TPM News

We've been swimming in credit card receipts from Rudy Giuliani's administration today, and one thing in particular has struck us: in 2001, apparently with an eye to future globetrotting, Giuliani's administration sent a check for $400,000 to American Express. Though it was billed to the Assigned Counsel Administrative Office, an office that provides lawyers for indigent defendants, the money served as an advance against future travel and other expenses later incurred by the mayor's office and his security detail.

The unusually large prepayment, as yet unreported, adds weight to the theory that the Giuliani administration was using accounting gimmicks to obscure his office's travel expenditures.

With $400,000 prepaid on the Amex account, the mayor and his staff drew down on the credit card for a number of trips, including a handful out to the Hamptons, where Judith Nathan had her condo. Giuliani's administration ultimately spent approximately $100,000 of the $400,000 before leaving office in January, 2001.

Stu Loeser, a spokesman for Mayor Bloomberg, confirmed to us that his administration put a stop to the practice of putting funds for future travel in bulk on a credit card. Shortly after Bloomberg took office, American Express refunded $298,000, the remaining unused balance on the account. The move came shortly after the city comptroller sent the mayor a letter critical of the Giuliani adminsitration's practice of billing obscure city agencies for mayoral travel expenses.

But Loeser declined to comment when asked directly why the administration did this, and declined to comment when asked directly if the Bloomberg administration thought the Giuliani approach was problematic. "We process spending and travel differently," he said. "We use a different method. If we have government funded travel, we go through the city's travel agent."

Prepaying a city credit card with such a large amount is a procedure that "appears intentionally opaque," a high-level budget official under a previous administration told us. "You're not able to see clearly what [the money] is being used for," the official said, "because it's bundled in an AmEx card as opposed to as direct payments to vendors."

The unusual $400,000 prepayment is revealed in a letter from Giuliani's deputy director of fiscal operations that was contained in a package of documents City Hall released today, in response to reporters' questions about Wednesday's Politico story. You can see the letter here.

Giuliani's administration had done a similar thing in June of 2000, cutting checks for $54,000 worth of "prepayment" and billing them to the New York City Loft Board and other backwater agencies.

In comments to the Politico yesterday, Anthony Carbonetti, a longtime aide to Rudy Giuliani and his chief of staff when he was mayor, told Ben Smith that this was the first he'd heard that the city comptroller had been asking about the mayor's charges to backwater agencies.

So we asked the city comptroller's office. And spokesman Jeff Simmons told us that the audit, which focused on $34,000 of travel charges to one of those obscure agencies, the New York City Loft Board, had indeed begun in 2001, when Rudy was still mayor. The comptroller had made "repeated requests to the Loft Board and Mayor’s Office for further information and was stonewalled," he said.

Of course, that stonewalling has continued in the Bloomberg administration, which has refused to discuss the charges, citing "security," although they did refer the matter to the city Department of Investigations, where it seems to have disappeared.

The Washington Post has an update to Special Counsel Scott Bloch's alleged scheme to have geeks scrub his hard drive (for background click here). Turns out that Bloch has the files that he erased on a thumb drive, but he's not turning them over, no sir: They're personal. And it's sparked a good bit of squabbling amongst the White House's ineffectual investigative agencies (in this case the other party is the Office of Personnel Management's inspector general).

But here's the part that's good. Earlier this year, Bloch launched, to great fanfare, a sprawling investigation of Karl Rove's alleged efforts to politicize the federal government, but it seems not to have gotten very far. But maybe, Bloch's enemies are saying, the investigation was just a canny ploy to incapacitate the investigations of him:

Attorneys representing the staff members in the complaints against Bloch cited the latest dispute in calling for his resignation.

"At the time that he initiated this probe of Karl Rove, we thought he was doing this to make himself bulletproof so the White House could not take disciplinary action against him," said Debra Katz, an attorney for the staff members. Bloch denied that charge and said the Rove investigation is the responsibility of his office.


Ah, oversight.

