Abramoff Arrested in L.A., Scanlon Reportedly Cooperating

The Washington Post reports former lobbyist Jack Abramoff was arrested in Los Angeles late this afternoon on the Florida Indictment we mentioned yesterday. His co-defendant, Adam Kidan of New York, will surrender in Florida today.

Washington lobbyist Jack Abramoff and a business partner were indicted by federal grand jury in Fort Lauderdale on Thursday, charged with five counts of wire fraud and one count of conspiracy in their purchase of a fleet of Florida gambling boats from a businessman who was later killed in a gangland-style hit.

Abramoff, 46, was arrested in Los Angeles in the late afternoon and was expected to be taken before a U.S. magistrate there on Friday. He was indicted along with Adam Kidan, the former owner of the Dial-a-Mattress franchise in Washington. Kidan, 41, of New York City, will surrender to the FBI here by Friday morning, his attorney, Martin I. Jaffe, said in a written statement.

It sounds like Kidan cooperated, thinking he could talk his way out of an Indictment, and failed.

Kidan said in a statement that he had cooperated with investigators, adding: "I did nothing wrong and these allegations are totally unfounded."

It's curious that Kidan, but not Abramoff, is being allowed to turn himself in. Abramoff is represented in Florida by the excellent Florida defense attorney Neal Sonnett. Neal told the New York Times today,

"We've made the point since the beginning of this investigation that Jack Abramoff has done nothing wrong," Mr. Sonnett said. "He's anxious to defend himself.


Mr. Sonnett had no comment when asked if the indictment would provide the Justice Department with leverage in pressing Mr. Abramoff to cooperate in a separate grand jury investigation here focused on his multimillion-dollar lobbying contracts with the gambling operations of Indian tribes.

I'll answer: Possibly.

The Post outlines the scheme to defraud. I won't rehash it. The Post also references the as-yet unindicted political scandal involving Abramoff - the one that blazes a trail to Tom DeLay.

The indictment marks the first formal charges against Abramoff, who has been at the center of a Washington controversy this year involving the large sums of money he collected from Indian casino interests and the influence he exerted on their behalf.

The Indictment makes no reference to Tom DeLay.

Federal authorities sidestepped specific mention of Abramoff's high-powered political connections. At an afternoon news conference here, Acosta did not mention Abramoff's use of congressional contacts to seal the SunCruz deal. The closest officials came to doing so was when Delaney said that, "regardless of position, status, wealth or associations, fraudulent activity will not be tolerated."

Then there's Michael Scanlon, Abramoff's associate. He was not indicted. The Post says he has been negotiating a deal for months. I assume that means he's been extensively debriefed. Did he give up DeLay or Rep. Ney?

Abramoff's dealings with SunCruz were intertwined with his relationships with powerful members of Congress and their staffs. As the negotiations warmed up, House Majority Leader Tom DeLay's office -- he was the House minority whip then -- gave Boulis a flag that had flown over the Capitol. And as the SunCruz deal was closing, Abramoff brought his lead financier to a DeLay fundraiser in the lobbyist's box at FedEx Field during a Monday Night Football game between the Washington Redskins and the Dallas Cowboys.

To help land the deal, an Abramoff associate, Michael Scanlon, persuaded Rep. Robert W. Ney (R-Ohio) to officially criticize Boulis in the Congressional Record; later, Ney praised Kidan in the official publication of Congress.

Abramoff listed Tony Rudy, a top DeLay aide at the time, and Rep. Dana Rohrabacher (R-Calif.) as personal references on his loan papers. And he flew key members of DeLay's staff -- including his current chief of staff -- on a SunCruz jet and took them for a night of gambling on a SunCruz boat at the 2001 Super Bowl in Tampa. The Super Bowl trip came just days before Boulis's slaying.

This isn't the only thing Abramoff needs to worry about:

In a separate Washington investigation, a task force of the FBI, the Internal Revenue Service and other agencies is exploring how Abramoff and Scanlon collected $82 million in fees for lobbying and public affairs work from Indian tribes around the country.The task force is also investigating whether Abramoff and his associates exerted improper influence over members of Congress and other federal agencies on behalf of their clients.

Here's why DeLay and Ney should be worried:

Scanlon has knowledge of both SunCruz, for whom he did public relations work, and dealings between Abramoff and members of Congress and their staffs. Of particular interest to prosecutors would be Scanlon's knowledge of whether trips, campaign contributions or favors were given in exchange for legislation.

Another possible cooperator: Former Reagan official Ben Waldman, who partnered with Abramoff and Kidan in the initial takeover of SunCruz.

Five years ago, while he was still one of the capital's most prominent Republican lobbyists, Abramoff, with Kidan and former Reagan administration official Ben Waldman of Springfield, Va., took over SunCruz Casinos. The company operated a fleet of gambling boats from as many as 11 ports in Florida.

