McCain, Campaign Manager Met with Russian Billionaire Suspected of Organized Crime Links

McCain's Keating five scandal (McCain Received $110,000 from Bank Whose Failure Cost US Treasury 2Billion Dollars) is not his only link to mafia-like swindles. The Pheonix Times reports:

As I mentioned in a February 5 blog item, The Washington Post recently reported on McCain's meeting with Russian billionaire Oleg Deripaska, who had his visa revoked by the U.S.government because of his "suspected links to anti-democratic and organized-crime figures." McCain's campaign manager Rick Davis assisted in putting the two men together in 2006.

Davis told the Post that his contacts with Deripaska "all relate to my private business and have nothing to do with Senator John McCain." The Post said there was no evidence of wrongdoing, or of some sort of tit-for-tat. Still, such coziness with a billionaire recalls a certain coziness with a high-roller named Charles Keating.

Indeed, the ghost of the Keating Five scandal is always close by McCain. I was reminded of this in watching grizzled old legal warhorse Robert Bennett being pulled out of the barn to defend McCain in this recent joust with The New York Times. Attorney Bennett (who's famous for defending Bill Clinton in the Monica Lewinsky case), led the Senate ethics investigation in the Keating affair back in the '80s. Bennett was criticized by another member of the Keating Five, Senator Dennis DeConcini, in his recent memoir, Senator Dennis DeConcini: From the Center of the Aisle.

In the book, DeConcini, a centrist Dem, charged that Bennett was attempting to make the controversy a "Democrat scandal" by steering it away from McCain, the scandal's sole Republican. DeConcini asserts that McCain was knee-deep in guilt. As I wrote in the Bird column "McCain Shame,"

McCain made out like a bandito, scoring a whopping $112K from Keating's [fundraising]efforts. Indeed, McCain and the slimy S&L-er were thick as thieves. While serving in the House from 1983 to 1986, McCain flew with Keating to the latter's private retreat in the Bahamas aboard Keating corporate aircraft. And the senator's trophy wife, Cindy McCain, along with her pops, invested $359K in a Phoenix shopping mall developed by an offshoot of Keating's American Continental Corporation.

McCain Received $110,000 from Bank Whose Failure Cost US Treasury 2Billion Dollars

How much should it cost to buy the acquiescence of a US Senator in a banking scheme that costs the US Treasury two billion dollars. In John McCain's case, he was warned that a bank with serious financial troubles was seeking exemption from banking rules in order to take even more risks, even though the bank's eventual failure would be paid for by the US taxpayers. But, how could McCain turn his back on his banker friend when "Senator John McCain of Arizona, [] received $110,000 and vacationed with Mr. Keating in the Bahamas four times", according to the New York Times?

According to the New York Times, McCain met with Charles Keating, a "flashy political contributor" from who McCain had received $110,000 in campaign contributions, and then the banking regulators whom McCain supervised reversed course and allowed Mr. Keating to take risks that led to the failure of his bank. Instead of taking action to protect the taxpayers, McCain was caught "intervening with regulators on behalf of Mr. Keating at a time when his Lincoln Savings and Loan Association was on the verge of collapse."

According to the New York Times,

Senator John McCain of Arizona, who received $110,000, and Senator John Glenn of Ohio ($242,000) were deemed guilty only of "poor judgment." It's true that Mr. McCain, who had been Mr. Keating's vacation guest in the Bahamas four times, did nothing for his benefactor after those 1987 meetings. Yet wasn't a Senator also obliged to do something to guard the public against Mr. Keating's increasingly suspicious behavior? New York Times March 1, 1991.

After hearings that held the entire US Senate and the country's attention, the US Senate Ethics Committee found that McCain "exercised poor judgment". The New York Times said,

Today's announcement came after the committee voted unanimously on each Senator, ending a 14-month investigation into whether the lawmakers acted inappropriately in intervening with Federal regulators on behalf of Mr. Keating's Lincoln Savings and Loan Association. Mr. Keating and his associates contributed $1.3 million to the Senators or causes they backed. Lincoln, in Irvine, Calif., was seized by the Government in 1989, a move that is expected to cost taxpayers more than $2 billion. New York Times, February 28, 1991

At the time, John McCain said,

"I'm sure that my political obituary will always have something about the Keating Five in it. I don't see how that could be avoided." New York Times, March 1, 1991

McCain Financial Scandal Cost US Treasury Two Billion Dollars

A review of New York Times archives from 1990 and 1991 shows that Senator John McCain was a subject of a major financial and bank scandal, known as the "Savings and Loan Scandal", that dominated news coverage of the US Congress during that period.

According to the New York Times, Senator John McCain and four other US Senators, who became known as the "Keating Five" during a Congressional investigation, received over a million dollars in campaign contributions from Charles H. Keating Jr. , the owner of Lincoln Savings and Loan Association of Irvine, Calif, and his associates. Then, John McCain and the other four senators intervened on behalf of the bank to prevent banking regulators from applying Federal laws and regulations meant to assure that Federally-insured banks remain solvent, because otherwise the taxpayers would have to pay the savings banks depositors back if the bank itself became unable to do so.