Despite the fact that thousands of Iraqis have risked their lives and the security of their families by supporting U.S. reconstruction efforts in Iraq, the U.S. is excluding them from a fast-track refugee resettlement program. Approximately 100 Iraqi employees of the U.S embassy will receive preferential treatment while the rest must rely on the surge working, join 2 million other Iraqis and flee the country, or risk violent retribution for their aid to the U.S. (AP)

The government is presenting closing arguments in its case against suspected terrorists accused of plotting a homegrown religious insurrection against the American government that would include spectacular attacks. Administration officials once “trumpeted” the case as a major break in the “war on terror,” until the defendants turned out to be pathetic indigents. Since the defendants never possessed weapons or equipment and posed “no immediate threat,” they face 70 years based primarily on a videotaped oath to Al Qaeda that was guided by F.B.I. informants. (New York Times)

Yesterday, two unidentified witnesses (including a man with a shaved head and black leather jacket) testified before a federal grand jury in an investigation into Blackwater. A third witness in a brown leather jacket and military style crew cut also appeared. A court escort wore khaki cargo pants and the judge may have worn a black robe but nobody seems to know any details of the testimony or even the names of the witnesses. (AP)

Read More →

Courtesy of the Rudy Giuliani camp's efforts to spin the shag fund story, this is another installment in Great Moments in Damage Control! (from The New York Daily News):

Joe Lhota, a deputy mayor in Giuliani's City Hall, told the Daily News Wednesday night that the administration's practice of allocating security expenses to small city offices that had nothing to do with mayoral protection has "gone on for years" and "predates Giuliani."

When told budget officials from the administrations of Ed Koch and David Dinkins said they did no such thing, Lhota caved Thursday, "I'm going to reverse myself on that. I'm just going to talk about the Giuliani era," Lhota said. "I should only talk about what I know about."...

"I don't understand when it started. I don't understand why it started," Lhota said. "But I do know one thing: It was consistently done ... in no way shape or form did it imply a coverup."


The "no explanation" explanation seems to be the best spin the Giuliani camp has available.

Other than that, there's 1) the irrelevant focus on whether the NYPD reimbursed the backwater city agencies which originally were billed for the tryst costs -- a response that has only served to highlight that Giuliani is dodging the main issue, or 2) the fact that, in order to keep the mayor's budget artificially low, there seems to have been a policy of misallocation in his administration, of which the trips to Judith Nathan's Southampton condo were only a small part (though for some reason we haven't seen them try this line yet).

So "I don't understand when it started, I don't understand why it started" it is!

From the Blotter:

Well before it was publicly known he was seeing her, then-married New York Mayor Rudy Giuliani provided a police driver and city car for his mistress Judith Nathan, former senior city officials tell the Blotter on ABCNews.com.

"She used the PD as her personal taxi service," said one former city official who worked for Giuliani.

New York papers reported in 2000 that the city had provided a security detail for Nathan, who became Giuliani's third wife after his divorce from Donna Hanover, who also had her own police security detail at the same time.

We here at TPMm have dived headlong into the murky world of New York City accounting procedures to bring you the full story of Rudy Giuliani's security detail's mistress visit accounting shell game.

A general clarification first. The central allegation behind the story was that Giuliani, or someone else looking to protect Giuliani, stuck the costs for the security detail into the budgets of obscure city agencies like the New York City Loft Board. It's not clear right now, though, how much total those trips to visit Giuliani's girlfriend Judith Nathan in the Hamptons cost (the Politico counts eleven trips), or which trips were hid in which agency. Not all of the Mayor's Office's travel was stuck with the backwater agencies -- much of it was billed to the mayor's office. It's not clear (to us, at least) if any of the trips to the Hamptons were billed that way, though.

The comptroller found that Giuliani's office hid $143,867 worth of "non-local travel" expenses in random city agencies in 2000; they upped the slippery accounting in 2001, charging $435,215 in 2001. Given the charges for the Hamptons travel noted in the Politico piece, only a fraction of this was for the eleven trips.

