Category Archives: Scandals

Newly Scrupulous Legislators Reporting Fewer Gifts

The giving of gifts to members of the General Assembly — or perhaps I should say the acceptance of them — has declined precipitously since 2013 when former Governor Bob McDonnell was indicted in a scandal best remembered by favor-seeker Jonnie Williams paying for his daughter’s wedding reception. Although McDonnell was ultimately cleared by U.S. Supreme Court of breaking the law, his political career was finished. Lawmakers took note. The graph above shows the declining value of gifts reported by legislators, courtesy of the Virginia Public Access Project based on the latest public filings.

The most dramatic drop occurred in the category of “gift items” — objects of value — followed by invitations to sporting events and hunting, fishing and outdoor activities. Even “meals/receptions” were down sharply, which I find surprising, for that would be one category the acceptance of which could be defensible. If you’re an elected official, it’s one thing to attend a UVa basketball game or a theatrical production, true diversions, and quite another to go to dinner or a reception, during which you spend the whole time talking to lobbyists — not much different from your day job.

Be that as it may, all such gifts are down sharply.

Another VPAP infographic shows the breakdown of gifts between Republicans and Democrats. The largesse flows heavily in the favor of Democrats. The imbalance would be even more pronounced if one took into consideration the fact that Republicans are more numerous, especially in the House, than Democrats. It’s hard to know what to make of this, though. My hunch is that Republicans, scalded by the example of McDonnell, a fellow Republican, are more acutely worried about how gifts might be perceived by the public than Democrats are.

All told, says VPAP, fewer than half of the 140 General Assembly members accepted meals, gala tickets or other gifts valued at more than $50 in the last eight months of 2016. Whatever the gifts and whatever the party affiliation, that’s a big improvement. Let’s hope legislators’ new-found scruples reflect lasting lessons learned.

Meanwhile, in Bucolic Rappahannock County…

Rappahannock County winery.

Rappahannock County winery.

As the Newport News/Williamsburg Airport scandal reaches its denouement (see previous post), we also hear of troubles in rustic Rappahannock County, set in the foothills of the Blue Ridge mountains and described by the county website as “a scenic masterpiece made perfect by nature.”

From RappNews:

Rappahannock County Treasurer Debbie Knick is accusing her own county government of mismanagement, including failure to follow proper expense and payroll procedures and lack of oversight of budgeting and spending by senior county officials.

Among her grievances lodged to the supervisors, Knick cited cases of “overpayment” of county funds, including one recent instance involving former Rappahannock County Commonwealth’s Attorney Peter Luke and his successor Art Goff.

Bacon’s bottom line: The alleged abuses focus on the use of credits cards and county-owned automobiles. Admittedly, even if the allegations turn out to be justified, we’re talking about irregularities measured in the thousands of dollars, not millions or billions. Still, this grain of sand adds to what seems to be spreading fiscal carelessness and recklessness at every level.

(Hat tip: Tim Wise.)

Axes Fall after People Express Loan Guarantee Blows Up

People Express aircraft at Newport News/Williamsburg Airport. Photo credit: Daily Press

The executive director of Newport News/Williamsburg International Airport has been placed on administrative leave in the wake of a scandal involving the use of $3.55 million in state funds to help make good on a loan guarantee made to People Express airline.

The airport had backed the loan as part of a deal to get People Express to provide discount passenger service to the Newport News/Williamsburg area. The episode did not turn out well. People Express fell $100,000 behind in its passenger facility charges, and the Peninsula Airport Commission told the airline in 2014 to leave after less than three months of operation there. The company subsequently filed for bankruptcy.

Meeting in a closed session, the commission approved using the $3.55 million state funds plus $1 million in federal funds to meet its loan obligations. Such a use violated a 30-year state policy. Virginia’s transportation secretary Aubrey Layne called it the largest unauthorized use of state aviation funds ever, reports David Ress with the Daily Press.

Support for the airport evaporated as the state, the City of Hampton and the James City County Economic Development Authority decided to withhold payments to the body. In the most recent developments, reported this morning, the Newport News City Manager has resigned as an airport commissioner, the commission ended its six-decade-old relationship with its law firm, and the airport’s executive director Ken Spirito was put on paid administrative leave until completion of  a state audit.

