TPM News

The news that a House committee plans to look into the events that led to that fateful investigation of Eliot Spitzer may have some observers licking their chops in anticipation of finding out whether the probe was politically motivated payback for the governor's targeting of Wall Street.

That notion has persisted, despite little concrete evidence, almost since the news of Spitzer's tryst with Ashley Dupre first surfaced in March.

But don't get too excited just yet. Steve Adamske, a spokesman for Rep. Barney Frank -- who, as chair of the House Financial Services committee, will run the inquiry -- told TPMmuckraker in an interview that in fact the effort won't be designed primarily to look at that question. Rather, said Adamske, it will focus on the somewhat drier subject of whether increased scrutiny by the Treasury Department of banking transactions, as required by the Patriot Act, is an effective counter-terrorism tool. Banks have in the past complained about the increased paperwork required by the law, arguing that in addition to being burdensome, it does little to help fight terrorism.

The Spitzer saga is the hook for an inquiry into that subject because the investigation of the governor began after his bank filed a routine report to Treasury about a series of wire transfers he made to QAT International, a shell company connected to the Emperor's Club prostitution ring. After another bank filed reports about suspicious activities by QAT International, investigators noticed the previous report about Spitzer, and began looking closer.

That focus may disappoint some committee members. Michael Capuano, a Massachusetts Democrat on the committee, seems to see the issue differently. "The question was: Why were they looking for this? Is this political retribution?" he told the New York Times.

But it's by no means clear that Frank's inquiry will answer that question.

House leaders voiced their support for the Constitution's "speech or debate clause" -- a provision designed to protect members of congress from being arrested for their legislative activities -- in a brief filed Monday in the case of outgoing Arizona GOP Rep. Rick Renzi. Renzi, who is accused of conspiracy, fraud, and money laundering, says the government collected evidence against him using an illegal wiretap order that taped conversations between him, aides, and other members of congress. He is one of a string of legislators, including Louisiana Rep. William Jefferson and Alaska Sen. Ted Stevens, to use this as defense. (CQ Politics)

Officials at the Office of Tax Revenue said that Rep. Charles Rangel (D-NY) incorrectly received a tax break on his DC home and could owe the government back revenue. The rule is designed for people who make DC their principle home, but Rangel has said his primary residence is in New York. The irregularity could complicate the House Ethics Committee investigation of allegations that the congressman received a rent break on his New York apartments. (Washington Post) A House committee will investigate the investigation of Eliot Spitzer's post-Valentine's Day tryst with a call girl, amid speculation that the case was politically motivated and designed as revenge for Spitzer's aggressive prosecution of Wall Street executives. Meanwhile, a judge sentenced Ashley Dupre's booking agent to one year's probation. (AP)

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The White House is unlikely to grant sweeping pardons to former Bush administration officials who may have encouraged or enabled torture in approving harsh interrogation methods for terror suspects, reports the Wall Street Journal.

Some Republicans have been pushing for President Bush to grant the pardons before he leaves office. But White House officials point to opinions put out by the Justice Department that supported the administration's methods, and say that pardons -- which would no doubt draw fire from congressional Democrats and other administration critics -- are unnecessary.

It's unclear whether the incoming Obama administration intends to prosecute officials from the CIA, DOJ, and other government agencies who approved the harsh methods. A spokesperson for the Obama transition team told the Journal: "No decisions about interrogation issues will be made before the full national security and legal teams are in place."

But some congressional Democrats, as well as liberal legal scholars, have called for such prosecutions, over activities including water-boarding and the NSA's warantless wiretapping.

The Associated Press reports:

The Justice Department has released hundreds of documents that it used to falsely accuse scientist Steven J. Hatfill of masterminding the 2001 anthrax attacks.

The documents were unsealed Tuesday following last week's federal court order to do so. They show the FBI seized clothing, financial records, VHS tapes, books and other papers from Hatfill's home in Frederick, Md.

Hatfill originally was named a person of interest in the anthrax attacks. But the Justice Department cleared him last summer after switching its focus to another suspect, Bruce Ivins.

Some of the court documents can be found here. We'll bring you the rest as soon as DOJ makes them available.

The New York Times and Los Angeles Times had sued to have the Hatfill documents released.

Late Update: Here are more of the documents.

The clock's running out on the Bush administration, which leaves just 56 days for the president to wipe criminal slates clean. Former California GOP congressman Randy "Duke" Cunningham officially filed for a presidential pardon back in July, but sympathy for the man one author dubbed the "most corrupt congressman in history" appears pretty lackluster.

We noticed that there are only 13 signatures on an online petition designed to demonstrate public support for a pardon, even though it was posted nearly three years ago -- just two days after Cunningham pleaded guilty to accepting more than $2.4 million in bribes.

The 66-year-old, who has a history of prostate cancer, was later sentenced to 100 months in prison.

Fred Johnson III is listed as the organizer of the petition. Mr. Johnson did not respond to an e-mail, sent through the petition site, asking for his thoughts on Cunningham's odds. We'll settle for yours.

