DeLay Ex-Aide to Plead Guilty in Lobby Case

DeLay Ex-Aide to Plead Guilty in Lobby Case
By ANNE E. KORNBLUT

WASHINGTON, Nov. 18 - Michael Scanlon, a former top official for Representative Tom DeLay and onetime partner of the lobbyist Jack Abramoff, has agreed to plead guilty in a deal with federal prosecutors, according to his lawyer. The deal reveals a broadening corruption investigation involving top members of Congress.

Criminal papers filed in federal court outlined a conspiracy that not only named Mr. Scanlon but also mentioned a congressman, identified only as Representative No. 1, as part of the exchange of favors from clients funneled to lobbyists and officials.

This was the first time that a member of Congress, identified by lawyers in the case as Representative Bob Ney, Republican of Ohio, has been implicated in criminal papers as part of the inquiry, which has sprawled from Indian casinos to the lucrative lobbying firms of Mr. Abramoff and Mr. Scanlon and then reached to the Republican leadership.

Federal prosecutors announced a single conspiracy charge against Mr. Scanlon on Friday, in advance of a Monday court hearing at which he is expected to plead guilty in exchange for his cooperation. Investigators accused Mr. Scanlon of conspiring to defraud Indian tribes of millions of dollars as part of a lobbying and corruption scheme.

Mr. Scanlon, 35, is a former spokesman for Mr. DeLay. News of his cooperation with law enforcement officials sent a jolt through the Republican majority in Congress.

Mr. DeLay has been indicted in Texas on unrelated charges involving fund-raising practices for state Republicans. His ties to Mr. Abramoff, along with costly overseas trips, have been under investigation for more than a year. The indictment forced Mr. DeLay to step aside as House majority leader this fall.

Court papers filed Friday alleged that Mr. Scanlon and Mr. Abramoff, who has not been charged in the Indian lobbying case, had sought to "corruptly offer and provide things of value, including money, meals, trips and entertainment to federal public officials in return for agreements to perform official acts." The wording suggested that more than one lawmaker was under investigation.

But the document singled out Representative No. 1 as the main recipient of gifts, tickets and meals - including a now infamous golfing trip to Scotland - in exchange for helping Mr. Scanlon and Mr. Abramoff with their clients.

Mr. Ney, chairman of the House Administration Committee, has offered his cooperation to prosecutors, said Brian Walsh, his spokesman, who added that Mr. Ney had contended that he was tricked by Mr. Scanlon and Mr. Abramoff into assisting their clients.

Federal prosecutors and Congressional officials have been conducting extensive investigations into the lobbying practices of Mr. Abramoff and Mr. Scanlon, who earned about $82 million representing a handful of wealthy Indian tribes on gambling issues over four years. Investigators believe the two men funneled millions through charities and front organizations to skim profits, avoid taxes and mask incomplete work.

Beyond accusations of fraud, investigators have delved into the politically delicate territory of the relationship between lobbyists and lawmakers. Until last year, Mr. Abramoff ruled an industry governed by networking because of his close ties to Mr. DeLay, trading on his access to the rising Republican leader to build a lucrative lobbying practice. He and Mr. Scanlon are at the center of a Senate inquiry that held its final hearing this week.

In the eight-page criminal filing, prosecutors accused Mr. Scanlon of taking part in a "corruption scheme" between January 2000 and April 2004, working alongside a "Lobbyist A" who was identified by lawyers involved in the case as Mr. Abramoff.

The pair "provided a stream of things of value" to Representative No. 1 and members of his staff, the charge read. In return, both Mr. Scanlon and Mr. Abramoff received agreements from Mr. Ney "to perform a series of official acts," including "agreements to support and pass legislation, agreements to place statements into the Congressional Record," and meetings with their clients.

The court filing also states that the congressman helped one of the businessmen's clients apply for a license to install wireless telephone infrastructure in the House of Representatives. Mr. Ney's committee manages such issues.

Mr. Ney has been the focus of scrutiny for months after revelations that he took a 2002 golfing trip to Scotland that was sponsored by Mr. Abramoff. Mr. Ney has started a legal defense fund. His legal troubles have added to the growing ethics accusations against Congressional Republicans.

Other lawmakers including Mr. DeLay received campaign donations from Mr. Abramoff's and Mr. Scanlon's Indian clients. But Mr. Ney performed what prosecutors portrayed as blatant favors for Mr. Abramoff and Mr. Scanlon, inserting remarks helpful to their business into the Congressional Record and sponsoring bills at their behest.

Mark H. Tuohey, the lawyer representing Mr. Ney, said that the congressman had never offered any legislative help to the lobbyists in exchange for travel, like the 2002 golfing trip to Scotland, or gifts.

Mr. Ney has said that Mr. Abramoff deceived him over how the Scotland trip was paid for in his travel disclosure forms, saying it was paid for by a conservative educational group, not by Mr. Abramoff or his lobbying firm - and about the details of Mr. Abramoff's purchase of a casino boat fleet in Florida in 2001.

"I think the people who are named in this among others, Scanlon and Abramoff, didn't tell him the truth," Mr. Tuohey said of Mr. Ney.

Mr. Abramoff was indicted in Florida this year on fraud and conspiracy charges relating to a separate effort to buy Sun Cruz, a fleet of casino boats, in 2000. Although Mr. Scanlon did public affairs work for Sun Cruz, he was not charged in that case. It now appears that Mr. Scanlon has been cooperating with the authorities to reach a plea deal in the Indian gambling inquiry. Mr. Abramoff is not cooperating with law enforcement officials, people involved with the case said.

The lawyer for Mr. Abramoff, Abbe Lowell, declined to comment. The lawyer for Mr. Scanlon, Stephen Braga, confirmed that his client would enter a plea on Monday. "Mr. Scanlon and the Department of Justice will present a proposed plea agreement to the court to resolve the charge," Mr. Braga said.

How much Mr. Scanlon knows and has told prosecutors about the business practices of Mr. Abramoff and members of Congress remains unclear. "This puts a tremendous amount of pressure on Abramoff because Scanlon was reportedly his closest associate," said Lawrence Barcella, a former federal prosecutor who is now a prominent defense lawyer in Washington. As for politicians like Mr. DeLay and Mr. Ney, Mr. Barcella said, "I wouldn't be sitting as comfortably today as I was yesterday if I were them."

In addition to the corruption scheme, prosecutors say Mr. Scanlon and Mr. Abramoff carried out a secret kickback deal in which Mr. Abramoff encouraged his Indian clients to hire Mr. Scanlon for public affairs work. Mr. Scanlon then funneled half his profits to Mr. Abramoff. Their aim was "to enrich themselves by obtaining substantial funds from their clients through fraud and concealment and through obtaining benefits for their clients through corrupt means," the charge said.

Tribes in Mississippi, Louisiana, Texas and Michigan fell prey to the conspiracy, the Scanlon papers said.

Philip Shenon, Eric Lichtblau and

David D. Kirkpatrick contributed reporting for this article.
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