A new kind of politics: Richardson under investigation

ahem...

[rquoter]Bill Richardson bows out of commerce secretary job

Story Highlights
Sources: Richardson being probed for ties to a company that won bond business
Richardson said the investigation could take months, stresses he did nothing wrong
The investigation threatened to delay bettering the nation's economy, he says
(CNN) -- New Mexico Gov. Bill Richardson is withdrawing his nomination to be commerce secretary, citing the distraction of a federal investigation into ties to a company that has done business with his state.

Two Democratic officials told CNN the investigation involves a California company that won municipal bond business in New Mexico after contributing money to various Richardson causes.

In a statement Sunday, Richardson said he asked Obama "not to move forward" with his nomination now.

"I do so with great sorrow. But a pending investigation of a company that has done business with New Mexico state government promises to extend for several weeks or, perhaps, even months," the statement reads. "Let me say unequivocally that I and my Administration have acted properly in all matters and that this investigation will bear out that fact. But I have concluded that the ongoing investigation also would have forced an untenable delay in the confirmation process.

"Given the gravity of the economic situation the nation is facing, I could not in good conscience ask the President-elect and his Administration to delay for one day the important work that needs to be done." iReport.com: Share your reaction to Richardson's withdrawal

Richardson, one of the best-known Hispanics in the Democratic Party, served as energy secretary in the Clinton administration as well as ambassador to the United Nations. The 61-year-old said he will remain governor.

Obama released a statement saying that he accepted the withdrawal with "deep regret."

"Governor Richardson is an outstanding public servant and would have brought to the job of Commerce Secretary and our economic team great insights accumulated through an extraordinary career in federal and state office," Obama's statement read.

"It is a measure of his willingness to put the nation first that he has removed himself as a candidate for the Cabinet in order to avoid any delay in filling this important economic post at this critical time.

"Although we must move quickly to fill the void left by Governor Richardson's decision, I look forward to his future service to our country and in my administration."

Two Democratic strategists outside Obama's transition team told CNN that Obama aides pushed the withdrawal because they did not want an ethical distraction in the wake of controversy surrounding embattled Illinois Gov. Rod Blagojevich. Federal prosecutors allege that Blagojevich, a Democrat, had hoped to barter Obama's Senate seat for either money or influence.

One of the Democratic strategists described Richardson as "stunned." But Democrats who talked with CNN noted the withdrawal is in keeping with the Obama philosophy of resolving issues quickly.

When Obama announced on December 3 that Richardson was his pick for commerce secretary, Obama hailed the New Mexico governor as a "leading economic diplomat for America."

Obama said then: "I know that Bill will be an unyielding advocate for American business and American jobs, at home and around the world. And I look forward to working with him in the years ahead."

Richardson was the third former presidential rival to join Obama's team. Vice President-elect Joe Biden and Sen. Hillary Clinton, Obama's pick for secretary of state, also competed for the Democratic presidential nomination.

Richardson also was a contender for the secretary of state post.

Richardson withdrew from the race for the Democratic presidential nomination on January 10, 2008, after a poor showing in the New Hampshire primary, and later endorsed Obama. Obama and Clinton both lobbied Richardson for his endorsement.[/rquoter]

 

a new kind of suck, indeed.

 

incompetent vetting? indeed.

[rquoter]Richardson, Obama Teams Trade Blame
By Carol D. Leonnig and Michael D. Shear
Washington Post Staff Writers
Tuesday, January 6, 2009; A01

Weeks before President-elect Barack Obama chose New Mexico Gov. Bill Richardson to head the Commerce Department, a small group of volunteers with ethics, tax and investigative expertise -- most of them lawyers -- scoured his background looking for embarrassing facts or political problems.

But the team underestimated a potential time bomb -- a grand jury investigation that had been focusing on Richardson's gubernatorial office. The investigation had been widely reported, but Richardson seemed convinced that the probe, which involved a campaign donor, was not likely to thwart his Senate confirmation.

Yesterday, however, Richardson abruptly withdrew from consideration. In the preceding weeks, the extent to which he had underestimated the seriousness of the FBI investigation became obvious both to Obama's vetting team and to Richardson's own staff.

Sources within the transition and the Justice Department said that Richardson had played down the importance of the probe and did not reveal that his office and staff could be at risk. The seriousness of the matter became apparent after the FBI began its own background check on Dec. 2. But Richardson's longtime aides defended his disclosures, noting that subjects under examination by a grand jury are rarely aware of its secret deliberations.

"This was out there, and he told them," said a senior Richardson aide, speaking on the condition of anonymity because of the ongoing investigation. "I feel that they just missed the boat on it. The FBI or the campaign or something. I don't think it's fair that this is being portrayed as him holding anything back."

Yesterday, Richardson hired a prominent white-collar lawyer to represent him in the investigation, which centers on a California financial services firm that won a lucrative contract from the New Mexico Finance Authority after donating to political committees linked to the governor.

In a brief news conference yesterday in Santa Fe, the governor declined to comment on the ongoing probe.

"As you might expect, I'm disappointed in the turn of events," Richardson said. "There were a lot of ways in which I thought I could help this country in a time of financial crisis. Sometimes your own dreams and plans must take a back seat to what is best for the nation."

A Richardson aide said the governor did "nothing wrong" and noted that New Mexico news outlets had reported on the federal grand jury probe starting in August, when officials at the Finance Authority were first interviewed by the FBI about the agency's selection of CDR Financial and its president, David Rubin, a Richardson donor.

But a source with the Obama transition said Richardson's disclosures to the team were incomplete.

