Skip to comments.Caught in the Searchlight: Hsu, Reid, and the Searchlight Leadership Fund
Posted on 09/13/2007 12:59:08 PM PDT by Fedora
Caught in the Searchlight: Hsu, Reid, and the Searchlight Leadership Fund
Harry Reids Mob Money, Part 5
Fugitive fundraiser Norman Hsus donations to Hillary Clinton have understandably grabbed the limelight, but there is another story lurking in the shadows of the affair. Federal Election Commission documents record that on May 17, 2007, Hsu donated $1,000 to the Searchlight Leadership Fund, a political action committee associated with Senate Majority Leader Harry Reid. On the same day, Searchlight received a $1,000 contribution from Winkle Paw, described by Hsus lawyer as a business associate of Hsu. Also donating $1,000 to Searchlight that day was Paul Su of Dilini Management Group, a company Hsu listed on a form while making a political contribution to Senator Dianne Feinstein.
These donations to Searchlight expose a funding conduit reaching to the heart of Harry Reids political machine. The financial trail stretches back to Reids hometown, his longtime business associate Jay Brown, and his Nevada gambling industry patrons; and it connects the Hsu affair to scandal-ridden lobbyists William Oldaker and Jack Abramoff, Reids financial consigliere Claude Zobell, and a political action committee targeting freshmen Congressmen.
The Searchlight Leadership Fund is named after Reids hometown of Searchlight, Nevada. Lying about 60 miles south of Las Vegas, Searchlight is a former gold mining town with a current estimated population of 780, half of whom are retired. Today its economy depends on the nearby Lake Mohave resort town of Cottonwood Cove.
Reids father belonged to Searchlights second wave of miners, and the Reid family has retained a local presence. Senator Reid visits for holidays and owns real estate and mining interests in the area. His financial disclosures mention a creditor with a Searchlight address named Larry J. Reid, who is presumably his frequently-mentioned brother Larry. A Deanna Reid Miller was formerly president of the Searchlight Museum Guild, a charity which supports the Searchlight Community Museum. The guilds treasurer and resident agent is Searchlight Nugget Casino owner Verlie Doing, who has donated $10,000 (minus $4,000 returned) to Senator Reid since 1991, and also contributed $5,000 to the Searchlight Leadership Fund in 2000.
Reids political success has been a boost to the local economy of Searchlight. In 2005, through the Southern Nevada Public Land Management Act (SNPLMA), Reid secured $16 million (some sources reported $17 million) for the Bureau of Land Management (BLM) and the University of Nevada Las Vegas to develop a museum and research center on a historic Searchlight ranch, the Walking Box Ranch. The ranch, formerly owned by local celebrity politician Rex Bell, had passed through several hands before being acquired in 2000 by Las Vegas Gaming Investments (LVGI), a company whose members have had a controversial relationship with North Las Vegas Mayor Michael Montandan. In April 2005 LVGI sold the Walking Box Ranch for $1.96 million to BLM, which paid for the purchase with SNPLMA funds. Funding for the ranch development project was to be generated by BLM sales of land in Southern Nevada. To administer the project, the BLM partnered with the University of Nevada Las Vegas, which had created a Public Lands Institute to help BLM and other federal land management agencies administer a number of similar projects.
In addition to the $16 million Reid secured for the Walking Box Ranch project under SNPLMA, he later persuaded the Senate Appropriations Committee to grant the project another $200,000.
In September 1996 Reid founded another channel to fund improvements in Searchlight, the nonprofit Searchlight Foundation (aka the Harry Reid Searchlight Foundation, Ltd.). Reid announced in January 1998 that the foundations board of directors would decide how to distribute profits from a book on local history he had just published.
The president of the Searchlight Foundation is former Clark County District Attorney Rex Bell, Jr., whose family formerly owned the Walking Box Ranch. The treasurer is Jane Bunker Overy, a local historian who founded the Searchlight Community Museum and Searchlight Museum Guild. Through other officers and legal representatives, the Searchlight Foundation has interlocked with the law firm of Singer, Brown & Barringer (aka Singer & Brown), named for Michael Singer, Reids longtime business associate Jay H. Brown, and Reids son-in-law Steven Barringer.
Brown has had a long and controversial history with Reid, stemming from their mutual background relationship to Nevadas gambling industry. Browns name first became publicly entangled with Reids during an FBI probe of Mafia casino skimming in 1981, when Reid was chairman of the Nevada Gaming Commission and Brown was attorney for the Tropicana Hotel. Brown began contributing to Reids political campaigns in 1982, and since then he and his law firm have had various business dealings with Reid, his sons, and his son-in-law Barringer. Recently Reid had to amend his financial disclosures after reporters revealed that he had failed to properly inform Congress about the details of one of his real-estate ventures with Brown.