The intervention of John McCain and four other senators on behalf of a major contributor, leaning on federal regulators to turn a blind eye toward banking irregularities, prevented federal regulators from doing their job and cost taxpayers about two billion dollars in this one case alone. The New York Times says,

A senior savings and loan regulator said today that pressure imposed by an aide to Senator Alan Cranston in May 1988 caused regulators to delay an enforcement action against a huge California savings institution, creating greater losses for taxpayers.

The regulator, William K. Black, testified in the Senate Ethics Committee's hearings into the five Senators' actions on behalf of Charles H. Keating Jr. while he was owner of the savings and loan and a major contributor to their campaigns and to organizations they supported. Mr. Black, general counsel in the Office of Thrift Supervision's western division, was the first witness to tell of enforcement that was delayed because of pressure.

Mr. Black described a meeting of the Federal Home Loan Bank Board on May 5, 1988, in which a decision was made to "freeze the risk profile" of the Lincoln Savings and Loan Association of Irvine, Calif., or limit its high-risk commercial real estate investments. The next day, an aide to Senator Cranston, Democrat of California, called two top officials of the agency and "indicated severe displeasure" with its intention to bring the institution under tighter control, Mr. Black said. Day After the Call

Mr. Black said that the next day, in a move that he attributed largely to that call, the bank board agreed to a number of "modifications" that not only did "not freeze the risk profile, but expressly permitted Lincoln to make new direct investments," particularly expanding such investments. Another result is that Lincoln began investing heavily in high-risk, high-yield corporate debt securities, or junk bonds.

A result of these new investments was to increase the amount of the ultimate losses at the institution, Mr. Black said.

Mr. Black described a meeting of the Federal Home Loan Bank Board on May 5, 1988, in which a decision was made to "freeze the risk profile" of the Lincoln Savings and Loan Association of Irvine, Calif., or limit its high-risk commercial real estate investments. The next day, an aide to Senator Cranston, Democrat of California, called two top officials of the agency and "indicated severe displeasure" with its intention to bring the institution under tighter control, Mr. Black said.

Day After the Call

Mr. Black said that the next day, in a move that he attributed largely to that call, the bank board agreed to a number of "modifications" that not only did "not freeze the risk profile, but expressly permitted Lincoln to make new direct investments," particularly expanding such investments. Another result is that Lincoln began investing heavily in high-risk, high-yield corporate debt securities, or junk bonds.

A result of these new investments was to increase the amount of the ultimate losses at the institution, Mr. Black said. New York Times, December 6, 1990.

On April 2, 1987, Senator John McCain and four other US senators met with the chairman of the board of the Lincoln Savings and Loan Association of Irvine, California, after which an aide to one of the five senators called federal banking regulators and told them to 'lay off' this bank, letting it effectively do as it pleased. Without federal regulation, the bank failed and taxpayers picked up the tab.

Now, Senator John McCain wants to become president of the United States and we have to compare his record for probity to that of his opponents. Although McCain was not convicted of bribe-taking, it seems clear that he take enormous amounts of money from a contributor and then do the contributors bidding in a manner that cost taxpayers billions of dollars in this one case alone. Is that the kind of president we need to elect to clean up the messes of George W. Bush?

DNC Targets McCain Campaign's Lobbyist Army

Is being a lobbyist a requirement for working on the presidential lobbying campaign of Sen. John McCain?

The Huffington Post has a story on a 1997 Bill sponsored by John McCain, which would have banned lobbyists from campaigns. This on news from this morning that his campaign manager lobbies for foreign entities without registering as a foreign lobbyist and setting up meeting between McCain and russian oligarchs.

McCain's '97 Lobbyist Bill Would Cripple Current Campaign

Senator John McCain has a lobbyist problem. This past week, as several aides resigned because of their work representing unsavory governments, his campaign implemented a new policy governing these potential conflicts of interest. That led to the departure of additional staffers, including former Rep. Thomas Loeffler, a key adviser and fundraiser.

The McCain camp has insisted that the resignations are nothing more than evidence of the Senator's sincerity in combating outside influences. But the truth, reform groups say, is far from adulatory: McCain's current policy simply doesn't compare to the ethical commitments he championed earlier in his career.

Just twelve years ago, when McCain was politically recuperating from his involvement in the Keating Five scandal, he introduced legislation that would, if implemented today, cripple his presidential campaign.

In March 1996, McCain took to the Senate floor to offer a bill that, in his own words, "would ban a candidate or a candidate's authorized committee from paying registered lobbyists."

In order to root out the moneyed influences, McCain continued, Congress had to unequivocally cut off the flow of campaign cash.

"Registered lobbyists who work for campaigns as fundraisers clearly represent a conflict of interest," he added. "When a campaign employs an individual who also lobbies that Member, the perception of undue and unfair influence is raised."

The legislation, introduced twice, never passed.

