Thursday, November 8, 2007

Dem AGs take $50K from investigated firm

There are 31 Democratic state Attorneys General and more than a few of them, like Andrew Cuomo of New York, Richard Blumenthal of Connecticut, Marc Dann of Ohio, and Lisa Madigan of Illinois, fashion themselves as activist crusaders for consumers and small businesses.

Last May, the New York Times gave them a front page hot tip ("Rubbing Shoulders with Trouble, Presidents") about a controversial Illinois company whose business consulting services are the subject of hundreds of complaints from small businesses across the land. Surely, the sultans of scam-busting would pounce.

What did the Democratic AGs do? They waited a few weeks and, instead of investigating, took a huge campaign donation from the company, International Profit Associates, through their 527 political action committee. As the complaints continue to pile up, those "aggressive, activist" AGs, at least when it comes to IPA, are deep at sleep.

Madigan has said publicly that she has been investigating IPA since 2003. That's four plus years without a result. Considering she has more than 170 complaints within her office, and there are another 400 plus on file with the Better Business Bureau and hundreds more in AGs office across America, that inaction is hard to explain.

Madigan has directly taken $20,750 in donations from IPA, which include the use of IPA headquarters in 2002 to do phone banks when she was first seeking the office. Her spokeswoman said last year that Madigan would not return IPA money because it was taken before her "investigation" began. I don't know for sure that Madigan is a member of the Democratic Attorneys General Association, but it is highly unusual for a company under an investigation from a Democratic AG to be giving money to the political arm of the national group of Dem AGs.

Another one of the Dem AGs, Cuomo of New York, returned money from IPA last year prior to the NY Times article, as did many other major politicians across the country. Some other politicians, most notably Hillary Clinton, refuse to return IPA money despite the company's checkered past, which, in addition to the fraud allegations, include a massive pending sexual harassment lawsuit, the criminal past of its main founder, and the mentioning of its longtime lawyer in the high profile Tony Rezko indictment.

From my previous work in the Illinois Attorney General's office I can tell you the IPA matter is ripe for a multi-state investigation spearheaded by Madigan because the company is headquartered in her state. The $50,000 donation appears to be IPA's attempt to break up any momentum for such a wider probe. It's hard to argue the strategy is not working.

And where has the MSM been during all this? About as active as the AGs. It's not like the issue is too inconsequential to cover. When Republicans formed the Republican Attorneys General Association 527 committee in the 1990s, there were plenty of major national stories about how corporations were attempting to evade enforcement actions from the AGs by giving them campaign contributions.

One more question. Who, exactly, solicited IPA for the 527 donation at a time when it was clearly known that the Illinois AG was investigating the company? Was it an Attorney General? Was it Ohio's Marc Dann, who, as a candidate for AG was soliciting donations on behalf of the 527 during the same week the IPA contribution came in, this article says.

Many questions remain unanswered. Journalists?

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