Author Topic: FBI blocked in corruption probe involving Sens. Reid, Lee  (Read 1637 times)

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Offline Bigun

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FBI blocked in corruption probe involving Sens. Reid, Lee
« on: March 13, 2014, 09:49:58 PM »
FBI blocked in corruption probe involving Sens. Reid, Lee
Agents quietly working with Utah prosecutors to make case in DOJ absence

 By John Solomon

-

The Washington Times

Thursday, March 13, 2014

FBI agents working alongside Utah state prosecutors in a wide-ranging corruption investigation have uncovered accusations of wrongdoing by two of the U.S. Senate’s most prominent figures — Majority Leader Harry Reid and rising Republican Sen. Mike Lee — but the Justice Department has thwarted their bid to launch a full federal investigation.

The probe, conducted by one Republican and one Democratic state prosecutor in Utah, has received accusations from an indicted businessman and political donor, interviewed other witnesses and gathered preliminary evidence such as financial records, Congressional Record statements and photographs that corroborate some aspects of the accusations, officials have told The Washington Times and ABC News.

But the Justice Department’s public integrity section — which normally handles corruption cases involving elected figures — rejected FBI agents’ bid to use a federal grand jury and subpoenas to determine whether the accusations are true and whether any federal crimes were committed by state and federal officials.

The information involving Mr. Reid and Mr. Lee is not fully developed but centers on two primary issues:

• whether both or either politician sought or received money or other benefits from donors and/or fund-raisers in connection with doing political favors or taking official actions;

• whether Mr. Lee provided accurate information when he bought, then sold a Utah home for a big loss to a campaign contributor and federal contractor, leaving his mortgage bank to absorb large losses.

“There are allegations, but they are very serious allegations and they need to be looked at by somebody,” Sim Gill, a Democrat who is the elected chief prosecutor in Salt Lake County, told The Washington Times. “If true, or even if asserted, they truly should be investigated and put to rest, or be confirmed.”

Spokesmen for both senators denied their bosses engaged in any wrongdoing and said the lawmakers were unaware of the investigations.

Mass recusal

The investigative efforts has been further complicated by the fact that Mr. Reid worked to get Mr. Lee’s chief counsel, David Barlow, confirmed in 2011 as the new U.S. attorney in Salt Lake City. That action — a Democratic Senate leader letting a Republican be named to a key prosecutor’s position in the Obama administration — raised many eyebrows and angered some Democrats.

Subsequently, the entire office of federal prosecutors in Utah was forced to recuse itself from the corruption case after questions surfaced about a conflict of interest involving one prosecutor and a subject of the probe. After the recusal, state prosecutors secured a court order transferring the federal evidence gathered up to that point to their possession.

The process has left FBI agents in the unusual position of trying to help two local prosecutors make a case in state court without the ability to use the federal court system to determine whether accusations against two powerful members of Congress are true.

“We’re just two local prosecutors but everybody who was supposed to look at this evidence above us has made a decision not to, and by default left it to us to investigate and prosecute at the state level,” Mr. Gill said.

He and his counterpart in the wide-ranging probe, chief Davis County prosecutor Troy Rawlings, praised the FBI agents assisting their case for their dedication to finding the truth.

Read much more: http://www.washingtontimes.com/news/2014/mar/13/fbi-blocked-in-corruption-probe-involving-sens-rei/#ixzz2vtiSOQ5V

“It is difficult to free fools from the chains they revere.” —Voltaire

Offline Bigun

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Re: FBI blocked in corruption probe involving Sens. Reid, Lee
« Reply #1 on: March 13, 2014, 09:50:54 PM »
Well isn't this a fine kettle of fish!
“It is difficult to free fools from the chains they revere.” —Voltaire

Offline Howie66

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Re: FBI blocked in corruption probe involving Sens. Reid, Lee
« Reply #2 on: March 13, 2014, 09:56:20 PM »
Well isn't this a fine kettle of fish!

My money is that Reid set this up and then put the brakes on it.

That sonovabitch is as dirty as the day is long.

I'm also willing to bet that Mike Lee will be completely exonerated, but tarnished.
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I didn't enlist in the Corps just to watch my country become a Third World Communist Shit-hole. Don't know anyone who did.

Offline Oceander

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Re: FBI blocked in corruption probe involving Sens. Reid, Lee
« Reply #3 on: March 13, 2014, 10:32:10 PM »
We already know that Reid exchanged money for political favors:  he made the floor of the Senate Tom Steyer's personal bully pulpit - and implicitly sold him 55 Senate votes since Reid runs his "flock" with an iron hand - in exchange for Steyer's promise to raise and contribute $100 million to democrat campaigns.

Offline EC

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Re: FBI blocked in corruption probe involving Sens. Reid, Lee
« Reply #4 on: March 14, 2014, 12:12:53 AM »
On the good news side, at least the FBI are taking their job seriously.
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Offline Bigun

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Re: FBI blocked in corruption probe involving Sens. Reid, Lee
« Reply #5 on: March 14, 2014, 09:50:14 AM »
My money is that Reid set this up and then put the brakes on it.

That sonovabitch is as dirty as the day is long.

I'm also willing to bet that Mike Lee will be completely exonerated, but tarnished.

When you read the entire article it becomes clear that this is Abut 95% about Reid and 5% Lee.

I predict that both will skate and 99% of Americans will never know a thing about it!
“It is difficult to free fools from the chains they revere.” —Voltaire

Offline Gazoo

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Re: FBI blocked in corruption probe involving Sens. Reid, Lee
« Reply #6 on: March 14, 2014, 09:53:57 AM »
Yeah, they are protecting Reid. If it were just Lee THE WACKO BIRD TP guy- they would have him crucified at dawn.
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Offline Rapunzel

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Re: FBI blocked in corruption probe involving Sens. Reid, Lee
« Reply #7 on: March 14, 2014, 03:42:29 PM »
I know quite a bit about the guy who sucked bot Reid and Lee into this investigation, I'll post some of it later today.
“The time is now near at hand which must probably determine, whether Americans are to be, Freemen, or Slaves.” G Washington July 2, 1776

Offline flowers

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Re: FBI blocked in corruption probe involving Sens. Reid, Lee
« Reply #8 on: March 14, 2014, 03:46:59 PM »
I know quite a bit about the guy who sucked bot Reid and Lee into this investigation, I'll post some of it later today.
bkmk


Offline Rapunzel

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Re: FBI blocked in corruption probe involving Sens. Reid, Lee
« Reply #9 on: March 14, 2014, 04:44:01 PM »
Been following this almost three years.......  this guy came on our radar when he was photographed illegally flying people over an event at Lake Powell and letting them jump out of his helicopter to the crowd below - actually this is when he came full on the FBI radar because the FAA got involve.......

here is the start from the time the Feds got involved with this guy - who until this happened everyone was sort of in awe of as he had a huge houseboat and regularly flew out to the boat in his private helicopter (which he crashed taking off the boat not long before all this started)

http://www.ksl.com/?nid=960&sid=15936232

Feds arrest St. George business man, philanthropist for mail fraud
By Dennis Romboy
June 11th, 2011 @ 10:01pm
This archived news story is available only for your personal, non-commercial use. Information in the story may be outdated or superseded by additional information. Reading or replaying the story in its archived form does not constitute a republication of the story.
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SALT LAKE CITY — His shaggy red hair sticking out in all directions after a night's sleep, Jeremy Johnson tossed a wad of cash on the end of his inflatable mattress in a large tent on the Dominican Republic-Haiti border.

The cash — he probably had no idea how much — would cover gas for three helicopters and other expenses for the day's relief mission in earthquake- ravaged Port-au-Prince in January 2010.

But before the team, many of whom worked for one of Johnson's lucrative Internet enterprises, headed out to do some good, the boss was in the mood for a contest. And he was willing to throw some bills down to make it happen.

Money was never an object for Johnson, until the Federal Trade Commission came down on him and his company IWorks for allegedly luring consumers into bogus government grant and money-making schemes that netted $275 million.

And now the U.S. Attorney's Office for Utah wants the 35-year-old St. George man.

IRS agents arrested Johnson on Saturday afternoon at the Phoenix Sky Harbor International Airport as he changed planes en route to Costa Rica. Johnson moved his wife and two children to the Central American country earlier this year.
"This is a sizable case. I think it's one of the largest cases in the number of consumers and amount of consumer injury."
–Collot Guerard

Federal prosecutors charged him with one count of mail fraud, a crime punishable by up to 20 years in prison. Johnson is scheduled to appear in U.S. District Court in Phoenix on Monday.

The criminal charge stems from Johnson allegedly using the U.S. mail to further his fraudulent business. According to the felony complaint, he used false advertising, false testimonials and phony reviews to market IWorks and dozens of shell companies.

The latest charge parallels a civil complaint the FTC filed against Johnson last December alleging IWorks scammed people by billing them online for products and services they didn't order. The complaint in federal court in Las Vegas alleges the company offers bogus moneymaking and government grant opportunities on various websites. Those who sign up for the "risk-free" offers are charged monthly fees of as much as $59.96 and enrolled in other programs without their knowledge.

"This is a sizable case. I think it's one of the largest cases in the number of consumers and amount of consumer injury," said FTC attorney Collot Guerard.

Edgardo Hong, of Holly, Mich., was one those consumers estimated by Guerard to number at least 5 million. Wanting to start a translation business, he ordered a CD ostensibly exlaining how he could obtain a government grant in Feburary 2009. He never received the CD, and found 12 unauthorized charges totaling $283.40 on his credit card, according to the FTC complaint.

A 63-year-old Kearns woman ordered a CD to get a grant to help with her house payment. It never came. When she tried to cancel her payment, she was given a telephone number to nowhere.

"It really did freak me out when I realized I'd been scammed," she said. Rather than let the charges pile up on her debit card, she canceled it and opened a new account. "It's a pain in the butt."

