CHAPEL HILL (WTVD) — The Edwards house in Orange County is a house divided – divided by infidelity, and former presidential candidate John Edwards acknowledges federal investigators are now probing his affair with Rielle Hunter.
Frank Perry spent 22 years with the FBI and is familiar with political corruption cases. He’s now retired and works for a non-profit in downtown Raleigh called – the Foundation for Ethics in Public Service.
While the feds are not commenting on the investigation, Perry explained to Eyewitness News how the case will proceed.
“It is the FBI that makes a determination of that allegation, to see if it’s credible, specific and coherent enough to proceed,” he said. “I think many people wrongly believe US attorneys generate public corruption cases, but the initiation, the vetting, the working of the case, the FBI is driving that train and it’s done with a true abundance of caution, fairness, and you want to be as firm and fast as you are fair.”
In 2006 and 2007, Edwards’ political action committee paid Hunter $114,000 to produce videos of Edwards. Federal investigators are trying to figure out if those payments violated federal law.
Perry is not connected to the Edwards investigation, but says political corruption cases focus on a federal law – called “honest services fraud”.
“Honest services means that a public official has done something that deprives the citizens of the honest services they expect from public officials,” he explained.
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“It can take some time to build a case,” he said. “And [an] honest services case can take a lot of effort and can be extremely time consuming with respect to going through the financial records and following that money.”
While it appears the investigation is being conducted in Raleigh, Perry says political corruption cases have a lot of oversight – from both FBI headquarters in Washington and the Justice Department in Washington.
May 7, 2009
Fed investigation into “honest services fraud”
May 3, 2009
Investigators dig through records to see if donors’ money was used to cover up affair with campaign worker
Federal investigators are sifting through the records of money that helped John Edwards’ presidential campaign to determine if any was used to keep quiet his affair with Rielle Hunter.
Edwards, a Democrat and former U.S. senator, acknowledged the investigation to The News & Observer.
“I am confident that no funds from my campaign were used improperly,” Edwards said in a statement.
“However, I know that it is the role of government to ensure that this is true. We have made available to the United States both the people and the information necessary to help them get the issue resolved efficiently and in a timely matter. We appreciate the diligence and professionalism of those involved and look forward to a conclusion.”
Edwards declined to discuss the matter.
A review of Edwards’ campaign money will turn up a cluster of nonprofits, some not subject to the same rules of transparency as official campaign organizations.
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“This may be a bit like looking for a needle in a haystack,” said Sheila Krumholz, executive director of Open Secrets, a campaign watchdog group. “John Edwards is a leader in misleading the public.”
Campaign finance laws prohibit candidates from spending campaign money to pay for personal expenses they would have incurred had they not been running for office. But nonprofits created to support a candidate or his message have different requirements.
The Alliance for a New America, the group that received Mellon’s millions, was kept at arm’s length from Edwards, a requirement of campaign finance law. Nonprofits such as this, known as 527 groups, primarily finance media messaging that most often closely aligns with a particular candidate’s stance.
The alliance was launched by Nick Baldick, Edwards’ campaign manager in 2004. At least one of the donors, San Francisco attorney Jim Finberg, said he was advised the money would pay for media ads supporting universal health care in Iowa. He knew the group was linked to Edwards; by law, however, Edwards couldn’t be involved in the group’s activities.
The Center for Promise and Opportunity, a nonprofit organization allowed to shield donors’ identity but allowed some political expenditures, paid for much of Edwards’ early groundwork in New Hampshire and Iowa.
The organization’s statement of purpose filed along with its tax disclosures never mention Edwards. Edwards was the center’s honorary chairman, according to media reports in 2006.
“They play this charade. Refrain from saying they are a candidate, so they don’t have to follow the rules,” said Paul S. Ryan of the Campaign Legal Center, a nonpartisan group that monitors campaign finance issues. “They’re gaming the system. If they play carefully enough, they can avoid running afoul of the law.”