Since 1996, a series of members of Browns law firm have served as officers and resident agents of the Searchlight Foundation. Nevada business filings record that the foundations resident agents have included Browns partners Singer and Barringer and their firms administrative supervisor Carol Caldwell, who doubles as the foundations secretary. Caldwell has also been involved with Brown, his wife Sharyn, his business associate David Obal, and others in a series of ice cream, pretzel, and investment companies.
In addition to his firms support of the Searchlight Foundation, Brown helped kick off the Searchlight Leadership Fund with an early $5,000 contribution on December 31, 1997, joining a list of less than 20 donors who contributed $5,000 or more to the fund during its first year. The funds website gives the impression that Reid founded it after he won his 1998 Senate campaign, but FEC documents record that the fund was actually created in May 1997. During the first year of the funds existence, most of the donors contributing $5,000 or more like Brown had connections to Nevadas gambling industry. In addition to Brown, these included:
--Irwin Molasky, a Las Vegas real estate mogul who has been associated with such major gambling figures as Moe Dalitz, Ivan Mindlin, and Steve Wynn. Molasky contributed $5,000 to the Searchlight Leadership Fund in November 1997. Susan Molasky also contributed $5,000.
--The family of William Bennett of the Sahara Hotel, which contributed $20,000 between December 1997 and January 1998.
--Harvey Whittemore of Lionel, Sawyer & Collins, the most powerful lobbyist in Nevada, who has represented numerous gambling interests, notably fellow Reid contributor Steve Wynn. Whittemore has employed all four of Reids sons, and Reid has repeatedly come under criticism for using his influence to promote legislation favorable to a Coyote Springs Valley real estate development project where Whittemore has been represented by Reids son Leif. Whittemore contributed $5,000 to Searchlight in December 1997.
--Sheldon Adelson of the Sands Hotel and his wife Miriam, who each contributed $5,000 in December 1997.
This early pattern of donations from Reids gambling industry patrons to the Searchlight Leadership Fund continued as the fund grew. For instance, between 2000 and 2002, Searchlight raised $636,000 in soft money contributions from the casino and gaming industries.
While continuing to receive support from its initial gambling patrons, Searchlight soon sought donors outside Nevada, striving to tap the rich vein of the lobbying channels flowing through Washington, DC.
The first FEC filings for the Searchlight Leadership Fund in May 1997 initially listed the funds treasurer as Reids Special Assistant William E. Marion (of the public relations firm Purdue Marion & Associates), with an address of 245 Second Street NE, Suite 300 in Washington, DC. This address was next to the Dirksen Senate Office Building and the adjoining Hart Senate Office Building, where Harry Reids office is located. But by the end of 1997 filings had begun listing a new address of 616 South Third Street in Las Vegas (currently the offices of the law firm Fadgen & Associates). All activity during this period was conducted by volunteers, and contributions were relatively low.
Activity and fundraising increased significantly in summer 1999 when the fund opened a permanent office in Washington DC and hired a full-time staff member. A May 6, 1999 filing formally announced that the funds address was moving to 818 Connecticut Avenue NW, Suite 1100 in Washington DC (a block over from the White House), and treasury and record custodian duties were being taken over by William Oldaker, a well-connected Washington lobbyist whose law firm Oldaker & Harris had its offices at that address. Oldaker would expand the scope of Searchlights patronage into the world of Washington lobbying, paving the way for contributions from figures like Hsu.
Oldaker had a history of scandal dating back to 1973, when he was demoted and suspended for falsifying records submitted to US Equal Employment Opportunity Commission officials. Despite this setback, he worked his way up to general counsel to the FEC from 1976 to 1979. At the FEC he was supposed to be investigating a complaint by President Carter against Senator Edward Kennedy, but instead he used his position to get a job as general counsel and treasurer to Kennedys 1980 Presidential campaign, setting what became a characteristic pattern of using insider status to gain leverage with his employers political opponents. From Kennedy he went on to advise other Democrats, including Edward Markey (whom he helped run a direct-mail scam), Alan Cranston, Gary Hart, Walter Mondale, Geraldine Ferraro, Joseph Biden, and Jim Wright. Meanwhile in 1984 he became an original investor in Washington, DCs Century National Bank (CNB, a subsidiary of Century Bancshares, Inc.), where he remained on the board of directors until the banks merger into United Bank in 2001.
