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Bribery trial paints stark picture of Pa. politics

Written by Marc Levy/The Associated Press | Mar 27, 2017 3:25 AM
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Photo by AP Photo/Matt Rourke

(Harrisburg) -- Then-gubernatorial candidate Rob McCord was leaving a meeting in 2013 with a potential campaign donor when an aide told him he felt like he needed to "take a shower."

Now a cooperating witness in the FBI's wide-ranging, pay-to-play investigation of Pennsylvania state government, McCord described the exchange during his four days of testimony in a bribery trial of a wealthy investment adviser.

McCord's testimony, along with recordings of conversations made by the FBI while McCord was Pennsylvania's elected treasurer, painted a stark portrait of how political, and official, business gets done in a state without campaign finance limits and with a Legislature that has no intention of stemming the flow of money into politics.

In short, it suggested how much revolves around people who are able to make big campaign donations.

"I remember thinking, 'This is a weird business because you say you lie down with dogs and get up with fleas,'" McCord said under questioning by a lawyer for defendant Richard Ireland.

The FBI's investigation dates back to at least 2009, when it set up a fake company in Harrisburg and began engaging lobbyists. Eventually it ensnared a man who had been one of the most prominent behind-the-scenes players, John H. Estey, the onetime chief of staff to former Gov. Ed Rendell. Estey began cooperating with the FBI and, according to revelations during Ireland's trial, offered up McCord as a target.

Estey secretly taped McCord for the FBI, and the FBI also listened on McCord's phone calls three years ago when he was running for governor in a four-way Democratic primary. McCord lost badly. And, in a case that became public in early 2015, McCord was recorded attempting to use his position as state treasurer to strong-arm donations to his failing gubernatorial campaign.

McCord pleaded guilty to two counts of attempted extortion and is awaiting sentencing.

But, during McCord's testimony against Ireland, Assistant U.S. Attorney Michael Consiglio effectively forced McCord to admit that he had abused his office's powers in more ways than previously revealed by prosecutors.

That included awarding a $50 million investment contract to a $100,000 campaign donor who hid a connection to the contribution by giving through a joint acquaintance. It included promising to help a donor's son land an investment contract, and offering to slow down a state payment to the competitor of a donor.

McCord's testimony portrayed a broken campaign finance system in Pennsylvania, one of 12 states that allows unlimited campaign contributions to candidates.

Donations are routinely given in someone else's name, or filtered through other fundraisers to veil the giver, McCord suggested.

It was routine to hear "governors and others" swap fundraising favors, McCord said.

The cashing of a check can also be timed to ensure the money isn't reported publicly for more than a year -- long after it was spent.

Pennsylvania bars donations from corporations. But it allows contributions from partnerships, which help donors hide their identity because those business entities do not have to identify their owners.

Ireland is accused of trying to bribe McCord with more than $500,000 in secret campaign contributions in what prosecutors call part of a yearslong scheme to land lucrative contracts to invest taxpayer dollars.

Allegations against Ireland include making contributions to a charity as a swap for a campaign contribution to McCord, or reimbursing employees who made a campaign contribution to McCord.

Senate Minority Leader Jay Costa, D-Allegheny, who has fruitlessly pushed legislation to limit campaign contributions for eight years, said the system is getting out of hand.

As more and more money pours into campaigns, average people are "priced out" of the ability to run for office, Costa said in an interview.

"Then we're going to be stuck with the millionaires club," Costa said. "That's not what we want to be."

In the 2013 meeting, the potential donor, who had interests in waste disposal firms, demanded that he get to pick McCord's environmental protection secretary, should McCord become governor, in exchange for a campaign contribution, McCord testified.

McCord said he deflected the conversation to a person he thought both of them could support -- Sen. John Yudichak, D-Luzerne. But McCord also was frank about the need to negotiate with big donors, even those seeking an illegal exchange of a campaign contribution for an official act.

"You have to lie down, in a sense, with anybody in the commonwealth of Pennsylvania to get stuff done," McCord said.

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