Corporate Villains Seem To Like
Cornyn’s A.G. Slush Fund
Dozens of alleged villains implicated in the current corporate-crime wave have given more than $5 million to a PAC that launders money for an attorney general slush fund that Texas Attorney General John Cornyn helped found in 1999.
As a U.S. Senate candidate, Cornyn rarely mentions the Republican Attorney General Association (RAGA). But during the bubble economy, he often reminded corporate interests that he helped create RAGA to prevent industry-wide lawsuits like the one that states filed against big tobacco.
This mission—and the fact that RAGA hides the identities of its donors by laundering its money through the Republican National State Election Commission (RNSEC)—has prompted protests that RAGA is a lawsuit-protection racket. “This is absolutely an effort by people with special interests to stop attorneys general from pursuing their traditional role as protectors of the public interest,” said Scott Harshbarger, the former Massachusetts attorney general who heads Common Cause.
Because RAGA refuses to disclose which RNSEC funds were earmarked for RAGA, every RNSEC donation is suspect of being a stealth RAGA contribution. Since RAGA’s 1999 founding, RNSEC has received $5.4 million from the PACs, executives and treasuries of corporations that recently have been accused, convicted or have confessed to serious wrongdoing (see below). These charges—some of which are being investigated by attorneys general—include accounting fraud, excessive executive perks, insider trades, improper stock promotions, document shredding, breaking consumer laws and exploiting electric-deregulation loopholes.
Big RNSEC donors include alleged corporate thugs Enron, Worldcom, Adelphia, Tyco, Global Crossing, Qwest and Arthur Andersen. Enron was the No. 1 source of this money, pumping $721,272 into RNSEC (including $282,910 from Ken Lay and $50,000 from Jeff Skilling). While Cornyn returned $200,000 that he received from Enron, his RAGA will not return—or disclose—what it took from alleged corporate crooks. RNSEC, the top donor to the Republican Party of Texas this election cycle ($1.1 million), is popular with companies that incorporated off shore to dodge taxes that they otherwise would pay to Uncle Sam.
RNSEC's Tax-Dodger Money Unamerican
Global Crossing Bermuda $366,729 Tyco Internat'l Bermuda $146,715 Accenture Bermuda $127,200 Carnival Corp Panama $40,000 Triton Energy Cayman Isles $25,000 Xoma Corp Bermuda $1,500 TOTAL: $707,144
Major RNSEC donors clearly could benefit from RAGA’s promises to oppose active attorneys general like Mississippi’s Mike Moore (who is going after alleged WorldCom frauds) and Connecticut’s Richard Blumenthal (who sued Stanley Works to stop its move to Bermuda). Such stains may explain why RAGA launders its money.
Note: Includes corporate, PAC and executive donations.
Donations From Actual & Alleged Corporate Villains
To the Republican National State Election Committee
Jan. 1999 Through July 2002
RNSEC Donor RNSEC
Admitted or Alleged Skulduggery Enron Corp $721,272 Huge accounting frauds; TX/CA electricity gaming charges El Paso Energy $536,432 Round-trip trader; grave accounting concerns Kmart Corp $572,937 SEC accounting probe; changed dubious accounting practices TXU Corp $420,486 TX PUC charges of 'gaming' TX electric system Citigroup $395,909 Did deals hiding Enron debt; NY AG probing stock-pumping charges *Global Crossing $366,729 Insider trading and sham transactions to inflate sales alleged. Reliant Energy $328,940 Round-trip trade admissions prompted federal probes MCI Worldcom $311,077 Executives indicted for $7.2 billion accounting fraud Interpublic Group $200,000 Improperly accounted for $69 million in expenses Merrill Lynch $188,525 Settled stock-pumping charges for $100 million.; Enron deals probed Dynegy $168,982 Round-trip trader. Alleged: accounting/tax fraud, CA gaming charges Williams Co's $161,800 Resold capped CA energy elsewhere; SEC accounting probe *Tyco International $146,715 Improper accounting and executive perks alleged. CEO indicted AOL Time Warner $105,850 Federal accounting probe; ordered to preserve documents Halliburton $88,000 Accounting concerns involving construction-project cost overruns PG&E Corp $82,550 Improper accounting and asset transfers alleged Qwest Comm. $72,059 Restated $1.1 billion; sham transactions to inflate sales alleged Duke Energy Corp $65,000 Feds probing its admitted round-trip trades Rite Aid Corp $65,000 Executives indicted on fraud charges; restated $1.6 billion earnings Arthur Andersen $60,966 Obstructing justice conviction; approved many cooked books Calpine Corp $55,800 SEC urged it to revise financial disclosures Xcel Energy $50,000 FERC records show it discussed gaming CA system w/ Mirant Adelphia $43,000 Executives indicted for fraud after receiving $3.1 billion in loans Xerox Corp $42,300 Paid $10 million fine after overstating almost $2 billion in revenue KPMG $36,500 SEC probing role of KPMG partners in Xerox accounting scandal Charter Comm. $35,000 DOJ probe of accounting for capital expenses Echostar Comm. $25,000 10 state AGs probing alleged consumer-protection law violations PNC Bank $25,000 Restated $155 million after loan-transfer-accounting questions Lucent Tech. $11,250 SEC probing $679 million revenue restatement JP Morgan Chase $7,500 Crafted deals hiding Enron debt Avista Corp $5,000 FERC probing alleged manipulation of CA energy markets CMS Energy Corp $3,850 Disclosed overstated revenues from round-trip trades TOTAL: $5,424,429
* Reincorporated in Bermuda to dodge U.S. taxes.
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