Newly released documents in the Jack Abramoff investigation shed light on how the lobbyist secretly routed his clients' funds through tax-exempt organizations with the acquiescence of those in charge, including prominent conservative activist Grover Norquist.
The federal probe has brought a string of bribery-related charges and plea deals. The possible misuse of tax-exempt groups is also receiving investigators' attention, sources familiar with the matter said.
Among the organizations used by Abramoff was Norquist's Americans for Tax Reform. According to an investigative report on Abramoff's lobbying released last week by the Senate Indian Affairs Committee, Americans for Tax Reform served as a "conduit" for funds that flowed from Abramoff's clients to surreptitiously finance grass-roots lobbying campaigns. As the money passed through, Norquist's organization kept a small cut, e-mails show.
A second group Norquist was involved with, the Council of Republicans for Environmental Advocacy, received about $500,000 in Abramoff client funds; the council's president has told Senate investigators that Abramoff often asked her to lobby a senior Interior Department official on his behalf. The committee report said the Justice Department should further investigate the organization's dealings with the department and its former deputy secretary, J. Steven Griles.
Norquist has long been an architect of tax-cutting policies and political strategies that have boosted the Republican Party. He and Abramoff have been close since their days as young conservative leaders of the College Republicans more than two decades ago.
Trail of e-mail
The Senate committee report also details Abramoff's dealings with two others from the College Republicans crowd: Ralph Reed, former Christian Coalition executive director; and Amy Moritz Ridenour, president of the National Center for Public Policy Research, which sponsored a golf trip in 2000 to Scotland for then-Rep. Tom DeLay (R-Tex.).
"Call Ralph re Grover doing pass through," Abramoff wrote in a stark e-mail reminder to himself in 1999, a year in which Norquist moved more than $1 million in Abramoff client money to Reed and Christian anti-gambling groups. Reed was working to defeat lotteries and casinos that would have competed with Abramoff's tribal and Internet gambling clients.
In a recent interview at The Washington Post, Norquist said that Americans for Tax Reform and Abramoff's gambling clients worked together because they shared anti-tax, anti-regulatory views. He denied that Americans for Tax Reform was used to conceal the source of funds sent to Reed.
Reed reiterated in a statement last week that he did not know the money he received originated as the proceeds of gambling at Indian casinos.
Ridenour, appearing before the Indian Affairs Committee last year, acknowledged that her organization had accepted grants lined up by Abramoff and disbursed funds at his suggestion. She insisted that she told Abramoff that the National Center for Public Policy Research would be willing to finance only programs consistent with the group's tax-exempt purpose, listed in tax records as "nonpartisan analysis, study and research."
Groups as lobbying tools
But dozens of e-mails show that Abramoff and his team considered the national center and other tax-exempt groups a ready resource in their efforts to influence Congress.
In one instance, Abramoff's team wanted to send two lawmakers on a trip to the Mississippi Choctaw reservation in 2001, but one congressman's office had concerns about accepting such a trip from a gaming tribe.
"How about getting National Center for Public Policy Research to sponsor the trip?" Abramoff suggested. "Works for me," replied a lobbying colleague.
E-mails suggest Ridenour was well aware that Abramoff viewed her organization as a convenient pass-through.
In September 2002, Abramoff suggested to one of his associates placing $500,000 in client funds with the national center because the group "can direct money at our discretion, anywhere if you know what I mean."
The same morning Abramoff messaged Ridenour: "I might have $500K for you to run through NCPPR. Is this still something you want to do?" Ridenour was enthusiastic: "Yes, we would love to do it."
Ridenour did not respond to requests for comment on the Senate committee report or the e-mails released with it.
‘Blatant misuse of charities’
Earlier this year, after Abramoff pleaded guilty to conspiring to ply lawmakers with gifts in exchange for favors, IRS Commissioner Mark W. Everson said, "One of the most disturbing elements of this whole sordid story is the blatant misuse of charities in a scheme to peddle political influence."
Tax experts said it is impermissible for a tax-exempt organization to act as a pass-through for money destined for private business purposes.
"It's not a tax-exempt activity to act as a bag man for Jack Abramoff," said Marcus S. Owens, a tax lawyer at Caplin & Drysdale and a former Internal Revenue Service official.
‘Hole in my budget’
Norquist's relationship with Abramoff's gambling clients began in 1995 when Congress was considering taxing tribal casinos.
Abramoff, then a newly registered lobbyist with Preston Gates & Ellis, e-mailed a colleague that Norquist was willing to fight a tax opposed by another of his clients -- a beverage company -- if the firm became "a major player with ATR." Abramoff suggested the firm donate $50,000 to the group.
"What is most important however is that this matter is kept discreet," Abramoff said in an e-mail on Oct. 24, 1995. "We do not want the opponents to think that we are trying to buy the taxpayer movement." He promised that Norquist would be "very active" on the issue.
The following year, according to the Senate committee report, the Choctaw tribe donated $60,000 to Americans for Tax Reform to oppose a tax on Indian casinos. By 1999, ATR was getting large sums of Choctaw money. "What is the status of the Choctaw stuff?" Norquist asked Abramoff in an e-mail that May. "I have a 75g hole in my budget from last year. ouch."
All told in 1999, the Choctaws gave Americans for Tax Reform $1.15 million, most of which ATR passed on to Reed's for-profit political consulting company, Century Strategies, and Christian anti-gambling groups working to defeat a state lottery in Alabama.
Norquist said in The Post interview that the Choctaw tribe originally wanted ATR to direct the anti-lottery campaign, but his organization decided that it would be better to assist Christian groups already fighting the lottery.
