Former DeLay Aide Pleads Guilty to Fraud ChargesA former top aide to Rep. Tom DeLay, R-TX, pleaded guilty Friday to conspiring with lobbyist Jack Abramoff to stop legislation in exchange for money and promised to help in a federal investigation into corrupt lobbying practices.
Tony C. Rudy worked for DeLay in the 1990s before joining Abramoff's lobbying firm Greenberg Traurig LLP in January 2001. In exchange for his guilty plea, prosecutors agreed not to pursue other charges against Rudy or his wife, Lisa, who received payments arranged by Abramoff through the consulting firm Liberty Consulting LLC.
Among the statements in Abramoff's plea agreement is that he said he helped influence legislation to oppose postal rate increases. Though the charges against Rudy don't mention postal rates specifically, they do say that he "sought to further their clients' interests by influencing public officials, including Members of the United States Congress." The charges also mention several $5,000 payments to Liberty Consulting from a nonprofit organization "as arranged by Abramoff." That nonprofit has been identified as Toward Tradition, a Seattle religious foundation.
Toward Tradition has said that it received $25,000 each from eLottery and the Magazine Publishers of America. The MPA had hired Abramoff's firm Preston Gates Ellis Rouvelas & Meeds LLP in March 2000 for a $10 million, three-year campaign to fight a proposed 15 percent postal rate increase for Periodicals mail and to push for postal reform. MPA officials have denied knowledge of how the donated money was used. Abramoff left Preston Gates in December 2000 to join Greenberg Traurig.
Last week, Abramoff and a business partner were sentenced to 70 months in federal prison on separate fraud charges related to their 2000 purchase of a line of gambling ships. The judge has postponed the date for them to report to prison so they can continue cooperating in other investigations.
Among the charges against Rudy is the allegation that he and Abramoff had clients pay $75,000 to an unnamed public policy organization to obtain position papers and press coverage favorable to the clients' interests. The Web site RawStory.com reported last month that conservative think tank National Center for Public Policy Research president Amy Ridenour wrote several editorials favoring Abramoff's clients, including the MPA and Pitney Bowes.
According to public records compiled by The Center for Public Integrity, Pitney Bowes, Stamford, CT, was Preston Gates' second-largest client from 1998 to 2004, while the MPA was its sixth-largest client. In that period, Pitney Bowes paid Preston Gates $6.06 million while the MPA paid $1.88 million to do lobbying.
In testimony before a Senate committee last summer, Ridenour said she didn't know about Abramoff's illegal lobbying activities.
In May 2000, Ridenour interviewed the MPA and wrote that a "[p]roposed 15% postal rate increase would hurt everyone," arguing that anything more than a single-digit rate increase could result in a death spiral for the postal service. In January 2001, the U.S. Postal Service increased the Periodicals rate 9.5 percent, though the USPS raised rates again in July 2001, making the combined increase 12 percent for the year. However, though Congress has oversight over the postal service, it does not control postal rates.
Ridenour also lobbied for Pitney Bowes, according to RawStory and a search of the center's archives, giving the company favorable coverage, attacking a competitor and praising its contributions to African-Americans in a piece on Black History Month.