RNC Chair Steele's fund use questioned

by Frank James

Several commenters have alluded to today's Washington Post report that federal agents interviewed the sister of Michael Steele, the Republican National Committee's new chairman, over allegations that he used his 2006 Senate campaign funds to make a payment to his sister's defunct company.

It's a story that's definitely worth reviewing even though it's hard to know exactly what to make of it.

For one, the person making the allegation, among others, is the former finance chair of Steele's Senate campaign, Alan Fabian, a convicted swindler seeking leniency by giving prosecutors information about Steele. So the credibility question perforce looms large.

On the other hand, there's the $37,000 payment made to Steele's sister's company in February 2007, 11 months after she filed legal documents to end the company. That's definitely a strange occurrence.

An excerpt from the WaPo:

In one of his allegations, Fabian points to a February 2007 payment by Steele's Senate campaign of more than $37,000 to Brown Sugar Unlimited, the company run by Steele's sister, Monica Turner. Campaign finance records list the expense as having been for "catering/web services." Turner filed papers to dissolve the company 11 months before the payment was received.

Turner, a doctor and the former wife of Mike Tyson, declined yesterday to describe any services she provided to the campaign. "Ah, it's the 'sabotage Michael Steele' story," she told a reporter before closing the door of her home in Potomac. "No, I'm not with that program. . . . I'm not going to do this."

Then there's something hinky about the dates on her dead company's invoice on which the payment was supposedly based.

Another WaPo excerpt:

Anderson, Steele's spokesman, said Turner "did a lot of media stuff" for the campaign. He later provided a copy of an invoice for nearly $15,000 for catering services for one event in October 2006 and for another in July 2007. The invoice was dated December 2006, a discrepancy Anderson said was a typographical error.

So let's see if I have this right. In March 2006 or thereabouts Turner filed the necessary paperwork to have her company disbanded but supposedly her ghost company did work for the Steele Senate campaign in October of 2006 and July 2007. Sounds very Chicago, though it happened in Maryland.

As the WaPo further goes on to state, there's nothing wrong with a family member being paid for working on a campaign. Another snippet:

Federal election law permits a candidate's family members to be paid for work on a campaign. Any compensation must be for actual services and must be at a fair market rate.

Again, what obviously raises red flags here is the timing of her business dissolution paperwork and the supposed work she did for campaign which was followed by the payments.

The WaPo contains other allegations by Fabian against Steele but the other allegations about campaign funds beings shifted between a state campaign fund to a federal one frankly aren't as sexy as the payment to his sister's dead company.

This is obviously not the way any party chairman wants to start his term in office, especially a Republican chair at this point in history where all of his efforts need to be aimed at rebuilding the party following two unsuccessful national elections,

Maybe this will turn out to be nothing more than Fabian's unproven allegations. If that's the case it will soon be forgotten. That has to be the prayer of Steele and fellow Republican officials right now.

There's another unusual aspect of this story. Apparently, the federal prosecutor's office sent the Washington Post a document that was supposed to be under court seal.

Another excerpt:

The claim about the payment, one of several allegations by Alan B. Fabian, is outlined in a confidential court document. Fabian offered the information last March as he was seeking leniency for himself during plea negotiations on unrelated fraud charges. It is unclear how extensively his claims have been pursued. Prosecutors gave him no credit for cooperation when he was sentenced in October...

...The U.S. attorney's office inadvertently sent the confidential document, a defense sentencing memorandum filed under seal, to The Washington Post after the newspaper requested the prosecution's sentencing memorandum.

This raises the possibility of some sanction by the court against the prosecutor's office since judges tend to take the release of documents under seal very seriously.