updated 1/22/2014 10:42:35 AM ET 2014-01-22T15:42:35

THE RACHEL MADDOW SHOW
January 21, 2014

Guests: Rosalind Helderman, Matt Katz


JIM MOORE, BIG BEND STRATEGIES: -- what about me? It`s going to hurt
his campaign. The more he attacks her this way, he`s going to run into
trouble.

CHRIS HAYES, "ALL IN" HOST: Krystal?

UNIDENTIFIED FEMALE: I completely agree. I think especially going
after the education piece, you know? She put herself through community
college and graduated ahead of Texas Christian with the aid of
scholarships. You know, by the time she was married, by the time she went
to Harvard and had a husband who was willing to help.

HAYES: That`s Jess (INAUDIBLE), Jim Moore from Big Bend Strategies,
and Krystal Ball, who can you can catch here on "THE CYCLE," weekdays at
3:00 p.m. Eastern on MSNBC.

That is "ALL IN" for this evening.

THE RACHEL MADDOW SHOW starts now. Good evening, Rachel.

RACHEL MADDOW, MSNBC HOST: Good evening, Chris. Thanks, my friend.

And thanks to you at home.

When it rains, it pours. Former Governor Bob McDonnell of Virginia
and his wife, the first lady of Virginia, Maureen McDonnell, have today
been indicted by federal prosecutors on more than a dozen felony charges.
If they are convicted of those charges and they face the maximum penalties
allowed by law, they could be looking at decades in jail and fines of over
$1 million.

This is a story that we have been covering from the very beginning.
Our first coverage of this scandal was back in early April of last year.
But, you know what, credit where credit is due on this one. The lion share
of the reporting on this story has been done by the Virginia reporters
working out of "The Washington Post", one of those key reporters is going
to be here in just a moment to talk about this story, and also some key
parts of the story were broken by "The Richmond Times-Dispatch".

And those papers and those reporters deserve the credit for staying on
this Bob McDonnell story in the face of months of denials and stonewalling
by that government, and also, frankly, staying on this story in the face of
the cynical, dismissal of this story by much of the national press corps,
who too often swallow the made-up excuse from the governor`s defenders that
Virginia law excuses this kind of behavior by public officials and that
what the governor did was normal and that no prosecution effort would ever
come out of this.

Well, today, not only a prosecution, but a who were of a multi-count
felony indictment has arrived in Virginia. And, again, "The Washington
Post" was first with the story.

And if you want to know where it started, it started with the chicken
dinner. The catered chicken dinner at the wedding for one of Governor Bob
McDonnell`s daughters, which was hosted at the governor`s mansion back in
June of 2011.

A June wedding is always a nice thing. A June wedding of the
governor`s daughter is the kind of thing people love to hear about. And
when the wedding is hosted at the absolutely lovely governor`s mansion in
Richmond, Virginia, that is the kind of thing that`s going to get a lot of
adoring attention.

And as the glamorous photos from the wedding and from the lavish
preparations for the wedding started to appear in the press, the governor`s
office took pains to point out that the taxpayers of the commonwealth of
Virginia were not going to be on the hook for this lavish wedding. They
made it clear that the governor and his family were picking up the tab
personally, even though it was happening at the governor`s mansion.

Turns out that was not true. After inquiries from "The Washington
Post," Governor Bob McDonnell`s spokesman revised that initial statement to
say, actually, that Governor McDonnell was not paying for all of the
expenses for his daughter`s wedding. She and her fiance, themselves, were
picking up some of the cost.

Specifically, the governor`s office said, the daughter and her fiance
would be picking up the cost of the chicken dinner. Governor McDonnell did
not pay for the catering. His daughter paid for the catering.

And by his daughter paying for the catering, turns out what they
actually meant was that the daughter accepted as a gift a payment from one
of her father`s campaign contributors, which is what actually covered the
cost of that very nice catered chicken dinner.

It was weird, right? It was weird. It was or of a sign that maybe
something was going on here that we didn`t expect.

And that was the beginning of the reporting. That initial leak about
the dinner we now know was provided by the executive chef from the
governor`s mansion, who has been hired by Governor McDonnell and the first
lady, but who eventually got into a dispute with them over their management
of the mansion and the kitchen and their treatment of him as their chef.

That dispute eventually devolved into the chef being convicted of two
misdemeanor counts of embezzlement last fall. But the chef did not go down
without a fight. When things started to go sour between him and the
McDonnells, the chef later explained to "Washingtonian" magazine that he
began documenting everything. He took cell phone pictures of anything he
thought looked fishy.

And he made sure to preserve, specifically, the check for the wedding
catering, because the check for the wedding catering did not come from the
McDonnells. Even though they were publicly claiming that they were
covering the cost of everything at that wedding themselves, it wasn`t true.

And that dispute between the McDonnells and the chef ultimately led to
those misdemeanor charges against the chef. It also led to a string of
embarrassing revelations about governor Bob McDonnell and his family, and
specifically how they behaved with regard to the taxpayer-funded governor`s
mansion in Virginia.