In other words, Giuliani's office had something like a widespread policy of misallocation of which the trysts were just a part -- something that they'd also done for certain salaries, according to today's New York Times:

The administration of Mr. Giuliani’s successor, Mayor Michael R. Bloomberg, said in 2002, several months after taking office, that the Giuliani administration had kept the budget for the mayor’s office artificially low by paying more than $5 million in salaries through other city agencies. The agencies to which Mr. Giuliani billed the travel expenses were outside the mayor’s office.


The Times adds that the NYPD typically picked up the bill for the mayor's security detail. But a Bloomberg aide tells the New York Daily News that it is common for the security detail to bill the mayor's office and then for the NYPD to reimburse it. However, "the aide could not confirm it was past practice to shuffle costs among an alphabet soup of agencies." There lies the rub.

As a spokesman for Rep. John Doolittle (R-CA), Gordon Hinkle earned his salt answering reporter's questions about whether his boss was on his way to prison. Now Hinkle will put that experience to work:

Gordon Hinkle, 34, was named deputy press secretary for the state Department of Corrections and Rehabilitation, according to a statement issued Wednesday by Gov. Arnold Schwarzenegger's office....

Hinkle has been Doolittle's communications director and senior field representative since February. He was among a handful of aides who received subpoenas in September from a Washington grand jury investigating Doolittle for his ties to jailed lobbyist Jack Abramoff. He was asked to turn over documents but was not required to testify.


For those curious at home, if Doolittle, who is under investigation for his ties to lobbyist Jack Abramoff, were in fact convicted of bribery charges, he'd end up in a federal penitentiary, not one in the California state system, so the two aren't likely to be reunited. Oh, well.

Hinkle is the third senior Doolittle aide to jump ship in recent months.

Over the summer, we reported on an under-the-radar executive order issued by President Bush allowing him to freeze or seize the U.S-based assets of anyone, potentially including U.S. citizens, he deems to threaten "the peace or stability of Iraq or the Government of Iraq" or who "undermin(e) efforts to promote economic reconstruction and political reform in Iraq."

The executive order was written so broadly as to alarm civil libertarians, who feared it was a back-door attempt at criminalizing the antiwar movement -- which Bush could conceivably argue posed a threat to Iraq by seeking to end the U.S. military presence -- or even unwitting donors to insurgent-linked charities. A spokeswoman for the Treasury Department, Molly Millerwise, told us not to worry: "Be assured that the individuals and entities we add to this list are in full faith acting in an aggressive, violent and reckless way in financing the insurgency," she said.

Earlier this month,the nonpartisan Congressional Research Service said: actually, maybe you should worry. It released a report (pdf) exploring "the contrast between the executive order's broad language and its narrow aim" and questioning why the Treasury Department hasn't released a list of eligible Iraq-related targets for the order.

Read More →

General Lute said on Monday we'll negotiate them. Ali al-Dabbagh wouldn't rule them out. But at the White House press gaggle today, Dana Perino denied the Bush administration's interest in long-term U.S. military bases in Iraq. From AFP:

"We do not seek permanent bases in Iraq," spokeswoman Dana Perino told reporters after Lieutenant General Douglas Lute said Monday that the flashpoint issue would be part of negotiations to decide the future of US troops in Iraq.


Yawn. This standard formulation is nothing new for the administration. Zalmay Khalilzad, for instance, used the same words as far back as 2005, and the Iraq Study Group still considered the statement less than categorical. After all: what would we do if Iraq just happened to offer us open-ended access to certain military installations, or access renewable in x-number of years? Very, very rarely will a host country deny the U.S. a re-up on a military base: it took the Philippines nearly 100 years to get us out of Clark Air Base and Subic Bay Naval Base.

There's a sense in which our presence at those bases wasn't "permanent," and another in which we didn't "seek" permanence. But it's one in which the literal meaning has to be interpreted in direct contradiction to the events and issues those words describe. Luckily, the American Philological Society calls that interpretation a "Perino."

TPMLivewire