Giuliani No Lobbyist? Depends on What You Mean by “Lobbying”Rudy Giuliani and his cohorts at Giuliani Partners have insisted he’s no lobbyist. But there’s mounting evidence to the contrary. Maybe he’s so averse to the term because his firm lobbied illegally.
Exhibit A is today’s Time story, which for the first time reveals details about just what Hank Asher, Giuliani’s troubled buddy, paid him so much money to do.
As we laid out in a series of posts last week, Giuliani struck a pretty sweet deal with Asher during his first year of business. Asher’s Seisint was hocking its data-mining software, code-named MATRIX, to the government. Rudy’s job was to serve as a kind of front man for the company, in part so that Asher’s drug-running past wouldn’t be an issue. The contract, for a previously untold amount of money, was based on a $2 million yearly fee, commissions, and stock options. A stock holder in the company was so alarmed by the giveaway that he sued Seisint; the case was settled.
Today, Time puts a price tag on all that: $30 million, $24 million of that from stock options. And what did Rudy do for the money? It turns out, plenty.
Well, first and foremost, he lobbied. A shareholder in Seisint tells Time that “nobody knew us; everybody knew him,” and that with Giuliani, “the doors were wide open. It was almost a flood of business opportunities.” The company’s in-house lobbyist says that Giuliani set up a meeting at the Department of Homeland Security.
The White House looks like another one of those doors that Giuliani opened. In January of 2003, just a month after Seisint hired Giuliani, Asher gave a presentation to Vice President Dick Cheney, FBI director Robert Mueller, Homeland Security director Tom Ridge, and Gov. Jeb Bush (R-FL) in the Roosevelt Room at the White House on MATRIX, according to documents obtained by the ACLU back in 2004. (The ACLU doggedly opposed MATRIX; Asher responded by once joking that the ACLU “is probably funded” by Al Qaeda. I’m sure he and Cheney got along fine.)
It wasn’t the first time Giuliani had used his connections to ring up bigwigs on behalf of his clients. When Giuliani Partners were representing Purdue Frederick, the manufacturers of OxyContin, Giuliani personally met with Drug Enforcement Agency chief Asa Hutchinson when the DEA launched a criminal investigation of the company.
Giuliani and his associates have denied in a variety of ways that he acted as a lobbyist. In 2004, when talking to the New York Times, he simply noted that he’s not a registered lobbyist. The senior managing partner of his firm, Michael Hess has been more direct. When the Times questioned him whether Giuliani sitting down with public safety officials on behalf of the firm’s client Nextel was lobbying, he said, “That’s not lobbying… that’s the First Amendment.”
Hess was even more direct with The Washington Post this spring:
[Hess said], emphatically, that the firm has not tried to use Giuliani’s political connections to influence federal officials.
“We don’t do lobbying. And therefore that is not something where we are running to talk to a regulator or an agency,” Hess said. “In terms of people he has known in the government — whether city, state or federal — we just don’t do that.”
So much for that. Clearly Giuliani was lobbying on behalf of Seisint. And in return for opening doors, Giuliani Partners got commissions on state and federal contracts — an arrangement that’s illegal. But Giuliani’s people have a defense for that. Sorta:
A [Giuliani Partners] official who refused to be named insists that the firm never received “commissions” from Seisint â despite what [Michael Brauser, a major shareholder in Seisint] and [Seisint’s in-house lobbyist, Dan Latham] remember and despite the fact that payments to GP are labeled “commissions” in both the minutes of a Seisint board meeting and a key financial statement. Instead, says the official, GP earned “special bonuses” based on the achievement of corporate “milestones.”
So if Rudy wasn’t lobbying, then what exactly was he doing to earn the $30 million? Maybe that shareholder had a point.