Bacon’s bottom line: Let this be a warning to citizens serving on local commissions, authorities and other public entities. It seems easy and painless to guarantee a loan as a way to lure a business to your community. But if the loan needs a guarantee, there’s probably a lot of risk attached to it, and you could very well be on the hook for it. That’s what officials of the Peninsula Airport Authority learned to the detriment of their careers.

Kudos to the Daily Press, by the way, for bird-dogging this story every step along the way.

A New Book Examines the Virginia Way

virginia-politicsby Peter Galuszka

Over the past several years, Virginia has seen plenty of high drama and low politics.

There was the tawdry corruption trial of former governor Robert F. McDonnell (R) and his wife, Maureen. At the University of Virginia, Teresa Sullivan, the school’s popular president, was temporarily ousted in a mysterious coup. Everywhere were unlimited amounts of political money, revolving doors and public benefits for rich individuals and companies.

Taken together, the events might be a tipping point for the Old Dominion, ending, or at least reining in, the so-called “Virginia Way” of lax ethics rules and the assumption that players are honest gentlepeople.

An excellent summation of how and why the stars have so aligned can be found in a new book, “Virginia Politics & Government in a New Century, The Price of Power,” by Jeff Thomas (The History Press).Thomas, a Duke University engineering graduate who worked in non-profits in the District, lays out in painstaking detail how largely unregulated money donations have led to an extraordinary web of conflicts of interest. This paradigm has been going on for years and has been largely unquestioned, until now.

Drawn largely from the work of Virginia journalists and political analysts, Thomas finds that:

Thomas Farrell, the head of the power utility Dominion Resources, set up his young son Peter, an “amateur thespian,” to get the Republican nomination to be a delegate from Henrico County. Later, the Farrells used their clout to get more than $1 million in state aid for a Civil War movie they wrote and produced and in which Peter Farrell acted.

Sinecures abound. After he left the state senate in 2013, Henry Marsh, 80, became a part-time board member of the Alcoholic Beverage Control at a salary of $122,000. Del. Bob Brink 66, became a deputy commissioner for aging for $110,000 a year. Del. Algie Howell, 76, got a parole board seat worth $122,455 a year.

McGuireWoods, one of the state’s most prominent and wealthiest law and lobbying outfits, got more than $4.6 million in help from Richmond, otherwise crippled by a 25 percent poverty rate and crumbling school buildings, to build a new headquarters downtown.

The Washington Redskins, the fifth richest team in the National Football League, got $11 million from Richmond to build a summer training camp that the Redskins use only three weeks a year.

The state created a fund, with money from Virginia’s share of a huge health settlement with four large tobacco companies, to help Tobacco Road counties. One of its directors ended up in prison with a 10-year sentence for fraud and self-dealing. Still, the tobacco fund has paid money for new factories in the southern and western parts of the state that haven’t created anywhere close to the number of jobs advertised.

Exhibit A, of course, is the McDonnell case. The couple accepted more than $177,000 in cash, gifts, loans and vacations from vitamin supplement salesman Jonnie R. Williams Sr. The Supreme Court vacated the governor’s convictions, and he and his wife are now free. But their six-week-long trial in 2015 revealed extraordinary conflicts and hubris in the Executive Mansion.

Since then, the state has applied some cosmetic limits on accepting gifts. But donations can run sky high as long as they are reported. Even gift-giving still has plenty of loopholes, provided the giver is a “personal friend.” Travel funded by corporations is okay, too.

Thomas, a native Richmonder, has done Virginia residents a valuable service with his book. The depth of his research is impressive although the text is overly chopped up, making it a more difficult read.

In sum, he writes: “The Virginia Way cannot change as long as politicians’ self-conceptions hinge on their own righteousness, for if there can be no fall, there can be no catharsis.”

This review first appeared in the Washington Post’s “All Opinions Are Local” section.

Give It Up, Dudes, There’s Nothing There

The McCabe family

The McCabe family

by James A. Bacon

The Wall Street Journal editorial page has doubled down on the newspaper’s insinuation that Governor Terry McAuliffe’s financial support for state senatorial candidate Jill McCabe was somehow linked to her husband Andrew McCabe’s handling of the FBI investigation into Hillary Clinton’s private email server. Drawing upon the Journal’s news report the previous day, the newspaper’s top editorial finds significance in the fact that “[McAuliffe], a longtime friend of Hillary and Bill, steered money to the campaign of the wife of a top FBI official.”