In 2006, Edwards traveled the nation, walking picket lines and talking to crowds about poverty and his regret in voting to fund the war in Iraq, travel paid for by the Center for Promise and Opportunity.
The center also paid for Edwards’ trips abroad, where he met with foreign leaders and visited developing nations plagued by squalor. Rielle Hunter was at his side filming.
April 3, 2009
Fed Grand Jury sitting on Edwards mistress pay-off
Multiple sources now confirm The ENQUIRER’s report that a federal grand jury is investigating possible misuse of presidential campaign funds by John Edwards to pay off his mistress.
U.S. Attorney George Holding revealed yesterday he “was not going to confirm or deny any investigation” regarding Edwards that was first reported by the ENQUIRER earlier this week.
A Federal grand jury did convene on Wednesday in Raleigh, North Carolina, according to multiple local reports. Grand jury proceedings are kept secret. Attorneys are liable for criminal prosecution if they discuss such investigations in public or to the press.
Prominent Raleigh defense attorney and John Edwards’ mentor Wade Smith declined to comment on whether he was representing Edwards before the grand jury investigation.
“I’m at a place where I cannot make any comment to confirm or deny,” Smith said. “I can’t say anything. It’s possible, at some later point, I can.”
The disgraced 2-time Presidential candidate began his career working for Wade Smith’s law firm and they are long time friends.
August 14, 2008
Lawyers’ Ties Hint at Extent of Hiding Edwards’s Affair
As tabloid reports of a sex scandal threatened former Senator John Edwards’s presidential campaign last December on the eve of the Iowa caucuses, two lawyers surfaced with written statements that appeared to exonerate the candidate.
One of them, Robert J. Gordon of New York, said that his client, Rielle Hunter, a pregnant 43-year-old filmmaker, was not carrying Mr. Edwards’s child. Shortly thereafter, the other lawyer, Pamela J. Marple of Washington, sent word that her client, Andrew Young, an Edwards campaign aide, was the baby’s father.
Seemingly issued independently of Mr. Edwards, the statements appeared to deflate the anonymously sourced reports of an Edwards tryst. But what went unnoticed was that the two lawyers shared an important connection to Mr. Edwards that suggests they were part of an orchestrated effort to protect him, one that is continuing even after he admitted last week that he had an affair with Ms. Hunter but denied that he fathered her child.
The lawyers are linked through Fred Baron, a wealthy Dallas lawyer and former finance chairman for the Edwards campaign who was a key player in the campaign’s response to the scandal. Mr. Gordon has worked with Mr. Baron on class-action personal injury cases, and Ms. Marple helped defend a lawsuit brought against both men and their law firms by an asbestos manufacturer.
After initially saying that he did not know how the lawyers were chosen to represent Ms. Hunter and Mr. Young, Mr. Baron acknowledged that he might have played a role.
The revelations of ties among the lawyers emerged through public records and interviews with people close to Mr. Edwards and Ms. Hunter, which suggested that their affair went on longer than Mr. Edwards admitted and that the effort to conceal it by Mr. Edwards’s inner circle was much more extensive than has been reported.
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August 8, 2008
Edwards Chair Denies Hush Money
Fred Baron, John Edwards’ campaign finance chairman and longtime confidante, told NBC News in telephone interviews, he has been providing financial assistance to both Andrew Young and Rielle Hunter.
Young is the married Edwards campaign staffer who has admitted to fathering Hunter’s child. Earlier today, Edwards admitted to also having an affair with Hunter.
Baron said he was personally upset with how the National Enquirer was harassing the two and helped them relocate out of North Carolina. He has continued to help them with their overhead.
Baron insisted Edwards never knew what Baron did for Young and Hunter; he believes Edwards didn’t even have an inkling that Baron was doing this.
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November 18, 2007
Hubris Hypocrisy and Greed
John Edwards launched his slight public career — one Senate term, two presidential candidacies — with the money and reputation he made as a trial lawyer. Today he is the candidate of a small fraction of the electorate but a sizable portion of America’s trial lawyers. Edwards says Washington is “corrupt.” Well.
