September 10, 1996 in Nation/World

Chenoweth Admits Unreported Loan Financial Disclosure Statements Omitted $50,000 Loan From Client In 1994

By The Spokesman-Review
 

U.S. Rep. Helen Chenoweth took a $50,000 loan from a former client to help her buy a condominium near Washington, D.C., but never reported it on her financial disclosure statements.

Chenoweth revealed the loan at a news conference Monday, saying she has filed amended disclosure forms for both 1994 and 1995.

Her campaign staffers and supporters watched, grim-faced, as Chenoweth spoke. The lapse could bring ethics charges or even prosecution.

“Some will ask me, ‘How could you have not reported something as large as a $50,000 loan?”’ Chenoweth said. “There is no satisfactory answer, for me or to you. I missed this item when filing my personal financial disclosure statement. I gained nothing from this omission.

“I apologize for this error, and I have corrected it.”

It was the latest in a long series of amendments Chenoweth has filed to her various congressional and campaign financial disclosure forms.

In this case, the disclosure form notes that anyone filing false information or concealing the required information can face civil and criminal penalties.

Federal law calls for anyone who “knowingly and willfully falsifies” the forms to face civil fines of up to $10,000. Criminal fines and/or up to five years in prison also were possible penalties cited on the 1994 form, but those were deleted in 1995 after a Supreme Court decision suggested that the criminal penalties didn’t apply to members of Congress.

Chenoweth paid $152,000 for a condo in Alexandria, Va., shortly after she was elected to Congress in 1994. She took out a $114,000 mortgage but had to pay upfront the remaining $38,000, plus $10,000 for a parking space in the condominium complex.

Chenoweth’s business, Consulting Associates, had represented Joseph Krygoski, owner of a Michigan construction company, in several different matters.

Chenoweth said Monday that she expected a $50,000 bonus from Krygoski upon conclusion of a lawsuit he had filed against the federal government. So she borrowed that amount from him, at 7 percent interest, to be paid back either when she sold the condo or when the legal case was concluded, whichever came first.

Krygoski’s lawsuit challenged the termination of his construction contract at a Michigan missile base. He won, Chenoweth said, but the decision was overturned on appeal and now awaits a hearing before the U.S. Supreme Court.

Chenoweth said she never worked on Krygoski’s behalf after she began serving in Congress.

Chenoweth said she spent the past week going through her finances with a “fine-tooth comb” because her election opponent, Dan Williams, and the Idaho Democratic Party have made her finances an issue.

“I sat down with a couple of my campaign advisers and we reviewed every detail of my personal financial dealings, searching for any irregularities. We discovered a mistake that needs to be corrected - and I believe explained - before it becomes an issue in the campaign.”

Bill Mauk, chairman of the Idaho Democratic Party, said, “I feel as though the Democratic Party is vindicated in persistently raising questions about discrepancies in her reports.”

Idaho Democrats have three pending complaints with the Federal Election Commission about Chenoweth’s campaign finances.

Williams was traveling, but his campaign press secretary, Ted Sullivan, called Chenoweth’s disclosure “something rotten” and said, “Helen Chenoweth has a pattern of misrepresenting every aspect of her campaign and financial life.”

Florence Heffron, a University of Idaho political science professor who teaches courses on law and Congress, said Chenoweth is likely to face ethics charges in the House if she is re-elected.

The chances of Chenoweth being prosecuted are “pretty slim” unless ethics charges are filed and upheld, Heffron said.

But she said such charges are likely. They can be filed by any member of Congress.

Chenoweth’s voluntary, although tardy, disclosure of the matter “doesn’t get her completely off the hook,” Heffron said, but it could take the steam out of efforts to pursue an investigation.

Chenoweth said she has instituted “checks and balances” among her staff to try to avoid such mistakes in the future.

“I know my friends find these lapses frustrating,” she said, “and my enemies take great pleasure in them.”

She added, “If I have caused any of my constituents any embarrassment, I sincerely apologize.”

, DataTimes


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