Another Reporter Called to Give Up Sources

May 30, 2008 1:52 PM

Justin Rood Reports:

Another journalist is being told by a court he must reveal his sources.

A federal judge in California has called Washington Times newspaper reporter William Gertz to identify the confidential sources who told him about an investigation into alleged Chinese spying, the New York Sun reported Friday.

Judge Cormac Carney subpoenaed Gertz to appear June 13 in his Santa Ana courtroom and name the people who told him that criminal charges were expected to be filed against engineer Chi Mak and his relatives. THe move came after a year-long FBI investigation to identify Gertz's sources.

Chi Mak was convicted last year of being an unregistered agent for China and was recently sentenced to 24 years in prison. His wife and three other relatives pled guilty to related charges.

Gertz's is the third high-profile case to be weighed while Congress debates the merits of a federal shield law to protect reporters from court efforts to identify their sources.

USA Today reporter Toni Locy is fighting court-sanctioned fines and the threat of imprisonment for refusing to disclose her sources for reporting that former Army scientist Steven Hatfill was a "person of interest" to FBI agents investigating anthrax-laced letters mailed to congressional offices in 2001.

And New York Times reporter James Risen is fighting a January grand jury subpoena for the names of the confidential sources who provided information about the CIA for his book, "State of War."

May 30, 2008 | Permalink | User Comments (1)

Hell Hath No Fury Like a First Lady Scorned

May 30, 2008 12:19 PM

Justin Rood Reports:

He's faced an accusation of sexual assault and allegations of taking bribes.  But can he face an angry, estranged wife who's going public with his dirty laundry?

That's the question faced by Nevada Gov. Jim Gibbons, R, who's watching his hopes for a discreet divorce from his wife disappear rapidly, as news outlets from Nevada to New York have covered the acrimonious mess.

Gibbons' wife, Dawn, is asking the court to reject her husband’s efforts to seal their divorce proceedings.  In filings and comments, she and her lawyer make veiled and not-so-veiled suggestions that his transgressions go beyond typical marital infidelity –- and that she may have information which confirms earlier criminal allegations Gibbons has denied.

One example: One night just prior to Nevada's 2006 gubernatorial election, Gibbons, then a congressman, was accused of drunkenly assaulting a cocktail waitress in a parking garage.  Gibbons denied the accusation, surveillance tapes disappeared, and Gibbons' campaign spun the story into a he-said, she-said zone.

In her recent filing, Dawn Gibbons said that the public was "misled" about the incident by Gibbons' "handlers, spinmeisters and staff," who "trashed" the victim in public.

"[S]he never had the opportunity of having a Public hearing with attendant cross-examination of this man so the truth would be told," Dawn Gibbons said in her filing.

It has also been reported that Gibbons has been the subject of a bribery investigation, for allegedly taking cash and gifts as a congressman in exchange for defense contracts.  Gibbons has denied the allegations.  But his wife might have more on the topic, her lawyer appeared to insinuate in comments to the New York Times yesterday.

"You'd have to be a dummy to realize that there aren't implications beyond the divorce itself for her and for him," said Dawn Gibbons' attorney, Charles Dunlap.

"When you have everything out in the open, the truth is served, the public knows, democracy is served and all that."

May 30, 2008 | Permalink | User Comments (3)

Newest Rezko Victim: Las Vegas Casinos

May 29, 2008 10:59 AM

Justin Rood Reports:

There's more bad news this morning for Sen. Barack Obama's erstwhile fundraiser, and personal real estate advisor, Antoin Rezko: he's wanted in Nevada.

As a federal grand jury in Chicago mulls Rezko's guilt or innocence on corruption-related charges, a Las Vegas judge has issued a felony arrest warrant for him.  Turns out he owes over $800,000 in gambling debt to Caesars Palace, Bally's and the Bellagio, according to the Las Vegas Sun.

A onetime entrepreneur, Rezko apparently managed to dig himself quite a financial hole.  In January, Rezko told a federal judge he was in debt by $50 million.  It is not clear if that figure included the casino debts.

Obama, the likely Democratic White House nominee, has acknowledged that it was a mistake to invite Rezko in 2005 to tour a Chicago-area house whose purchase the lawmaker was considering, and that the mistake was compounded by involving Rezko in the home purchase when he purchased an adjoining lot from the home’s sellers at the same time Obama purchased the house.

Rezko was also a major fundraiser for Obama, ginning up roughly $250,000 for his state and federal election campaigns, much of which Obama’s campaign has since given to charity.