Within Edwards’ lucrative trial bar constituency, there has been a flurry of criminal indictments. Their target has been what Fortune magazine calls the law firm of Hubris Hypocrisy and Greed. (See Peter Elkind’s jaw-dropping report in the issue of Nov. 13, 2006.) The real name of the nation’s foremost securities class-action firm is Milberg Weiss.
It has been indicted as a “racketeering enterprise” that obstructed justice and committed perjury, bribery and fraud while collecting about $250 million in fees from about 250 cases using paid plaintiffs, which is illegal. Several of the firm’s members, past and present, also have been indicted.
Since 1965, the firm has won, often by tactics indistinguishable from extortion, $45 billion from corporations — more than $1 billion a year for plaintiffs claiming to have been cheated as investors. Plaintiffs firms such as Milberg Weiss are paid contingency fees — they are paid only if they win, but up to 30 percent of what is won. Mel Weiss, whose case is going to trial, and his former partner, Bill Lerach, who specialized in volatile stocks of Silicon Valley companies in the 1990s and is now going to jail, each pocketed — it would be strange to say they earned — more than $100 million in the 1990s. The firm itself has been charged with paying $11.4 million to three serial plaintiffs who testified in 180 cases over 25 years, claiming to have been repeatedly defrauded.
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Until Lerach pleaded guilty he was a fundraiser for Edwards, for whom he collected $64,000 from lawyers in the firm he founded after he had a falling out with Weiss. Remember this when next you hear Edwards’ populist riff about trial lawyers as white knights protecting little people.
Real Clear Politics 11/18/07
http://www.realclearpolitics.com/articles/2007/11/legal_troubles_mount_for_edwar.html
October 20, 2007
Edwards pot calling Clinton kettle crooked
Hillary Clinton raised big bucks at a Chinatown fund-raiser from donors who listed seemingly modest-paying jobs on contributor forms, prompting an angry exchange between John Edwards’ campaign and Team Clinton.The flap came after the Los Angeles Times reported people holding jobs such as dishwasher, server or chef made donations ranging from $500 to $2,300.The newspaper said it could not find one-third of the donors using property, telephone or business records.By mid-afternoon, David Bonior, Edwards’ campaign manager, issued a statement that “many Clinton campaign contributions are raising eyebrows again.”Howard Wolfson, a top Clinton adviser, said the campaign does not “ethnically profile donors.”
He acknowledged the campaign flagged a number of questionable donations based on occupations and amounts. It returned $7,000 it couldn’t confirm was legally given, he said.
As for the Edwards rebuke, Wolfson replied, “If Mr. Edwards is so concerned about campaign finance reform, he should give back the contributions he got from Geoffrey Fieger.”
In August, Fieger was indicted on charges of conspiring to make more than $125,000 in illegal donations to Edwards’ 2004 presidential campaign. Team Edwards said it will give the money to charity if Fieger is convicted.
New York Daily News 10/20/07
http://www.nydailynews.com/news/wn_report/2007/10/20/2007-10-20_hillarys_chinatown_fundraiser_draws_edwa.html”>LINK
October 18, 2007
Milberg Weiss Legal Scandal and John Edwards
Last year, the firm was indicted on federal charges of fraud and bribery. But the political partnership has not been entirely severed. Since the indictment, 26 Democrats around the country, including four presidential candidates, have accepted $150,000 in campaign contributions from people connected to Milberg Weiss, according to state and federal campaign finance records. And some Democrats have taken public actions that potentially helped the firm or its former partners.The recent contributors include current and former Milberg partners who had either been indicted or were widely reported to be facing potential criminal problems when they wrote their checks. One of them, William S. Lerach, was a fund-raiser for John Edwards’s presidential campaign until his guilty plea last month. Melvyn I. Weiss, a founder of the firm, gave the maximum $4,600 to Senator Hillary Rodham Clinton in June. Other firm members contributed to the presidential campaigns of Senators Barack Obama and Joseph R. Biden Jr.