IWorks and its shell companies tried to appeal to customers by promiently displaying  the American flag or a picture of President Barack Obama on their websites. Sources formerly associated with the company told the Deseret News it targeted people believed to be impoverished and less educated, particularly single African-American mothers in the South.

Johnson has denied IWorks' involvement in any wrongdoing.

"I look at the situation and I think of what is the right thing. Not what is the proper thing, what is the right thing? Look, even when Jesus was here, people thought he did things wrong, too, and he wasn't following the rules."
–Jeremy Johnson

Court documents filed in the FTC case revealed sides of Johnson that were hidden to the public under his do-gooder persona.

That scene in the Dominican Republic, for example, showed someone who enjoyed putting money on the line for a little competition.

Johnson that day offered $200 to the first man to take down another in a wrestling match on the dirt baseball field he secured for his humanitarian aid base camp. Two gladiators quickly emerged: a stocky Johnson employee training to be an ultimate fighter and a muscular Dominican security officer Johnson hired to guard the camp.

A circle quickly formed around the combatants and the fight was on. The Dominican eventually grappled his opponent to the ground, and Johnson happily peeled off the prize money from a fat roll of bills.

Besides being a multimillionaire businessman and humanitarian, Johnson, court records show, is a chronic a gambler. And an internal FBI investigative report obtained by the Deseret News shows he isn't averse to bullying while transacting business.

By his own admission, Johnson is not good with money. But when you've made $275 million in a decade's time, what's the use of keeping track. He would rather spend it anyway. 

Of that amount, court records show $59 million supported a lavish lifestyle devoted to mansions, property, gold and silver, businesses, a dozen helicopters and airplanes, a Ferrari and a Lamborghini. He gave money to family, friends and his LDS Church ward.

Johnson made international headlines last year as a daring helicopter pilot, dropping food to starving Haitian earthquake victims and rushing injured children to hospitals.

No one told Johnson to be a hero after the Jan. 12, 2010 earthquake. He just climbed into his custom-made helicopter and went — carrying $150,000 in cash. Some friends — mostly IWorks employees — joined him, turning helping people into an adventure. He spent more than $1 million on Haiti relief efforts.

The way he helped people, sort of playing Robin Hood in Haiti, drew some criticism as being disrespectful. But in a Deseret News interview last year he was undaunted.

"I look at the situation and I think of what is the right thing. Not what is the proper thing, what is the right thing? Look, even when Jesus was here, people thought he did things wrong, too, and he wasn't following the rules. He did what he thought he should do, and it was different than what everyone else thought he should do. I get held back, but if I had my way, I wouldn't care what anybody thought, or what the rules or laws said."

Johnson also frequently flew search-and-rescue missions for the Washington County Sheriff's Office.

In the same interview, he recalled his first rescue, an elderly hunter who had gone missing the mountains.

"Just having this feeling this guy was going to live was an unbelievable high. I thought to myself, 'It's like a drug.' It's a little bit of an addictive feeling, and you want to replicate it."

Saving people isn't the only thing Johnson found intoxicating.

Johnson gambled regularly at Wynn Las Vegas, the MGM Grand and other MGM properties, losing $1.35 million from June 2006 and January 2011, court records show. Between return humanitarian trips to Haiti, he dropped another $1.5 million playing online poker at sites including PokerStars and Full Tilt Poker.

In a January 2011 deposition, he admitted to a federal investigator that he was addicted to gambling.

Asked how often he gambled in Las Vegas, Johnson replied, "Too often. I can tell you that. I don't know how often."

Losing apparently didn't matter. He told the investigator he didn't know how much money he lost only that it was "way too much."

And he apparently doesn't consider playing online poker to be gambling. Asked if he gambled online, Johnson said, "No, I played poker online. … There's a difference."

Many of Johnson's business deals went through St. George-based SunFirst Bank. The bank's part owner and vice president, John Campos, was indicted in New York in April for allegedly running illegal online poker operations, specifically Full Tilt Poker and PokerStars.

Campos initially had "trepidations," but then allegedly agreed to process gambling transactions in return for a $10 million investment in SunFirst by a Las Vegas man named Chad Elie and an associate, according to prosecutors. The investment would have given Elie, who is named in the indictment, and his associate 30 percent ownership in the bank.

Johnson introduced SunFirst to the online gambling processing, while Elie handled the technological side of the deal, said FTC attorney Guerard.

Elie and Johnson had also conducted business together, and Johnson bought Elie a Cadillac Escalade at one point because "he told me to," court documents show. Elie also later sued Johnson for $20 million, but the case was dismissed.

Guerard said she met Johnson in the course of the FTC investigation and described him as "perfectly pleasant."

But an FBI investigative report obtained the Deseret News shows a darker side.

Johnson, according the report, was among a dozen men involved in holding hostage a man who apparently owed Johnson money.

Johnson invited the man to a June 29, 2006 business meeting at his home in Santa Clara. When the man arrived, a "big guy" identified in the report as possibly a bounty hunter or bouncer greeted him. The next thing the man remembers is waking up on the floor with his hands handcuffed behind his back. The big guy sat him on a chair and restrained his legs with zip ties.

Johnson, according to the report, arrived after the man was tied up. The man was held for about four or five hours before being released.

In an interview with the FBI about the incident, Johnson wasn't particularly forthcoming.

 "Johnson refused to identify the individual who arranged for the 'big guy' to be at the home," according to the report. He also would not provide contact information of others who were there.

"During the meeting, Johnson was very careful not to ask … for money or anything else because Johnson did not want to be accused of extortion."

According to the report, Johnson was concerned about possible criminal charges and contemplated talking to an attorney. No charges were filed against him.

The criminal charge leveled against Johnson last week in connection with the alleged IWorks scam will keep in him jail over the weekend. He will likely have a detention hearing this week to determine whether he will be held in custody before being returned to Utah to answer the charge.

In the months since the FTC complaint, Johnson has moved his family Costa Rica to "pursue other business opportunities," court records show, and was headed there when IRS agents arrested him. But how he has managed to shuttle between there and St. George has federal investigators wondering where's he getting the money.

A federal judge in Nevada froze Johnson's assets and appointed a receiver to manage them pending the outcome of the FTC case. According to the new criminal charge, he has "substantial resources" in other countries including real estate in Belize and the Philippines.

But in a recent filing in the FTC case, government attorneys say Johnson hasn't been candid about his assets and question how he apparently continues to live the high life. He asked the receiver for permission to use a million-dollar houseboat over the recent Memorial Day weekend.

"How can Johnson and his family have funds to travel to Lake Powell, expend the funds necessary to use their luxurious houseboat for a weekend getaway, and then return to Costa Rica or St. George, when all of their non- receivership assets have purportedly been 'depleted?'"


“The time is now near at hand which must probably determine, whether Americans are to be, Freemen, or Slaves.” G Washington July 2, 1776

Offline Rapunzel

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Re: FBI blocked in corruption probe involving Sens. Reid, Lee
« Reply #10 on: March 14, 2014, 04:46:14 PM »
more on the last post from Salt Lake Tribune which is pretty much a rehash of KSl

http://www.sltrib.com/sltrib/news/51989098-78/johnson-federal-iworks-mail.html.csp

and the Desert News.......

http://www.deseretnews.com/article/705364802/Federal-judge-freezes-assets-of-iWorks-Jeremy-Johnson-in-alleged-Internet-fraud-case.html

Federal judge freezes assets of iWorks, Jeremy Johnson in alleged Internet fraud case

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By Dennis Romboy, Deseret News

Published: Thursday, Jan. 20 2011 11:30 p.m. MST
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A federal judge in Nevada has temporarily frozen the assets of a multimillionaire St. George businessman who the Federal Trade Commission alleges runs a fraudulent far-reaching Internet enterprise.

SALT LAKE CITY — A federal judge in Nevada has temporarily frozen the assets of a multimillionaire St. George businessman who the Federal Trade Commission alleges runs a fraudulent far-reaching Internet enterprise.

U.S. District Judge Kent J. Dawson also appointed a receiver to take control of iWorks and 60 other companies operated by Jeremy Johnson and nine associates. The FTC next week will ask the court to impose those orders for the duration of the case, which could take years to resolve.

"There is good cause to believe that irreparable damage to the court's ability to grant effective final relief for consumers in the form or monetary redress will occur from the sale, transfer or other disposition or concealment by Jeremy Johnson and the corporate defendants of assets or records unless Jeremy Johnson and the corporate defendants are immediately restrained and enjoined by order of this court," Dawson's ruling said.

The FTC last month initiated legal action against iWorks for allegedly scamming consumers out of $275 million by billing them online for products and services they didn't order. A complaint filed in federal court in Las Vegas alleges the company offers bogus moneymaking and government grant opportunities on various websites. Those who sign up for the "risk-free" offers are charged monthly fees and enrolled in other programs without their knowledge, according to the complaint.

Johnson has denied any wrongdoing.

Freezing the assets means Johnson can't sell, trade or otherwise move anything he owns such as stocks, real estate and cash. In addition to Johnson, the order applies to the other defendants: Duane Fielding, Andy Johnson, Loyd Johnston, Scott Leavitt, Scott Muir, Bryce Payne, Kevin Pilon, Ryan Riddle and Terrason Spinks.

The court-appointed temporary receiver would have the power to manage all aspects of the company including removing employees and taking down websites, according to court documents. The defendants also were ordered to provide an accounting of their assets and finances to the receiver.

On Thursday, a federal judge in Salt Lake City approved an FTC motion to intervene in another lawsuit against Johnson and several business partners.

A Nevada man, Chad Elie, claims Johnson owes him $20 million from a profitable joint business venture in 2009. "He believes he didn't get his fair share," said David Hague, Elie's attorney.

Elie, owner of Viable Marketing Corp., had also sought a court order freezing Johnson's assets.

