If you look back at virtually every large fraud uncovered in the past two decades (and probably more) you can find a direct link between the theft and political corruption–meaning, campaign contributions. The same is true with the massive investment fraud perpetuated by Allen Stanford.
In today’s Wall Street Journal there is this news:
Ralph Janvey, the receiver for the assets of R. Allen Stanford and his financial companies, sent letters Monday to more than 50 current and former members of Congress, asking them to hand over any contributions from Mr. Stanford or others charged with fraud.
The letters went to some of the most prominent names in Congress, including Senate Majority Leader Harry Reid (D., Nev.), former presidential candidate Sen. John McCain (R., Ariz.) and former Sen. Hillary Clinton (D., N.Y.), now secretary of state.
The Securities and Exchange Commission filed civil fraud charges last week against Mr. Stanford and two of his top lieutenants, James M. Davis and Laura Pendergest-Holt. A federal judge froze the assets of those three individuals as well as three companies in the Stanford Financial Group.
A representative of Sen. Reid said the senator plans to return the contributions. A spokeswoman for Sen. McCain said the McCain campaign is donating all contributions from Mr. Stanford and people associated with Stanford Financial to charity. A State Department spokesman said he didn’t have information about Mrs. Clinton’s campaign finances.
As you can see from this list, this is a bi-partisan problem:
List of politicians who were asked to return campaign contributions
Sen. Bill Nelson: $45,900
Pete Sessions: $41,375
Sen. John McCain: $28,150
Sen. Chris Dodd: $27,500
Sen. John Cornyn: $19,700
Sen. Charles Schumer: $17,000
Rep. Charlie Gonzalez: $15,500
Rep. Gregory Meeks: $15,100
Rep. Pete Olson: $14,500
Sen. Richard Shelby: $14,000
Rep. Charles Rangel: $11,800
Sen. Roger Wicker: $8,800
Sen. Harry Reid: $8,500
Sen. Jack Reed, $7,000
Sen. Hillary Clinton: $6,900
Sen. Orrin Hatch: $6,100
Sen. Patty Murray: $6,000
Rep. John Boehner: $5,000
Delegate Donna Christian-Green: $5,000
Rep. Donald Payne: $5000
Sen. Jay Rockefeller: $5,000
Rep. Dan Maffei: $4,550
Rep. Michael Acuri: $4,000
Rep. Richard Neal: $4,000
Sen. Dick Durbin: $3,500
Sen. Tim Johnson: $3,500
Sen. Susan Collins: $2,500
Rep. David Camp: $2,500
Rep. Paul Kanjorski: $2,500
Sen. Mary Landrieu: $2,500
Sen. Mitch McConnell $2,500
Rep. Adam Putnam: $2,500
Rep. John Boccieri: $2,300
Rep. Deborah Halvorson: $2,300
Rep. Walter Minnick: $2,300
Rep. Spencer Bachus: $2,000
Rep. Joe Barton: $2,000
Rep. Kevin Brady: $2,000
Sen. Robert Menendez: $2,000
Rep. Randy Neugebauer: $2,000
Rep. Lamar Smith: $2,000
Rep. Patrick Tiberi: $2,000
Sen. Max Baucus: $1,000
Rep. Marsha Blackburn: $1,000
Rep. Barney Frank: $1,000
Rep. Jack Kingston: $1,000
Rep. Rubin Hinojosa: $500
Sen. James Inhofe: $500
Rep. Jean Schmidt: $500
Sen. John Thune: $500
Sen. David Vitter: $500
Rep. Gregg Harper: $250
Sen. Tom Udall: $250
*Total amount since 2000 given by Stanford Financial Group employees and Stanford’s political-action committee, according to the Center for Responsive Politics
And what did Stanford manage to do with this money? The Financial Times had a run-down over the weekend:
A $10m Florida mansion, bills of up to $75,000 for children’s Christmas presents and holidays, and a $100m fleet of private jets topped a list of Sir Allen’s outgoings and assets in the documents obtained by the Financial Times from a court case two years ago.
Details of his lifestyle emerged as the Federal Bureau of Investigation continued its probe into the billionaire’s affairs and allegations that his Antigua-based Stanford International Bank was at the centre of an $8bn fraud that may have drawn in tens of thousands of investors.
This is nothing new. For a book that I’m wrapping up this week (whew!), here is just a reminder from the past Enron affair:
In the political world, Enron money washed across state and federal officials, rewarding mostly Republicans but a far number of Democrats as well. According to one report published by Public Citizen soon after the bankruptcy, "Since 1989, 259 current members of Congress have received Enron campaign cash. This includes 188 Representatives (117 Republicans, 71 Democrats) and 71 Senators (41 Republicans, 29 Democrats)…Top current senators receiving Enron contributions since 1989: Kay Bailey Hutchison (R-Texas.), $99,500; Phil Gramm (R-Texas.), $97,350; Conrad Burns (R-Mont.), $23,200; and Charles Schumer (D-N.Y.), $21,933 (Source: Center for Responsive Politics)…Top current representatives receiving Enron contributions since 1989: Ken Bentsen (D-Texas), $42,750; Sheila Jackson Lee (D-Texas), $38,000; Joe Barton (R-Texas), $28,909; Tom DeLay (R-Texas), $28,900; and Martin Frost (D-Texas), $24,250 (Source: Center for Responsive Politics)."
Another investigation uncovered the intricate ties between the bi-partisan elite world of money and law. Enron bought the services of Akin, Gump, Straus, Hauer & Feld; Bond Donatelli; Bracewell and Patterson; Davis Wright Tremaine; Price Waterhouse Coopers; Sideview Partners; Skadden Arps Meagher and Flom; Verner Liipfert Bernhard McPherson and Hand; Vinson & Elkins; and Quinn Gillespie.—representing the spectrum of Democratic and Republican deal-makers. The same inquiry found both parties making deals that were suspiciously linked to campaign contributions: "During a trade trip to Bosnia and Croatia in July 1996, [Clinton Secretary of Commerce Ron] Brown’s successor, Mickey Kantor, helped a senior Enron official that accompanied the secretary clinch a deal to construct a $100 million power plant, the Boston Globe reported. Six days before the trip began, Enron made a $100,000 contribution to the Democratic National Committee."
The point is something we know, but we tend to let recede in memory until the next scandal pops up: until we get a grip on the day-to-day legalized political campaign contribution racket, we are going to keep feeling the perversion of public policy (and, no, now-President Obama’s campaign did not change that world).
