Waldholtz’ Spouse Linked To Earlier Money Troubles He Was Fired As Personal Aide To National Committeewoman

Joseph Waldholtz, the missing husband of Rep. Enid Waldholtz, R-Utah, was fired as a personal aide to Republican National Committeewoman Elsie H. Hillman in 1992 over a dispute concerning more than $100,000 of Hillman’s own money that he allegedly spent to finance a lavish lifestyle, including gifts to his wife-to-be, according to sources close to the situation.

Meanwhile, a former campaign aide said Thursday that Enid Waldholtz was confronted by staff members about financial irregularities during her 1994 bid for Congress, but that she acted only after the aides sought outside help from state Republican leaders.

“For Enid to say she had no knowledge is disingenuous at best,” said Steve Taggart, who left the campaign over the financial discrepancies. “She was warned there was a substantial (Federal Election Commission) problem.”

Former campaign workers said their paychecks and those of paid consultants routinely bounced and they had to complain to Joseph Waldholtz, who was treasurer, to get their money.

The Waldholtz money mess, which came to national attention this week, has been a long-running saga in Utah and appears to have chipped away at the congresswoman’s once formidable political support. Endless news stories - on topics ranging from unpaid credit card and jewelry bills to mysterious infusions of cash into her political campaign - have tried the patience of GOP leaders. There is now a federal investigation into her and her husband’s finances and an arrest warrant has been issued for Joseph Waldholtz, who disappeared last Saturday from National Airport. His access to the couple’s joint bank accounts has been cut off in recent days and on Tuesday the congresswoman filed for divorce.

“A lot of people are at the end,” said Russ Behrmann, executive director of the Utah Republican Party. “The only thing that can possibly save her is that people who even worked for her had no idea the problem was this deep.”

Behrmann and others said Waldholtz must make a credible explanation if she is going to salvage her once-shining political career.

Federal investigators also want to know the source of $1.8 million in campaign money that paid for the last-minute advertising blitz that propelled Enid Waldholtz into office. Justice Department sources said she has told them her husband claimed the funds came from a legal swap of assets, in which he gave Enid Waldholtz’s father a $5 million trust fund that contained mostly real estate holdings in exchange for money. Joseph Waldholtz’s father, however, has said that no such trust fund existed.

Joseph Waldholtz, 32, is also the subject of a grand jury investigation into an alleged check-kiting scheme in which he wrote checks for $228,000 more than his account held. It is still unclear how much, if anything, the congresswoman knew about her husband’s dubious financial dealings.

An attorney representing Joseph Waldholtz’s father said in an interview Thursday that in 1993 relatives discovered that the younger Waldholtz had taken out a loan of about $100,000 from a Pittsburgh bank by using the home of his sickly grandmother as collateral. The attorney, Bruce S. Gelman, said the family suspects that Joseph Waldholtz may have secured additional loans by putting up as collateral a number of other properties that he does not own.

“The grandmother doesn’t need the loan because she has her estate and is old and suffering from Alzheimer’s (disease),” Gelman said. The estate’s guardians, Joseph Waldholtz’s father and a cousin, have grown concerned about more than $600,000 that the grandmother gave Joseph Waldholtz to invest over the past 10 years. He has repeatedly refused to give an accounting of the funds.

A source said Thursday that during his three years as a personal aide to Hillman, one of Pennsylvania’s most influential Republicans and the wife of billionaire investor Henry L. Hillman, Joseph Waldholtz allegedly spent more than $100,000 of her money on expensive hotel suites, first-class airline tickets and lavish meals, as well as presents for his wife-to-be, Enid, including flowers and other gifts.

A spokeswoman for the congresswoman did not return calls seeking comment. But in a statement issued by Enid Waldholtz earlier in the day she said she “fully believed” the money she had contributed to her campaign was in compliance with the law. “My belief was based on misrepresentations made to me by Joe Waldholtz regarding the family trust, the gift he gave me when we married, and our supposed joint ownership of property in Pennsylvania,” the statement said.