But the article did not demonstrate a quid pro quo, or even suggest what the quid pro quo might have been, and neither did the editorial.

As far as I’m concerned, former Secretary Clinton deserves all the scrutiny she gets for her Clinton Foundation ties, her decision to buck State Department policy by setting up her own jinky home-based server, her decision to destroy 30,000+ “personal” emails, thousands of which turned out not to be so personal, her repeated lies to the public, and the obstruction by her allies and even State Department officials to delay and thwart the email releases. There’s plenty to investigate. But the Journal does a dis-service by creating a flimsy distraction that can be used as evidence that Republicans and conservatives are just making stuff up. .

Here is the Journal’s logic:

Mrs. McCabe announced her candidacy the same month (March 2015) as the news broke about Mrs. Clinton’s private email server. Mr. McCabe was running the FBI’s Washington field office at the time, and he was promoted to the No. 3 FBI spot not long after the formal FBI investigation began in July 2015.

 

The FBI said in a statement that none of this is an issue because Mr. McCabe wasn’t promoted to the No. 2 position until February 2016, months after his wife lost her race, and only then did he assume “for the first time an oversight role in the investigation into Secretary Clinton’s emails.”

 

All of this asks voters to believe that Mr. McCabe as the No. 3 official at the FBI had nothing to do with the biggest, most sensitive case at that agency. This strains credulity. Before he became No. 3 at the FBI Mr. McCabe ran the bureau’s Washington, D.C., field office that provided resources to the Clinton probe. Campaign finance records show that 98% of the McAuliffe donations to Mrs. McCabe came after the FBI launched its Clinton probe.

McAuliffe, of course, has denied any skulduggery. He began recruiting Mrs. McCabe to run against Sen. Dick Black, R-Leesburg, for the 13th senatorial district, in February 2015, before the email scandal broke, said the governor’s office in the Times-Dispatch today, The recruitment efforts were led by Lieutenant Governor Ralph Northam as part of a larger bid to re-take control of the state senate. I would conjecture that Democrats considered the seat, occupied by one of the most conservative members of the senate, to be more vulnerable than most. It is not implausible to think that the Dems targeted the seat and plowed money into Mrs. McCabe’s candidacy because they thought she could win.

One way the Journal could have buttressed its story was to talk to Northam and other leading Democrats. Did they find McAuliffe’s support for McCabe controversial in any way? Were they baffled that he poured so much money into her race? Or did Democratic Party leaders share the perception that McCabe was the best candidate with the best chance of beating Black? For the record, although McCabe lost the election, she did put in a strong showing against an incumbent, garnering 47.6% of the vote.

The Journal also could have talked to Thomas V. Mulrine, an Army veteran and attorney who had announced his candidacy before McCabe did. The T-D‘s Graham Moomaw did talk to him, and it turns out that he was a little miffed that McAuliffe had backed McCabe, calling it “unseemly” that the governor would recruit one Democratic candidate to run against another. “I think the citizens of the county ought to choose who their representatives are and not just have somebody foisted on them by somebody from afar,” Mulrine said.

One might ask why McAuliffe chose to intervene on McCabe’s side before the nomination. Is it unheard of in Virginia Democratic Party politics for the governor to get so involved in selecting candidates? If so, McAuliffe’s intense interest in McCabe might be cause for suspicision. But if McAuliffe involved himself in the selection of other candidates, then there is no need in McCabe’s case to invoke another explanation entailing a corrupt desire to influence the outcome of an FBI investigation. Continue reading

The McAuliffe-Clinton Email Nothingburger

andrew_mccabe

Andrew McCabe

by James A. Bacon

So, what do we make of the front-page revelation in today’s Wall Street Journal that Governor Terry McAuliffe, a long-time ally of Bill and Hillary Clinton, gave $475,000 through his Common Good VA PAC to Jill McCabe, a Democratic candidate in 20015 for a Northern Virginia state senate seat, who … was married to Andrew McCabe, then the chief of the FBI’s Washington field office… who later ran the investigation into the Hillary Clinton email scandal?