A motion filed by the chef`s lawyers listed details about things that
the governor and the first lady and their children had taken from the
mansion for their own use -- bottled water, cups, Gatorade, protein powder,
flats of eggs, liquor, taken not just by one of the McDonnell children, but
also by her boyfriend, pots and pans that were taken out of the mansion
kitchen by the first lady and given to the McDonnell children.

That motion from the chef`s lawyers led ultimately to a Freedom of
Information Act request from "The Washington Post," and then further very
specific details on things the first family took for themselves, either
directly out of the governor`s mansion or things they just bought for
themselves on the mansion credit card. Things like, say, hummus, hint of
lime tortilla chips, toilet paper, body wash, deodorant, dry cleaning, shoe
repair, a detox cleanse of some kind, nasal spray. Something called sleep-
inducing elixirs.

Also dog vitamins. The dog, reportedly, is ginger. She`s adorable.
She`s a sheltie/terrier mix and she needs vitamins. And the McDonnell
family, reportedly, had the taxpayers of Virginia pay $9.49 in taxpayer
money for the dog`s vitamins.

Those revelations were embarrassing, and ultimately Governor McDonnell
and his family repaid the state for the cost of the dog vitamins and some
of the other stuff.

But it turns out that that dispute with the chef and the improper
spending that he narced them out for, that did not end up being the
scandal. The scandal ended up being, specifically, about that check that
the chef photocopied for the chicken dinner. And specifically the question
of who that check came from. The chicken dinner was actually paid for by
this guy, Johnny Williams, the CEO of a Virginia company called Star
Scientific.

Star scientific is convinced that it has unlocked the health benefits
of tobacco. They invented an anti-inflammatory tobacco-based pill called
Anatabloc.

Star Scientific is based in Virginia. The CEO is a well-connected
rich guy who`s also based in Virginia, and the CEO apparently decided that
they were the key to success of Anatabloc. We know now that the company
sought to have Anatabloc covered in the health plans of Virginia state
employees. They sought state government support for research on the health
benefits of Anatabloc and its active ingredients.

The fact that they wanted those things for their own company and their
own product, that`s not criminal. It`s not even irrational from the
perspective of the tobacco pill company. But what the Justice Department
now alleges in today`s complaint, today`s 43-page, 14-count complaint, what
the Justice Department alleges is criminal here is what happened between
that ambitious company CEO and Virginia Governor Bob McDonnell, because it
turns out it wasn`t just the $15,000 chicken dinner that he paid for at the
wedding.

As documented in press reports over the last nine months and as
alleged in the 43-page indictment today, the gifts and loans from Johnny
Williams to Governor Bob McDonnell and his family, between the time Bob
McDonnell was inaugurated. And last March, when it finally started to
stop, when the McDonnell family finally had to start answering questions
from law enforcement, the list of stuff that they took is just
breathtaking.

Tens of thousands of dollars of free flights on the CEO`s plane. That
$15,000 catered chicken dinner at the governor`s daughter`s wedding.
Another $10,000 for the wedding of the governor`s other daughter. Round-
trip air travel for the governor`s daughters for a bachelorette party. A
four-day vacation to Cape Cod, including a catered yacht, golf, a private
cottage at the resort, and private jet travel to and from.

A three-day vacation at a multi-million lake house, including a boat
rented for their use during the stay, and a $190,000 white Ferrari for the
governor to drive while he was there. Shopping sprees for the first lady
in New York City, including one glorious day in April 2011, where the bill
was allegedly $10,999 at Oscar de la Renta, more than $5,000 at Louis
Vuitton, and more than $2,000 at Bergdorf Goodman, all in one day.

More than $7,000 in golf, including greens fees and golf equipment and
food and drink consumed on the golf course at an exclusive golf resort, to
which the governor and his sons did not belong, but where they played
frequently and put it all on the tab of that company`s CEO.

A $6,500 Rolex watch for governor McDonnell, inscribed, quote, "71st
governor of Virginia." A $50,000 check made out to Maureen McDonnell, the
first lady. Another $70,000 in checks made out to a real estate company
that Bob McDonnell operated with his sister.

Not to mention tens of thousands of dollars more in campaign
contributions, mostly in the form of free private jet travel for the
governor.

And while that is quite an amazing array of things for the governor
and his family to have taken while the governor was in office, that,
itself, is not necessarily a crime. I mean, there may be reporting
requirements with regard to some of those gifts. There may be tax
implications and banking implications there.

But the sheer fact of having taken that much loot from one guy while
you were governor, in Virginia, that wouldn`t be the sort of thing that
would necessarily get you indicted on its own. That`s just the quid. What
federal prosecutors are alleging is quid pro quo.

What federal prosecutors say they can prove is the core allegation in
this indictment, the core allegation of federal prosecutors that in
exchange for the six-figure largess from the CEO of Star Scientific,
Governor McDonnell and his wife, quote, "participated in a scheme to use
Robert McDonnell`s official position as governor of Virginia to enrich the
defendants and their family members, by soliciting and obtaining payments,
loans, and gifts of other things of value from that CEO and his company in
exchange for Governor McDonnell, and the office of the governor in
Virginia, performing official actions to legitimatize, promote, and obtain
research studies for the CEO`s products.

