www.denverpost.com/news/ci_4493558

Group led by ex-Norton associate criticized

Mike Soraghan
Denver Post

October 14, 2006

Washington - A nonprofit group headed by a one-time Colorado associate of former Interior Secretary Gale Norton may have violated tax laws by lobbying Norton's department on behalf of convicted lobbyist Jack Abramoff's tribal-casino clients, a Senate investigation found.

The group - the Council of Republicans for Environmental Advocacy, or CREA - is one of five tax-exempt organizations whose activities on behalf of Abramoff were questioned in a 600-page report issued Thursday by the Democratic staff of the Senate Finance Committee.

CREA's president is Italia Federici, who was a fundraiser for Norton's 1996 campaign for Senate in Colorado. It is an extension of a group founded by Norton and anti-tax activist Grover Norquist in 1997.

"It is apparent from e-mail communication that CREA became an extension of Mr. Abramoff's lobbying operation," the report said. CREA reportedly got about $500,000 from Abramoff's tribal clients.

Under law, groups that function as paid lobbyists cannot claim tax-exempt status. "Arguably, the income from the activity should be taxable," the report said.

Contacted Friday by The Denver Post, Federici denied any wrongdoing. She stressed that the report did not accuse her or CREA of fraudulently providing money for congressional travel, laundering money or receiving money in exchange for taking certain positions.

Federici declined the Senate committee staff's request for an interview, with her attorney saying she would invoke her Fifth Amendment rights against self-incrimination to avoid answering questions.

Abramoff was a Washington lobbyist taking in millions from tribal-casino operators and others until he was charged in 2004 with cheating clients.

He has pleaded guilty to fraud and corruption charges. He faces prison time and is now cooperating with an investigation.

E-mails included in the report show Abramoff sought Federici's help in contacting Interior Department officials, including Norton, on American Indian issues such as tribal insurance and casinos.

It said Abramoff "directed his clients to make payments to CREA," and that some of his clients who contributed to CREA "were given a chance to speak one-on-one with Interior Department officials."

To his clients, Abramoff described CREA as "Norton's main group outside Interior" and "the outside advocacy group for DOI (Interior)," frequently referring to Norton as its former chairman. Norton has frequently said she had no affiliation with the group after becoming Interior secretary, though she did attend CREA events.

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www.washingtonpost.com/wp-dyn...82.html

Abramoff Witness Frustrates Panel

E-Mails Suggest She Was Lobbyist's Connection to Interior Official

Susan Schmidt
Washington Post

November 18, 2005

"Unfortunately, she is critical to me."

That's how former lobbyist Jack Abramoff once summed up his relationship with Italia Federici, the president of a Republican environmental group. He told colleagues that although Federici's help was expensive, it was important. Over three years, he directed Indian tribes he represented to contribute about $500,000 to her group.

Yesterday, Federici proved a combative witness before the Senate Indian Affairs Committee. She tangled with senators demanding explanations for a stack of e-mails that suggest she exploited a personal relationship with former deputy interior secretary J. Steven Griles to secretly help Abramoff lobby the department and obtain inside information affecting Abramoff's tribal clients.

Federici said she had been manipulated by Abramoff. She acknowledged that the lobbyist had arranged for the tribes to donate to her group, the Council of Republicans for Environmental Advocacy.

Committee Chairman John McCain (R-Ariz.) and the ranking Democrat, Sen. Byron L. Dorgan (N.D.), cast Federici as a paid conduit for Abramoff's influence-peddling with the department.

"It looks to me like you got paid for things that had nothing to do whatever with your organization," Dorgan said. "It looks to me like you were working for Mr. Abramoff and you were getting paid by Indian tribes to do it."

"I come from a pretty small town, but I think I can spot a pretty big lie," Dorgan told Federici. She insisted, "I am not lying to this committee."

Typical of the many requests Abramoff made to Federici was an e-mail dated Dec. 2, 2002, in which he sought Griles's help in scuttling a casino plan by the Jena Band of Choctaw, a Louisiana tribe seen as competition by his clients: "It seems the Jena are on the march again. if you can, can you make sure Steve squelches this again? thanks!!"

Asked to explain Abramoff's request and what she did with it, Federici responded: "We work with people every day with varying levels of decorum." It was a response that drew a puzzled scowl from McCain, who said at one point: "Your answers are so bizarre."

Griles testified earlier this month that he never got involved in tribal issues at Interior and said his relationship with Abramoff was no different from that with any lobbyist.

McCain, exasperated yesterday with Federici's "non-responsive" answers and combative demeanor, threatened to cite her for contempt. Federici accused McCain of conducting a "witch hunt" directed at her because her group had opposed one of his bills on oil drilling in Alaska.

Federici said her group had no contact with the tribes that contributed, and did not get involved in any tribal issues. But she said she did not question Abramoff's solicitation of tribal contributions because he was known as a philanthropist.

Abramoff's requests were often paired with discussions of contributions for Federici's group. On April 3, 2003, Abramoff sent her an "urgent alert" about an Interior policy change. "Any way to see if this is something coming from the top?" he asked. Federici responded: "I will definitely see what i can find out. I hate to bug you, but is there any news about a possible contribution. . . ."

McCain questioned whether the exchange was a quid pro quo.

On a school funding issue affecting the Saginaw Chippewa Tribe, an Abramoff client, Abramoff asked Federici to call Griles. "We're really going to need someone from the top down to tell [acting Assistant Secretary of Indian Affairs] Aurene Martin . . . that this money is going to the Saginaw, period."

"Got it," Federici replied.

Yesterday she told the Senate panel that she had merely meant to register receipt of the e-mail. While she always agreed to Abramoff's requests, she said, "I attempted to reach Steve many times more than I actually did."

Federici's group was co-founded by Gale A. Norton before she joined the Bush administration as interior secretary. In one e-mail, Abramoff told a colleague that Federici's group was "our access to Norton."

McCain said the committee has found no evidence that Norton knew Abramoff was trading on her name. Dan DuBray, Norton's press secretary, said she "was not aware of these activities." He added: "Mr. Abramoff's contact with the department -- both his direct contacts and those which may have been conducted by surrogates -- are being reviewed by the office of the inspector general and others."

Much of Abramoff's effort against the Jena tribe involved getting members of Congress to weigh in. At least 33 lawmakers who wrote letters to Norton opposing the Jena casino received more than $830,000 in Abramoff-related donations from 2001 to 2004, according to an Associated Press tally. Many of the lawmakers sent letters within days of receiving contributions from tribes represented by Abramoff or using the lobbyist's restaurant for fundraising, the AP found in its review of campaign records, IRS records and congressional correspondence.

Among those who wrote letters was House Speaker J. Dennis Hastert (R-Ill.), who held a fundraiser at Abramoff's Signatures restaurant on June 3, 2003, that collected at least $21,500 for his Keep Our Majority political action committee from the lobbyist's firm and tribal clients. A week later, Hastert wrote Norton to urge her to reject the Jena casino.

Senate Democratic Leader Harry M. Reid (Nev.) sent a letter to Norton on March 5, 2002, also signed by Sen. John Ensign (R-Nev). The next day, the Coushatta Tribe of Louisiana issued a $5,000 check to Reid's tax-exempt political group, the Searchlight Leadership Fund. A second Abramoff tribe also sent $5,000 to Reid's group. Reid ultimately received more than $66,000 in Abramoff-related donations from 2001 to 2004.

The lawmakers contacted by the AP said their intervention had nothing to do with Abramoff's fundraising, but reflected their long-held concerns about expanding tribal gambling.