David Hague said after the hearing he intends to negotiate a settlement with the other defendants in Elie's case whose assets are not subject to the freez
“The time is now near at hand which must probably determine, whether Americans are to be, Freemen, or Slaves.” G Washington July 2, 1776

Offline Rapunzel

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Re: FBI blocked in corruption probe involving Sens. Reid, Lee
« Reply #11 on: March 14, 2014, 04:47:52 PM »
A little more from Las Vegas.......

http://www.vegasinc.com/business/legal/2011/may/27/feds-move-sell-assets-utah-business-gambling-figur/

BTW as an aside - Johnson actually owned two houseboats at Lake Powell - one of the boats was notorious on the lake (as in no one wanted to be anywhere near the boat) it was called Animal House - a while after this initial event Animal House was raided at Antelope Point and seized for drugs.

« Last Edit: March 14, 2014, 04:49:20 PM by Rapunzel »
“The time is now near at hand which must probably determine, whether Americans are to be, Freemen, or Slaves.” G Washington July 2, 1776

Offline Rapunzel

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Re: FBI blocked in corruption probe involving Sens. Reid, Lee
« Reply #12 on: March 14, 2014, 04:52:02 PM »
http://m.sltrib.com/sltrib/money/52056154-79/johnson-fraud-attorney-charge.html.csp

Feds: Jeremy Johnson had wad of cash, one-way ticket

By Tom Harvey The Salt Lake Tribune
Published June 22, 2011 7:49 pm
This is an archived article that was published on sltrib.com in 2011, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.

St. George businessman Jeremy Johnson had $26,400 in cash and a one-way ticket to Costa Rica when he was arrested on a fraud charge earlier this month at the Phoenix airport by IRS agents.

But his attorneys say the money was for a business he is trying to start in the Central American nation and that he frequently travels internationally on one-way tickets because it's often cheaper than having to change return dates on round-trip fares. They want him released from jail pending trial in federal court when he is brought from Arizona to Utah to face a mail fraud charge.

The money and ticket are part of the evidence the U.S. Attorney's Office is using to try to keep Johnson in jail until the case against him is resolved. At a hearing last week in Phoenix over whether Johnson should be freed, Assistant U.S. Attorney Jim Knapp said Johnson had $26,400 in cash on him when he was arrested at Sky Harbor International Airport on June 11. Knapp added that Johnson and three unnamed companions each had a one-way ticket to Costa Rica, according to a recording of the session.

"I think there are some very strong facts to suggest the defendant was trying to leave the country and trying to leave with some of the proceeds from the fraud scheme," Knapp told the U.S. magistrate presiding over the hearing. Johnson ended up waiving his right to contest extradition to Utah and is expected to be flown to Utah soon to face the mail-fraud charge.

Johnson was arrested five months after the Federal Trade Commission sued him, several business partners and their companies for allegedly running a massive Internet fraud scheme that brought in $350 million from consumers who the agency says were duped into giving up credit and debit card information that was used for unauthorized billings.

Johnson's Utah attorney, Travis Marker, said Wednesday his client was legally carrying the money in Phoenix, adding that it was for an investment in a business in Costa Rica. Marker said the source of the funds had been disclosed.

Marker said he and his legal team are preparing to argue in Utah that Johnson is not a flight risk. Johnson would not have tried to leave the country from Phoenix had he known a charge was pending, the attorney said.

Melodie Rydalch, spokes-woman for the U.S. Attorney's Office in Utah, said prosecutors will be asking that Johnson be detained.

After Johnson's arrest on the criminal charge, the Las Vegas judge presiding over the FTC lawsuit last week denied his request for the release of frozen funds so Johnson could pay legal bills and about $27,000 a month in living expenses.

U.S. District Judge Roger L. Hunt said Johnson appeared to have access to funds that enabled him to pay more than $200,000 in legal fees, transport his family back and forth to Costa Rica where they have a house and to meet other expenses.

Among the living expenses Johnson listed were $16,600 a month to meet mortgage payments on his St. George home and $2,650 a month for yard maintenance.

The judge pointed out that the St. George house is worth less than Johnson owes on it and said that the circumstances of the mortgage were "suspicious."

"Under these circumstances alone, the court cannot justify Johnson's request," Hunt said in his ruling released Friday. "Johnson is not entitled to monies that would continue funding a fiscally irresponsible lifestyle."

The federal grand jury that indicted Johnson on the mail fraud count continues to meet, the U.S. Attorney's Office said, so additional charges are possible.

The IRS also has made a $2.6 million claim against Johnson, according to court records.
“The time is now near at hand which must probably determine, whether Americans are to be, Freemen, or Slaves.” G Washington July 2, 1776

Offline Rapunzel

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Re: FBI blocked in corruption probe involving Sens. Reid, Lee
« Reply #13 on: March 14, 2014, 04:56:09 PM »
http://www.sltrib.com/sltrib/mobile/52583579-79/johnson-federal-bail-million.html.csp



A freed Jeremy Johnson eager for day in court
image
Tribune file photo The FTC has asked a judge presiding over its lawsuit against Jeremy Johnson to amend it to include among others Johnson’s wife, Sharla, seen with him after a court hearing last fall.

By Tom Harvey

The Salt Lake Tribune
First published Sep 14 2011 11:57AM
Updated May 20, 2013 10:48PM

After posting nearly $2.8 million bail on a mail fraud charge, St. George businessman Jeremy Johnson walked out of the Frank E. Moss U.S. Courthouse in Salt Lake City on Thursday morning after 96 days in jail.

Holding the hand of wife Sharla, Johnson smiled as he left the courthouse and hugged relatives, freed from jail for the first time since his June 11 arrest in Phoenix.

"He’s happy to be out, excited, and he’s going to spend some time with his family," Johnson’s attorney, Nathan Crane, said in cutting off questions to Johnson.

Crane said he and Johnson would now prepare to battle federal prosecutors over the mail fraud charge and others expected to be handed up by a federal grand jury in connection with Johnson’s operation of iWorks, an online marketing company that took in millions of dollars, allegedly in unauthorized charges on consumers’ credit and debit cards.

"We’re excited about going to trial," Crane said. "Jeremy has run a legitimate business, and we look forward to our day in court."

U.S. Magistrate David Nuffer signed an order Wednesday that freed Johnson on bail until his trial. Nuffer’s action came after Johnson’s relatives and friends put up equity in property and an annuity to meet the demands of the U.S. attorney’s office for a substantial bail. He also must wear a GPS ankle bracelet that constantly monitors his whereabouts.

Johnson was in jail for 96 days, since his arrest at Phoenix Sky Harbor International Airport before he could board a flight to Costa Rica, where his attorney said he was trying to set up a helicopter tourism company. That came after Johnson had shut down his iWorks business late last year as it was being investigated by the Federal Trade Commission for possible fraud.

An IRS agent who arrested Johnson said the agency had been told Johnson intended to stay in Costa Rica for a substantial period of time, though the agent also said he didn’t think Johnson was fleeing the country. Johnson’s attorneys say he would have remained in the U.S. had he known he would be charged.

U.S. Justice Department trial attorney Brent Ward has said he expects a new indictment that will add more charges to the case against Johnson, who also is known in Utah for his philanthropic efforts.

In December, the Federal Trade Commission sued Johnson, iWorks, Johnson’s partners and others, accusing them of running a massive online fraud operation.

iWorks-related websites touted products for "make-money schemes," "stay-healthy programs" and information about government and private grants, which purportedly could be used by consumers to pay for personal expenses. But some of those who gave credit or debit card numbers to cover a minimal handling charge, usually $1.99, also were charged a one-time fee of $189, then monthly fees of $59.95, according to the suit.

From 2006 to late 2010, iWorks took in $350 million from hundreds of thousands of customers before Johnson shut it down in late 2010, and he received about $48 million from the business, according to the FTC.

Nuffer previously turned down $1 million in bail for Johnson after a former business partner testified Johnson showed him safes full of cash, gold and silver, and said he had money stashed on mountaintops and in lakes. But Crane worked out the new amount with Ward.

tharvey@sltrib.com" target="_blank">Indent">tharvey@sltrib.com
“The time is now near at hand which must probably determine, whether Americans are to be, Freemen, or Slaves.” G Washington July 2, 1776

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Re: FBI blocked in corruption probe involving Sens. Reid, Lee
« Reply #14 on: March 14, 2014, 04:58:52 PM »
At this point the investigation from the FBI started to sweep up some other "names"

http://money.cnn.com/2011/09/20/news/companies/poker_ponzi/index.htm

http://www.sltrib.com/sltrib/news/51636750-78/bank-johnson-gambling-indictment.html.csp

St. George bank leader caught in huge online poker sting

By Tom Harvey The Salt Lake Tribune
Published April 15, 2011 3:06 pm
This is an archived article that was published on sltrib.com in 2011, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.

An officer of a St. George bank was arrested Friday morning as part of a federal criminal indictment involving the processing of illegal online gambling payments, a case that also involves prominent Utah businessman and philanthropist Jeremy Johnson.

John Campos, vice chairman of the board and part-owner of SunFirst Bank, was arrested in St. George and is to appear Monday before a federal magistrate there.

Campos was alleged to have made a deal with a processor for two of the three largest online poker companies to use the bank to accept payment from gamblers in exchange for a $10 million investment in SunFirst and a $20,000 bonus to him for consulting services.

Arrested in Las Vegas was Chad Elie, a businessman with ties to Johnson. Johnson was not named in the indictment but in documents in another case, Elie said Johnson approached him in 2009 and said he had a trusted relationship with SunFirst Bank that they could use to process payments on behalf of Elie's clients, who the indictment says were online poker companies.

A 2006 law makes it a federal crime for gambling businesses to knowingly accept most forms of payment for illegal Internet gambling. Because of the law, Internet gambling companies that are located overseas concocted various schemes to use separate processing companies to hide the purpose of the payments from U.S. customers, the indictment says.

Elie and Johnson, known for his philanthropy efforts in Haiti and for use of his helicopter to aid Utah law enforcement efforts, together with a man named Andrew Thornhill, approached Campos in the fall of 2009. That came after the poker companies — PokerStars, Full Tilt Poker and Absolute Poker — decided they needed "transparent processing" when previous schemes involving credit cards and electronic checks kept getting shut down by Visa, MasterCard and banks.