So, we know the pile of loot that went one way from the CEO of that
company to the governor and his family. We know what they got. This
indictment today means that federal prosecutors think they can prove what
went the other way. They think they can prove what the governor`s office
did for that company and that it was an exchange for that loot.

There`s a launch party for the company`s magic tobacco pill that was
hosted at the governor`s mansion and attended by the governor and the first
lady. There was the first lady of Virginia touting the magic tobacco pill
at two events hosted by the company in Virginia and one in Michigan. It
was a top-level meeting, set up by the governor`s office between the
company CEO and top Virginia state health officials. No, make that two
meetings set up by the governor and his wife with top Virginia state health
officials and this company that had given them so much.

It`s the governor smiling, holding up a bottle of that magic tobacco
pill at a seminar set up in Richmond to convince doctors to recommend that
magic pill to their patients.

And if you want to see just a snapshot of the timeline here, and what
led to these charges, the indictment itself is an amazing thing. This is
from the indictment. From July 28th, 2011, through July 31st, governor and
Mrs. McDonnell and their family enjoyed a private vacation at the CEO`s
multi-million dollar vacation home at Smith Mountain Lake.

Maureen McDonnell had previously called the CEO to ask whether his
Ferrari would be at the house for Governor McDonnell to use. The CEO
arranged to have a star scientific employee transport the Ferrari from
Richmond to Smith Mountain Lake, so the defendants could use the Ferrari
during their vacation.

Then, check this out. On the last night of the vacation, at 7:47
p.m., Sunday night, Maureen McDonnell e-mailed a picture to the CEO,
showing her husband, Governor Bob McDonnell, driving the Ferrari.

Later that same night, 11:29 p.m., the governor himself sends an e-
mail to the secretary of health for the state of Virginia, saying, I`d like
you to have one of your deputies, in secretary felts` office, attend a
briefing at the mansion, 10:00 a.m. tomorrow morning about this company,
Star Scientific. The first lady will be there. That e-mail goes out at
11:29 p.m. on Sunday night after he spent the weekend driving this guy`s
Ferrari around, while staying at guy`s multimillion-dollar lake house.

The next morning, 10:00 a.m., the briefing happens with the Ferrari
CEO there and the first lady there and the health secretary, indeed, sends
his senior policy adviser.

Nice work, if you can get it, right?

The CEO pitches the case for his pill, says he has discussed this with
Governor McDonnell personally. He suggests having Virginia state
government employees use the drug as a control group in research studies.

That same day, the CEO meets privately with the first lady. The first
lady asks the CEO, hey, what brand of watch are you wearing? He says it`s
a Rolex. She tells the CEO she would like to get one for Governor
McDonnell, because he would like a Rolex, too.

The CEO reportedly expresses concern about whether a senior government
official like the governor of Virginia would want to be seen wearing such
an ostentatious luxury item, Maureen McDonnell told the CEO that she wanted
him to buy a Rolex for the governor. The CEO subsequently bought that
Rolex for the governor, and at the first lady`s request, it was engraved,
71st governor of Virginia. And that was, according to the indictment, all
in one day`s work. The indictment alleges that all of that, from the photo
of him in the Ferrari to "here`s what I want the inscription to be on the
Rolex," the indictment alleges that that all happened between Sunday night,
July 31st, and the next day, Monday, August 1st.

Today, it was announced that the Senator Mike Lee will get the Tea
Party response this year to the State of the Union address by President
Obama. We still don`t know who`s going to give the Republican Party
response, but the Tea Party response will be by Mike Lee.

For four straight years now, there have been separate Republican Party
and Tea Party responses to the State of the Union. And while that has been
kind of a weird strategy for Republicans overall, you know, the official
Republican Party responses have gone pretty poorly on their own, even
without the competition from their own side, with these Tea Party
addresses.

I mean, Bobby Jindal, forgive me, bombed in his response to the point
where it`s still being parodied. Marco Rubio and the big water reach,
Marco Rubio also bombed in his State of the Union response.

Mitch Daniels looks like he just popped the top off his coffin long
enough to let the bats fly out before he delivered his run for your lives
State of the Union message.

The Republican responses and the Tea Party responses in the State of
the Union have generally been terrible in the Obama era. But not Bob
McDonnell`s, not when he did it. When Bob McDonnell did it, he nailed it.

(BEGIN VIDEO CLIP)

THEN-GOV. BOB MCDONNELL (R), VIRGINIA: Good evening. I`m Bob
McDonnell. 11 days ago, I was honored to be sworn in as the 71st governor
of Virginia.

(END VIDEO CLIP)

MADDOW: Eleven days in.

Bob McDonnell seemed like a rising star for so many years, in part
because he carried himself perfectly. He carried himself like a president.

Yes, sure, maybe if you`re paying attention, you`d know that he`s a
president who might force you to have a medically unnecessary vaginal
ultrasound probe, but, still. "The Washington Post" reported in December
that the U.S. attorney was ready to levy these charges against Bob and
Maureen McDonnell, while the governor was still in office in December, and
that would have made him the first sitting Virginia governor to be
criminally indicted ever in the history of that state.

