DOJ Will Still Bring Corruption Cases After McDonnell:Official

Daily Report for Executives provides in-depth coverage of unfolding legislative, regulatory, and judicial news from the nation’s capital, the states, and around the world. This daily news service...

By Kenneth P. Doyle

Sept. 9 — The Justice Department will not refrain from prosecuting other public corruption cases following its decision to drop a long-running case against former Virginia Gov. Robert McDonnell (R), an official in the department's Public Integrity Section said Sept. 9.

Richard Pilger, who heads the DOJ Election Crimes Branch, suggested there would be “not much” fallout from the department's setback in the McDonnell case.

“We can still bring those cases and, if the evidence is compelling, we will do so,” Pilger said at a Washington conference on corporate political law sponsored by the Practising Law Institute (PLI).

He spoke a day after the DOJ moved to dismiss the high-profile McDonnell case, declining to prosecute the former governor under a new, narrower legal standard set by the Supreme Court in June (See previous story, 09/09/16).

Despite Pilger's confidence that corruption cases would continue to be prosecuted, he appeared to acknowledge the government would face higher legal hurdles in similar cases following the Supreme Court decision in the McDonnell case.

Jury Instructions at Issue

The Supreme Court decided that jury instructions in the McDonnell case were inadequate, Pilger said, even though the instructions were based on similar instructions used in a successful prosecution of former Rep. William Jefferson (D-La.) in 2009 (218 DER A-20, 11/16/09).

The Supreme Court vacated McDonnell's original conviction in a ruling that said the definition of “official act” in the jury instructions was too expansive and had to be narrowed for McDonnell's conviction to be upheld.

The court ruled that prosecutors in a bribery case must show that a top official, like McDonnell, agreed to accept a bribe in return for bringing “pressure” on subordinates to achieve a particular result, Pilger said. Prosecutors in McDonnell's case showed only that McDonnell arranged meetings and provided access to a businessman who gave him gifts and loans.

Pilger said he was not directly involved in the Justice Department decision to drop the McDonnell case rather than attempt to try the governor again under the new legal standard. He said there are “lots of other factors” in making such a decision.

More Campaign Finance Cases

Pilger addressed the McDonnell case during a wide-ranging panel discussion at the PLI conference. In spite of the Justice Department setback in the McDonnell case, Pilger's presentation indicated that prosecutors have had important successes in recent cases involving criminal violations of campaign finance laws.

These include a case in federal court in Iowa involving former aides to Rep. Ron Paul's presidential campaign who falsified campaign records (See previous story, 05/06/16).

Another, earlier case in federal court in Virginia involved illegal coordination by political consultant Tyler Harber of activities by a candidates's campaign and a super political action committee (super PAC) (114 DER 114, 6/15/15).

Although such illegal coordination cases are rare, Pilger said of the Harber prosecution: “We did a coordination case to show we are willing to do them.”

He said the DOJ would be willing to pursue other cases where it had strong evidence that someone providing funding to a super PAC—which can take unlimited contributions but must make only independent expenditures—did so in a coordinated effort with a candidate.

Pilger indicated the DOJ would continue to prosecute such cases and may branch out to new types of cases, for example possibly using anti-fraud laws to start going after what he called “scam PACs.” These are political action committees that raise money based on false representations that they are supporting particular candidates.

Ethics, Lobbying Enforcement Update

Appearing on the panel with Pilger were Omar Ashmawy, the staff director and chief counsel of the Office of Congressional Ethics (OCE), and Keith Morgan, an attorney in the Office of the U.S. Attorney for the District of Columbia, who is in charge of civil enforcement of the federal Lobbying Disclosure Act (LDA). Ashmawy and Morgan reviewed recent efforts to secure compliance with congressional ethics rules and the LDA.

The OCE, an independent unit within the House of Representatives, has been conducting dozens of investigations annually in recent years and has seen an evolution in the kinds of cases it is pursuing, Ashmawy said. He said cases are becoming more complex and involving more witnesses outside of Congress—including companies and other third parties—that interact with lawmakers in ways that raise ethics questions.

Morgan reviewed his efforts to secure compliance with the LDA registration and reporting requirements. He noted that the Justice Department has reached civil settlements with lobbying organizations for failing to file reports, but has never taken formal enforcement action against someone for lobbying while failing to register at all.

“We have reviewed these types of matters,” Morgan said, “but we have not brought any cases yet.”

Petalas Navigated FEC ‘Blocs.'

Also appearing on the PLI panel was Daniel Petalas, the former acting general counsel of the Federal Election Commission, who recently left the FEC to enter private practice with the law firm Garvey Schubert Barer. Petalas reviewed the FEC responsibilities for civil enforcement of campaign finance laws and noted the commission's unique structure, headed by six commissioners with no more than three belonging to the same political party.

Petalas recounted his five years at the FEC, saying he navigated the “blocs” of Democratic and Republican commissioners, with Steven Walther, a political independent who holds a Democratic seat on the commission, sometimes serving as a swing vote.

In recent years, the FEC has often deadlocked along party lines on key legal and enforcement matters.

Petalas said he was able to work with members of both blocs of commissioners, and also was in frequent communications with Pilger at the DOJ regarding how to proceed on campaign finance matters of interest to both agencies. Petalas said he was careful to keep the FEC commissioners apprised of these interactions and of requests for information from the DOJ on particular matters—requests he said the commissioners voted whether to grant.

Petalas left the FEC at the beginning of this month, and the commission has given no indication whether it will name a new acting general counsel or attempt to fill the post with a permanent appointment (See previous story, 08/31/16). The agency's last general counsel, Anthony Herman, left in 2013.

To contact the reporter on this story: Kenneth P. Doyle in Washington at kdoyle@bna.com

To contact the editor responsible for this story: Heather Rothman at hrothman@bna.com

Copyright © 2016 The Bureau of National Affairs, Inc. All Rights Reserved.