"As a result of his trusted relationship with SunFirst, Johnson represented to me that he was in a unique position to ensure that I could successfully process for my online merchants," Elie said in a declaration for a lawsuit he filed against Johnson for allegedly denying him at least $10 million in profit from their joint venture.

Campos agreed to the scheme, though the indictment and a complaint do not say any other bank officials knew of the connection to gambling operations.

"Campos, while expressing 'trepidations' about gambling processing, proposed in a September 23, 2009, e-mail to accept such processing in return for a $10 million investment in SunFirst by Elie and Elie's partner, which would give Elie and Elie's partner more than 30 percent ownership of the bank," according to the indictment.

The $10 million was not invested in SunFirst, according to its attorney, Loren Weiss of Salt Lake City, though the indictment says Elie and the partner did put in $3.4 million in December of 2009.

The arrangement led Thornhill, a representative of an Australian processing company who was not indicted, to tell an associate "things are going well with the bank we purchased in Utah and my colleagues and I are looking to purchase another bank for the purpose of repeating our business plan," the indictment says.

SunFirst processed over $200 million in payments for PokerStars and Full Tilt Poker through Nov. 9 of last year, earning it about $1.6 million in fees, according to the indictment.

Weiss said no one else at SunFirst knew of the relationship with the gambling companies and the bank had no connections with them but rather with the processors.

"They had no relationship with poker," he said.

Bank customers said Friday afternoon they had not heard of the arrest of Campos. Some did not think it would affect their relationship with SunFirst.

In December, the Federal Deposit Insurance Corp. ordered SunFirst Bank to stop providing payment services to companies controlled by Johnson.

That was after Johnson was sued by the Federal Trade Commission. The suit in federal court in Las Vegas alleges Johnson, his iWorks company and related entities defrauded online customers in a scheme in which they paid a minimal fee for information and services but then were billed as much as about $60 a month for services they had not knowingly agreed to.

Johnson's companies took in about $350 million and he pocketed more than $48 million from the businesses, according to the FTC.

An e-mail to Johnson's attorneys in Las Vegas seeking comment on the gambling indictment had not been returned as of early Friday evening.

Court papers in the FTC case show that he lost at least $2.8 million gambling in Las Vegas, where he was a frequent customer at Wynn Las Vegas, the MGM Grand, other MGM Resorts properties, and that he also gambled online at fulltiltpoker.com, as well as in Reno and Mesquite.

In a deposition in January, Johnson told an FTC attorney he used money from his companies to gamble, but that after he shut them down because of the lawsuit he no longer had that income and "it's been a really good cure for me, my addiction."

"So do you feel like you were addicted to gambling before?" asked Collot Guerard, the FTC attorney.

"I did use that word, didn't I? I guess so," said Johnson.

According to the indictment, PokerStars is based on the Isle of Man, Full Tilt in Ireland and Absolute Poker in Costa Rica.

"These defendants concocted an elaborate criminal fraud scheme, alternately tricking some U.S. banks and effectively bribing others to assure the continued flow of billions in illegal gambling profits," said Prett Bharara, the U.S. Attorney for the southern district of New York, in a statement. "To circumvent the gambling laws, the defendants also engaged in massive money laundering and bank fraud."


 How it worked

It is illegal in the U.S. to process credit card and other payments meant for online gambling.

As a result, overseas poker companies have relied on third-party processors that constructed elaborate facades to hide the money's destination. They created dozens of fictitious online sites, such as flower sellers and pet supply stores, that made it appear payments came from retail sales.

When banks halted processing those transactions, the companies turned increasingly to electronic checks.

Banks and federal authorities began to catch on to the e-checks, too, freezing and seizing funds from the accounts, so the poker companies engaged in a strategy of "transparent processing."

That strategy involved not lying to banks, and apparently led to the alleged agreement to invest in SunFirst Bank in return for processing payments.

Source: Federal indictment
« Last Edit: March 14, 2014, 04:59:23 PM by Rapunzel »
“The time is now near at hand which must probably determine, whether Americans are to be, Freemen, or Slaves.” G Washington July 2, 1776

Offline Rapunzel

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Re: FBI blocked in corruption probe involving Sens. Reid, Lee
« Reply #15 on: March 14, 2014, 05:00:19 PM »
wall street journal ran 3 articles on the full tilt poker Internet gaming collapse with one article making note of the St George Utah ties. Pretty hard to keep track of the facts as this thing jumps all over the globe.


online.wsj.com/article/SB100014240531119...h_TECHEDITORSPICKS_1

online.wsj.com/article/SB100014240529702...WSJ_Tech_LEFTTopNews

online.wsj.com/article/SB100014240529702...WSJ_Tech_LEFTTopNews

Then a few weeks later..........

Sunfirst bank in St George utah was closed down by bank regulators.

this is the bank  with ties to jeremy johnson that he allegedly used for some of his stuff. 


www.sunfirstbank.com/

www.sltrib.com/sltrib/money/50959508-79/...ftc-credit.html.csp.

www.sltrib.com/sltrib/news/51636750-78/b...-indictment.html.csp

www.sltrib.com/sltrib/money/52850409-79/...tal-johnson.html.csp

www.salttvnetwork.com/articles/20110416/...nline-gambling-probe

www.deseretnews.com/article/705393794/Su...assume-deposits.html
« Last Edit: March 14, 2014, 05:02:27 PM by Rapunzel »
“The time is now near at hand which must probably determine, whether Americans are to be, Freemen, or Slaves.” G Washington July 2, 1776

Offline Rapunzel

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Re: FBI blocked in corruption probe involving Sens. Reid, Lee
« Reply #16 on: March 14, 2014, 05:02:54 PM »
Jeremy gets arrested again, this time for allegedly writing a bad check for $100,000

www.ksl.com/?nid=148&sid=18273149&am...100k-check-in-vegas
“The time is now near at hand which must probably determine, whether Americans are to be, Freemen, or Slaves.” G Washington July 2, 1776

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Re: FBI blocked in corruption probe involving Sens. Reid, Lee
« Reply #17 on: March 14, 2014, 05:05:46 PM »
Then a year ago news started to lead Johnson had links to Harry Reid..........

http://pokerfuse.com/features/in-depth/jeremy-johnson-alleges-million-dollar-harry-reid-bribe-on-full-tilt-behalf-31-01/


Jeremy Johnson Alleges $1 Million Harry Reid Bribe on Full Tilt’s Behalf

Secret recording alleges online poker legislation was influenced by more than just lobbying.
Utah man alleges that money was paid to advance online poker legislation.
hansntareen, Creative Commons Attribution 2.0 License
By Haley Hintze

This week’s release of an hour-long audio tape between indicted iWorks marketing fraudster and SunFirst Bank online poker payment processor Jeremy Johnson and current Utah Attorney General John Swallow contains online-poker bribery allegations involving Nevada Senator Harry Reid.

Johnson recently released what he claims is a secretly-taped recording between he and Swallow, made in April 2012 at an Orem, Utah Krispy Kreme donut shop. On the tape, Johnson indicates he participated in a Full Tilt-instructed deal to send $1m to Reid via an intermediary, in exchange for Reid helping lead the charge to launch online-poker regulations.

The specific exchange regarding Full Tilt and online-poker takes up only about two minutes or so of the hour-long audio recording, which is available both on the Salt Lake City Tribune story on the recording and on the SLC Tribune’s YouTube page. The online-poker tale occurs about 40 minutes into the recording.

The full weight of the Johnson bribery accusations threatens to topple Swallow, the newly-elected Utah AG. Swallow is alleged by Johnson to have taken money to funnel to Reid, to make the federal FTC case against Johnson and his iWorks empire disappear.

It was Swallow who first broached the topic of online poker with Johnson, at one point remarking, “Do they know about your poker transaction with Harry Reid and stuff?”

Johnson replied, “I don’t think anybody knows that. Honestly, you’re the only person in the world I’ve even told that to.”

A couple of minutes later, the conversation returned to online poker more fully, with this exchange at the heart of the matter:

    Johnson: I’ll tell you this. We had a meeting with Reid, where he said—this was a private meeting—it was Reid, it was me, it was, you remember John Pappas? Remember him? Poker Players Alliance guy?
    Swallow: Oh, yeah.
    Johnson: John Pappas, and Ray Bitar, owner of Full Tilt Poker.
    Swallow: Yeah.
    Johnson: Owner of Full Tilt Poker. [] And Senator Reid—this was when it was a tight election with this lady down there, real tight…
    Swallow: Yeah… yeah, sure. I remember that.
    Johnson: And he said, 'Look, I’ve polled my constituents. They don’t like online poker. Bottom line. It’s bad for… it’s bad for jobs here in Las Vegas. But, I’m going to back what you guys are doing here. I’m going to introduce a bill for you.’

Johnson continues:

    And that was basically it, right? Well, I kid you not, a week later—no, no, right after Reid leaves…. So Reid leaves with his little entourage. Ray Bitar’s buddy, who flew over with him from Ireland, I said [to him], “How in the hell did you guys get him to do that?”

    And he says, 'Let’s just say he got a little something in his retirement fund.’

    And I was like, 'Okay, that’s how it is.’

    Well, I’m not kidding you, a week later, they have me—and they’re specific—“We want a bank cheque drawn on the bank’s general account.” For a million dollars, to some company, some media thing or something. “A cashier’s cheque. This money had better not get traced back to our account under any circumstances.”

    So what do I do, of course, I go into the bank, I tell them I need to pull this out of the bank’s general reserve, which is held in their account. I don’t tell the bank what I’m doing. I didn’t know what I was doing — I was like 'I don’t know,’ you know. I suspected, obviously.

    So, I believed… this is my belief: I believe Reid genuinely is on the take. I believe he’s getting money for deals all over hell 'cause he’s got so much influence. And I believe they’re onto him.

