AP source: Ex-lobbyist to plead in probe of campaign money, earmarks for defense contractors

By Pete Yost, AP
Thursday, September 16, 2010

AP source: Ex-lobbyist to plead in earmarks probe

WASHINGTON — A former lobbyist has decided to plead guilty and cooperate in a Justice Department probe of campaign donations to members of Congress who directed hundreds of millions of dollars to defense contractors without competitive bidding.

A person outside the government who is familiar with the criminal investigation said Thursday that the once-prominent lobbyist, Paul Magliocchetti, will enter a plea on Sept. 24 in federal court in Alexandria, Va.

An electronic entry on the courthouse docket specifies that Magliocchetti will have a “change of plea hearing” in his case on that date.

Justice Department spokeswoman Tracy Schmaler and one of Magliocchetti’s lawyers, William Lawler, declined to comment.

In the Justice Department probe, a federal grand jury more than a year ago subpoenaed documents from the office of Rep. Pete Visclosky, D-Ind., from some of Visclosky’s employees and from the congressman’s campaign committees.

Magliocchetti pleaded not guilty to an 11-count indictment felony indictment on Aug. 20. He is charged with paying hundreds of thousands of dollars in illegal donations to scores of campaigns dating back to 2003 to enrich himself and increase his firm’s influence with public officials.

The former lobbyist was to have gone on trial Oct. 5.

The person familiar with the probe, speaking on condition of anonymity in order to be able to speak more freely, said a combination of circumstances led Magliocchetti to decide to enter a guilty plea. One was that a son, Mark Magliocchetti, pleaded guilty in the same investigation and likely would have become a witness against his father at a trial. Also, many of the donations were allegedly passed through members of Paul Magliocchetti’s extended family, which would have meant that they, too, would have been in a position to testify against him.

Magliocchetti was a major player in Washington lobbying for nearly two decades.

Democrats on the House Appropriations defense subcommittee, where Magliocchetti once worked as a staffer, became favored recipients of donations by lobbyists in Magliocchetti’s firm, PMA Group Inc.

One of his early successes was lobbying on behalf of New York Yankees owner George Steinbrenner, who received a $58 million bailout from Congress for his shipbuilding business.

From 1989 to late 2008, Magliocchetti and his firm’s employees gave members of Congress $3.4 million in campaign donations, more than most of the larger firms in town. According to the indictment, a sizable chunk of that money actually came from the corporate cofffers of Magliocchetti’s firm and from Magliocchetti himself.

In 2007 and 2008 alone, Democrats Visclosky, James Moran of Virginia and John Murtha of Pennsylvania directed $137 million to defense contractors who were paying Magliocchetti’s firm to get them government business. At the time, Murtha headed the House defense subcommittee, where Visclosky and Moran were long-time members.

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