In 1987 Oldaker joined the Washington office of the Los Angeles law firm of Manatt, Phelps & Phillips, whose cofounder Charles Manatt had served as Chairman of the Democratic National Committee. Then in 1993 he became a partner at the law firm of Oldaker, Ryan, Phillips & Utrecht (now Ryan, Phillips, Utrecht & MacKinnon). His new partner Lyn Utrect was the counsel for the Clinton-Gore campaigns in 1992 and 1996, resulting in the firm handling much of the campaigns accounting and legal work those years. A Senate investigation of the 1996 campaign found that Utrecht and the Democratic National Committee had worked in improperly close coordination under White House Deputy Chief of Staff Harold Ickes. (Utrecht went on to advise Hillary Clintons Senate campaign, and currently advises her Presidential campaign, as well as her response against the FEC complaint filed by Peter Paul.)
In August 1998 Oldaker decided he wanted to form a bipartisan firm. So that November he left his law firm in a bitter break-up, taking their office space at 818 Connecticut Avenue with him, to join Republican lobbyist William D. Harris in founding the law firm of Oldaker & Harris (later expanded into the National Group). In 2001 he cofounded the complementary firm of Oldaker, Biden & Belair, where he was joined by his former client Joseph Bidens son Robert Hunter Biden.
Oldaker grew into one of the most well-connected lobbyists in Washington by serving as treasurer to 23 political committees while simultaneously lobbying Congress on behalf of various interests. Industries he represented ranged from tobacco, health care, and credit financing to aviation, utilities, and telecommunications. His lobbying firms clients have included clients doing business in Nevada, such as Health Plan of Nevada--a subsidiary of Sierra Health Services, Reids eighth largest career contributor, currently embroiled in a controversy over a $2.6 billion merger.
Under Oldaker, Searchlight attracted funding from the new interest groups Oldaker represented, while continuing to receive funds from its traditional Nevada gambling industry patrons, as well as the expanding Indian casino industry. Indian casino associates of lobbyist Jack Abramoff contributed to Searchlight during this period. In early 2002 Abramoff sent a list to Louisianas Coushatta Indian tribe recommending donations to campaigns or groups for 50 lawmakers he claimed were helpful to the tribe. Next to Reid's name, Abramoff wrote, 5,000 (Searchlight Leadership Fund) Senate Majority Whip. On March 6, 2002, the Coushattas wrote a check for $5,000 to Searchlight.
Like Abramoff, Oldaker applied his lobbying leverage to numerous Congressmen and Senators. For instance, he lobbied for appropriations-related interests while collecting $30,000 for Washington Democrat Patty Murray, who sat on the Senate Appropriations Committee.
Oldakers grasp also reached into the Executive Branch. In September 1999, President Clinton appointed Oldaker to serve as Member of the National Bioethics Advisory Commission. The White House press release announcing the appointment mentioned that since 1997 Oldaker had been serving as cofounder and general counsel to the College Park, Maryland firm NeuralStem Biopharmaceuticals Ltd., which owned a major stem-cell technology patent.
In 2004 Oldaker helped found WashingtonFirst Bank, where he sits on the board of directors. Meanwhile he served as general counsel to Wesley Clarks Presidential campaign, before shifting his support to John Kerry. During July 2004, Searchlight FEC filings began listing an address of 422 C Street NE, Lower Level in Washington, DC, which is near Stanton Park, a couple blocks from the Dirksen and Hart Senate Office Buildings.
An October 2005 report by the Center for Public Integrity exposed Oldakers glaring conflicts of interests, forcing Senators Kennedy, Reid, and Byron Dorgan to publicly dissociate themselves from him. In early 2006 Reid was forced to remove Oldaker as Searchlight Leadership Fund treasurer.
However, the Searchlight Leadership Fund continued to maintain Oldaker as an unpaid trusted adviser, Reids office was quoted as stating by reporter Eric Pfeiffer. Oldaker soon surfaced again as the custodian of the Democratic Freshmen PAC, formed by newly-elected Democrats in November 2006. The new groups treasurer was James Smith, a lobbyist with the American Continental Group.
Oldaker was exposed again by the Majority Accountability Project in April 2007, and by June 2007 he was forced to resign again. Meanwhile in May, he joined the board of directors of his lobbying client Neuralstem.