Johnson’s belief that investigators might be looking into Reid has fueled complaints about Johnson’s media tactics. And yet some facts have emerged that have lent some credibility to Johnson’s claims, even if his “I didn’t know what I was doing” excuse warrants closer scrutiny.

A meeting involving Reid, Johnson and various FTP people is known to have occurred, with convicted Black Friday payment processor Chad Elie releasing a photo a couple of months ago showing Reid, Johnson and Pappas together at a Vegas meet-n-greet, with Full Tilt people also in attendance.

The alleged channel used to funnel the supposed million-dollar Reid bribe connected to online poker remains unidentified, though the Salt Lake Trib ran another piece this week detailing other back-channel connections and shady dealings allegedly connected to Reid.

Separately, the battle over Johnson’s very public allegations has turned into a partisan Utah battle, with the Utah GOP issuing a release about Swallow’s “mistake,” while the US Attorney’s Office of Utah has sought a gag order against Johnson to prevent future leaking of information, in what it describes as a smear campaign against those elected officials connected to his cases.
“The time is now near at hand which must probably determine, whether Americans are to be, Freemen, or Slaves.” G Washington July 2, 1776

Offline Rapunzel

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Re: FBI blocked in corruption probe involving Sens. Reid, Lee
« Reply #18 on: March 14, 2014, 05:07:58 PM »
and the AG of Utah...........

http://www.sltrib.com/sltrib/home3/55598812-200/johnson-swallow-rawle-attorney.html.csp

Indicted businessman: Utah A.G. tied to alleged scheme

By Tom Harvey And Robert Gehrke The Salt Lake Tribune
Published January 12, 2013 10:10 pm

 Embattled St. George businessman Jeremy Johnson says new Utah Attorney General John Swallow helped broker a deal in 2010 in which Johnson believed he was to pay Senate Majority Leader Harry Reid $600,000 to make a federal investigation into Johnson's company go away.

But when the federal government filed a lawsuit Johnson thought he had paid to quash, he demanded Swallow return some of the $250,000 initial payment. Then, just days before the Nov. 6 election, Johnson engaged in a frenetic but unsuccessful effort to get Swallow to drop out of the race, saying information about what Johnson called a "bribe" would come out and force the Republican's resignation if he became attorney general.

Johnson's allegations come less than a week after Swallow took the oath of office. Federal agents have interviewed several Utahns about Johnson's relationship with Swallow, among other issues, according to those interviewed. The FBI would not comment.

Johnson said he does not know if any of the money he paid in the deal actually reached anyone connected to Reid.

Reid's office declined to comment, spokeswoman Kristen Orthman said Friday.

To back his allegations, Johnson provided an email from Swallow that Johnson identified as key in supporting his claims. Johnson also granted access to at least several dozen other emails, two financial records, several photos and a transcript of about 60 pages of a secretly recorded April 2012 meeting Johnson had with Swallow, who was then Utah's chief deputy attorney general.

The documents appear to support Johnson's story that in 2010 Swallow brokered a deal between Johnson and Richard M. Rawle, owner of the Provo-based payday-loan company Check City, to enlist Rawle to use his influence to get Reid involved on behalf of Johnson and I Works, Johnson's Internet marketing company that was under investigation by the Federal Trade Commission.

Swallow emphatically denies Johnson's allegations and said he doesn't understand why Johnson is spreading lies about him.

"Any suggestion by Mr. Johnson that I have been involved in illegal or inappropriate activity regarding his FTC case or any other matter is false and defamatory," Swallow said.

Swallow insists Johnson approached him in 2010 and sought help to hire a lobbyist to deal with his FTC issues. "I told Jeremy I could not and would not intervene with the FTC on his behalf, given my position with the state [attorney general]," Swallow said. Johnson later asked Swallow to approach the U.S. attorney on his behalf, but Swallow said he refused.



Political clout • Johnson sought help from Swallow in early 2010, when he felt the FTC was unjustly targeting him and I Works with an investigation into the company's business practices.

At the time, Johnson was largely known in Utah as a wealthy philanthropist who spent hundreds of thousands of dollars to ferry supplies into Haiti after the devastating 2010 earthquake.

Johnson, his business partners and family members also were generous political donors, having given more than $200,000 in campaign contributions to then-Utah Attorney General Mark Shurtleff starting in 2008 while Swallow served as Shurtleff's lead fundraiser. Johnson also supported charities and Attorney General's Office initiatives in which Shurtleff was involved. Johnson flew Shurtleff on his private jet to a fundraiser in California. Photographs from the summer of 2009 show the two men sitting in Johnson's yellow Lamborghini sports car.

Copies of emails show Swallow worked with Shurtleff to arrange meetings between Johnson and top Utah officeholders.

Then, with the FTC investigation continuing, Johnson said Swallow suggested Reid could make problems with regulators go away — for a price.

"I said, 'OK, what do I need to do?' He's like, 'OK, it costs money,' " Johnson said, who claimed Swallow was adamant he make a deal.

"I think he told me, 'Richard Rawle has a connection with Harry Reid,' " Johnson said.

He said Swallow at first wanted $2 million to enlist Reid's help. But I Works was no longer profitable and he did not have the money, Johnson said, so they eventually agreed on $300,000 upfront and $300,000 later.

Swallow put Johnson in contact with Rawle, whose company has operations in Nevada. Rawle had given generously to Swallow's failed congressional bids and hired Swallow as Check City's lobbyist and in-house legal counsel, a position Swallow held until he became chief deputy attorney general in December 2009.

Rawle, who died of cancer last month, had contributed to Reid's 2010 re-election bid and later bragged to Johnson that the Nevada Democrat helped him delay new federal payday-loan regulations, Johnson said.

On Sept. 29, 2010, Swallow sent an email to Johnson with the subject line "Mtg. with Harry Reid's contact."

"Richard [Rawle] is traveling to LV tomorrow and will be able to contact this person, who he has a very good relationship with. He needs a brief narrative of what is going on and what you want to happen. I don't know the cost, but it probably won't be cheap."

On Oct. 7, Johnson emailed Rawle, insisting there was "rock solid proof" the FTC allegations against I Works were false. "We will do whatever it take[ s ] to get Senator Reid on our side and hopefully you can help make it happen. Let me know."

They arranged an Oct. 9 meeting at Check City's Provo headquarters. Johnson said he, Swallow and Rawle attended, along with at least two other people.

Five days later, on Oct. 14, Rawle registered a new company called RMR Consulting LLC with the state, Department of Commerce records show. On Nov. 2, an official with a Check City-related company called Softwise Inc. emailed Johnson, with a copy to Rawle: "We wanted to let you know that we have our people in Washington D.C. currently working with the FTC on your case. … Also, the initial retainer of $50,000 can now be wired to RMR Consulting, LLC."

The writer provided an account number at Bonneville Bank.

A copy of I Works' general ledger that same day shows $50,000 was paid to RMR Consulting for "legal fees." Another $200,015 was paid Dec. 2.



FTC proceeds with suit • But less than three weeks later, on Dec. 21, 2010, the FTC filed a lawsuit against Johnson, I Works and others in federal court in Las Vegas.

The suit alleges illegal marketing and billing practices for online sales of kits and access to websites with information about such things as obtaining government grants for personal expenses and making money online. It also alleges Johnson created a number of shell companies whose connections to I Works were hidden so they could continue to bill customers after Visa and Mastercard threatened to cut him off because a large number of cardholders had reversed charges.

Johnson said he called Swallow and asked him why the lawsuit was filed after he had paid for it to go away. According to Johnson, Swallow told him it was because Johnson hadn't paid the second $300,000 they had agreed on and that Reid believed he had the money.

Johnson said he had no documentation or direct knowledge that any of the money went to Reid or the senator's associates.

Because the money he paid had done nothing for him and I Works, Johnson began a months-long effort to pressure Swallow and Rawle into returning at least some of the money, which Johnson had borrowed from a friend who also was an I Works executive.

In June 2011, Johnson was charged with a single criminal count of mail fraud and was arrested at the Phoenix airport while waiting to board a plane for Costa Rica, where he hoped to start a helicopter tourism business after I Works had been taken over by a court-appointed receiver and his assets were frozen.

Johnson spent 96 days in jail until federal prosecutors relented and a judge granted bail of $2.8 million.

While he was in jail, Johnson said, Swallow worried Johnson was cutting a deal with federal prosecutors. Just after Johnson's release, and with Swallow a candidate for attorney general, Johnson said Swallow and his campaign consultant, Jason Powers, met him at a St. George hotel, where Johnson said he again pressured Swallow to come up with the money.

Powers said his memory about the meeting is hazy, but he recalls the atmosphere as being cordial and remembers discussion of a meeting with Rawle that Johnson claimed Swallow attended, but Swallow said he had not. According to Powers, Johnson agreed.



Secret recording • Swallow and Johnson then met on April 30 of last year at the Krispy Kreme doughnut shop in Orem, according to Johnson. Swallow said he believed the meeting's purpose was to persuade him to encourage Rawle to return the money.

Without Swallow's knowledge, Johnson had the meeting photographed and recorded. Photos show Johnson and Swallow seated at a table facing each other.

In a transcript of the recording prepared by Intermountain Court Reporters, Swallow at first denies having met with Rawle and Johnson at the October meeting at Check City's offices and said all his interactions with Johnson focused on hiring lobbyists to influence the FTC.

Johnson takes none of it, and points to Swallow's Sept. 29, 2010, email in which Swallow mentions Reid and money. Johnson also tells him Rawle bragged about getting help from Reid to delay new payday-loan rules.

"I'd like to have it legally through lobbyists," Swallow tells Johnson, who replies, "I understand."

They discuss what the FBI might have, including emails from Swallow that were stored on I Works computers the federal government seized.

"Probably the only one they'd like to roast more than me would be a public official," Johnson at one point tells Swallow, whom Johnson described as being pale, nervous and visibly sweating during the meeting.

