WASHINGTON - When Jack Abramoff bragged about doing "a new kind of
lobbying" for the Mississippi Band of Choctaw Indians, his associate Amy
Ridenour was impressed. Once it became clear what he was really doing,
Ridenour told the Senate Committee on Indian Affairs June 22, a friendship
of 20 years came to an end.
The committee struggled to unravel the deeds of Abramoff, a prominent
Washington lobbyist, and his associate Michael Scanlon - both alleged to
have misled and defrauded the Choctaws of as much as $6.5 million in a
single year. The hearing in Washington, D.C., was the third in an ongoing
Senate investigation into their lobbying activities with numerous tribes.
If the charges are true, Abramoff and Scanlon picked one of Indian
country's savviest tribes to shake down. With no natural resources to speak
of, the Choctaw have created a manufacturing base and gaming industry that
today make the tribe the second-largest employer in Mississippi.
After Republicans took control of Congress in 1994, the House announced its
intent to tax tribal revenues. The Choctaw tried to reach out to the new
majority and were recommended the services of Republican lobbyist Abramoff.
Choctaw Attorney General Donald Kilgore told the committee that evidence
showed Abramoff and Scanlon practiced "a consistent pattern" of kickbacks,
pass-through schemes and fabricated consulting charges. Scanlon, former
spokesman for House Majority Leader Tom DeLay, R-Texas, was recommended to
the Choctaw by Abramoff and, according to e-mails, shared his fees with his
mentor in a secret "gimme five" kickback scheme that enriched both.
The tribe doesn't question the nature of the work the two men did on their
behalf, said Choctaw Tribal Planner Nell Rogers, but believes that
misconduct occurred in overcharging for work and diverting payments for
Abramoff is under investigation by a federal grand jury for overcharging
tribes for lobbying services.
Rogers sought to correct misimpressions fostered to date by the press. The
tribe did not contribute any money for legislative golf trips, she said,
including DeLay's widely reported Scotland junket in 2000; nor did it
contribute money to Americans for Tax Reform to buy access to the White
House. Rogers, who had frequent contact with Abramoff, called his behavior
"an extraordinary story of betrayal."
When the tribe first saw evidence of fraud in June 2004, it terminated its
relationship with Abramoff and began cooperating with the Justice
Department and the FBI.
Several business associates of Abramoff and Scanlon were called before the
committee, chaired by John McCain, R-Ariz., but pleaded the Fifth Amendment
and refused to answer questions.
The National Center for Public Policy Research, a conservative research
foundation, did speak on the record. Ridenour, its president, recounted how
Abramoff, a member of the board of directors from 1997 - 2004, used the
foundation as an unwitting conduit for Choctaw money destined for
organizations of his choice.
In one case, Abramoff directed $1 million to the National Center as a
Choctaw contribution, she said. A slice of $450,000 was forwarded to
Abramoff's private charity, the Capitol Athletic Foundation. Another
$500,000 went to Capitol Campaign Strategies, run by Scanlon; $50,000 was
targeted, it was later learned, for repayment of a debt Abramoff contracted
in his former days as a filmmaker.
The extent of the foundation's financial oversight, admitted Ridenour, was
lax: they left it to Abramoff to provide evidence he was fulfilling his
fiduciary responsibility to the tribe. Ridenour said she believed the
allocation of the money had the full blessings of the Choctaw. "I'd always
trusted Jack," she told the committee.
Choctaw officials maintained their contribution to the National Center was
intended for polling, research, and public information purposes outside the
legislative process. Some of their money appears to have been funneled to
pay expenses for a paramilitary organization in Israel, an all-boys Jewish
academy, and a Passover vacation for Abramoff.
Some comic relief was provided by David Grosh, who testified that Scanlon
enlisted him to be director of the American International Center, which now
appears to have been a front organization used to filter - or launder -
Grosh got his job when Scanlon, an old friend, called him one day and
asked, "Do you want to be the head of an international corporation" - with
no responsibilities, he added. Grosh, a former lifeguard and bartender, was
happy to comply.
Having suffered a change of heart since then, Grosh told the committee he
is now disgusted by the whole affair. Referring to his fellow participants,
he concluded, "the Lakota Indians have a word for it: wasichu [fat takers],
which accurately describes all of us."
"This tribe has been a victim of fraud, we believe," said Vice Chairman
Byron Dorgan, D-N.D. "The committee didn't need a Deep Throat to tell us to
follow the money."