Federal Justice Department officials in Washington reportedly
intervened and told prosecutors to delay bringing those charges. Delay the
charges until after the gubernatorial transition had taken place in
Virginia, which it did, just 11 days ago.

So, 11 days after he was inaugurated, he gave the State of the Union
response and everybody said he was going to be the next Republican process.
Eleven days after he left office, 14 felony charges, decades possible in
prison, $1 million in fines, possible, if he`s convicted.

Today, Governor Bob McDonnell denied these charges vigorously. He
said they were a manifestation of overreach by the federal government.

(BEGIN VIDEO CLIP)

MCDONNELL: Good evening. I am here with my wife, Maureen, and my
daughter, Cailin, and my son-in-law, Chris, and I really appreciate this
opportunity to address the people of Virginia here tonight.

I come before you this evening as someone who has been falsely and
wrongfully accused and whose public service has been wrongfully attacked.
I did nothing illegal for Mr. Williams in exchange for what I believe was
his personal friendship and his generosity.

I will use every available resource and advocate that I have for as
long as it takes to fight and prevail against these false allegations and
the unjust overreach of the federal government. There`s no way for me to
fully convey how much I appreciate the ongoing steadfast support and
encouragement that I have received over the many months, including today,
from family, from friends, and from people who I have worked with for 37
years in public life.

So I thank them tonight, in giving me the support during the most
difficult and unexpected ordeal of my life. My family and I are most
grateful.

(END VIDEO CLIP)

MADDOW: If these charges are proven, Governor Bob McDonnell is
looking potentially at decades in prison and more than $1 million in fines.

But, just one last note here on the perspective. Bob McDonnell was
inaugurated governor of Virginia four years ago this month. The two
American governors who were first inaugurated four years ago this month,
the only two governors who were first elected in that unusual off year
election year in 2009, the two governors were Bob McDonnell of Virginia and
Chris Christie, the governor of New Jersey. They were the only two this
year, bumper crop.

Joining us now is Rosalind Helderman, political reporter for "The
Washington Post."

Ms. Helderman, thanks very much for being here. It`s a real pleasure
to have you here.

ROSALIND HELDERMAN, THE WASHINGTON POST: Thanks so much for having
me.

MADDOW: So you have been covering this intensively right from the
very start. I have to ask you if in trying to sum it up that way, if I --
if you hear anything that I`ve gotten wrong or if this sounds basically in
keeping with your understanding.

HELDERMAN: I think you`ve basically got it.

MADDOW: OK, thanks.

Was there anything in the actual indictment that you were not
expecting based on your reporting thus far?

HELDERMAN: You know, I think the indictment added a lot of nuance and
a lot of details to a tale that we have unfolded pretty thoroughly over the
last few months. I think one thing that surprised me and maybe a lot of
other people is just how strong the indictment is. We`ve heard from the
governor, for many months now, that he did nothing illegal, as he said
again today.

And I think many people in Virginia were expected if there was an
indictment, it might feel sort of like a slap on the wrist indictment. And
that`s not what we got. We saw 14 felony counts for both the governor and
the first lady. As you say, they face decades in prison. This is a very
strong indictment.

MADDOW: State governors ending up in hot water is not terribly
uncommon in our country, sadly. But it`s very uncommon in Virginia. This
kind of thing is a first for Virginia, which has really prided itself on
relatively uncorrupt government and relatively scandal-free executive
leadership.

Is that an important factor for this prosecution, for its political
import, for its chances of success?

HELDERMAN: You know, that`s an interesting question. You`re right.
People refer to Virginia what they call the Virginia way.

It`s a sort of sense that people go into elected office out of a
gentlemanly sense of public service. And that people just don`t do this
kind of thing in Virginia. It`s not New Jersey. It`s not Illinois.

And they will be choosing jurors who likely have that impression of
the state. And so, whether that means they`re more likely to give the
governor the benefit of the doubt, because they like him and they think of
him in that way, or if that means that, you know, they`re shocked by this,
and more likely to hold them accountable. We`ll just have to see.

MADDOW: Rosalind, can you tell prosecute indictment who has been
cooperating with prosecutors in terms of them building this case? There`s
a few people who are referred to by their initials, Johnny Williams, the
Star Scientific CEO, is obviously one of them.

Are there other people who are referred to in this case, or who
obliquely turn up that you can tell have been cooperating?

HELDERMAN: It`s pretty clear that the governor`s staff has been
interviewed. I don`t know that they`ve been interviewed very happily, but
some of them obviously offered some accounts that the government found
useful. The same is true, I think, of staff to the first lady.

I don`t think it`s quite fair to say that the indictment shows that
they`ve turned on them or anything like that. But just that they offered
sort of honest feelings about what occurred and the government might have
found those answers useful. Although it is interesting that the defense
has already come out very strongly swinging and saying that not only are
they going to question the credibility of Mr. Williams, which I think
everyone was expecting, but also another witness, who`s referred to only by
her initials, the first lady`s chief of staff. They`re going to be
questioning her credibility as well.

