Lobbyist Jack Abramoff paid former Christian Coalition head Ralph Reed more than $5.3 million from money Abramoff charged Indian tribes to fight measures that would have cut into their gambling profits, according to a Senate report released Thursday.
The Committee on Indian Affairs report culminates a two-year investigation producing 750,000 pages of documents into questions raised in a February 2004 Washington Post story titled “A Jackpot From Indian Gaming Tribes; Lobbying, PR Firms Paid $45 Million Over 3 Years.”<?xml:namespace prefix = o ns = “urn:schemas-microsoft-com:office:office” />
Abramoff and his partner, Michael Scanlon, pleaded guilty in federal court to defrauding some of their tribal clients. According to the report, the two men collected about $66 million from six tribes between 2001 and 2003, using most of it for personal gain.
Investigators say the scheme worked like this: Abramoff earned the trust of tribal leaders and sometimes offered to work for free. He recommended hiring a consultant and pushed Scanlon, who in turn kicked back tens of millions of dollars to Abramoff. Abramoff did not reveal the potential conflict of interest to clients. Scanlon inflated his fees to cover both his and Abramoff’s split. They spent about one-third of the money collected for purposes the clients intended and divided the rest between them.
When Abramoff and Scanlon did work for their clients’ interests, they typically turned to Ralph Reed, Abramoff’s longtime friend and a Republican strategist currently running for <?xml:namespace prefix = st1 ns = “urn:schemas-microsoft-com:office:smarttags” />Georgia’s lieutenant governor. Reed took money to mobilize grassroots Christian support against state proposals to expand legalized gambling, benefiting Abramoff’s tribal clients, who feared losing business to increased competition.
Recognizing that Reed’s conservative evangelical base would not approve of him taking money from gambling interests, Abramoff had tribal leaders filter Reed’s money through various conduits, like Abramoff’s lobbying firm and Americans for Tax Reform, an anti-tax, non-profit organization headed by conservative activist Grover Norquist.
According to the Senate report, Reed reconnected with Abramoff in 1998, a few months before the lobbyist was discussing with the Mississippi Band of Choctaw Indians various legislative proposals in Mississippi and elsewhere that threatened their casino market share.
Through at the time with electoral politics, Reed promised “to build a strong grassroots network” to oppose a video-poker bill in Alabama, mobilizing groups including the Alabama Christian Coalition, the Alabama Family Alliance, the Alabama Eagle Forum, the Christian Family Alliance and enlisting Focus on the Family founder James Dobson to record a commercial.
Reed had no direct contact with the Choctaws, who worked through Abramoff as a liaison. Reed boasted that he had 3,000 conservative pastors and 90,000 households in the state that he could access for the effort. Reed proposed a $20,000 a month retainer and closed his letter with, “We look forward to bringing about the desired results for you.”
Later Abramoff proposed that the Coushatta Tribe of Louisiana also work with Reed. William Worfel, former vice chairman of the tribe, said he understood Reed would engage the Christian Coalition against bills expanding gambling in Louisiana.
Worfel said Kathryn Van Hoof, former outside counsel of the Coushatta Tribe of Louisiana, told him Reed “did not want his name being revealed,” and it couldn’t get out he was with the Christian Coalition. “It wouldn’t look good if they’re receiving money from a casino-operating tribe to oppose gaming,” Worfel said. “It would be kind of hypocritical.”
After Texas shut down the Speaking Rock Casino operated by the Tigua Indian Tribe of El Paso, Abramoff and Scanlon’s Louisiana client understood that legalized gambling in Texas could undercut its customer base. Abramoff turned again to Reed to mobilize a grassroots effort against the Tigua’s efforts to have the casino reopened.
Reed told Abramoff he was already working with former Southern Baptist Convention President Ed Young, pastor of SecondBaptistChurch in Houston, to mobilize the city’s pastors in support of the state’s anti-gambling efforts. “We have over 50 pastors mobilized, with a total membership in those churches of over 40,000,” Reed said in an e-mail. “That includes Second Baptist, which has 12,000 members.”
The Tigua did not know Abramoff and Reed worked behind the scenes to close their casino, and they were desperate after losing the industry they had used to lift the tribe from poverty. Abramoff went to the Tigua and offered to work for free. At his suggestion they hired Scanlon, who was paid $4.2 million from the Tigua and secretly kicked back $1.85 million to Abramoff.
Abramoff disclosed his friendship with Reed to Tigua, and said that while leading the anti-gambling movement among conservative Christians, Reed was tipping Abramoff off with information about the campaign so he knew their strategy.
Abramoff failed to deliver on a promise to have language protecting the Tigua placed into a federal election reform bill, but managed to solicit funds from the tribe to help foot the bill for a golfing junket to Scotland in May 2002 that included Reed and Rep. Robert Ney, R-Ohio, who was supposed to carry the Tigua provision forward and is expected to be the first Congressman to be indicted for bribery. [Two years earlier Abramoff footed part of the bill for a golf outing for Rep. Tom DeLay, R-Texas, and some of his staff. It was DeLay’s failure to report the donation that first brought Abramoff into the spotlight.]
Eventually, Abramoff and Scanlon apparently squeezed Reed out of the picture and kept most of the money. In a Dec. 18, 2001, e-mail, Abramoff wrote Scanlon, “Next year, we need to give [Reed] a pittance and we need to keep most of this ourselves.”
In an exchange Jan. 4, 2002, Scanlon asked if Reed spent all the money he was paid or had some left. “That’s a silly question,” Abramoff replied. “He ‘spent’ it all the moment it arrived in his account. He would NEVER admit he has money left over. Would we?”
Scanlon responded: “No, but I’d like to know what the hell he spent it on. He didn’t even know the [expletive] thing was there and didn’t do [expletive] to shut it down.”
Abramoff came back: “I agree. He is a bad version of us! No more money for him.”
A month later, discussing a $50,000 payment to Reed for work supporting the Choctaw, Abramoff told Scanlon, “Go ahead and pay him so I can get him off my back.”
Reed characterized the 357-page report as a clean bill of health that would allow voters to focus on other issues between now and the July 18 GOP primary.
According to the Atlanta Journal-Constitution, Reed said the report “confirms I have not been accused of any wrongdoing in this matter” and “that I was hired as a subcontractor for a very respected law firm and had no direct relationship with their clients.”
Reed says he was assured his efforts against casinos wouldn’t be bought with money tainted by gambling. “It’s now clear from the benefit of hindsight that this was a piece of business I should have declined,” he said.
Bob Allen is managing editor of EthicsDaily.com.
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