"I don't feel like it's a crime at all," Swallow says.

Johnson tells Swallow that others at I Works knew of their deal and could corroborate Swallow's involvement and the purpose of the payments, according to the transcript.

Swallow insists the money was meant to hire a lobbying firm.

"There's nothing wrong with that," Swallow says. "As long as I'm not interfering with a government agency as a government official, there's nothing wrong with me being involved."

Swallow insists during the meeting he did nothing wrong "criminally," but "politically — politically, I go whoa."

Later, Swallow says, "Let's assume that you paid me to put the deal together. … What's wrong with that?"

Johnson reminds him, "The problem is that email you sent. ... You sent me an email about what this money was gonna do and how it was gonna go to Reed [original spelling in transcript]."

"No wonder they're after me," Swallow replies.

Swallow eventually acknowledges he had received $20,000 from an unspecified Rawle company about the time when I Works made the payments to RMR Consulting, according to the transcript. But Swallow claims the payments were for consulting work on a proposed cement plant on Paiute tribal land in Nevada. He says he first billed Rawle in October 2010 and then billed him for $15,000 in March 2011.

"I'm really vulnerable," Swallow says later in the conversation, acknowledging after that, "I'm worried about RMR."

Swallow agrees to press Rawle to return some of the money.



Swallow responds • Swallow maintained he only helped put Johnson in contact with someone who could help hire lobbyists. He said he had no part in any deal and received no compensation.

"I can say this emphatically: I have never had a financial arrangement with Mr. Johnson and no money has ever been offered or solicited," Swallow said.

He acknowledged doing consulting for Rawle on a Nevada limestone project, but said the payments did not violate Utah law.

Swallow said he has hired the law firm of Clyde Snow & Sessions, which is working on a defamation case against those who are spreading lies about him.

"[Johnson] is extremely intelligent," Swallow said, "and appears to have a well-conceived plan to divert attention from his problems and draw attention to someone else."

By October, Johnson had agreed to a deal in the criminal case in which he would admit guilt to two charges, which prosecutors added as part of the plea deal. In exchange, Johnson said, the U.S. Attorney's Office said it would not prosecute his family, friends, associates or Swallow. Johnson said the cases brought against him ruined his life and he believed that, although Swallow had done wrong, he did not deserve to also have his life destroyed.

On Oct. 26, as the election approached, Johnson said he told Swallow in a text message that he needed to pay back some of the money. By that time, Rawle was suffering from cancer and the extensive treatments to combat it. He died Dec. 8.

Cort Walker, a spokesman for Check City who according to an email also arranged the payment to RMR, did not return phone messages Friday.



Election flurry • Just days before the Nov. 6 election, Johnson said he would try to make Swallow quit the race to save Swallow the pain and embarrassment of having to resign and be investigated after he won.

First, Johnson wanted to meet Democratic candidate Dee Smith to assess his character as a prosecutor, arranging a dinner meeting at Bambara restaurant in Salt Lake City.

"I went and met with him," Smith said. "He just indicated that he wanted to talk with me and wanted to make sure that, as he termed it, that I was a good guy because he told me he was going to be dropping what he called a bomb and it was going to end the attorney general's race and, as a result of it, I was going to be the next attorney general."

Smith said Johnson didn't give him any specifics and Smith didn't ask for details.

Johnson said he immediately liked Smith and believed him to be an honest prosecutor.

After the meeting with Smith, on Oct. 30, Johnson said he left a voicemail and sent a text message to Shurtleff, saying he wanted to meet to discuss Swallow.

The two met the next day outside a Salt Lake City Gateway condo, where Johnson was staying, Johnson said. He told Shurtleff about Swallow's deal and that the information would come out soon. He urged Shurtleff to press Swallow to drop out. Shurtleff said it was unlikely Swallow would quit at that late date, according to Johnson, but Shurtleff agreed to speak to Swallow about the allegations.

Swallow said Shurtleff didn't talk to him about getting out of the race.

Shurtleff did not return requests for comment Friday.

On Nov. 6, Swallow collected about 65 percent of the vote to become Utah's attorney general.

On Dec. 3, Johnson said Swallow paid $75,000, but sent it to his friend's attorney and notified the FTC, which could have a claim to the funds. Swallow said the payment was made by Rawle as a partial refund on the lobbying agreement.

Swallow was sworn into office Monday.

On Friday, Johnson and federal prosecutors aborted a deal in which he was to plead guilty to bank fraud and money laundering, with an 11-year prison sentence recommended to the judge.

"The truth is the worst thing I think I've done was I paid money knowing it was going to influence Harry Reid," he said. "So I've felt all along that I've committed bribery of some sort there."

In another conversation, Johnson said, "I shouldn't have done it. I regret it."

tharvey@sltrib.com,

gehrke@sltrib.com

John Swallow-Jeremy Johnson timeline

The relationship between Utah Attorney General John Swallow and businessman Jeremy Johnson goes back to at least 2009.

2009

June • Swallow emails Johnson soliciting campaign funds for Attorney General Mark Shurtleff's re-election campaign.

December • Shurtleff appoints Swallow chief deputy attorney general.

2010

Feb. 13 • Swallow emails Johnson about a "Cash for Gold" business deal and says he's "very close" to Richard Rawle, owner of Check City.

March 4 • A series of emails begins over whether Shurtleff and Swallow would sign off on the legality of Johnson processing payments for online poker companies.

July 5 • A Swallow email to Johnson says he was "not aware of any such law in Utah to prohibit what you are doing" in processing poker payments from players outside the state.

Aug. 25, Sept. 25 • Emails between Swallow, Johnson and Shurtleff discuss arranging meetings with top Utah officeholders about a Federal Trade Commission investigation of Johnson's I Works company.

Late September • Johnson says Swallow contacts him about meeting with Rawle to arrange payments to Nevada Sen. Harry Reid in return for his help in stifling the FTC investigation.

Sept. 29 • Swallow emails Johnson about Rawle traveling to Las Vegas to meet with someone close to Reid to discuss the FTC investigation.

Oct. 7 • Johnson emails Rawle: "We will do whatever it take[ s ] to get Senator Reid on our side"

Oct. 9 • Rawle emails Johnson: "I am working on this matter right now … "

Oct. 12 • Rawle email sets up a meeting that day in Provo.

Oct. 14 • Rawle's new company RMR Consulting LLC is registered with the Utah Department of Commerce.

Nov. 2 • A Rawle employee emails Johnson, saying he can deposit an "initial retainer" of $50,000 in an RMR Consulting account at Bonneville Bank; Johnson emails a friend/employee asking him to make the payment; an I Works ledger shows a $50,000 payment to RMR Consulting.

Dec. 12 • I Works ledger shows $200,015 sent to RMR Consulting account.

Dec. 21 • FTC sues Johnson, I Works, other officers and related companies.

2011

Jan. 19 • Swallow announces he is a candidate for Utah attorney general.

June 11 • A felony criminal charge is filed against Johnson and he is arrested in Phoenix, beginning a stay of 96 days in jail before he is allowed out on $2.8 million bail.

2012

April 30 • Swallow meets Johnson at a Krispy Kreme restaurant in Orem; Johnson has the meeting recorded and photographed.

Oct. 26 • With election just days away, Johnson sends Swallow a text message about getting the money back. Johnson decides he should try to get Swallow to drop out of the A.G. race.

Oct. 29 • Johnson meets Democratic attorney general candidate Dee Smith at Bambara restaurant in Salt Lake City as part of effort to get Swallow to drop out of race.

Oct. 31 • Johnson meets with Shurtleff, urges him to persuade Swallow to drop out before the election, saying information on their deal will be made public.

Nov. 6 • Swallow wins election for Utah attorney general.

Dec. 3 • Johnson says Swallow sends $75,000 to repay part of monies paid by I Works and an employee in the Reid deal.

Dec. 8 • Richard Rawle dies.

2013

Jan. 7 • Swallow is sworn in as attorney general.

Jan. 11 • A plea deal falls apart in which Johnson was to plead guilty to two felony charges.

Sources • Documents and interviews provided by Johnson; court documents; other sources
« Last Edit: March 14, 2014, 05:10:25 PM by Rapunzel »
“The time is now near at hand which must probably determine, whether Americans are to be, Freemen, or Slaves.” G Washington July 2, 1776

Offline Rapunzel

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Re: FBI blocked in corruption probe involving Sens. Reid, Lee
« Reply #19 on: March 14, 2014, 05:13:45 PM »
and then this.............

http://www.sltrib.com/sltrib/home3/57678156-200/swallow-federal-reid-johnson.html.csp

 Names of Sen. Harry Reid, Sen. Mike Lee pop up in probe
Swallow investigation » Salt Lake and Davis county prosecutors find evidence of misconduct against the Senate majority leader, Utah senator.

By Marissa Lang

and Tom Harvey

| The Salt Lake Tribune
First Published Mar 13 2014 10:52 pm • Updated 5 hours ago

County prosecutors investigating former Attorneys General John Swallow and Mark Shurtleff say their probe has uncovered alleged misconduct by Senate Majority Leader Harry Reid and Sen. Mike Lee that they believe merits federal scrutiny.

Even as their own probe proceeds, Salt Lake County Attorney Sim Gill, a Democrat, and Davis County Attorney Troy Rawlings, a Republican, say possible wrongdoing by the powerful senators goes beyond their ability to investigate, much less prosecute.
 

The U.S. Justice Department investigation

This time line shows the involvement of the U.S. Attorney’s Office for Utah and the Department of Justice in the investigation of former Utah Attorney General John Swallow, which began in earnest after St. George businessman Jeremy Johnson made allegations against Swallow in January 2013.

2013

Jan. 25 » The U.S. Attorney’s Office for Utah confirms it is investigating Swallow.

May 6 » The U.S. Attorney’s Office announces it is recusing itself from the Swallow investigation, leaving the probe to the Public Integrity Section of the U.S. Justice Department.