May 29, 2008 | Permalink | User Comments (11)

Ex-CIA Official Pleads Not Guilty

May 23, 2008 10:16 AM

Justin Rood Reports:

Former top CIA official Kyle "Dusty" Foggo pleaded not guilty to all of the charges contained in the grand jury indictment against him Thursday.

Foggo has been charged with a bushel of felony charges including conspiracy, money laundering, fraud.  Most of the charges stem from a series of deals he worked with his friend, defense contractor Brent Wilkes, worth many millions of dollars in CIA business.  As we reported yesterday, Foggo is also facing charges in connection with what federal prosecutors believe was an illicit effort to get his alleged mistress a job as an attorney for the CIA.

Foggo showed up in federal court in Virginia this morning with a five-lawyer defense team, featuring heavy hitters like Paul Butler, a former special assistant to then-Secretary of Defense Donald Rumsfeld -- and sometime commentator for CNN, FOX and CNBC, according to his biography.

One side note: Among the deals Foggo allegedly worked for Wilkes, the most well-known may have been a savagely marked-up contract to fly in bottled water to CIA officers in Iraq (although water was available locally).  But the new indictment alleges Wilkes also supplied CIA officers overseas with, among other things, shuffleboard wax and rolls of velcro.

Just what are the nation's spooks up to these days?

May 23, 2008 | Permalink | User Comments (4)

McCain Quietly Reaches out to Lobbyists

May 22, 2008 12:03 PM

Justin Rood Reports:

After a fervent round of anti-lobbyist posturing by John McCain provoked public grumbling from the K Street crowd, his presidential campaign quietly reached out to soothe their ruffled feathers, Roll Call newspaper reported Thursday morning.

On Monday afternoon, campaign official Susan Nelson held a call with lobbyists who support McCain "to assuage their bruised egos and pass along positive polling data," according to the paper’s account.

Sen. McCain, the likely GOP presidential nominee, has long portrayed himself as a political reformer with a uniquely stiff ethical backbone.

Recently, however, reporters have drummed out a tattoo of stories creating an impression that lobbyists with conflict-of-interest problems had all but infested McCain's campaign, prompting a number of McCain's lobbyist supporters to resign from the campaign or take leaves of absence from their firms.  Eventually, McCain's campaign announced a new conflict-of-interest policy for aides, volunteers and consultants, insisting it would not be tainted by the presence of the Gucci Gulch crowd.

The grumbling from K Street began almost immediately.

"Lobbyists: This is our thanks?" blared the headline from the D.C. paper Politico Wednesday morning. 

"I find it a little offensive," said one nameless influence-peddler who had contributed heavily to McCain's campaign.  "It was good enough to get my $2,300 donation.  If we're not good enough, then send my check back.  It pisses me off."

"McCain's self-righteous [expletive] has caught up with him," said anonymous lobbyist who volunteered for McCain, adding that McCain needed to change the subject to something other than lobbyists or risk losing their support.

Not to worry, reports Roll Call. The campaign wants lobbyists to have warm fuzzies about McCain again. They also want their checkbooks open: two fundraisers are scheduled for Washington, D.C., in June, including a major event right by Capitol Hill.

They must be good enough, after all.

May 22, 2008 | Permalink | User Comments (10)

Still More Lobbyists Leave McCain Camp

May 19, 2008 11:18 AM

Justin Rood Reports:

Two more lobbyists have left the McCain presidential campaign over conflict-of-interest issues.

The departures of lobbyists for Saudi Arabia and energy companies brings to five the total number of aides who have had to cut ties with the Republican presidential candidate over their conflicting roles as both influence-peddlers and campaign officials.

Former congressman Tom Loeffler, a national finance co-chairman for Sen. McCain's White House bid, quit the campaign Sunday after new reports that his firm earned millions representing Saudi Arabia.

Public filings show that as a lobbyist, Loeffler had met with Sen. McCain to "discuss. . . U.S.-Kingdom of Saudi Arabia relations."

Loeffler also represents the European firm EADS, which recently won a $35 billion contract after McCain blocked a similar, scandal-tarred deal with U.S.-based Boeing Co.  McCain has denied acting at the behest of lobbyists in the matter.

Eric Burgeson, an energy-industry lobbyist, was reportedly fired from the campaign on Thursday after it instituted a new conflict-of-interest policy.

These farewells mean that at least eight lobbyists have had to sever their ties to either the McCain campaign or to their own firms as a result of press scrutiny or the campaign’s new policy.

