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Prosecutors reveal more in Pennsylvania ex-treasurer scandal

Written by The Associated Press | Jan 10, 2017 2:21 AM
babara_hafer.jpg

Former Pennsylvania Republican state Treasurer Barbara Hafer AP Photo/Paul Vathis

(Harrisburg) -- Federal prosecutors are revealing more details about pay-to-play investigations that have ensnared two former Pennsylvania state treasurers, saying a businessman promised to take "very good care" of one former treasurer and paid another more than $600,000 after leaving office.

The new details emerged as prosecutors responded to efforts by lawyers for businessman Richard W. Ireland to get his charges dismissed in federal court in Harrisburg. The case revolves around lucrative state contracts to invest billions of taxpayer dollars.

Ireland's lawyers say prosecutors had not shown an explicit exchange of money for an official act to back up 6-month-old charges that Ireland allegedly tried to bribe ex-Pennsylvania state Treasurer Rob McCord with secret campaign contributions.

Prosecutors responded in Friday's filing, saying that recorded conversations between Ireland and McCord "make clear specific official actions sought by Ireland in exchange for offers."

One of those offers was to "take 'very good care' of McCord, and to put McCord on Ireland's 'payroll' after McCord leaves office," prosecutors said.

Prosecutors also said Ireland sought McCord's help in securing a state pension fund contract worth at least $100 million to an asset management company with which Ireland "had a financial relationship." McCord, as treasurer, sat on the board of the State Employees Retirement System.

In another conversation, Ireland sought McCord's hiring of a consultant at the Treasury Department who would be favorable to Ireland, prosecutors said.

Ireland's intent to pay McCord once McCord left the treasurer's office is evident, prosecutors said, from records showing that Ireland paid another former state treasurer more than $600,000 after that treasurer left office.

Prosecutors did not name that previous state treasurer, but one former Pennsylvania treasurer, Barbara Hafer, was charged in July with making false statements to federal agents, allegedly to conceal payments of more than $500,000 from an unnamed businessman's firm. Hafer was treasurer from 1997 to 2005.

Ireland, 79, has not been charged in connection with Hafer. Ireland has shared in millions of dollars in fees from the Treasury Department and, with a business partner, given more than $1 million combined in campaign contributions to Democratic and Republican groups, PACs and candidates, including Hafer and McCord.

The U.S. attorney's office in Harrisburg declined Monday to say who, exactly, was the former state treasurer allegedly paid by Ireland, or whether the State Employees Retirement System contract was actually awarded to an Ireland-affiliated firm.

The retirement system has said it believes it has no direct holdings or investments with any companies owned or operated by Ireland.

A lawyer for Ireland, Brian M. Heberlig, declined comment Monday. Ireland's trial is scheduled to start March 9. Hafer's is scheduled for June 12. Her lawyers say she is innocent.

McCord is awaiting sentencing in a separate criminal case.

McCord resigned with two years left in his second term as state treasurer before pleading guilty in February 2015 to two counts of attempted extortion. McCord admitted that recorded telephone conversations captured him trying to use his position as treasurer to strong-arm state contractors into donating money to his failed 2014 gubernatorial campaign.

An earlier version of this story is below:

(Harrisburg) -- Federal prosecutors are revealing more details about pay-to-play investigations that have ensnared two former Pennsylvania state treasurers.

In a new filing, federal prosecutors say businessman Richard Ireland paid a previous state treasurer more than $600,000 beginning within weeks after the treasurer left office.

Prosecutors aren't naming that previous state treasurer, but one former Pennsylvania treasurer, Barbara Hafer, is charged with making false statements to conceal payments of more than $500,000 from an unnamed businessman's firm.

Ireland isn't charged with anything in connection with Hafer.

He was, however, charged in July in what authorities allege was an attempt to bribe ex-Pennsylvania state Treasurer Rob McCord with secret campaign contributions.

McCord is awaiting sentencing in a separate criminal case.

Lawyers for Hafer and Ireland have said their clients are innocent.

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