Yesterday we noted this


Yesterday we noted this article in the Los Angeles Times which suggests that in 2002 the White House may have removed a United States Attorney who was about to begin an investigation into the lobbying activities of Jack Abramoff in the overseas territory of Guam. And Karl Rove appears to be directly tied to the decision-making — at least on the man’s replacement.

In that article, though, there’s also this passage …

In 2002, Abramoff was retained by the Superior Court in what was an unusual arrangement for a public agency. The Times reported in May that Abramoff was paid with a series of $9,000 checks funneled through a Laguna Beach lawyer to disguise the lobbyist’s role working for the Guam court. No separate contract was authorized for Abramoff’s work.

Certainly not the most efficient way to pay the bill, especially since it totaled more than $300,000. Here’s the passage in the earlier article referenced by the Times

In 2002 Abramoff was retained by the Guam Superior Court to help fight a judicial reform bill pending before Congress. It was an unusual arrangement for a public agency. No separate contract was authorized, and Abramoff’s lobbying fees were disguised in a series of small checks funneled through a California lawyer under an existing contract, records and interviews show.

The middleman, Laguna Beach lawyer Howard Hills, said in an interview that he backed out of his role after processing 36 separate checks in $9,000 increments totaling $324,000.

The transactions now are under investigation by the Guam Public Auditor’s office.

In May 2002, Superior Court administrators were trying to stop legislation that would give the Guam Supreme Court authority over the Superior Court.

The bill’s supporters at the time, such as Guam’s congressional delegate, Robert A. Underwood, said the measure was needed to prevent undue political influence on the judiciary and also to clarify the authority of the Supreme Court.

Foes, led by Superior Court Chief Justice Alberto C. Lamorena and court administrator Anthony Sanchez, objected to Congress interfering with a Guam domestic matter. But they received an unexpectedly hostile reception at a hearing in Washington on May 8, 2002.

According to Hills’ account, the court officials, licking their wounds over lunch, decided to call in Abramoff, known for his political ties to Rep. Tom DeLay (R-Texas), who was the House whip at the time.

The California lawyer, a former Reagan administration official, was acting as a consultant to the Guam Superior Court. Hills said the Guam contingent walked a few blocks to Signatures, the Washington restaurant they knew was owned by Abramoff.

At an impromptu meeting, Abramoff said he could help, Hills said. The lobbyist also told the Guam officials that DeLay and House Republican leaders would find abhorrent any interference by Congress in a local court dispute.

Hills withdrew, he said, thinking his services no longer were required. Instead, Hills said, he soon found himself helping to conceal Abramoff’s agreement with the Guam court.

Rather than create a new contract for Abramoff, the Guam Superior Court hired the lobbyist under Hills’ original consulting contract. No public disclosure was required and, according to Hills’ account and e-mails reviewed by The Times, the unusual billing system was created.

One e-mail from Sanchez to Hills on May 23, 2002, asked “can you please send me 22 individual invoices at no more than $9K for May payments…. Very important.” Sanchez used the e-mail address “nobodyonguam.”

In another e-mail dated Sept. 30, 2002, Sanchez ordered Hills not to talk about the arrangement. Hills said he forwarded all of the $9,000 payments to Abramoff.

Eventually, Hills said, he called a halt to the arrangement and refused to submit any additional bills on Abramoff’s behalf. That also ended the string of payments, prompting Abramoff’s complaint to Sanchez.

As I said, a rather unorthodox method of payment. And the pattern was clearly no accident, as shown by Sanchez’s direction to “send me 22 individual invoices at no more than $9K for May payments.” The additional detail here is that federal law requires banks to report funds transfers of over $10,000. (The change to this amount is relatively recent; but I’m pretty sure it predates late 2002.)

Thus, it seems very hard to come up with a reason for this odd pattern of payment other than as an attempt to conceal the transaction from federal authorities. And of course using Hills as a cut-out allowed Abramoff to avoid filing the requisite lobbying disclosures.

I’d be curious to <$NoAd$>hear from lawyers with relevant experience what they make of this arrangement.