DoJ blocks FBI from investigation Senators Reid and Lee corruption

An exclusive Washington Times story that broke late last night reveals that the Department of Justice is blocking the FBI from probing into a Utah corruption case that involves Senators Harry Reid and Mike Lee.

FBI agents working alongside Utah state prosecutors in a wide-ranging corruption investigation have uncovered accusations of wrongdoing by two of the U.S. Senate’s most prominent figures — Majority Leader Harry Reid and rising Republican Sen. Mike Lee — but the Justice Department has thwarted their bid to launch a full federal investigation.

The probe, conducted by one Republican and one Democratic state prosecutor in Utah, has received accusations from an indicted businessman and political donor, interviewed other witnesses and gathered preliminary evidence such as financial records, Congressional Record statements and photographs that corroborate some aspects of the accusations, officials have told The Washington Times and ABC News.

But the Justice Department’s public integrity section — which normally handles corruption cases involving elected figures — rejected FBI agents’ bid to use a federal grand jury and subpoenas to determine whether the accusations are true and whether any federal crimes were committed by state and federal officials.

The information involving Mr. Reid and Mr. Lee is not fully developed but centers on two primary issues:

• Whether both or either politician sought or received money or other benefits from donors and/or fundraisers in connection with doing political favors or taking official actions.

• Whether Mr. Lee provided accurate information when he bought, then sold a Utah home for a big loss to a campaign contributor and federal contractor, leaving his mortgage bank to absorb large losses.

“There are allegations, but they are very serious allegations and they need to be looked at by somebody,” Sim Gill, a Democrat who is the elected chief prosecutor in Salt Lake County, told The Times. “If true, or even if asserted, they truly should be investigated and put to rest, or be confirmed.”



There are some very strange occurences associated with this business, that makes it look like Reid, at least, is trying to cover his tracks:

The investigative efforts have been further complicated by the fact that Mr. Reid worked to get Mr. Lee’s chief counsel, David Barlow, confirmed in 2011 as the U.S. attorney in Salt Lake City. That action — a Democratic Senate leader letting a Republican be named to a key prosecutor’s position in the Obama administration — raised many eyebrows and angered some Democrats.

Subsequently, the entire office of federal prosecutors in Utah was forced to recuse itself from the corruption case after questions surfaced about a conflict of interest involving one prosecutor and a subject of the probe. After the recusal, state prosecutors secured a court order transferring the federal evidence gathered up to that point to their possession.

The process has left FBI agents in the unusual position of trying to help two local prosecutors make a case in state court without the ability to use the federal court system to determine whether accusations against two powerful members of Congress are true.

“We’re just two local prosecutors but everybody who was supposed to look at this evidence above us has made a decision not to, and by default left it to us to investigate and prosecute at the state level,” Mr. Gill said.

Harry Reid has proven to be a slippery fish during his career, but this case smells different. For example, Reid opposed online gambling for years, but had a change of heart in 2010 and introduced a bill to make it legal. Why?

On the recording, Mr. Johnson tells Mr. Swallow that, after Mr. Reid departed, Mr. Johnson himself pulled aside an online gambling official to ask about his announcement.

“I [Mr. Johnson] said, ‘How in the hell did you guys get him to do that?’ And he [the online gaming official] says, ‘Let’s just say he got a little something in his retirement fund.’ And I was like, ‘OK, that’s how it is.’”

The case against Senator Lee is different, and appears open to several interpretations:

The questions in the broad-ranging state probe that surround Mr. Lee involve real estate transactions in which the Republican bought a home for $1.1 million in Utah in 2008 when he was still a private lawyer and then sold it for $720,000 after becoming a senator, leaving his mortgage bank, J.P. Morgan, to absorb a significant loss.

Investigators want to know whether Mr. Lee accurately described his personal finances in conjunction with the mortgage transactions.

There's a chance that a special prosecutor could be named if the Justice Department continues to refuse to open a corruption probe.

How much trouble is Reid in? The primary witness against him has credibility problems. But then there's that tape with the allegation of bribery. I suspect that the rest of the story will eventually come out and Reid will not be held to account, given the ambiguous circumstances.