Sept. 12 » The U.S. Justice Department says it won’t prosecute Swallow.

2014

March 13 » Two county prosecutors say they have uncovered evidence that may implicate U.S. Senate Majority Leader Harry Reid and Sen. Mike Lee of Utah in connection with the Swallow investigation.



Possible federal legal violations

Wire fraud » Using a phone or electronic communication (email) to facilitate a scheme involving a conflict of interest, bribery, accepting kickbacks in exchange for favors

Obstruction of justice » Any effort to impede, delay or influence the “administration of justice” by the federal government

Witness tampering » Forbids any and all conduct intended to alter testimony, influence or intimidate witnesses, potential witnesses or “any person” involved in a case

Evidence tampering » Forbids any attempts to “illegitimately affect the presentation of evidence,” including, but not limited to, altering documents, records and information

Document destruction » Knowingly changing, destroying, concealing or falsifying records, documents or any “tangible object” with the intent to block, alter or influence an investigation.

   Join the Discussion
   Post a Comment

"We cannot fully do justice to the things we’re coming across," Gill said Thursday. "It clearly raises concerns that can only be addressed — either to confirm [the allegations] or to put them to rest — by other entities."

Allegations against Reid may center on his financial and political relationship with online poker companies.

As for Lee, a House Special Investigative Committee report released Wednesday tied him and his campaign fundraising efforts to Swallow, who, according to the report, helped create a network of political committees meant to launder and hide hundreds of thousands of dollars of campaign contributions from the payday loan industry in which Swallow once worked.

Neither Reid nor Lee responded to calls late Thursday.

The U.S. Department of Justice — the type of other entity Gill has suggested should examine the allegations — closed its investigation into alleged political corruption in Utah seven months ago without filing charges.

In so doing, it may have prematurely shut the door on numerous investigations that Utah officials and former federal prosecutors say deserve a second look.

Chief among them are the allegations against Lee and Reid, as well as the House investigative committee’s conclusion that Swallow violated numerous federal laws in cultivating — and then attempting to cover up — a "pay to play" relationship with wealthy, well-connected friends and supporters.

On Thursday, Justice Department spokesman Peter Carr declined to comment on the government’s decision to close its investigation or to say whether the department may re-examine allegations.

"I think there’s a certain level of frustration," Gill said of federal investigators’ decision not to pursue the case. "We wish we could do it all, but we can’t."

Rawlings also criticized the decision to pull out, saying federal investigators didn’t know enough at the time to understand the scope of corruption allegations.

"We’re not even completely sure today why the DOJ ran away from it," Rawlings said. "Our investigative team does believe the Department of Justice walked out prematurely."

The team includes assistant county prosecutors, a state investigator and FBI agents from Utah and elsewhere. The FBI assisted the local prosecutors’ investigation after the Department of Justice and U.S. Attorney’s Office pulled out.



The senators » Embattled St. George businessman Jeremy Johnson went public in early 2013 with allegations that Swallow had helped broker a deal between Johnson and payday loan mogul Richard Rawle to involve Reid in an attempt to stall a federal investigation into I Works, Johnson’s online marketing company.

Johnson alleged the intent was to use Rawle’s connections to pass money to a Reid associate in order to enlist the Nevada Democrat’s help, but Reid’s office denied knowing anything about the deal and Swallow has said the attempt was merely to get lobbyists to work on Johnson’s behalf.

Johnson said he had first encountered Reid at a 2010 fundraiser in Las Vegas sponsored by online poker interests at which Reid promised to introduce legislation to clarify laws on the legality of online poker. Johnson said he believed a $1 million check he drew from money that came from poker processing went to Reid, according to a transcript of a recording of the April 2012 meeting at the Krispy Kreme doughnut shop in Orem between Johnson and Swallow.

Johnson’s I Works and a business associate paid Rawle $250,000 as part of their deal. Subsequent disclosures showed that $50,000 of that money went to a Las Vegas
Sen. Mike Lee, R-Utah, speaks at the Conservative Political Action Conference (CPAC) in Washington, Friday, Feb. 11, 2011.(AP Photo/Alex Brandon)
Names of Sen. Harry Reid, Sen. Mike Lee pop up in probe
Swallow investigation » Salt Lake and Davis county prosecutors find evidence of misconduct against the Senate majority leader, Utah senator.

By Marissa Lang

and Tom Harvey

| The Salt Lake Tribune
First Published Mar 13 2014 10:52 pm • Updated 5 hours ago

County prosecutors investigating former Attorneys General John Swallow and Mark Shurtleff say their probe has uncovered alleged misconduct by Senate Majority Leader Harry Reid and Sen. Mike Lee that they believe merits federal scrutiny.

Even as their own probe proceeds, Salt Lake County Attorney Sim Gill, a Democrat, and Davis County Attorney Troy Rawlings, a Republican, say possible wrongdoing by the powerful senators goes beyond their ability to investigate, much less prosecute.
 0  7
Photos

    Senate Majority Leader Sen. Harry Reid, D-Nev., speaks to the media about the fiscal cliff at the U.S. Capitol in Washington, on Thursday, Dec. 20, 2012. (AP Photo/Jacquelyn Martin)
    Sen. Mike Lee, R-Utah, speaks at the Conservative Political Action Conference (CPAC) in Washington, Friday, Feb. 11, 2011.(AP Photo/Alex Brandon)
    (Trent Nelson | Tribune file photo) Utah Attorney General John Swallow announces his resignation, Thursday Nov. 21, 2013, in Salt Lake City.
    | Courtesy Sen. Majority Leader Harry Reid, left, Poker Players Alliance executive director John Pappas, center, chat with St. George business man Jeremy Johnson in 2010 at a fundraiser in Las Vegas for Reid sponsored by online poker officials.
    LEFT: Senate Majority Leader Sen. Harry Reid, D-Nev., speaks to the media about the fiscal cliff at the U.S. Capitol in Washington, on Thursday, Dec. 20, 2012. (AP Photo/Jacquelyn Martin) RIGHT:Sen. Mike Lee, R-Utah, speaks at the Conservative Political Action Conference (CPAC) in Washington, Friday, Feb. 11, 2011.(AP Photo/Alex Brandon)

View photo gallery (5 photos)
At a glance



The U.S. Justice Department investigation

This time line shows the involvement of the U.S. Attorney’s Office for Utah and the Department of Justice in the investigation of former Utah Attorney General John Swallow, which began in earnest after St. George businessman Jeremy Johnson made allegations against Swallow in January 2013.

2013

Jan. 25 » The U.S. Attorney’s Office for Utah confirms it is investigating Swallow.

May 6 » The U.S. Attorney’s Office announces it is recusing itself from the Swallow investigation, leaving the probe to the Public Integrity Section of the U.S. Justice Department.

Sept. 12 » The U.S. Justice Department says it won’t prosecute Swallow.

2014

March 13 » Two county prosecutors say they have uncovered evidence that may implicate U.S. Senate Majority Leader Harry Reid and Sen. Mike Lee of Utah in connection with the Swallow investigation.



Possible federal legal violations

Wire fraud » Using a phone or electronic communication (email) to facilitate a scheme involving a conflict of interest, bribery, accepting kickbacks in exchange for favors

Obstruction of justice » Any effort to impede, delay or influence the “administration of justice” by the federal government

Witness tampering » Forbids any and all conduct intended to alter testimony, influence or intimidate witnesses, potential witnesses or “any person” involved in a case

Evidence tampering » Forbids any attempts to “illegitimately affect the presentation of evidence,” including, but not limited to, altering documents, records and information

Document destruction » Knowingly changing, destroying, concealing or falsifying records, documents or any “tangible object” with the intent to block, alter or influence an investigation.

   Join the Discussion
   Post a Comment

"We cannot fully do justice to the things we’re coming across," Gill said Thursday. "It clearly raises concerns that can only be addressed — either to confirm [the allegations] or to put them to rest — by other entities."

Allegations against Reid may center on his financial and political relationship with online poker companies.

As for Lee, a House Special Investigative Committee report released Wednesday tied him and his campaign fundraising efforts to Swallow, who, according to the report, helped create a network of political committees meant to launder and hide hundreds of thousands of dollars of campaign contributions from the payday loan industry in which Swallow once worked.

Neither Reid nor Lee responded to calls late Thursday.

The U.S. Department of Justice — the type of other entity Gill has suggested should examine the allegations — closed its investigation into alleged political corruption in Utah seven months ago without filing charges.

In so doing, it may have prematurely shut the door on numerous investigations that Utah officials and former federal prosecutors say deserve a second look.

Chief among them are the allegations against Lee and Reid, as well as the House investigative committee’s conclusion that Swallow violated numerous federal laws in cultivating — and then attempting to cover up — a "pay to play" relationship with wealthy, well-connected friends and supporters.

On Thursday, Justice Department spokesman Peter Carr declined to comment on the government’s decision to close its investigation or to say whether the department may re-examine allegations.

"I think there’s a certain level of frustration," Gill said of federal investigators’ decision not to pursue the case. "We wish we could do it all, but we can’t."

Rawlings also criticized the decision to pull out, saying federal investigators didn’t know enough at the time to understand the scope of corruption allegations.

"We’re not even completely sure today why the DOJ ran away from it," Rawlings said. "Our investigative team does believe the Department of Justice walked out prematurely."

The team includes assistant county prosecutors, a state investigator and FBI agents from Utah and elsewhere. The FBI assisted the local prosecutors’ investigation after the Department of Justice and U.S. Attorney’s Office pulled out.



The senators » Embattled St. George businessman Jeremy Johnson went public in early 2013 with allegations that Swallow had helped broker a deal between Johnson and payday loan mogul Richard Rawle to involve Reid in an attempt to stall a federal investigation into I Works, Johnson’s online marketing company.

Johnson alleged the intent was to use Rawle’s connections to pass money to a Reid associate in order to enlist the Nevada Democrat’s help, but Reid’s office denied knowing anything about the deal and Swallow has said the attempt was merely to get lobbyists to work on Johnson’s behalf.