"When we looked at it, we said they have an actual ongoing effort, we don't need to run it and [could instead] just contribute there, which was a continuation of the previous coalition," Norquist said. "They said fine."
But Choctaw representative Nell Rogers told Senate Indian Affairs Committee investigators that ATR "was not involved and was not considering getting involved in any efforts the Choctaw ultimately paid Reed and others to oppose," the committee reported. "Rogers told the committee staff that she understood from Abramoff that ATR was willing to serve as a conduit, provided it received a fee," the report said.
‘Grover kept another $25 k!’
Rogers said the tribe had a long relationship with Americans for Tax Reform and assumed that the fee "would simply be used to support the overall activity of ATR."
Abramoff, however, grew annoyed at the amount that Norquist took off the top before sending the money on, e-mails show. "Grover kept another $25 k!" Abramoff wrote in a February 2000 note to himself.
John Kartch, a spokesman for Americans for Tax Reform, said Friday that the group was not involved in Abramoff's lobbying business. The Choctaw tribe, he said, "was a longtime supporter of ATR. They had no business dealings with Grover Norquist, nor did Jack Abramoff."
E-mails show that Abramoff also moved client money through a conservative Jewish foundation called Toward Tradition, run by longtime Abramoff friend Rabbi Daniel Lapin. In January 2000, when Reed sent Abramoff an $867,000 invoice to be billed to a Choctaw official, Abramoff responded: "Ok, thanks. Please get me the groups we are using, since I want to give this to her all at once." Reed responded: "Amy, Grover, Lapin and one other I will get you."
Abramoff tapped the same cluster of tax-exempt groups in 2000 to help defeat legislation to ban gambling on the Internet. Abramoff's client, an online gambling services company called eLottery, donated money to ATR, the policy research center and Toward Tradition.
Infamous round of golf
In May 2000, just before a key vote on the anti-gambling bill, the research center paid for the Scotland trip for then-House Majority Whip DeLay. Toward Tradition hired the wife of DeLay aide Tony C. Rudy, who later pleaded guilty to conspiring to corrupt public officials, saying his wife was paid in exchange for his official actions. Lapin has said his hiring of Lisa Rudy was not connected to any eLottery donations.
Americans for Tax Reform received $160,000 from eLottery, and Norquist immediately sent most of the money to a state nonprofit group, which in turn sent the money to another Ralph Reed company to fund attack ads on Republicans who supported the gambling ban.
In the interview, Norquist denied that the purpose of the transfer was to hide the money's origin.
"Someone from eLottery talked to me or somebody on our staff and said, 'Will you help us with this campaign?' and we said, 'We're certainly supportive of it,' and they gave us resources and asked if we would contribute to the state group," Norquist said.
Norquist said he could not remember if he knew at the time that eLottery was an Abramoff client, but he said it would not have made any difference.
Trip to the Marianas
As far back as 1996, Abramoff was using Ridenour's National Center for Public Policy Research to hide the source of funding for trips and other ventures intended to boost the interests of his lobbying clients, e-mails show.
Douglas Bandow, a think-tank scholar and former Copley News Service columnist, received $10,000 that year from Abramoff clients through the center, according to an Abramoff e-mail. Bandow has acknowledged that he accepted money from Abramoff in exchange for writing articles supporting the lobbyist's clients in the 1990s.
Abramoff used the center to hide his sponsorship of an all-expenses-paid trip in 2000 for three congressional staffers to the Northern Mariana Islands that now figures in the investigation. The trip is listed as an illicit activity in the plea agreements of Abramoff and three associates.
The congressional staffers on the Marianas trip worked on the campaign of a Marianas politician who pushed through a $100,000-a-month government lobbying contract for Abramoff.
Abramoff e-mailed instructions to his assistant, Susan Ralston, and others to conceal the true source of funding for the "very important" trip. "The tickets should not in any way say my name or our firm's name," Abramoff wrote. "They should, if possible, say 'National Center for Public Policy Research.' We should pay using my Visa."
Groups claim they were duped
Ridenour readily agreed to help, e-mails show. A Marianas client wired about $25,000 to the center's bank account. Abramoff instructed Ridenour to write checks to cover the travel costs of the congressional staffers and Edwin A. Buckham, a former DeLay top aide and lobbyist.
"We'll call the bank first thing in the a.m. and confirm that the money has arrived, and then I will get checks out to you and Ed," Ridenour wrote.
"Yes, we should get invoices for these. This is not only good for us, but if the IRS should later inquire, it is proof for you and Ed that you do not owe income tax on this money. The invoices need not be fancy. Thanks, Amy."
Last year, Ridenour told the Senate committee that she thought the DeLay trip she agreed to sponsor in 2000 was "an educational trip" to Britain, not a golfing junket to Scotland. "The trip I believed I was approving -- and indeed the trip that I invited the member of Congress on . . . was simply to be a trip to London, meet with some members of Parliament and fly home," she said.
By this time, Abramoff was routinely juggling money among various groups. Months after the Scotland trip, Buckham complained to Abramoff that he was still awaiting reimbursement for costs incurred on the trip by DeLay and DeLay's chief of staff, Susan Hirschmann.
"Jack, I hate to bother you on this note, but I am still carrying the DeLay/Hirschmann etc. bills on my American Express Sign and Travel and the interest keeps adding up. Any hope on reimbursement by Amy's group?"
Abramoff replied: "Sorry about this Ed. How much is it again? Would it be alright to get the payment from somewhere other than Amy's group?"