MADDOW: Wow. Wow. Amazing stuff.

Rosalind Helderman, groundbreaking reporter on this story for "The
Washington Post." You`ve been very much ahead of the pack, you and your
colleagues at "The Post", all along, in covering this story.
Congratulations on having led on this story that now everybody else is
catching up to. It`s good to have you here.

HELDERMAN: Thank you. I appreciate it.

MADDOW: Thank you.

All right, we`ve got lots more ahead, including another eventful day
for the other Republican governor elected in 2009, New Jersey`s Chris
Christie. There`s a lot to get to tonight.

(COMMERCIAL BREAK)

MADDOW: One of the things about a criminal indictment is that you get
a lot of specifics. So, for example, in the Bob McDonnell corruption
scandal in Virginia, there`s been a lot of reporting over the last nine
months or so about the kinds of gifts that the governor and his family took
from the CEO of the Virginia company who figured in the scandal.

Before today, though, before the actual indictment came out, including
this forfeiture list of items that Governor McDonnell and his wife will be
expected to hand over if they are convicted, this forfeiture list, we`ve
never had this kind of detail about what they took.

But now we know, if convicted, they will have to hand over the sum of
not less than $140,805.46. Also, black Rebecca Minkoff shoes, a black
Louis Vuitton shoes, white Louis Vuitton shoes, a cream Louis Vuitton
purse, a cream Louis Vuitton wallet, a silver Rolex watch, engraved with
"71st governor of Virginia," a yellow Peter Sam (ph) dress, a blue Armani
jacket, and two matching dresses, two gold Oscar de la Renta dresses, a
black Louis Vuitton raincoat, a gold Oscar de la Renta sweater, one pair of
Emilio Rose earrings, one gear sweatshirt, two pairs of Footjoy golf shoes,
one button down Ralph Lauren shirt, one white Peter Miller golf shirt, one
baby blue striped Peter Miller golf shirt, one royal blue Peter Miller golf
shirt, one aqua fairway green tech golf shirt, one white striped Ralph
Lauren golf shirt, one ping University of Virginia golf bag, one ping
Kinloch golf bag, one Sun Mountain Notre Dame golf bag, two sets of golf
clubs, one Heather McKenzie watercolor and frame, two iPhones, and 30 boxes
of Anatabloc.

All of which the governor and his wife and family reportedly took as
gifts from the CEO of the company that makes Anatabloc.

Joining us now to discuss this 14-count felony indictment and the
prospects for this corruption prosecution is Kendall Coffey. Mr. Kendall
is a former U.S. attorney and he`s now an NBC News legal analyst.

Kendall Coffey, thanks very much for being with us.

KENDALL COFFEY, NBC NEWS LEGAL ANALYST: Hey. Thanks for inviting me.

MADDOW: So there are charges here about false statements and
obstructing the inquiry, essentially charges related to the cover-up and
trying to evade justice. But it seems to me like the core charges here are
basically bribery. Is that correct when you look at this indictment?

COFFEY: It doesn`t use the word bribery, but what it`s really saying
is, there was an ongoing scheme to extract all kinds of personal benefits.
In effect, close to $140,000 in largely cash items -- the rather intriguing
list of consumer items that you just detailed, in order to get favorable
treatment from the governor`s office.

And it`s sufficiently specific in terms of the kind of favorable
treatment that was sought, so that I think that the federal prosecutors can
make out successful charges, even though the defense is going to argue, you
have to have more of a specific quid pro quo here. It isn`t like the
governor was going to veto or not veto legislation or sign some particular
bill based on your enticements. It was more of having a strategic relation
in getting help, perhaps with a couple of study probes that the private
vendor wanted to get the governor`s assistance on.

MADDOW: The governor`s response today was that this whole
prosecution, he said, was based on a novel legal theory and that nobody has
ever been prosecuted for this sort of thing before. What do you make of
that line of defense from Governor McDonnell?

COFFEY: There`s nothing novel about this. When someone in public
office tries to turn a private party into, effectively, an ATM machine,
which is what the government`s alleged here, in order to get all kinds of
personal benefits, golfing trips, family vacations, cash advances, loans,
whatever you want to call them, $120,000, there`s nothing novel about that.

If the government can prove it, it`s a crime. And the government has
got multiple theories that are tried and true and tested in other
corruption cases.

MADDOW: It sounds like you think this is a strong indictment. I just
interviewed Rosalind Helderman from "The Washington Post", who`s been one
of the leading reporters on this. She said, just as a journalist, one of
the things she was surprised by, by the indictment, is that it does seem
like a strong indictment, at least from a layman`s perspective.

It seems like that`s your view, too.

COFFEY: Yes. It`s very, very detailed and we`ve got e-mails where
the former first lady was basically saying, we`re broke. You`ve got to
come through and help me get some money here.

