A lobbyist under investigation for billing Indian tribes tens of millions of dollars was at the center of an earlier inquiry that said his firm hadn't justified roughly $1.2 million it charged the Northern Mariana Islands (search).
Jack Abramoff (search), who has ties to President Bush and House Majority Leader Tom DeLay, is the lobbyist being investigated. He was the lead lobbyist for Seattle-based Preston Gates & Ellis when it worked on behalf of the U.S. territorial islands to keep them free from certain federal labor and immigration laws during the last half of the 1990s, according to reviews conducted by the Pacific islands' public auditors.
One audit concluded that about $1.2 million in government payments to Preston Gates was "not adequately supported." The charges included travel, telephone, photocopy, computer research and outside-professional fees. Auditors said Preston Gates improperly billed the government $2,000 for a June 1996 golf tournament.
The auditors said some payments to Abramoff's firm were made illegally, the documents show.
Andrew Blum, a spokesman for Abramoff attorney Abbe Lowell, said Abramoff "worked tirelessly" on behalf of the Mariana Islands and fees paid to Abramoff or his lobby firms were "more than justified."
"Due to the efforts of Mr. Abramoff and his team, [the commonwealth] realized substantial benefits for its economy," Blum said.
Preston Gates (search) partner Jonathan Blank, speaking for the firm, declined to address the specific audit findings except to say they mostly addressed internal government procedures. "Looking quickly at the report, it would seem we did our job," Blank said.
Abramoff, a major Bush fundraiser, now is under investigation by a federal grand jury for deals under which he and an associate received at least $66 million from six Indian tribes to lobby for their casinos and other issues. The tribes question whether some charges were excessive.
Democrats in Congress also are exploring Abramoff's ties to Rep. DeLay, R-Texas, citing foreign trips DeLay took that were arranged by the lobbyist and questioning whether the congressman made legislative decisions based on the relationship. DeLay denies wrongdoing.
One of those trips was in December 1997 when DeLay traveled to the Mariana Islands on a trip organized by Abramoff and paid for by the commonwealth government and the Saipan Garment Manufacturers Association.
DeLay told the Houston Chronicle at the time that he saw nothing wrong with accepting the trip and that he viewed the Saipan garment industry as an example of "free-market success" because it didn't have to follow most U.S. labor laws, exemptions he said he would fight to maintain.
Abramoff was the lead lobbyist for the islands for Preston Gates through 2000, then took the account to a new firm, Greenberg Traurig.
The audit reports said the island's lobbying costs fell after Abramoff changed firms, but they also questioned why the island awarded the new contract to Greenberg Traurig without competitive bidding.
The auditors concluded the islands' government broke its own laws when it paid Preston Gates just over $3 million from October 1996 to October 1997 after the contract had expired, and they questioned whether the islands got their money's worth.
The tiny commonwealth with a population of about 80,000, located in the northern Pacific Ocean near Guam, "may have in the past paid more than it needed to for lobbyist services," the auditors reported in November 2001.
The auditors also reported that while island government officials believed the lobbying work helped keep them free from new U.S. regulations "it may be difficult to validate to what extent lobbyists were the reasons behind preserving the status quo."
"There are many outside forces that go into such decisions in Congress," the auditors noted.
The audits showed that between October 1993 and September 2001 the Preston Gates firm reaped about $6.7 million from the commonwealth's government, about 72 percent of the government's overall lobbying payments. The Mariana Islands government was one of the firm's biggest clients, the audit said.
When Abramoff moved to Greenberg Traurig, the auditors said the islands began to get more work for their money, but Abramoff began to do less work, the reports said.
"Our analysis of billings and time charges shows that the CNMI [islands' government] has received more lobbyist services from Greenberg Traurig, in terms of time spent, than it did from Preston Gates," the audit said.
The new firm was to lobby the U.S. government "to preserve the commonwealth's current independence from certain aspects of United States immigration, customs, and labor laws, to provide representation of commonwealth's issues during the transition to the new Bush administration, and to advance other commonwealth interests."
The firm told the commonwealth government its 2001 lobbying included fighting proposals to apply a minimum wage to the Mariana Islands and to change immigration rules, working on legislation on "Made in the USA" clothing labeling rules, and educating the incoming Bush administration about Mariana Islands issues.