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In the current campaign, the race for cash has led to several embarrassments for the Democrats, including the indictment of a trial lawyer, Geoffrey Fieger, who was accused of using straw donors to make illegal contributions to Mr. Edwards’s 2004 presidential campaign, and the arrest of Norman Hsu, a businessman accused of fraud who raised hundreds of thousands of dollars for Mrs. Clinton.
In addition to the kickback charges in the Milberg Weiss case, federal agents have investigated allegations that the firm funneled campaign contributions through plaintiffs and expert witnesses in the 1990s, said two lawyers familiar with the inquiry. The guilty plea entered by Mr. Lerach hinted at that, but it also specified that prosecutors would not pursue campaign finance violations, in exchange for Mr. Lerach’s admission that he had conspired to obstruct justice by concealing the kickbacks.
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More recently, Mr. Edwards, a trial lawyer who became wealthy pursing personal injury cases, joined labor unions and consumer groups last May in pressing securities regulators to intervene in a lawsuit against banks brought by Mr. Lerach on behalf of Enron investors. His campaign said Mr. Edwards’s actions had nothing to do with Mr. Lerach, and were consistent with the candidate’s longstanding defense of working people.
Still, Mr. Edwards’s willingness to be seen doing anything that could benefit Mr. Lerach and allowing him to raise money provided fodder for critics. At the time the Edwards campaign took on Mr. Lerach as a fund-raiser, it was already widely reported that Mr. Lerach, who left Milberg Weiss in 2004, was one of the unnamed co-conspirators cited in court documents related to the firm’s indictment.
In all, Mr. Edwards collected about $16,000 from people connected to Milberg Weiss, including Mr. Lerach and two other former Milberg Weiss lawyers who had joined him at his new firm, Patrick J. Coughlin and Keith F. Park. Federal authorities agreed not to prosecute them as part of a plea deal with Mr. Lerach. (Mr. Lerach also raised $64,000 for Mr. Edwards from members of his new firm who were not named in the Milberg case.)
“With Edwards, he has associated himself with people in his campaign that don’t represent the face that even the trial lawyers want to put forward to the country,” said Walter K. Olson, a fellow at the Manhattan Institute, a conservative research group, who has written extensively on the American legal system.
New York Times 10/18/07
http://www.nytimes.com/2007/10/18/us/politics/18milberg.html?ref=politics
September 20, 2007
Bundler badness
Democrat John Edwards’s list of bundlers includes well-known fellow trial lawyer William S. Lerach, who raised $80,000 from his family and law firm partners for the candidate after a government probe had begun of Lerach’s wrongdoing, campaign aides confirmed yesterday. Lerach pleaded guilty this week to a conspiracy charge, prompting Edwards to announce that he will give back Lerach’s personal donations but not the money Lerach raised from others.
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In recent weeks, Edwards has sharply criticized a “corroded and corrupt” Washington system in which politicians raise money from special interests, which then seek their help on government matters. His campaign’s latest statement on that subject came on Tuesday, the day of Lerach’s plea deal. Top strategist Joe Trippi sent out a mass e-mail criticizing Clinton’s campaign for hosting a fundraising event with companies and lobbyists seeking the government’s multibillion-dollar homeland security business.
“Too many in office have fallen under the spell of campaign money at any cost — and do not see that when they defend the system, they are protecting those that have rigged the game that puts corporate profits ahead of the interests of working Americans,” Trippi wrote.
In May, Edwards issued a statement urging the Securities and Exchange Commission to weigh in with the Supreme Court on behalf of an effort by Lerach’s clients — who had invested in Enron — to sue banks associated with the energy giant. “The question for all Americans is whether their government will be on the side of those big banks or regular families,” Edwards said in a statement released by his presidential campaign. Lerach posted the statement on his law firm’s Web site.
Edwards’s campaign declined to discuss how much it knew about Lerach’s legal problems while Lerach raised money. Campaign officials also said they do not consider the statement about the Enron case a favor to a major donor and fundraiser.