And a couple of the elements that I think would create additional
strength in front of the jury are the fact that the governor, who was a
former attorney general, he had to know about where the line was and where
the line wasn`t, for example, the indictment alleges that he failed to
disclose substantial loans on financial applications.

Maybe some people can say I forgot, but I`m not so sure that`s
something a former attorney general can get away with.

The other thing about this that really creates sizzle and spice with a
jury, from a prosecution`s standpoint, is the list you were sharing with
your viewers. When you`re talking about Louis Vuitton, when you`re talking
about Rolex, when you`re talking about Armani, those kind of things that
might have a juror that`s going into the case with an open mind.

All of a sudden, when they hear about things that seem like
extravagant greed, things that they could never hope to own, all of a
sudden, you`ll see their reaction, right in the courtroom. They`ll start
to look differently at everything about the case.

So, the government`s got plenty of specifics. And I think the right
kind of elements that give this a powerful force in a courtroom.

MADDOW: Kendall Coffey, former U.S. attorney and NBC News legal
analyst now, thank you very much for joining us tonight and helping us
understand it. I appreciate it.

COFFEY: Thanks, Rachel.

MADDOW: I will say, just because I have been marinating in this
indictment since it came out this afternoon, I`ve got to say, bribery does
appear. Counts 2 through 4, defendants, Robert F. McDonnell, Maureen
McDonnell, and others, known and unknown to the grand jury, knowingly and
intentionally, having devised and intended to devise a scheme and artifice
to defraud the citizens of Virginia of their right to the honest services
of the governor of Virginia through bribery. Also, the word "extortion" is
in there two pages later.

This is absolutely -- this has been a scandalous story from the
beginning, but the detail that is in this indictment is, I`ve got to admit,
even for just a layman, it`s almost mind bending. I almost can`t believe
this isn`t a move.

All right. Also, today was Governor Chris Christie`s inauguration day
in New Jersey. And lots of activity surrounding that governor`s bridge
scandal managed to transpire today, despite this other scandal and despite
the inauguration and despite the huge snowstorm that is socking the East
Coast in the face as I speak.

Lots ahead. Stay with us.

(COMMERCIAL BREAK)

MADDOW: In the middle of all the intense political news today and the
giant snowstorm hitting the East Coast, today was also Election Day. Today
was the day that Virginians of all the beleaguered folks in the country,
Virginians not only had to absorb the news of the criminal indictment of
their most recent governor today, but people in Northern Virginia also had
to go to the polls the today in a special election for a race that may end
up determining which party controls the Senate in that state. Control of
the Senate will not be sure in Virginia until one other race goes through a
recount, but this one tonight is just as crucial to that outcome.

Polls closed at 7:00 p.m. in the special election for the 33rd Senate
district in northern Virginia. And now with 100 percent of precincts
reporting, "The Associated Press" has declared the Democrat in the race,
Jennifer Wexton, to be the winner, with 52.7 percent of the vote. She`s a
pro-choice, pro-gun reform Northern Virginia Democrat who defeated both a
Republican in the race named John Whitbeck, and a Republican named Joe May,
who ran a strong campaign in this race as an independent.

Jennifer Wexton`s win tonight means that control over the Virginia
Senate hinges now on the results of a recount that`s going on in the other
special Senate election in Virginia, Virginia`s District 6.

The stakes on that recount are now officially very high. If the
Democrat wins that recount, Democrats control the Senate in Virginia. If
the Republicans win that recount, they control the Senate. Big deal.

Watch this space.

(COMMERCIAL BREAK)

MADDOW: Late on Thursday night, this past Thursday night, an
emergency conference call was convened in the great state of New Jersey.
The conference call was hosted by this man, Todd Christie. You can see the
family resemblance there.

Todd Christie, you can tell, is the brother of New Jersey Governor
Chris Christie.

Now, on this conference call, Todd Christie made a direct appeal for
last-minute cash to pay for Governor Christie`s upcoming inauguration
festivities, including a day-long party ending on Ellis Island. That
choice of venue was supposed to make Chris Christie`s inauguration for his
second term into a big, high-profile, all-American affair, not incidentally
highlighting what Governor Christie wants to be his own bipartisan appeal
on the issue of immigration. Hence, Ellis Island.

But with just days to go before that big party, Governor Christie`s
allies found themselves short on cash for the party. The governor`s
brother, Todd, convened that conference call with some of the governor`s
most loyal, big-money donors. And then according to "The New York Times,"
quote, the governor himself got on the line, trying to convince his
listeners that he was moving beyond the George Washington Bridge scandal
and getting back to work.

That was Thursday night. Governor Chris Christie trying to reassure
his most loyal donors that the bridge scandal was totally behind him, and
they should pony up big bucks for his inauguration party. That was
Thursday night. Then, Friday morning happened.

Quote, "The next day, state investigators sent 20 subpoenas to Chris
Christie`s inner circle, as the inquiry into the bridge scandal widened."
Stick with me, big money guys, this is all behind me, I swear. Pay no
attention to the subpoena.