Trust me, I am not one to minimize the significance of the Clinton email scandal. I believe that former Secretary Clinton set up a personal email server to avoid public scrutiny of the tangled conflicts engendered by the Clinton Foundation and her state department service, that she put national security at risk by transmitting classified documents over that server, that her communications were likely hacked by foreign intelligence services, that she obstructed justice by deleting the infamous 30,000+ “private” emails, and that she should have been prosecuted on multiple accounts. Her actions, lying and cover-up disqualify her from the presidency every bit as much as Donald Trump’s history of predatory groping, kissing and sexual advances disqualify him. (Yes, I am totally disgusted with the choices we have for president this year.)

However, as much as it would satisfy me to see confirmation of my jaundiced view of Clinton and her emails, I don’t think there’s much to the WSJ story. There certainly isn’t anything in the article that discredits McAuliffe.

Here are the facts presented. In a bid to regain Democratic control of the state senate, McAuliffe urged Jill McCabe, a hospital physician, to run against Sen. Dick Black, R-Leesburg, for the 13th senatorial district. McAuliffe’s PAC contributed $475,000 to her campaign, and the Virginia Democratic Party kicked in another $208,000, accounting for about a third of all the funds she raised.

A spokesman for the governor said McAuliffe “supported Jill McCabe because he believes she would be a good state senator. This is a customary practice for Virginia governors. Any insinuation that his support was tied to anything other than his desire to elect candidates who would help pass his agenda is ridiculous.”

McAuliffe met with Mr. and Mrs. McCabe on March 7, 2015 to urge her to run. That is the only time McAuliffe recalls ever meeting the FBI executive. As it happened, Clinton’s use of a private email server was just coming to public light in early March. The FBI announced its probe four months later.

The Journal article notes that Mr. McCabe played no role in his wife’s campaign; he appeared in no events and participated in no fund-raising. He sought ethics advice from the bureau, and followed it, avoiding involvement with public correction cases in Virginia. At the end of 2015, Mr. McCabe was promoted to FBI headquarters, where he assumed the No. 3 position. In February 2016, he became the second-in-command to FBI Director James Comey. His supervision of the Clinton email case in 2016 was not seen as a conflict because his wife’s unsuccessful senatorial bid was over by then, and McAuliffe was not part of the probe.

The article provides no evidence whatsoever that McAuliffe tried to influence the outcome of the Clinton email investigation. It did note that McAuliffe has been under investigation for months by the FBI’s Washington field office for donations made on behalf of a Chinese businessman, possibly in violation of a law requiring people to register as agents of a foreign entity. Stated the Journal: “It was unclear the extent to which Mr. McCabe may have recused himself from discussions involving Mr. McAuliffe.”

Bacon’s bottom line: The article presents not a scintilla of evidence to suggest that McAuliffe backed Mrs. McCabe for any reason other than what he stated, which was to win a Democratic majority in the senate. Unless concrete evidence surfaces, any insinuation to the contrary cannot be taken seriously.

What the article does illustrate, however, is how inbred and incestuous Washington government and politics are. We can infer by Mrs. McCabe’s allegiance to the Democratic Party that Mr. McCabe likely is a Democrat as well — although even that cannot be assumed. (Politically mixed marriages do occur.) If it can be documented that Mr. McCabe is a Democrat, one might be justified in asking whether his partisan leanings had anything to do with his ascent through the Obama administration FBI or if they affected his oversight of the Clinton investigation. Those are not idle questions given the controversial decisions that someone in the FBI hierarchy made (a) to tightly limit the scope of the investigation and (b) to grant immunity agreements to five Clinton insiders, including Secretary Clinton’s chief of staff Cheryl Mills. (Google “clinton email investigation fix” for more concerns.)

If the Journal had written an article focusing on the role Mr. McCabe played in the FBI’s questionable decisions, then it would have been reasonable to ask if he was motivated by partisan considerations. But the Journal didn’t write that article. It wrote an article that emphasized McAuliffe’s connection. And, based upon what we know, there just isn’t any “there” there.

Update: The Republican Party of Virginia is jumping on the story. “Today, at my direction, the Republican Party of Virginia is filing a Freedom of Information Act request with Governor McAuliffe’s office for any and all communications related to Dr. Jill McCabe’s 2015 campaign for state Senate,” said RPV Chairman John Whitbeck in a press release. “While the Governor’s PAC is not a public organization, we also call on Terry McAuliffe to release any and all emails to and from that organization related to Dr. McCabe’s campaign.”

Good luck with that.