Yesterday, the Washington Post and Bloomberg News both reported on the astronomical sum of money -- the Post put it at almost $900 billion -- that the Federal Reserve is quietly lending to banks and other financial institutions hit by the financial crisis.

Unlike with the $700 billion in bailout money allocated to the Treasury Department, the Fed won't reveal basic details about the program: for instance, which institutions are getting that money, how much they're getting, or which assets are being used as collateral on the loans.

Bloomberg News filed a Freedom of Information Act (FOIA) request, in order to pry loose the information, but the Fed responded that this was "confidential commercial information", reports the Post, and argued that the Federal Reserve Bank of New York, which keeps the information, is not subject to FOIA. Bloomberg has now filed a federal lawsuit against the Fed.

Some in Congress are also concerned. Several members at a hearing of the House Financial Services Committee last week expressed skepticism about the lack of transparency. And a staffer for Rep. Scott Garrett (R-NJ), a member of the House financial services committee, told TPMmuckraker that the congressman will soon send a letter to Fed Chairman Ben Bernanke asking him to provide further details about the loans.

At that same hearing, Bernanke explained the reason for the Fed's secrecy: "There's a concern that if the name is put in the newspaper that such and such bank came to the Fed to borrow overnight for a good reason, that people might begin to worry: Is this bank credit-worthy?" he said. "And that might create a stigma, a problem, and might cause banks to be unwilling to borrow."

Tim Yeager, a former economist at the Federal Reserve Bank of St. Louis, and now a professor of finance at the University of Arkansas, bolstered that view. He told TPMmuckraker that in normal times more disclosure makes sense, but that in times of crisis like this, "if word leaked out" that banks were going to the Fed to borrow money, "there could be a liquidity run."

We've made calls to the House financial services and oversight committees, and the Senate banking and finance committees, to ask whether they have plans to look into the issue further, given the amount of taxpayer money at issue. We'll let you know what we find out.

A former White House aide has been charged with stealing thousands of dollars of federal money that was intended to promote democracy in Cuba, reports the Washington Examiner.

Felipe Sixto was charged with stealing from the Center for a Free Cuba, a non-profit organization, both while he worked there from 2005 to 2007, and after he went to work in the White House last year.

In March of this year, we noted that Sixto had resigned from the White House after the allegations first surfaced. He had been working there as a special assistant to the president in the office of inter-governmental affairs.

Sen. John Conyers (D-MI) and Sen. Patrick Leahy (D-VT) have written to Attorney General Michael Mukasey pressing the Justice Department on its decision to foot the bill for lawyers hired to defend former Attorney General Alberto Gonzales in a suit about politicized hiring practices. The DOJ had agreed to pay up to $24,000 per month, about twice the price of a public attorney, according to reports last week. (Politico)

Just be reasonable, a federal appeals court ruled Monday in a case about spying on American citizens abroad. The three-judge panel said the U.S. did not need warrants to conduct searches and electronic surveillance, but must meet the Fourth Amendment's requirement for reasonableness. (New York Times)

The New York Times reveals New York Democratic Rep. Charles Rangel's decision to support a tax loophole that allows companies to reduce taxes by opening offices abroad, despite his prior condemnation of it as unpatriotic. Rangel said he did not support closing the loophole because doing so would effectively impose a retroactive tax on the companies, something he opposes. Nabors Industries, which had lobbied aggressively in favor of the tax shelter, donated $1 million to a school project championed by the congressman. The two parties deny any quid pro quo. Rangel chairs the powerful Ways and Means committee and is a top fundraiser for other Democratic candidates. He faces an ethics investigation about charges that he did not disclose income drawn from real estate. (New York Times/Roll Call)

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Call it a sign of the times...

It looks like Freedom's Watch, the pro-war pressure group bankrolled by casino mogul Sheldon Adelson and talked up by former White House spokesman Ari Fleischer, is wrapping up its operations -- apparently without too much to show for its efforts.

The advocacy organization is likely to permanently shut its doors at the end of the year, according to sources who spoke to the Las Vegas Review Journal.

As we noted earlier this month, Adelson has been down on his financial luck lately. His casino company Las Vegas Sands recently said it may default on debt and face bankruptcy.

The group, which advocates an open-ended commitment in Iraq and unquestioning support for Israeli hawks, spent $30 million to influence the recent congressional elections.

But spokesman Ed Patru, a former spokesman for the National Republican Campaign Committee, wouldn't say how the group's favored candidates fared. "Our focus was to impact the debate," said Patru.

In other words, it's safe to assume, not well.

Wal-Mart has fired James Hirni, the former Team Abramoff lobbyist who prosecutors on Friday charged with giving illegal gifts to two congressional staffers.

In a statement emailed to The Hill, a company spokesman wrote:

"Based on Mr. Hirni's [expected] guilty plea which relates to conduct occurring prior to and unrelated to his employment by the company, we terminated his employment."

Todd Boulanger, another former Abramoff team member implicated in the scheme resigned on Friday from the lobbying firm Cassidy and Associates. Boulanger has not been formally charged at this point.

Hirni had worked as Wal-Mart's "director of Republican outreach". He first represented the retail giant in 2004 while working with Abramoff at the law and lobbying firm Greenberg Traurig.