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Court Denies Abramoff’s Partner-in-Crime Reduction of $20M Restitution to Ripped-Off Indians

A federal appeals court denied a request from the former business partner of convicted Republican super-lobbyist Jack Abramoff to reduce the $20 million restitution order against him for scamming Indian nations out of more than $80 million.

In an unanimous ruling January 20, a three-judge panel of the U.S. Court of Appeals for the District of Columbia said that neither the trial judge or the appellate court could change the sentence handed down last year to Michael Scanlon, who pleaded guilty to conspiracy involving bribery, wire fraud and “honest services fraud.” Scanlon was sentenced by federal district court Judge Ellen Huvelle in February 2011 to a 20-month prison term and $20 million restitution to the victims who he and Abramoff ripped off.

Scanlon and Abramoff were the at the center of a sordid web—a crony-capitalist, influence-peddling corruption scandal that rocked Washington politics during the first decade of the 21st century. The scandal brought down presidential appointees at the highest levels of government, members of Congress, congressional staffers, a bogus “nonprofit environmental” organization that lobbied for corporate interests, and others. During their rampage though Washington and Indian country, Abramoff and Scanlon stole more than $82 million from six tribes between 2001 and 2003, according to the investigative report “Gimme Five,” issued by the Senate Committee on Indian Affairs. The report found that Abramoff persuaded his tribal clients to hire Scanlon at exorbitant fees for “grassroots support” or access to high public officials, and that Scanlon then kicked back half of the money to Abramoff.

The two men also lavished federal officials, lawmakers and staffers with illegal gifts including meals, free tickets to the offensively-named Washington football team’s games and trips to Scottish golf courses. In 2006, Abramoff pleaded guilty to charges of tax evasions, mail fraud and conspiracy as well as a bank fraud case in Florida, and he served 43 months in federal prison before being released last summer.

Scanlon entered a guilty plea in November 2005. In a plea bargaining deal, his attorneys sought no prison time in exchange, pointing out his “extraordinary cooperation” that helped the Justice Department prosecutors convict 20 other people in the Abramoff scandal—including Abramoff himself. Scanlon even aided efforts in a Texas money laundering case in which former Republican Congressman Tom DeLay was convicted in November 2010 of money-laundering charges in a state trial, five years after his indictment forced him to resign as majority leader in the House of Representatives. DeLay was last seen on Dancing with the Stars in the fall of 2009.

Scanlon’s lawyer, Stephen Braga, asked the appeals court in November 2011 to allow Scanlon to amend the plea bargaining deal he had made with the government, according to the Blog of Legal Times. Braga argued that a U.S. Supreme Court ruling in June 2010 should allow Scanlon to get off the hook for the “honest services” fraud charge against him. In the pro-corporate decision, the high court narrowed the scope of criminal liability for corporate officers and employees under the “honest services” law of the federal wire and mail fraud statutes. Before the ruling, prosecutors could convict corporate executives and other employees for a broad range of activities, including non-disclosure of conflicts of interest. Under the new ruling individuals can be convicted of honest services fraud only if they have committed bribery or received kickbacks. One of the appeals judges, David Tatel, noted that Scanlon wanted to keep the part of the plea bargain that sentenced him to only 20 months in prison, but did not want to be burdened by the restitution order.