May 19, 2008 | Permalink | User Comments (11)

ALERT: A New Message From Osama Bin Laden Is on the Way

May 15, 2008 6:12 PM

From The Blotter:

An radical jihadist Web site has announced that a new message from al Qaeda leader Osama bin Laden is forthcoming.

A banner announcing the message says he will address the 60th anniversary of Israel. His message is titled, "The reasons for the struggle in the remembrance of the 60th anniversary of the rising of the occupier nation of Israel."

Developing...

May 15, 2008 | Permalink | User Comments (309)

Legal Powerhouse Olson Will Take W.Va. Court Case to SCOTUS

May 15, 2008 3:56 PM

Maddy Sauer Reports:

Legal powerhouse Theodore Olson said today he will represent a small West Virginia mining company that is seeking to file an appeal with the Supreme Court of the United States in a case that has shined a spotlight on the issue of money and influence with elected state supreme court justices.

Harman Mining says it was denied its constitutional rights because a West Virginia State Supreme Court justice refused to recuse himself from their case, despite the fact that the CEO of the company being sued by Harman helped to wage a $3.5 million advertising campaign that helped that justice win an election.

Despite numerous requests for his recusal, Justice Brent Benjamin stayed on the Harman case and twice voted in favor of the defendant, Massey Energy. Benjamin wrote in court documents that there is no evidence to suggest that he cannot be fair and impartial, but critics say the appearance of impropriety should have been enough for him to recuse himself.

"A line needs to be drawn somewhere to prevent a judge from hearing cases involving a person who has made massive campaign contributions to benefit the judge," said Olson today. "The improper appearance created by money in judicial elections is one of the most important issues facing our judicial system today."

Harman won a $50 million verdict in trial court, but the case was appealed to the West Virginia State Supreme Court where Benjamin twice voted to overturn the jury's verdict. Harman is now planning to file an appeal at the SCOTUS.

Olson has argued 49 cases before the court, including Bush v. Gore during the 2000 presidential election recount fiasco. He has also served as private counsel to Presidents Ronald Reagan and George W. Bush.

Harman attorney David Fawcett said today he is thrilled to welcome Olson to their legal team. "This problem affects the credibility of courts and justices everywhere," said Fawcett. "To have the man whom many see as the finest Supreme Court advocate on our side, we feel it is very important."

May 15, 2008 | Permalink | User Comments (3)

Panel OKs "Boot Camp" Bill

May 14, 2008 2:33 PM

Justin Rood Reports:

A House panel today approved a measure intended to protect teens in wilderness, "boot camp" and other types of residential programs which market themselves to parents of troubled youth.

By a 27-16 vote, largely along party lines, the House Education Committee voted in favor of the Stop Child Abuse in Residential Programs for Teens Act, which would establish federal standards for staff training and youth care at such programs and require federal on-site inspections of the operations.

Over the last several months, the panel had heard moving testimony from children who alleged they were abused in such programs, and parents whose children died while attending them.  Congressional investigators also probed the camps and reported serious problems with their operations and marketing practices.

"Kids being forced to eat their own vomit, to eat dirt, to not be allowed to go to the bathroom...all in the idea that somehow this is building character," is how Rep. George Miller, D-Calif., who co-authored the bill, described what congressional investigators found when they probed some of the programs.

The measure now awaits consideration by the full House of Representatives.

May 14, 2008 | Permalink | User Comments (1)

Oil Giants to Appear Before Congress

May 13, 2008 9:55 AM

Justin Rood Reports:

Call it the Price-Capades! The titans of the oil and gas world have agreed to sit under the bright lights for the Senate Judiciary Committee next Wednesday, and again for the House Judiciary Committee on Thursday.

The general theme of questioning: why are Americans being charged record-high prices at the pump -- at a time when petroleum companies are raking in record profits?

Stock up on popcorn and jujubes, it looks to be a good show. Headliners at both hearings are expected to include top executives from ExxonMobil (which recently reported a "disappointing" $11 billion profit last quarter), Chevron ($5.17 billion), Shell ($9 billion), ConocoPhillips ($4.14 billion) and BP America (whose parent company, BP PLC, reported a profit of $7.6 billion), according to committee staffers.

For those catching the Thursday show, watch for a guest-star appearance by Abdalla Salem El-Badri, secretary general of the Organization of the Petroleum Exporting Countries (OPEC).

Both chambers are entertaining anti-OPEC legislation -- so-called "NOPEC" bills -- which would allow the U.S. government to sue other countries they believed engaged in price-fixing and other anti-competitive behavior.