“This position is consistent with John Edwards’s long-standing support for protecting the retirement savings of middle-class families and is shared by many others, including the New York Times editorial page, Securities and Exchange Commission, Senate Banking Committee Chair Chris Dodd, and a coalition of consumer groups, to name a few,” Edwards spokeswoman Colleen Murray said.
Lerach is the second Edwards fundraiser to face legal troubles in the past year. Lawyer Geoffrey Fieger was indicted in August on federal charges of conspiring to route more than $125,000 in illegal contributions to Edwards’s 2004 presidential bid. Fieger has pleaded not guilty.
Edwards’s campaign has said it knew nothing about Fieger’s alleged scheme and has cooperated with the Justice Department. But the campaign has declined to refund the donations in question, waiting for the outcome of Fieger’s trial to avoid influencing jurors. If he is convicted, the campaign has said it plans to send his donations to charity.
Washington Post 9/20/07
http://www.washingtonpost.com/wp-dyn/content/article/2007/09/19/AR2007091902508.html?hpid=topnews
September 19, 2007
Edwards pressured SEC on behalf of leading fundraiser
Though his former law firm came under indictment more than a year ago and he himself appeared likely to face criminal charges, prominent trial lawyer William S. Lerach slipped past the vetting of John Edwards’ presidential campaign and was permitted to raise large amounts of money for the Democrat’s 2008 bid.Lerach, his family and members of his new law Lerach Coughlin law firm accounted for nearly $78,000 in donations to Edwards’ campaign in the first half of this year, making the trial lawyer one of the North Carolina Democrat’s leading “bundlers” of contributions.
In the midst of that fundraising, Lerach negotiated behind the scenes for a plea deal that was consummated on Tuesday and will send him to federal prison for at least 12 months on a conspiracy charge involving his past legal work as partner in the Milberg Weiss law firm.
Through it all, Edwards stood by his fellow trial lawyer and even took an action this spring that was helpful to his longtime financial supporter in a government matter.
In May, Edwards used the bully pulpit of his presidential campaign to publicly pressure the Securities and Exchange Commission not to oppose Lerach’s new law firm in a Supreme Court case over whether Lerach’s lawsuits could proceed against banks on behalf of investors who lost millions in the collapse of energy giant Enron.
“The question for all Americans is whether their government will be on the side of those big banks or regular families,” Edwards said in a statement released by his presidential campaign that was trumpeted on the Web site of Lerach’s law firm.
All of this transpired while Edwards campaigned against what he calls a “corroded and corrupt” Washington system in which politicians raise money from special interests who then seek their help on government matters. To make his point, Edwards campaign is refusing any donations from lobbyists registered in Washington.
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Trippi’s attack made no mention of Lerach, the Edwards’ bundler, or the fact that Lerach had just reached a plea deal in a scheme prosecutors alleged involved kickback payments to plaintiffs in class action lawsuits he and his former law firm brought.
Lerach and his former law partner Melvyn I. Weiss were notified in the summer of 2005 that they had become targets in that lengthy criminal investigation, meaning they were likely to be indicted, according to lawyers involved in the case.
Court papers say that they employed the scheme for more than two decades in 150 cases that brought their firm more than $200 million in fees.
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Edwards campaign said it donated Lerach’s personal donations to charity yesterday after his guilty plea, but isn’t returning the money he raised from others.
As for the statement Edwards issued favorable to Lerach’s lawsuits earlier this year, Edwards spokesoman Colleen Murray said: “This position is consistent with John Edwards’ longstanding support for protecting the retirement savings of middle class families and shared by many others, including the New York Times editorial page, Securities and Exchange Commission, Senate Banking Committee Chair Chris Dodd, and a coalition of consumer groups, to name a few.”
Lerach is the latest bundler in the 2008 race whose background has raised questions about how carefully campaigns are vetting those who collect their checks.
Washington Post 9/19/07
http://blog.washingtonpost.com/the-trail/2007/09/19/lawyer_in_plea_deal_was_edward.html?hpid=topnews