A Justice Department source also said Richardson neglected to mention the ongoing investigation on a background-check questionnaire.

FBI agents assigned to comb his background learned independently that an inquiry was underway in New Mexico, the source said. Staff members in the deputy attorney general's office relayed the existence of a "significant" probe -- but no details of the investigation -- to senior members of the transition team.

Justice Department spokeswoman Laura Sweeney declined to comment yesterday on the probe, or on any conversations that may have occurred between the department and the transition team.

Obama's aides also declined to comment yesterday. Obama press secretary Robert Gibbs defended the process, saying: "The totality of our Cabinet picks, it's impressive, and I think our vetters have done a good job."

In New Mexico, the probe of CDR Financial evolved from a larger, nationwide investigation into allegations that investment firms were giving bribes and gifts to local officials to win lucrative work advising local governments on bonds.

The FBI became interested in the New Mexico finance agency, legal sources said, because CDR and its founder had donated $100,000 to two political action committees headed by the governor. The donations, in 2003 and 2004, were made near the time that the authority awarded two contracts to CDR.

In bidding for the first contract, state records show, CDR was not ranked as the most qualified firm to do the work. But the staff for the authority recommended splitting the work and awarding CDR a portion of it. The authority's executive director at the time of that recommendation was David Harris, the governor's former deputy chief of staff, who had gotten the job with Richardson's help.

Steve Flance, board chairman of the Finance Authority, said yesterday that he was interviewed by the FBI in August along with other board members, and that his office has provided numerous boxes of transactions to help federal investigators. He said he does not think the probe will find any wrongdoing by the governor or by state officials.

"I realize the FBI may have other information I am not aware of," Flance said. "But I believe in the end that it will be determined there has been no criminal activity by anyone in the state."

The investigation into CDR was not limited to New Mexico. Authorities have investigated the firm's actions and gifts to public officials in Charlotte; Philadelphia; Jefferson County, Ala.; and Florida.

CDR attorney Richard Beckler said the company has not been charged in any of these cases and has worked to cooperate with government investigations. He said the company has also helped local governments make millions of dollars in investments.

"CDR has always abided by the law and complied with these rules," he said. "There's no direct pay-to-play quid pro quo in any of this."

Pendleton James, who led the vetting process for President Ronald Reagan's nominees, called the situation "astounding." "Come on, they just found this out yesterday?" he asked. "If this was some misdemeanor, I could understand, but . . . a grand jury investigation anywhere near a sitting governor?"[/rquoter]

 

oh, you misunderestimate me- i'm generally delighted w/ Obama thus far. true, he wasn't my first choice, but on the whole i'm happy w/ his cabinet choices, and he seems to be committed to killing the bad guys, and hasn't given any indication he intends to abandon israel.

the prop 8 thing sucks, but there was never any difference between him and mccain on that score.

 

this can't be good.

[rquoter]Funds Tie Obama to Richardson Probe Figure
Embattled Executive David Rubin Gave Thousands to Campaign

By JUSTIN ROOD
Jan. 6, 2009—

President-elect Barack Obama took big money from a man at the center of a federal probe that has forced one of Obama's top Cabinet picks to withdraw.

Financial records show the Obama campaign got more than $30,000 from California financier David Rubin, the target of an investigation into donations and possible "pay-to-play" deals involving New Mexico Gov. Bill Richardson, Obama's pick for commerce secretary.

Richardson removed himself from consideration for the post Sunday, saying the ongoing grand jury investigation threatened to hold up his confirmation. Richardson and Rubin have both denied any wrongdoing in the matter, which involved contributions and state business in 2003 and 2004.

David Rubin Attended Exclusive Hollywood Fundraiser for Obama

In late September, Rubin attended an exclusive Los Angeles fundraiser for Obama, held at the Beverly Hills' Greystone Mansion. Attendees gave tens of thousands of dollars which the campaign split between its own coffers, the Democratic National Committee and state-level campaign groups supporting Obama and Democratic candidates. The technique helps campaigns take in from individuals far more than the $2,300 maximum they are allowed to give to a single campaign fund.

Rubin's money went to a joint Obama-DNC fund ($28,500), the DNC itself ($26,200), and to the Obama campaign ($2,300), according to the database of campaign donations at OpenSecrets.Org. News of the federal investigation into Rubin's New Mexico dealings had broken less than three weeks earlier.

According to Entertainment Weekly's coverage of the event, Rubin sat at Table 17  one table away from Leonardo DiCaprio, "Survivor" producer David Katzenberg and comedian Chris Rock.

Reached by phone Monday, Rubin declined to answer questions. His firm's spokesman, Allan Ripp, said neither he nor Rubin would discuss Rubin's donations to Obama or his attendance at the fundraiser. Ripp said that Rubin sought nothing for his donation but to elect Obama.

Neither the Obama campaign nor the DNC responded immediately to a request for comment.

Rubin's Firm No Stranger to Scandal

Rubin's firm, which helps local and state governments issue bonds, is no stranger to scandal and controversy. The IRS has investigated him on suspiciously high fees and concerns about his ties to banks who his firm connects with governments to issue bonds. The Justice Department raided his offices in 2006. No charges have been brought, and Rubin has denied any wrongdoing.

In early September  two weeks before Rubin attended Obama's Beverly Hills fundraiser  a group of Alabamans sued Rubin's firm and others over multi-billion dollar bond deals. The suit alleged CDR was part of a conspiracy which defrauded citizens and with bribery and corruption.

CDR has not responded to the suit. In a statement released Monday, Rubin said that his firm "has never practiced pay-for-play, on any playing field where we do business."[/rquoter]