May 13, 2008 | Permalink | User Comments (13)

Bush Signs CNMI Immigration Bill into Law

May 08, 2008 3:55 PM

Justin Rood Reports:

President Bush signed into law today an obscure but important measure which, its supporters say, will help reduce sex trafficking and exploitation of guest workers in a U.S. territory.

Although under U.S. control, the Commonwealth of the Northern Mariana Islands has maintained lax immigration laws in contrast to the mainland.  With help from Congressional Republicans and now-imprisoned superlobbyist Jack Abramoff, CNMI for years successfully fought off legislation proposed to tighten security and improve working conditions on the islands.

The bill Bush signed today extends U.S. immigration laws to CNMI and establishes a guest worker program there.  It was opposed by CNMI's leader, Gov. Benigno R. Fitial.

ABC News "20/20" first revealed disturbing sweatshop conditions for workers in the factories on the CNMI island of Saipan in the late 1990s.

May 8, 2008 | Permalink | User Comments (3)

Embattled Official Defends Pricey Hand Towels

May 07, 2008 12:43 PM

Justin Rood Reports:

Amid the cloud of alleged criminality and political machinations kicked up by yesterday's raid on the office and home of presidential appointee Scott Bloch, one charge seemed incongruous: that Bloch had misspent four hundred taxpayer dollars on custom-made hand towels for his washroom, which bore the official seal of his office.

So whispered an anonymous source to the Washington Post, anyway.  But is it true?

Yes, the towels are quite real, and a legitimate expense, Bloch said through a spokesman Wednesday. Bloch has served since 2003 as the head of the Office of Special Counsel, charged with protecting the rights of government whistleblowers and investigating charges of improper political activity by government workers.

"Scott, as a presidentially-appointed, Senate-confirmed member of the administration gets an allowance for things," spokesman Jim Mitchell explained.  "He paid about $300 for some towels that had the OSC seal on it. He took a couple home, which he paid for himself."

Mitchell compared the towels to carpets in the Department of Justice headquarters which feature that agency’s seal.  He also observed that his boss could be thrifty – for instance, Bloch has always shunned the car and driver which comes as a perk of his position.

Asked if Bloch planned to step down, Mitchell said, "Not that I know of.  He hasn't mentioned anything like that today."

Mitchell confirmed that Bloch is scheduled to testify before a grand jury as part of the investigation which prompted yesterday's raid, believed to center on suspicions Bloch may have destroyed evidence during a separate investigation into his activities.  Bloch maintains his innocence.

May 7, 2008 | Permalink | User Comments (18)

Shock and Awe on M Street

May 07, 2008 11:09 AM

Justin Rood Reports:

"Swift" and "total" are two words which come to mind after reading the morning-after accounts of the federal raids on the home and workplace of Office of Special Counsel Scott Bloch.

Twenty agents from the FBI and the Office of Personnel Management Inspector General’s office descended on Bloch's office starting around 10:30 a.m.  Agents reportedly caught Bloch mid-phone call, served him a subpoena and interrogated him.

Senior OSC staffers sitting down to a morning meeting quickly found themselves talking to agents instead of each other.   Meanwhile, agents moved to shut down the office's computer networks and email system, effectively shuttering a federal office, in an effort that former law enforcement officials told the Washington Post was "unusual, if not unprecedented."

In Fairfax Co., Va., still more agents searched Bloch's home while his wife and children were there, reported govexec.com, which had some of the best details on yesterday's events.  Still more agents reportedly showed up at an OSC field office in Dallas.

Bloch is thought to be under criminal investigation for allegedly obstructing justice by possibly destroying evidence on his computer that was sought by OPM IG investigators. Bloch has confirmed he erased data on his computer but said it was to get rid of a virus.

But the raids appear to have targeted documents and information on a number of topics and issues, leading some to suggest that Bloch's troubles with the feds could multiply.

OSC sources told reporters that the grand jury subpoenas served by agents requested access to computers and emails from Bloch to other employees, Bloch's expense reports and credit card receipts, "information regarding his use of storage facilities or safety deposit boxes," and "material related to testimony he has delivered at congressional hearings."

The subpoenas also requested access to documents from closed OSC investigations into former GSA administrator Lurita Doan and Secretary of State Condoleezza Rice, who was National Security Adviser to Bush at the time of the OSC investigation.

In 2004 Bloch concluded that allegations Rice had improperly used federal funds to appear at Bush-Cheney campaign events were unfounded. In 2007, he concluded Doan had violated federal laws barring officials from using federal resources for partisan political activity, charges Doan denied.