His duties at the Democratic Freshmen PAC were reportedly going to be taken over by the law firm of Perkins Coie, which lobbies for various interests ranging from natural resources and computers to Indian casinos. Perkins Coie advised President Clinton during his impeachment hearings and currently serves as counsel to the Democratic Congressional Campaign Committee (DCCC). A June 22, 2007 FEC document recorded that the PAC was now based at 607 14th Street NW, Suite 800 and was using an email address of PLGroup@perkinscoie.com, indicating Perkins Coies offices. The PACs website continued to list an address in Oldakers law office at 818 Connecticut Avenue NW, Suite 1100 as of early September 2007.
When Oldaker left Searchlight Leadership Fund in early 2006, Reid initially replaced him with Holly Giarraputo, a former Director of Elections Service at Oldakers law firm. Giarraputo had been the funds assistant treasurer since approximately late June 2004, when an FEC document for Searchlight lists an email address of firstname.lastname@example.org at Oldakers law firm. Around this time Giarraputo left Oldakers firm to found Campaign Compliance, which offers administrative outsourcing support to political organizations. Searchlight paid Campaign Compliance $5,506 for accounting services between September and December of 2004. Giarraputos name actually begins appearing listed in the space for treasurer in Searchlight FEC forms as early as October 2004, well before Reid announced Oldaker was stepping down as treasurer in early 2006. This was presumably done for clerical convenience on Oldakers behalf, as a letter from January 2005 indicates Giarruptos actual title at that time was Comptroller-Assistant Treasurer.
By April 2007, FEC documents indicate that Giarraputo had been replaced as Searchlight Leadership Fund treasurer by Memphis-based attorney Claude E. Zobell, Jr. A Utah native, Zobell is the brother of Charles Zobell, managing editor of the Las Vegas Review-Journal. He served on the US District Court of Nevada in the early 1980s, when Reid was chairman of the Nevada Gaming Commission. He became Reids first chief of staff in 1983 when Reid became a Congressman, and he has prepared Reids financial disclosures since then, including the disclosures misreporting Reids dealings with Jay Brown.
April 2007 FEC documents list Searchlight Leadership Fund as having an address of 607 14th Street NW, Suite 800 in Washington, DC, with an email address of PLGroup@perkinscoie.com: the same Perkins Coie addresses used by the Democratic Freshmen PAC in its June 2007 filing.
Thus, when Hsu, Paw, and Su made their donations to Searchlight in May 2007, they had singled out a fund with a pipeline to one of the most powerful lobbying networks in Washington, connected directly to the keeper of Harry Reids personal pocketbook.
How did Hsu learn of Searchlight and gain access to it? Had he met Oldaker or Zobell during the course of his fundraising activity? Or did he gain access through another route?
These questions remain to be answered. In light of the Las Vegas connections noted above, it may be worth observing that according to New York Times reporter Mike McIntire, records documenting the financial activity of Hsus company Components Ltd. during one month in 2003 record only one ATM withdrawal: $302.50 from a casino in Las Vegas.
As for Harry Reid, like a teflon don he has somehow managed to keep public attention away from his trail of scandals so far. But with Hsu under investigation by the Justice Department, and with a money trail leading straight from Hsu to Reids financial preparer, the Senator may yet find himself caught in his own searchlight.
Part 1: Mr. Cleanfaces Dirty Laundry
Part 2: Harrys Henchman Rory Reid
Part 3: The Aviators Droppings: Harry Reid, Steven Barringer, and Howard Hughes Legacy
Part 4: When Harry Met Blue Eyes: Reid and Sinatra
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Now I feel ashamed I didn’t think of a new Hsu pun for the title :-)
What splendid work, Fedora!
Braqvo,Fedora! Thanks for the ping.
I did not notice when I “hit” on this post and began to read it. But less than one third of the way down, without looking, I knew it was you. Someday, the “FreeRepublic” magazine will be outselling the Economist and your contributions to the nation will be well known.
Google is FAST!
They’ve already cached your article!
Thanks for the ping! Awesome work as usual.
Impressive piece of work, as always!
I look forward to studying this over the weekend.
Thanks for all you do.
LOL! I'll try using "Richard Bachman" as a pseudonym next time and see if that works :-)
That *is* fast! I thought Google took longer than that to crawl through the web. . .maybe it’s because Newsmeat updated their keywords.
The plot just keeps on thickening...
Thank you....and spreading the word ping!
Read it. Thanks for this. Posting so I can find it and read it to Mrs. RQSR when she gets home.
Great work Fedora, thanks again.
Golly gee, another elite liberal criminal err donor, George $oreA$$ is a longtime supporter of the SearchLight Leadership Fund.
Have you seen this?
You might be interested in this information.
Another story about Winkle Paw.
I think the name is so funny I put it in my tagline.
And Winkle has a sister named Dimple.
Are you series? :-)