to then-House Majority Whip Tom DeLay (R-Tex.), provided fresh detail about the alleged bribes. The document also indicated the nature of testimony Scanlon is prepared to offer against a congressman it calls "Representative #1" -- who has been identified by attorneys in the case as Rep. Robert W. Ney (R-Ohio).
Scanlon, a 35-year-old former public relations executive, faces a maximum five years in prison and a $250,000 fine, but the penalty could be reduced depending on the level of his cooperation with prosecutors. His help is expected to be crucial to the Justice Department's wide-ranging Abramoff investigation, which began early last year after the revelation that Scanlon and the lobbyist took in tens of millions of dollars from Indian tribes unaware of their secret partnership to jack up fees and split profits.
Investigators are looking at half a dozen members of Congress, current and former senior Hill aides, a former deputy secretary of the interior, and Abramoff's former lobbying colleagues, according to sources familiar with the probe who spoke on the condition of anonymity. Because of his central role in much of Abramoff's business, Scanlon could be a key witness in any trials that arise from the case.
Scanlon had been in discussions with prosecutors for six months before Friday's announcement that he was being charged with one count of conspiracy as part of a plea agreement. He entered his guilty plea before U.S. District Judge Ellen Segal Huvelle yesterday and agreed to pay restitution of $19.7 million, Scanlon's share of fees from four tribes named in the charging documents.
He admitted that he or Abramoff offered bribes on behalf of clients over a period of four years, and at one point during the proceedings he corrected court filings that mistakenly noted that the illegal acts began in 2001. "My client informs me that some of the overt acts are actually in 2000," said Scanlon attorney Stephen L. Braga.
Ney spokesman Brian Walsh said the congressman was defrauded by Scanlon and Abramoff and his official actions had nothing to do with improper influence. "Any allegation that Representative Ney did anything illegal or improper is false. This plea agreement mentions a number of unsubstantiated allegations, but in fact, many of the things suggested to have occurred did not actually take place," Walsh said.
The plea agreement lists gifts Ney was offered or received, including a golf trip to Scotland in 2002, $4,000 to his campaign committee, $10,000 to the National Republican Campaign Committee made with credit to Ney, regular meals and drinks at Abramoff's Signatures restaurant, sports tickets, and frequent golf and related expenses at courses in the Washington area.
The document states that the gifts were "in exchange for a series of official acts." These included providing legislation, agreeing to put statements into the Congressional Record, contacting federal officials to influence decisions, meeting with Abramoff's clients and endorsing a wireless telecommunications company that wanted to install antennas in House office buildings.
According to the plea agreement, Ney made the Congressional Record statements in support of Abramoff's efforts to buy a fleet of Florida casino ships "calculated to pressure the then-owner to sell on terms favorable to Lobbyist A [Abramoff] and his partners."
The filing also refers to a trip that Ney was offered to attend the Super Bowl in Tampa in 2001 that sources have told The Washington Post the Ohio congressman backed out of at the last minute. That trip was paid for by SunCruz Casinos Inc., which Abramoff acquired in 2001. Abramoff is facing fraud charges in Florida in connection with the acquisition of that company.
Ney also provided help to two Texas tribal clients of Abramoff that wanted permission to open casinos, the plea agreement said. In one case in December 2002, Ney sought help from another unidentified House member for one of the tribes, the prosecutors said. Ney also met with a member of a California tribe doing business with Abramoff and agreed to help pass tax legislation affecting the tribe, the documents said.
Another all-expenses-paid trip mentioned in the documents was a 2000 visit to the Commonwealth of the Northern Mariana Islands, an Abramoff client. A source with knowledge of the trip said that senior members of Ney's and DeLay's staff went along.
At yesterday's hearing, Scanlon folded his hands and answered the judge respectfully and even, at times, enthusiastically. Asked if he was satisfied with his attorneys, he said, "I am indeed!" He also appeared relaxed afterward, joking with Mary Butler, the top prosecutor on the case, that she was letting him leave the courtroom first to "face the gauntlet" of reporters outside.
Scanlon was released after promising to post a $5 million unsecured bond -- essentially a personal guarantee. Scanlon, who purchased a home in St. Bart's with lobbying proceeds, gave his passport to his attorney Plato Cacheris under an agreement with prosecutors. He agreed not to leave the country without giving authorities two weeks' notice.
Standing in the rain next to his attorneys, Braga and Cacheris, Scanlon declined to comment. Cacheris said, "He's obviously regretful for the circumstances that brought him here." At the end of the briefing, Scanlon, who remembers many of the reporters from days handling press for DeLay, said: "Thanks, guys. I'll be in touch."