An apparently new allegation against Bloch rose to the surface in the Washington Post's coverage, intimating wasteful spending by the Bush appointee. "Some staff members had complained that Bloch used agency funds to buy for his office restroom $400 hand towels decorated with a special OSC seal," the paper reported.

Then again -- for a man under federal criminal investigation, clean hands can be priceless.

May 7, 2008 | Permalink | User Comments (4)

WEWS Cleveland: Natural Gas Boom Has Hidden Danger

May 02, 2008 1:49 PM

From The Blotter:

Our affiliate in Cleveland, Ohio is reporting on the hidden dangers of natural gas wells being drilled in residential neighborhoods.

NewsChannel5 Chief Investigator Duane Pohlman interviews an elderly couple who lost their home after a massive natural gas explosion, which was traced to a new well located just down the road from their home.

Rick and Thelma Payne, pictured, were asleep at their home when they were shaken out of their bed.

"The bed went up and came down and crashed," Thelma said. "It was terrifying that night, and it's been terrifying ever since."

While regulations have recently been tightened, the changes have done little to address concerns about where new natural gas wells are located. Under the current guidelines, wells can be drilled as close as 100 feet from an occupied home or apartment.

Read WEWS's Full Report.

May 2, 2008 | Permalink | User Comments (5)

Lobbyists Making Even More Money Than Ever

May 02, 2008 1:04 PM

Justin Rood Reports:

As the construction industry sheds thousands of jobs and retail stores shutter across the country, one industry is still booming bigger than ever: Lobbying.

Washington's influence-peddlers are on track to rake in close to $4 billion this year, according to an analysis of new lobbyist filings by Congressional Quarterly.

That's about $1 billion more than they reported for 2007.  But experts say the boost may be due to tightened reporting requirements from last year’s ethics reform law.

It was widely believed that in years past lobbyists, per the old rules, reported merely the money they made for their interactions with lawmakers' offices.  They were not required to report fees they billed clients for monitoring legislation, handling public relations or other tasks.

But new, tough penalties for noncompliance are pushing many lobbyists to report fees they hadn’t in the past, to avoid any scrutiny, experts told CQ.

Still, spending on lobbying is thought to be increasing this year, as it has every year since records were first kept in 1998.

May 2, 2008 | Permalink | User Comments (0)

Thanks to You, the Blotter Marks Second Year With More Success

May 02, 2008 12:41 PM

From The Blotter:

Thanks to our readers, the Blotter has marked its second year by breaking dozens of stories and logging millions more page views.

Since our first anniversary, the Blotter has logged more than 46 million page views, up 10 million from its inaugural year...and that's because of you, our readers. Since it first appeared on ABCNews.com, it has logged more than 82 million page views.

You were incensed to read about female contractors in Iraq who said they were gang-raped or sexually assaulted by their coworkers or soldiers. Our coverage led to two congressional hearings on rape and sexual assault in Iraq and Afghanistan as well as a Senate measure that would require military contractors to report sex crimes committed by or against their employees and provide employee victims with assistance and protection.

Democratic presidential candidate Barack Obama's relationship with the fiery preacher, the Rev. Jeremiah Wright, tipped off a heated debate among our readers, many of whom commented on the story. The Blotter was the first to post the videos of Wright's controversial sermons, and numerous media outlets picked them up from here. The Blotter was also the first to post video of Sen. Hillary Clinton's days on the board of Wal-Mart.

When New York Gov. Eliot Spitzer fell from grace, you, our readers, helped to make the Blotter the No. 1 go-to source for developments in the investigation into his downfall, giving us more than nine million page views in March.

This past October, the Blotter also picked up another award in addition to the four it garnered in its first year, which included the Peabody Award, the Walter Cronkite Award from the USC Annenberg School of Journalism, the Investigative Reporters and Editors Online Reporting Award and the National Headliner Online Journalism Award. This year, the Online News Association recognized the Blotter for excellence in investigative journalism among large sites for our coverage of the Mark Foley Investigation.

In what was described as a "watershed" event for investigative reporting on the Web, the Blotter broke the story in September 2006 on then-Representative Foley's sexually explicit instant messages to underage former congressional pages. We broke the story after receiving online tips from our readers. Former pages read the first story and responded online, providing us with the messages that would lead to Foley's resignation and an investigation of the entire House Republican leadership.

Just as we did with that investigation, we continue to value your input and encourage you to continue to send us your investigative tips.

We are grateful to see a growing number of people around the world checking in to see what's on the Blotter –- and we look forward to continuing to deliver the best in investigative news.

May 2, 2008 | Permalink | User Comments (1)