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

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.

Paul 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.

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

The person familiar with the probe, speaking on condition of anonymity in order to be able to discuss the matter 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 would have become a witness against his father at a trial. Also, many of the illegal 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 of having 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 employees gave members of Congress $3.4 million in campaign donations, more than most of the larger lobbying firms in town. If the allegations in the indictment are true, a sizable chunk of that money actually came from Magliocchetti personally or from the firm’s coffers.

In 2007 and 2008 alone, three top Democrats on the House defense subcommittee directed $137 million to defense contractors who were paying Magliocchetti’s PMA Group to get them government business. The three were subcommittee chairman John Murtha of Pennnsylvania, James Moran of Virginia and Visclosky.

Murtha, who died in Feburary, collected $2.37 million in campaign contributions from PMA’s lobbyists and the companies it has represented since 1989, according to the Center for Responsive Politics, which tracks political money. Visclosky has collected $1.36 million; Moran, $997,348.

The indictment says Magliocchetti directed lobbyists in his employ to write donation checks from their personal accounts to specific candidates, advanced funds to them for political contributions or reimbursed their donations by writing personal checks or from the company’s coffers.

For nearly two years, Magliocchetti’s long lobbying history on Capitol Hill has made him a focus of federal prosecutors looking into possible criminality in the awarding of “defense earmarks” — the money that members of Congress steer to defense favored contractors for specific projects.

FBI agents raided Magliocchetti’s firm in late 2008 around the time he was bowing out of the Washington lobbying scene and moving permanently to Florida.

In a separate Justice Department investigation, FBI agents and Pentagon investigators raided one of Murtha’s favored defense contractors back in his Pennsylvania congressional district, Kuchera Defense Systems.

In that probe, federal prosecutors won the cooperation of Richard Ianieri, a businessman who worked closely with one of the owners of the Kuchera company, William Kuchera, and with a lobbying firm that once employed Murtha’s brother.