Virginia gubernatorial candidates Terry McAuliffe (D), left, and Ken Cuccinelli II (R). (Nikki Kahn/The Washington Post) Virginia gubernatorial candidates Terry McAuliffe (D), left, and Ken Cuccinelli II (R). (Nikki Kahn/The Washington Post)

In a startling turn of events, the Associated Press (AP) has retracted a story in which it reported that Virginia gubernatorial candidate Terry McAuliffe did something very bad. In the words of the story:

Documents in a federal fraud case allege that Virginia Democratic gubernatorial candidate Terry McAuliffe lied to a federal official investigating a Rhode Island estate planner now imprisoned for receiving death benefits on annuities secured on terminally ill people without their knowledge.

AP spokesman Paul Colford tells the Erik Wemple Blog via e-mail: “The initial alert moved on AP’s Virginia state wire at 9:45 p.m. The story was withdrawn one hour and 38 minutes later. That was an hour and 38 minutes too long. As our retraction said, ‘The indictment did not identify McAuliffe as the ‘T.M.’ who allegedly lied to investigators.'”

Hmmm, so the AP fingered McAuliffe based on initials?

Looks that way. In fact, the deeper into the details that you get, the worse this one looks for the AP. Some background: In a big story that broke yesterday, McAuliffe’s name surfaced as one of the investors in an alleged scam spearheaded by a Rhode Island estate planner. According to a lengthy grand jury indictment, attorney and accountant Joseph Caramadre stole the identities of terminally ill people to set up bogus annuities. Wire fraud, mail fraud and aggravated identity theft are among the many charges in the document.

Yet the one that captivated Associated Press reporter Bob Lewis was count 66, witness tampering, which centers on someone identified as “T.M.” Here are the relevant paragraphs:

On or about April 19, 2010, a United States Postal Inspector (the “Postal Inspector”) investigating this case telephoned T.M. and asked if he would speak with him in connection with an ongoing investigation of JOSEPH CARAMADRE. T.M. agreed to meet with the Postal Inspector. Prior to T.M.’s meeting the Postal Inspector, T.M. called CARAMADRE and informed him that the Postal Inspector wished to speak with him about CARAMADRE. During this conversation, CARAMADRE falsely told T.M. that the money CARAMADRE had previously paid him was for work T.M. had performed in CARAMADRE’s house.

On or about April 20, 2010, the Postal Inspector met with T.M. and asked him if a $2,000 check he received from CARAMADRE was a payment for referring a terminally-ill individual to CARAMADRE. T.M. intentionally lied to the Postal Inspector, telling him that the check was not a payment for referring a terminally ill patient to CARAMADRE, but rather was payment for construction work that T.M. had performed in CARAMADRE’s house.

The information T.M. provided the Postal Inspector, at the behest of defendant JOSEPH CARAMADRE, was false in that the aforementioned check was not in payment for any work that T.M. had completed at CARAMADRE’s house. Rather, the $2,000 check was a payment CARAMADRE made to T.M. for referring a terminally ill individual to CARAMADRE.

The AP appears to have drawn a line between this “T.M.” and McAuliffe, whose full name has been disclosed as one of the investors in Caramadre’s project.

But read those three paragraphs a couple of times. No matter how you interpret the alleged lie that passed among “T.M.,” Caramadre and the postal inspector, one thing is clear: This “T.M.” fellow either performed some construction work — with his own bare hands, it appears — or perhaps was engaged in a profession in which he would perform construction work. Does that sound like McAuliffe? He’s been called a “fixer” before, but not this kind. Another red flag arises from the specifics of what “T.M.” told the postal inspector. Would Terry McAuliffe, a Washington creature with access to massive amounts of legal help, expose himself in such a scenario by participating in an unlikely lie about a new bathroom floor, or something along those lines?

In deference to Lewis and the AP, there is another section of the indictment that does use the initials “T.M.” to refer to a “client” of Caramadre, and McAuliffe’s full name is on a list of investors in Caramadre’s project.

A possible explanation for the AP’s massive breakdown here is that it was moving too fast. The last line in the piece suggests as much: “McAuliffe’s campaign did not immediately respond to email and phone requests for comment about the allegation.”

How long did the AP give the McAuliffe campaign to respond? The AP hasn’t immediately responded to our inquiries on that front. And McAuliffe campaign spokesman Josh Schwerin, when asked the same question, replied: “It’s water under the bridge. With less than a month out, we’re focusing on why Cuccinelli continues to refuse to publicly denounce Ted Cruz’s shutdown strategy as Virginia’s economy suffers.” Moving attention away from this story is a pro move, indeed. The indictment, after all, alleges some spectacularly tawdry and greedy behavior by a fellow with ties to McAuliffe. The campaign depicts him as a “passive investor” and a victim of the ringleader’s lies..

Lewis took the hit: