Nonprofits on right accused of fraud
WASHINGTON – Five conservative nonprofit organizations, including one run by prominent Republican Grover Norquist, “perpetrated a fraud” on taxpayers by selling their clout to lobbyist Jack Abramoff, Senate investigators said in a report issued Thursday.
The report includes previously unreleased e-mails between the now-disgraced lobbyist and officers of the nonprofit groups, showing that Abramoff funneled money from his clients to the groups. In exchange the groups, among other things, produced ostensibly independent newspaper op-ed columns or press releases that favored the clients’ positions.
Officers of the groups “were generally available to carry out Mr. Abramoff’s requests for help with his clients in exchange for cash payments,” said the report, issued by the Senate Finance Committee. The report was written by the Democratic staff after a yearlong investigation and authorized by the Republican chairman, Sen. Charles Grassley, R-Iowa.
Abramoff has pleaded guilty to fraud and conspiracy and could go to prison as early as next month. Prosecution and defense lawyers jointly filed papers Thursday asking a judge to recommend that he be sent to a federal facility in Cumberland, Md., to make it easier for him to cooperate with the ongoing probe.
The Senate report released Thursday states that the nonprofit groups probably violated their tax-exempt status “by laundering payments and then disbursing funds at Mr. Abramoff’s direction; taking payments in exchange for writing newspaper columns or press releases that put Mr. Abramoff’s clients in a favorable light; introducing Mr. Abramoff’s clients to government officials in exchange for payment; and agreeing to act as a front organization for congressional trips paid for by Mr. Abramoff’s clients.”
The report bolstered earlier revelations that Abramoff laundered money through the nonprofits to pay for congressional trips and paid Norquist to arrange meetings for his clients with government officials including White House senior adviser Karl Rove.
The groups named in the report are Norquist’s Americans for Tax Reform; the Council of Republicans for Environmental Advocacy, which was co-founded by Norquist and Gale Norton before she became secretary of the Interior; Citizens Against Government Waste; the National Center for Public Policy Research, which was a spinoff of the Heritage Foundation; and Toward Tradition, a Seattle-based religious group founded by Rabbi Daniel Lapin.
E-mails released by the committee show that Abramoff, often with the knowledge of the groups’ leaders, exploited the tax-exempt status and leveraged the stature of the organizations to build support among conservatives for legislation or government action sought by clients including Microsoft Corp., mutual fund company DH2 Inc., Primemedia Inc.’s Channel One Network, and Brown-Forman, maker of Jack Daniels whiskey.
Norquist spokesman John Kartch called the report “political nonsense” pushed by Democrats close to the midterm election.
Sen. Max Baucus, D-Mont., the committee’s ranking Democrat, called on the IRS and FBI to investigate. “These groups’ dealings with Jack Abramoff certainly violated the spirit, and perhaps the letter, of the laws that give charitable and social welfare organizations a break for the good work they’re supposed to do,” Baucus said in a statement.