Today was inauguration day in New Jersey for Chris Christie, because
the news gods, as always, have an impeccable sense of timing. Leading up
to today`s festivities, most of the coverage was about how little interest
there was in celebrating the start of Chris Christie`s second term, given
what else is going on for him. The governor himself had to get on the
phone just a few nights before his big payday to beg for money to pay for
the events. Inauguration organizers had a surplus of tickets they were
desperately trying to give away, even on the eve of the event.

One leading New Jersey Republican told "The Wall Street Journal,"
quote, "They are having a hard time filling the spaces." A dinner for the
governor that was scheduled to be held tonight in Jersey City abruptly got
called off. It was canceled early last week because of a reported lack of
response. People are just not buying tickets for it.

And then, there was the big, all-American inauguration party on Ellis
Island. Well, that also was cancelled. Arguably the good news for Chris
Christie today was this massive snowstorm that has slammed into the
Northeast. The snowstorm makes it a totally normal apolitical decision to
cancel some of the festivities just on account of lousy weather.

The bad news for Chris Christie is that on the day of his
inauguration, the day that was supposed to be his big victory lap after
cruising to re-election, today, the New Jersey state legislature decided to
finally get its house in order in terms of their investigation into the
ongoing bridge scandal. Last night on this show, you`ll remember we spoke
to Democratic state legislature, John Wisniewski. As of last night, he was
the chair of the New Jersey assembly`s select committee on investigation.

In addition to his committee in the assembly, the New Jersey Senate
had also formed its own committee looking into the bridge scandal, each
chamber of the New Jersey legislature, operating its own investigation.
Awkward, right?

Today that awkwardness ceased. Today, New Jersey legislative leaders
announced that instead of having two committees looking into this incident
at once, stepping on each other`s toes and getting in each other`s ways,
they are going to combine forces and create one joint committee made up of
members of the state assembly and the state senate. It will be eight
Democrats and four Republicans, because Democrats have the majority in both
of those bodies.

Now, as a practical matter, this is a big development. In terms of
the legislative inquiry into potential wrongdoing here, this is now going
to be a combined effort, not two parallel investigations proceeding on
different tracks, and as I said, maybe getting in each other`s way. This
decision also settles the question of whether or not the legislature, and
by extension, New Jersey`s taxpayers, are going to be paying for more than
one expensive lawyer to help advance this investigation.

We now know the answer to that. It`s the hot shot former federal
prosecutor who helped bring down Governor Rod Blagojevich in Illinois, the
guy who the state assembly has already hired. He is going to be the main
special council for the whole legislature. There`s not going to be a
second special counsel brought in, as had been previously expected.

So this decision today about combing the committees, that settles that
question about who`s in charge and who`s the special counsel?

But it also raises a few more questions. The state assembly last
week, that`s the group that sent out 20 subpoenas in this case, to a long
list of people believed to be involved, in some way, in the bridge scandal.
The state Senate hasn`t yet sent out any subpoenas, but the chair of the
Senate side did say last week that there were three people who she named,
as people who she intended to subpoena. Two of those people, the chairman
of the Port Authority, David Samson, and Chris Christie`s incoming chief of
staff, Regina Egea, they were among the 20 people who got subpoenas from
the state assembly anyway.

But the third one the senate named, a Port Authority commissioner
named Pat Schuber, he didn`t get a subpoena from the assembly. Is he now
going to get one now that the investigations are combined?

The assembly didn`t want to talk to them. The Senate said they did.
Now that the Assembly and the Senate are together now, does he get a
subpoena? We don`t know. So that`s one question.

Here`s another question. Last week, when the New Jersey legislature
voted to form these committees, that vote was unanimous in both chambers.
Every Republican in the assembly and every Republican in Senate voted for
it along with every Democrat.

Since then, however, a number of high-ranking Republicans have decided
they are against the New Jersey legislature investigating the scandal,
because now they say it has become partisan, a partisan investigation, even
though they voted for it just last week.

While establishing this new joint committee will require a new vote in
the legislature. Will the Republicans still vote for it? Will that give
those Republicans who are now saying they`re against this investigation a
chance to jump-ship and try to kill the investigation, or at least turn it
into an all-Democrat affair, instead of the previous bipartisan,
unanimously improved investigation that we had as of -- well, today.

Hold that thought. Joining us next is somebody who knows these
things. Stay with us.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

VAN JONES, CNN: You ran for governor. You know the importance of the
Republican Governors Association. Chris Christie is now in charge of that.

Do you think it`s fair for him to stay in that role, that key role for
your party?

KEN CUCCINELLI (R), FORMER VA ATTY. GENERAL: I think just from the
perspective of setting aside this as an issue in other races, it makes
sense for him to step aside in that role. He does not serve the goals of
that organization by staying as chairman.

NEWT GINGRICH, CNN: Let me ask you --

CUCCINELLI: And that doesn`t mean any of the charges, political or
otherwise, are substantive or not. It doesn`t matter. Perception is
reality.

(END VIDEO CLIP)

MADDOW: That was Ken Cuccinelli, who was Virginia`s attorney general,
and the failed Republican nominee to succeed Governor Bob McDonnell in
Virginia. Governor Bob McDonnell indicted today on 14 federal felony
charges.