Johnson said he had first encountered Reid at a 2010 fundraiser in Las Vegas sponsored by online poker interests at which Reid promised to introduce legislation to clarify laws on the legality of online poker. Johnson said he believed a $1 million check he drew from money that came from poker processing went to Reid, according to a transcript of a recording of the April 2012 meeting at the Krispy Kreme doughnut shop in Orem between Johnson and Swallow.

Johnson’s I Works and a business associate paid Rawle $250,000 as part of their deal. Subsequent disclosures showed that $50,000 of that money went to a Las Vegas law firm with close ties to Reid.

Johnson also may have been involved in raising money for Lee’s campaign, as facilitated by Swallow, according to the House report released this week.

In a February 2010 email recovered from Swallow’s crashed hard drive, which the House investigative committee obtained this month, Swallow asked then-Attorney General Mark Shurtleff, "can i [sic] introduce Mike Lee to Jeremy Johnson?" Shurtleff responded, "Sure."

y June of that year, Johnson had apparently arranged for thousands of dollars of contributions to Lee’s campaign. In an email that month, Swallow notified Johnson that checks to the Lee campaign from four of Johnson’s associates — which the report said totaled $9,600 — had bounced. Swallow forwarded the exchange to the Lee campaign, a suggestion, the report said, that Swallow was coordinating his efforts with the candidate’s campaign.

The report also revealed several new emails that showed Swallow’s intimate involvement in helping to coordinate the raising of hundreds of thousands of so-called "dark money" — unreported funds, moved through a series of nonprofits to avoid having to report the donors, many of which were payday lenders.
Rawlings and Gill declined to comment about specific allegations involving Lee and Reid, but noted their offices will "not ignore" any alleged breaches of Utah law.

"We do not have sufficient evidence to convict any United States senator of any state crime and our focus to date has not been on that prong of allegations," Rawlings said. "The current voluminous investigation into various state officials, associates or surrogates is not yet complete. It is our hope that the DOJ will re-engage related to any potential federal aspects of this case."



Federal crimes » The House committee report also suggested federal prosecutors may have dropped the ball in deciding not to prosecute Swallow for violating several federal laws in performing favors for well-connected supporters, damaging the integrity of his office and compromising the judicial system.

Swallow then covered up his alleged misdeeds, investigators said, by fabricating, altering and destroying damning documents.

Former federal prosecutors add Swallow may have committed more federal crimes than those detailed in the report, including wire fraud, obstruction of justice, witness tampering, evidence tampering and document destruction.

Former Assistant U.S. Attorney Jim McConkie said Swallow may have committed acts that could amount to numerous federal charges of the same state crime.

"Every act of dishonesty or every time evidence was destroyed or deleted from a computer, that could be a charge," McConkie said. "The [federal government] really should open this case up again."

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The same committee report alleged Swallow committed no fewer than eight state crimes — several of which he may have committed more than once.

"Typically if there’s a state corruption violation, you can find a federal equivalent," said former federal prosecutor Brett Parkinson, who now works in private practice.

Ex-federal attorneys also asserted that a government-led investigation — and prosecution — would ultimately do more to restore the public trust than one spearheaded by state or county agencies.

"There’s a different feeling to it in situations like this when it can be seen as a little incestuous in regards to the state doing an investigation headed by the Legislature then turning it over to a county prosecutor, all within the same system with similar ties and influence," Parkinson said. "When you have the federal government, there’s a separation."

Gill and Rawlings have said they will pursue any violations of state law, but cannot hold individuals accountable for federal breaches.



Maintained innocence » Swallow has maintained his innocence of all wrongdoing throughout the course of the House committee’s investigation and the county attorneys’ investigation.

His lawyer, Rod Snow, has pointed to the Justice Department’s refusal to prosecute the former top cop as proof his client committed no crimes.

In a letter to House investigators, Snow called their approach and allegations in the report "untrue" and "unfair."
“The time is now near at hand which must probably determine, whether Americans are to be, Freemen, or Slaves.” G Washington July 2, 1776

Offline Rapunzel

  • Hero Member
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Re: FBI blocked in corruption probe involving Sens. Reid, Lee
« Reply #20 on: March 14, 2014, 05:26:15 PM »
I think the Desert News article is  lot more accurate.......

http://www.deseretnews.com/article/865598667/Utah-prosecutors-forward-allegations-against-Sens-Mike-Lee-Harry-Reid-to-feds.html?pg=all

Utah prosecutors forward allegations against Sens. Mike Lee, Harry Reid to feds
By Dennis Romboy, Deseret News

Published: Friday, March 14 2014 3:11 p.m. MDT

Sen. Mike Lee, R-Utah speaks at the Conservative Political Action Committee annual conference in National Harbor, Md., Thursday, March 6, 2014.

Cliff Owen, Associated Press
Summary

County prosecutors investigating former Utah Attorneys General John Swallow and Mark Shurtleff say they have come across allegations of wrongdoing by Senate Majority Leader Harry Reid and Sen. Mike Lee.

SALT LAKE CITY — County prosecutors investigating former Utah Attorneys General John Swallow and Mark Shurtleff say they have come across allegations of wrongdoing by Senate Majority Leader Harry Reid and Utah Sen. Mike Lee.

Salt Lake County District Attorney Sim Gill and Davis County Attorney Troy Rawlings say they're not actively investigating the two senators but have passed along information to the U.S. Department of Justice.

Also, Lee's name came up in the Utah House Special Investigative Committee's report released this week in connection with Swallow's effort to raise campaign funds for him through indicted businessman Jeremy Johnson in 2010.

“We do not have sufficient evidence to convict any United States senator of any state crime, and our focus to date has not been on that prong of allegations and information received," Rawlings said. "It is our hope that the DOJ will re-engage related to any potential federal aspects of this case. However, we will not ignore potential state ramifications."


ABC News and the Washington Times ran a lengthy story Thursday raising questions about whether Lee and Reid sought or received money or other benefits from donors and fundraisers in connection with doing political favors or taking official actions.

The story also questions whether Lee provided accurate information when he bought, then sold his Alpine home for a big loss to a campaign contributor and federal contractor, leaving his mortgage bank to absorb large losses.

Gill said those allegations popped up in the course of the county investigation.

"Are we aware of this? Yes. Are they potentially serious allegations? Absolutely," he said.

But, Gill said, there are a "host of different little things out there" that are outside his jurisdiction but deserve to be looked into by the appropriate authorities. He said he couldn't be specific because of the ongoing investigation.

Lee spokesman Brian Phillips said on Friday: "The article doesn’t present any new information about Sen. Lee and he is looking forward to clearing things up." As it relates to the sale of the home, he said the senator filed all the required documentation.

The Utah House report released Wednesday tied Lee to Swallow and his effort to raise money for the senator's 2010 election campaign. Swallow — chief deputy attorney general at the time — enlisted Johnson to help but only after clearing it through his boss Shurtleff, who was the attorney general.

Swallow asked Shurtleff in a February 2010 email: "can i (sic) introduce Mike Lee to Jeremy Johnson?" Shurtleff replied, "Sure." Johnson was a large donor to Shurtleff's campaign fund.

Swallow was "working hard" to raise money for Lee before the June 22 primary election, according to the report.

An email exchange between Swallow and Johnson on June 21, 2010, suggests that he had asked Johnson to round up donations.

In one email, Swallow tells Johnson that "four of those checks bounced," to which Johnson replied, “I am really sorry about the checks. I will get it fixed ASAP! Let me know whos (sic) bounced. I was in a mad rush to get those so maybe I pushed a few people too hard."

The four checks totaling $9,600 were written by associates of Johnson.

Swallow forwarded the email exchange to a member of Lee's campaign staff. Johnson himself gave $2,400 to Lee’s primary campaign — the federal limit — on June 21, 2010.

The House report paints a damning picture of Swallow's own campaign activities leading up to his election as attorney general in 2012, saying he "hung a veritable 'for sale' sign" on his office door. The 200-page report included allegations of hiding campaign funds, doing favors for wealthy supporters and friends and destroying evidence.

The report also goes into detail about his relationship with Johnson, the one-time multimillionaire founder of the online marketing company iWorks.

Johnson claims Swallow helped arrange a $250,000 payment to a friend who had ties to Reid to derail a Federal Trade Commission investigation into iWorks. Reid has disavowed any knowledge of Johnson's case.

The FTC filed a civil complaint against Johnson in December 2010, which remains unsettled. Johnson also faces fraud charges in an 86-count federal indictment connected to iWorks.

Rawlings said the county investigation, in conjunction with the FBI and the Utah Department of Public Safety, is sweeping up a broad swath of evidence, but it is focused on Swallow and Shurtleff.

"I think it would be unfair to say we are currently investigating Sens. Reid and Lee at this time. But we are not going to ignore the scraps of evidence coming in about them. Do we plan on formally turning attention to all of the scraps picked up about them? We do plan on that,” Rawlings said.

Gill said state investigators have passed on information to their counterparts at the FBI because they can't investigate on a federal level.

The U.S. Attorney's Office for Utah opened an investigation into Swallow and Shurtleff in early 2013 but turned it over the DOJ Public Integrity Section, which last September declined to file criminal charges against them.

The county prosecutors have expressed frustration that the DOJ investigation ended prematurely.

Gill said the House report is part of a larger "mosaic" and complements the investigation.

State investigators say they've conducted hundreds of interviews, combed through nearly 100,000 pages of documents and electronic files and issued search warrants and subpoenas. They're also looking at a state elections office report that says Swallow violated financial disclosure laws.

"We have a lot of information to digest and we're working aggressively to reach certain conclusions, but we're not there yet," he said.

Email: romboy@deseretnews.com, Twitter: dennisromboy; DNewsPolitics
“The time is now near at hand which must probably determine, whether Americans are to be, Freemen, or Slaves.” G Washington July 2, 1776


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