The heart of the alleged fraud was the $23 million wire transfer, faxed by Kidan and Waldman to the partners' key lender -- Foothill Capital, now part of Wells Fargo Bank. It was intended to persuade lenders to provide $60 million in financing to Abramoff's group to be used for the $147.5 million purchase.

Waldman was not indicted on Thursday. Asked whether Waldman was a suspect or a witness, Acosta said: "I'm not going to discuss whether someone may or may not be a witness."

So Abramoff, Waldman and Kidan do a deal to buy SunCruz from Gus Boulis. Boulis and Kidan have a falling out. Abramoff goes to Miami to smooth things out. But Abramoff continues to back Kidan. And Boulis ends up murdered. No one has been charged in his death.

There are two cases for Abramoff. One has now been indicted. The unanswered questions: Will Abramoff fold and give up DeLay and/or Ney, saying they exchanged legislative favors for campaign contributions? Will the Justice Department even need Abramoff, if they've got Scanlon?

Update: Josh Marshall thinks Abramoff has tried to get a deal and been rebuffed.

Update: Waldman's lawer, Jane Moscowitz, tells the Sun Sentinel that Waldman has never been a target.

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  • Re: Abramoff Arrested in L.A., Scanlon Reportedly (none / 0) (#1)
    by squeaky on Sat Dec 17, 2005 at 01:02:13 PM EST
    They will all be classified opposite of of enemy combatant, but with the same priveleges and thus escape prosecution because we are at war. When they did their treson they were, as enemy combatants are, sub human and by definion, not bound by human law.

    I would really hate to be standing in Abrahamoff's shoes today. The GOP is going to do all they can to make sure he takes all his secrets straight to prison. And then they'll forget him. As for the federal prosecutors, which one is going to step up and say, "Hey, boss! Good news! I got this guy to give up Tom DeLay!" That would be the fast track to a demotion, wouldn't it?

    Re: Abramoff Arrested in L.A., Scanlon Reportedly (none / 0) (#3)
    by Che's Lounge on Sat Dec 17, 2005 at 01:02:13 PM EST
    Bu bye.

    Re: Abramoff Arrested in L.A., Scanlon Reportedly (none / 0) (#4)
    by MikeDitto on Sat Dec 17, 2005 at 01:02:13 PM EST
    Abramoff is implicated in many, many other shady dealings, from a lobbying job in Guam where he demanded to have his fee payed with a couple dozen $9,000 checks via an intermediary lawyer in California in order to evade detection to the circular back-scratching routine with Ralph Reed and Tom DeLay, to some nefarious dealings regarding DeLay's ARMPAC and TRMPAC. He's the personification of cash-and-carry government. He's the kind of guy the RICO statute was designed to bring down. He's also a cancer in the Republican party, so if Bush cares anything about retaining that Republican majority, he'll be making a big time example of Abramoff. And then he'll probably pardon him as he's leaving office.

    Re: Abramoff Arrested in L.A., Scanlon Reportedly (none / 0) (#5)
    by Sailor on Sat Dec 17, 2005 at 01:02:13 PM EST
    Hey, anybody got video of the perpwalk!?

    Re: Abramoff Arrested in L.A., Scanlon Reportedly (none / 0) (#6)
    by squeaky on Sat Dec 17, 2005 at 01:02:13 PM EST
    They will be named Patriot Crusaders, a war time criminal categoriy of super humans, opposed to the sub -human Enemy Combatant. These two advesaries fight in the war on terror. Because they are both non-human they enjoy freedom from any restricting US or international law...... it keeps thungs simple: yur eeder wid us or yur uhgin us.

    Re: Abramoff Arrested in L.A., Scanlon Reportedly (none / 0) (#7)
    by DawesFred60 on Sat Dec 17, 2005 at 01:02:13 PM EST
    Do any of you remember the king brother's? From Florida. many people still don't think the boys did the crime and are innocent.

    Interesting note on the Abramoff scandal in the Washington Post story this morning, it noted towards the end that one of my favorite Republican sociopaths in Congress, Dana Rohrabacher, either co-signed or was some sort of reference on the Abrahamoff boat loan. Now, I have a speical place in my heart of Dana. My question is just how far does Dippy Dana's involvement with Abramoff go? Could this scandal actually expand to encomass Rohrabacher? Could this be the final bit that makes the Orange County GOP just finally cut him loose? Will any local media pick up on this story?

    As a member of the Mississppi Band of Choctaw Indians, who were former clients of Jack, I am glad to see that this puke is now going to enjoy life through by looking through some prison bars. Now if my tribe could just shed themselves of the corrupt turds that hired him....

    One too many throughs. Whoops.