Governor McDonnell, first elected governor in 2009, same time as New
Jersey Governor Chris Christie was first elected. And it`s New Jersey
Governor Chris Christie that Ken Cuccinelli said tonight should step down
as the chairman of the Republican Governors Association because of the
scandal surrounding him.

Got it? Yes. It`s hard to keep track at this point.

Joining us now is Matt Katz. He`s a reporter for WNYC, who`s been
covering Chris Christie and the New Jersey bridge scandal extensively.

Mr. Katz, thanks very much for being here.

MATT KATZ, WNYC: Sure thing, Rachel.

MADDOW: So, the big substantive development today in the New Jersey
story is that the Senate and the assembly are joining forces, they are
merging their two investigations. What are the implications of that?

KATZ: Yes, this is a big deal. The Democrats were somewhat
embarrassed by the fact that they had these dueling committees issues two
subpoenas. So they did themselves a favor by finally coming to an
agreement on this.

What it does is, the governor, remember, he said he was going to
cooperate with all appropriate inquiries in this regard. Now, they`ve
taken away one opportunity, one potentially legal opportunity he would have
had to complain about these two committees and to go to a judge and say
these are -- this is over-burdensome. And I couldn`t possibly respond to
two committees or my people shouldn`t be forced to respond to two sets of
subpoenas.

So, they` taken that away from the governor now and they can form a
unified committee with one message. I mean, you can just imagine media
even separating themselves to go to two committee hearings going on at the
same time. This was something they had to do and interestingly enough,
they announced it within minutes of Governor Christie`s inauguration today.

I mean, I was at the inauguration across the street from the state
house waiting for it to begin, listening to a children`s choir while the
Democrats announced it across the street at a press conference.

So, their timing was also interesting. It was a little comeuppance
there.

MADDOW: Matt, let me ask you about that scene actually, because one
of the worries, one of the concrete worries about there being two
committees was David Samson, chairman of the Port Authority, an absolutely
key figure in this scandal. Loretta Weinberg in the Senate has said, I
intend to subpoena him from the Senate side. The assembly did subpoena
him. There was this question that he would have dueling subpoenas from two
sides, maybe that would be a way to fight both of them.

David Samson reportedly was there, not only just at the inauguration
today, but on stage with the governor? Did you see that?

KATZ: I did. It`s -- it was pretty amazing. He`s on stage, Loretta
Weinberg is on stage. John Wisniewski, who`s the assembly lead
interrogator, they`re all on stage.

It was incredible. I mean, the governor did not mention bridgegate
once. He didn`t even really allude to it, but it was hanging thick in the
air because of the people who were there, like David Samson who`s the only
link really between the two scandals going on, the alleged scandals going
on, bridgegate and the situation in Hoboken.

He`s there and his interrogators were there. And then, of course, it
was noticeable for the people that weren`t there like Bridget Kelly, who
would have a seat on the stage today.

But, of course, she`s lost her job in this whole situation.

MADDOW: Matt Katz, reporter for WNYC, who`s been all over this story.
Matt, thank you for helping us understand this remarkable scene today. I
appreciate you being here today.

KATZ: You got it, Rachel.

MADDOW: All right. We`ll right back. We have an important
correction you may enjoy. Stay with us.

(COMMERCIAL BREAK)

MADDOW: I`m sorry. Earlier in the show, I said the two governors who
were elected in 2009 were Bob McDonnell, who, of course, has just been
indicted by federal prosecutors on bribery charges, and Chris Christie, who
has well-documented ongoing problems in New Jersey, including federal
prosecutors looking into him there, too.

Turns out I was wrong. There was a third governor elected in that
off-off year of 2009. It was the governor of the commonwealth of Northern
Mariana Islands. Remember the Jake Abramoff`s scandal?

In 2009, the people of the Northern Mariana Islands reelected Jack
Abramoff`s one time ally Ben Fitial to the governorship. That was 2009.
Within four years, Governor Fitial became the first governor of any U.S.
territory to be impeached.

Among the allegations was that he ordered a prisoner to be released
from prison specifically so that prisoner could give him a massage. See,
his personal masseuse was in prison and he wanted a massage, so he ordered
that the guy be sprung out of prison. Seriously.

Also, the governor was accused of using port police to help the then-
attorney general flee the island to evade his own criminal charges. So,
using the cops as the getaway car to help your buddy go on the lam, that
will generally get the governor in trouble, no matter where you govern. He
got impeached by the House in the Northern Marianas and then Governor
Fitial resigned last year before the Northern Marianas Senate got a crack
at him.

But when I said earlier there were two governors elected in `09, there
were, in fact, three. The one who got indicted today, the one whose
administration is under intensive investigation in New Jersey, and the
prison-freeing, massage-getting, aiding and abetting, Ben Fitial of the
Northern Marianas Islands.

I`m sorry. I forgot. 2009 was a bang-up year for governors, yes?

Now, it`s time for "THE LAST WORD WITH LAWRENCE O`DONNELL".

Have a great night.

Massage!

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY
BE UPDATED.
END

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