Politico reported on March 11:
Over the course of the past decade, Rep. John P. Murtha has earmarked millions of dollars for the Electro-Optics Center at Penn State University — money that has, in turn, gone to clients of the PMA Group, the Murtha-linked lobbying shop that was raided in November as part of a federal criminal probe.
PMA may soon be Murtha’s undoing. The firm was founded by his top operative Paul Magliocchetti, who is now reportedly under investigation for making campaign donations in the names of other people. Campaign finance violations are not treated seriously by prosecutors, except for this one. The result can be prison time and big fines. If faced with the prospect of jail, would Magliocchetti turn on Murtha?
PMA has collapsed as most of it’s lobbyists have quit. It’s quite a fall from last year when it ranked as the 10th-biggest Washington lobbying firm by earnings.
Murtha escaped prosecution in the 1980 Abscam scandal by testifying against Reps. Frank Thompson (D-NJ) and John Murphy (D-NY). This near-death experience made him exceedingly careful in the intervening years during which he’s built an empire on earmarked funds. In return for their trust and loyalty, a small circle of friends and relatives have been handsomely rewarded. That circle has now been broken as the feds may have leverage on his closest associate.
On March 12, Jonathan Allen and Alex Knott report in CQ Today that Magliocchetti and his family…
…made $1.5 million in political contributions from 2000 through 2008 as the lobbyist’s now-embattled firm helped clients win billions of dollars in federal contracts. A sizable chunk of those campaign dollars went to the House members who control Pentagon spending.
…Magliocchetti…and nine of his relatives — two children, his daughter-in-law, his current wife, his ex-wife and his ex-wife’s parents, sister and brother-in-law — poured contributions into the coffers of candidates, political action committees and national and state party committees, according to a CQ review of public documents.
Magliocchetti’s possible contributions in the name of others was first reported in the Washington Post on February 14, 2009. According to the story by Carol Leonnig:
Marvin Hoffman is listed in campaign finance records as one of the many lobbyists with the powerful PMA Group donating money to lawmakers. But Hoffman is a soon-to-retire information technology manager in Marina del Rey, Calif., who has never heard of the Arlington lobbying firm or the Indiana congressman to whom he supposedly gave $2,000.
“It’s alarming that someone is stealing my identity somewhere,” Hoffman, 75, said in an interview. “I’ve never heard of this company.”
Another contributor listed as a PMA lobbyist is, in fact, a sales manager for an inflatable boat manufacturer in New Jersey. John Hendricksen said he did make campaign donations but never worked at PMA and does not know how he ended up listed in records that way.
And in the spirit of Jack Abramoff, who pressed his lifeguard into service, the Post also reported:
Two men listed in campaign finance reports as together giving $30,000 to lawmakers and being part of the PMA Group team are not Washington lobbyists at all. They live and work in the Florida resort community of Amelia Island, where PMA founder Magliocchetti has a beachfront condominium. Both are listed as directors of PMA.
John Pugliese had been a sommelier at the posh Ritz-Carlton Hotel on the island, his family said. Jon C. Walker is in charge of golf marketing at the neighboring Amelia Island Golf Club, according to club personnel and its Web site. They each donated identical amounts to the same lawmakers, in 12 installments each, almost always on the same date.
The federal investigation into Murtha’s empire was first reported by the Wall Street Journal on October 30, 2007. The front-page story by John Wilke was titled, “How Lawmaker Rebuilt Hometown on Earmarks; Johnstown Gets Billions With Power Broker’s Aid; FBI Questions a Contract.” It detailed how Murtha has steered as much as $2 billion to his district. According to Wilke:
Johnstown’s good fortune has come at the expense of taxpayers everywhere else. Defense contractors have found that if they open an office here and hire the right lobbyist, they can get lucrative, no-bid contracts.
…ProLogic, a closely held software and technical-services firm based in Fairmont, W.Va., opened a facility in Mr. Murtha’s district two years ago, though its headquarters are less than a half-hour away. The ribbon-cutting by Mr. Murtha and other politicians promised more local jobs, and the congressman’s office put out a news release taking credit for recruiting the company; more earmarks were soon steered to ProLogic.
Funding for the new facility also helped the chief executive. Local real-estate records show that the building is part-owned by the CEO’s family; ProLogic pays a monthly rent higher than prevailing local rates. A ProLogic official said the rent was justified because the building had to have the special wiring and shielding required for classified Pentagon contracts.
Ken Boehm, of the conservative nonprofit National Legal and Policy Center in Virginia, says that county records reveal that ProLogic had similar rental arrangements in other facilities where it carried out defense contracts. He noted that four of its six locations are in the districts of members of the House appropriations committee.
ProLogic was subpoenaed last year as part of a broader Federal Bureau of Investigation probe of earmarks granted by Rep. Alan Mollohan, a West Virginia Democrat, whose district includes ProLogic’s headquarters. Both the congressman and company have denied wrongdoing. More recently, FBI and Defense Criminal Investigative Service agents have begun looking into the alleged illegal diversion of earmarked funds to a commercial ground-radar software project, people close to this inquiry say.
The Mollohan investigation was prompted by a 500-page Complaint filed by NLPC with the U.S. Attorney in D.C. on February 28, 2006, following NLPC’s own nine-month investigation.