YOU ARE HERE: LAT HomeCollections

Former Force on Capitol Hill Admits Fraud

Jack Abramoff's plea is a turning point in the probe of influence peddling in Congress. The ex-lobbyist agrees to cooperate with officials.

January 04, 2006|Walter F. Roche Jr. and Richard B. Schmitt | Times Staff Writers

WASHINGTON — Asking forgiveness from "the Almighty and from those I have wronged," an ashen Jack Abramoff, once a powerful Republican lobbyist on Capitol Hill, stood before a federal judge Tuesday and pleaded guilty to a scheme of fraud and tax evasion that could send him to prison for 11 years.

Abramoff now becomes a prospective witness for the prosecution in an ongoing influence-peddling investigation of Congress that has mushroomed into a major corruption scandal. It has already ensnared one member of Congress and two former congressional aides, and Abramoff's guilty plea gives the inquiry a new impetus.

The plea deal requires that Abramoff, who once showered some members of Congress with expensive meals and golf outings, cooperate in the probe of his actions over a decade, a process that could significantly reduce his jail time. Abramoff also must make restitution of about $25 million and pay a little more than $1.7 million in back taxes to the Internal Revenue Service.

Speaking softly, at times barely above a whisper, Abramoff, 46, responded with mostly "yes" and "no" answers as he entered the guilty pleas in a 50-minute session before U.S. District Judge Ellen Segal Huvelle. Abramoff wore a rumpled black suit and appeared pale as he stood beside his lawyer, Abbe Lowell, in the packed fourth-floor courtroom.

At the end of the court session, Abramoff stood and, with the judge's permission, read from a folded piece of paper.

"I only hope that I can merit forgiveness from the Almighty and those I have wronged or caused to suffer," he said. "Words will not ever be able to express how sorry I am for this, and I have profound regret and sorrow for the multitude of mistakes and harm I have caused."

Abramoff admitted to engaging in a conspiracy to defraud Indian tribes of more than $20 million through secret kickbacks. Abramoff also admitted to defrauding his former law and lobbying firm, Greenberg Traurig, by having clients direct payments to entities he controlled.

His prison sentence will be set later and will depend on his continued cooperation, said Mary K. Butler, the Justice Department's lead prosecutor in the case.

The charges of conspiracy, fraud and tax evasion carry a maximum prison term of 30 years, but federal sentencing guidelines call for nine to 11 years, officials said.

The agreement marks a significant turn in an investigation the FBI launched in March 2004. Justice Department officials said Abramoff had already begun sharing information and documents with them.

Officials declined to discuss any additional charges, but documents released Tuesday indicated prosecutors were focusing on benefits provided by Abramoff and his colleagues to members of Congress, their relatives, and current and former congressional staffers and their relatives.

"The corruption scheme with Mr. Abramoff is very extensive, and we will continue to follow it wherever it leads," said Assistant Atty. Gen. Alice Fisher, head of the Justice Department's criminal division. "This case is very active and ongoing. We are going to expend the resources that are necessary to make sure that people know that government is not for sale."

"This is just the beginning," predicted Stanley Brand, a Washington lawyer and former general counsel to the House of Representatives. "That is the pattern of the Justice Department. They start with the lobbyists and the outsiders and they build into the public officials. The members of Congress are the highest point in the food chain."

The scandal is "about an 8 on the Richter scale, and it is probably going to be a 9 before it is all over," Brand said.

Abramoff has also agreed to plead guilty today to conspiracy and wire fraud charges in Florida relating to the purchase of a fleet of gambling boats, according to Neal Sonnett, his lawyer in that case. The sentences in the two cases are expected to be served concurrently.

Tuesday's plea agreement mirrors charges brought earlier against one of Abramoff's former partners, Michael P.S. Scanlon. Scanlon has entered a guilty plea and has promised to cooperate with investigators.

According to court documents, Abramoff and Scanlon hid millions of dollars in fees by persuading Indian tribal clients with casino interests to pay consulting fees to companies and a nonprofit corporation Abramoff had set up. The two then shared the excess profits "pursuant to their secret agreement."

Abramoff, the documents charge, knew that the same services could have been provided by others at a far lower cost. But Abramoff, the government said, lied to the tribes, telling them he was working for nothing and, in some cases, denying any connection to the companies receiving the payments.

Abramoff and Scanlon called their scheme "Gimme Five," and in one case simultaneously collected fees from two Indian tribes on opposite sides of the same issue, said prosecutor Fisher.

Los Angeles Times Articles