Monday, January 10, 2005
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Ex-Clinton Aide Indicted for Lying About Los Angeles Fundraiser
From Staff and Wire Service Reports
Sen. Hillary Rodham Clinton’s former finance director has been indicted on charges of filing fictitious reports that misstated contributions for a Hollywood fund-raising gala for the senator, the Justice Department said Friday.
The indictment, rare for a political campaign, was unsealed in Los Angeles charging David Rosen with four counts of filing false reports with the Federal Election Commission. The charges focus on an Aug. 12, 2000, dinner and concert supported by more than $1.1 million in “in-kind contributions” — goods and services provided for free or below cost. The event was estimated to cost more than $1.2 million.
The FBI previously said in court papers that it had evidence the former first lady’s campaign deliberately understated its fund-raising costs so it would have more money to spend on her campaign.
While the event allegedly cost more than $1.2 million, the indictment said, Rosen reported contributions of about $400,000, knowing the figure to be false.
The indictment charged that he provided some documents to an FEC compliance officer but withheld the true costs of the event and provided false documents to substantiate the lower figure.
Fraud Charged
In one instance, Rosen obtained and delivered a fraudulent invoice stating the cost of a concert associated with the gala was $200,000 when he know that figure was false, according to the indictment. The actual cost of the concert was more than $600,000.
Each of the four counts of making a false statement carries a maximum penalty of up to five years in prison and up to $250,000 in fines upon conviction.
Rosen’s attorney, Paul Mark Sandler, did not return a call asking for comment. Clinton’s lawyer on campaign finance matters, David Kendall, said, “The Senate Campaign Committee has fully cooperated with the investigation. Mr. Rosen worked hard for the campaign, and we trust that when all the facts are in, he will be cleared.”
The businessman who hosted the event, Peter Paul, has told federal authorities that it cost more than $1 million and that he had been surprised when he saw that most of the contributions were not reported.
Paul, a former associate of famed comic book illustrator Stan Lee, has sued Rosen, Clinton, former President Bill Clinton, and the event’s producer, Aaron Tonken, in Los Angeles Superior Court. He is represented by Judicial Watch, an advocacy group long at odds with the Clintons.
Paul claims that he was encouraged to donate by promises of a future business relationship, which never materialized, with Bill Clinton. He alleged in his complaint that the defendants placed him at risk of prosecution by not reporting the donations.
No Invite
The Clintons, Paul claims, disassociated themselves from him after it was disclosed that he had been twice convicted of felonies involving fraud and customs violations more than 15 years earlier. He was disinvited from the last Clinton state dinner at the White House, and never received a promised overnight stay in the Lincoln bedroom, he alleged in his complaint.
Paul has not been criminally charged in connection with the fundraiser. He was the subject of an unrelated indictment on charges of bank fraud and manipulating the stock of now-bankrupt Stan Lee Media, Inc.
In Paul’s civil action, Rosen prevailed on an anti-SLAPP motion, the granting of which has been appealed. A similar motion filed on behalf of the Clintons was denied, and that is being appealed as well.
The money from the fund-raiser went to Hillary Clinton’s Senate campaign, the Democrats’ national Senate campaign organization and a state Democratic Party committee.
The joint fund raising made the rules more complicated because the gala raised both “hard money” — funds given to candidates subject to federal limits — and “soft money” that was unregulated and unlimited under the former campaign finance law.
Underreporting the cost of the event allowed the committee to spend less of the coveted hard money, contributions that unlike soft money could be used to cover Clinton’s campaigning costs.
Federal law governing such joint fund-raisers was designed to prevent joint committees from circumventing restrictions on the contributions given directly to candidates.
Most allegations of campaign finance irregularities are handled administratively through the FEC, although the Justice Department has investigated such matters in the past.
During former President Clinton’s administration, a Justice Department campaign finance task force charged more than two dozen individuals and two corporations with fund-raising abuses from the 1996 election cycle. Many of the charges involved Democratic fund raising.
In addition to his Clinton effort, Rosen has raised money for several other high-profile Democratic candidates, including former presidential hopeful Wesley Clark. Most recently, he was named to the fund-raising team of Donnie Fowler, a candidate for the Democratic National Committee chairmanship.
“I’m sorry that that happened to David, but I don’t think it’s going to stop or slow down the campaign for chair,” Fowler said in a telephone interview Friday.
Copyright 2005, Metropolitan News Company