Fast-forward a dozen years and the political dynamics have clearly changed. Now the GOP standard barer, McCain has 115 lobbyists either working or raising money on his behalf. Many of these individuals have taken a leave of absence from these positions in order to help with the campaign. But others have held, simultaneously, fundraising and lobbyists positions.

In addition, the Senator has 70 registered lobbyists who have bundled money on his behalf - raising at least $100,000. On top of this, the Center for Responsive Politics reports that the Arizona Republican has received more than $610,000 in direct donations - not bundled cash - from lobbyists.

His recent, self-implemented, campaign policy is designed to counteract the image that such a fundraising apparatus suggests. "No person with a McCain Campaign title or position," the document reads, "may participate in a 527 or other independent entity that makes public communications that support or oppose any presidential candidate."

But critics and reform groups not only argue that the policy is too little too late, but that McCain can no longer claim the ethical high ground on which he has built much of his political career.

"I think because Mr. McCain believes himself to be an ethical man he believes you can't question his ethics. But the fact of the matter is, he has talked a good game but he isn't walking it. And you can't be the guy who positions himself as a reformer and then plays fast and loose with the rules," said Melanie Sloan, executive director of Citizens for Responsibility and Ethics in Washington. "I think he was sincere after Keating Five, and he obviously really believed in campaign finance reform, because he pushed it when it really didn't helped him. But I think over time that's changed. At the time he [made this speech] he wasn't thinking how it would affect his presidential run."

Moreover, they add, it is not just the quantity of lobbyists who have surrounded McCain. It is the quality. Indeed, some of the very people funding the Arizona Republicans run for the White House are those who would be interested in favors should he get there. As the New York Times reported in April 2008, several of McCain's bundlers have business interests before the Senator's own Commerce Committee:

Kirk Blalock, of the lobbying firm Fierce, Isakowitz & Blalock, leads Mr. McCain's young professional group and has raised over $250,000 for him; his clients include Sprint Nextel and Viacom.

Kyle McSlarrow, chief of the National Cable and Telecommunications Association, the lobbying arm for the cable industry, has raised over $100,000 for Mr. McCain. He and others in the cable industry recently butted heads with Mr. McCain over a proposal that would allow customers to pick and choose which channels they received.

McCain's supporters insist that his ethical compass is sound enough to ignore these potential conflicts of interest. And indeed, as McSlarrow can testify, raising money for McCain's campaign doesn't always bring with it a return of legislative favors.

"When it comes to McCain," Wayne Berman, another McCain bundler whose clients are affected by McCain's chairmanship at Commerce, told the New York Times, "there's just absolutely no concern whatsoever that he is going to be influenced by lobbyists. He takes on issues as he sees them. It doesn't matter whether his best friends are on the other side or not."

But as it stands now, critics believe that McCain's bevy of lobbyists represents a political liability. On Tuesday, Moveon.org put out one in what will likely be a series of campaign commercials, cataloging the "worlds worst tyrants" for whom Charlie Black, one of McCain's top aides, had previously worked. The list includes Ferdinand Marcos, Mobuto Sese Seko, Angolan rebel Jonas Savimbi and Ahmad Chalabi.

"Charlie Black said he didn't do anything wrong," the spot says. "John McCain should tell Black he did."

McCain Staffer Warned Him that His Big Contributor Was Trying to Bribe Him

Is John McCain too tainted with scandal and bribery accusations to become president of the United States? The New York Times reported on November 21, 1990,

Ms. van Paasschen, a banking expert on Mr. McCain's staff, explained her distrust of Senator DeConcini's motive in seeking Mr. McCain's cooperation on the Keating case by pointing out that Mr. McCain had received more campaign contributions from Mr. Keating. "So if the press were to ever get a hold of it," she said, referring to the Senators' assistance, "it would be more embarrassing for Senator McCain than for Senator DeConcini." NYT, November 21, 1990

Because John McCain failed to take appropriate action based on the warning that a major contributor of his was trying to bribe US Senators, this eventually became know as the "Keating Five Scandal", in which John McCain was investigated and embarrassed.

And John McCain still thinks he should be president of the United States?

Does John McCain Cheat on His Wife or Doesn't He?

In spite of the information developed by the New York Times, Sen. John McCain is " vigorously denying and denouncing a newspaper report suggesting an improper relationship with a female lobbyist." But, the issue just won't go away until the public has learned the whole truth. Yahoo News says,

At the very least, the episode gives Democrats an opening to try to exploit McCain's decades-long ties to Washington even though he's known as a Republican lawmaker willing to stand up to special interests and reduce the influence of lobbyists. It's a reputation he has carefully honed in the aftermath of the Keating Five influence-peddling scandal decades ago. The Senate cited him for "poor judgment" in that matter but took no further action.

The Democratic National Committee said Thursday in a statement: "After 25 years in Washington, the real John McCain is just like the other D.C. insiders he rails against on the campaign trail. John McCain's 'do as I say, not as I do' approach to ethics and lobbying reform can be called a lot of things. 'Straight talk' isn't one of them."