Steele Trap? Taking Stock Of The Claims Against The New RNC Chief

So what to make of the allegation against newly elected GOP chairman Michael Steele, that his 2006 Senate campaign made payments to a company run by his sister, for work that was never performed?

It’s not yet clear. The claim comes from a court filing made last March by Alan Fabian — Steele’s finance chair during that campaign — who was facing unrelated fraud charges and hoped, in vain, to get credit for cooperation. In the end, Fabian was sentenced to nine years in jail for swindling millions from businesses and banks.

So there’s reason to be skeptical.

But there isn’t reason to dismiss the claim out of hand. For one thing, the Feds appear to be taking it seriously: Agents have spoken to Steele’s sister about the issue, according to a Steele spokesman.

Steele told ABC’s This Week that the FBI is “winding this thing down” but didn’t explain how he knew that. And although Steele added that the payments were for legitimate work, the explanations from his camp don’t yet add up.

At issue is a February 2007 payment of more than $37,000 made by Steele’s unsuccessful Senate campaign to Brown Sugar Unlimited, a company run by Monica Turner, Steele’s sister (and also the former Mrs. Mike Tyson, incidentally).

According to campaign finance records, reports the Post, the payments were for “catering/web services.” But a Steele spokesman told the paper that Turner “did a lot of media stuff” for the campaign. The spokesman then showed the paper an invoice for catering services for two events. But the invoice was dated December 2006, although the events occurred in October 2006 and July 2007. The spokesman attributed this to a typo.

So, was it media, web services, or catering? How many companies do all three?

There’s also the fact that, as the Post reports, “Turner filed papers to dissolve the company 11 months before the payment was received”. (Steele told ABC yesterday that Turner believed the company was still in existence when the payments were made.)

The payments to Turner aren’t the only allegations Fabian is making against Steele. There are three additional — and apparently less serious — claims.

One is that Steele, who at the time was Maryland’s lieutenant-governor, used his state campaign to pay bills invoiced to his 2006 Senate campaign for printing services, totaling around $38,000 — which would violate campaign finance law. Steele’s spokesman says the printing was related to Steele’s lieutenant governor’s office.

Another claim is that Steele paid $75,000 from the state campaign to the law firm of Baker Hostetler, for work that was never performed. The payment was listed in campaign finance records as an in-kind contribution to the state GOP. And a lawyer for Baker Hostetler — who was also chief counsel for the RNC — told the Post that the payment was for legal work on challenging Maryland’s 2002 legislative redistricting.

Finally, Fabian claims that Steele or an aide transferred more than $500,000 in campaign cash from one bank to another without appropriate authorization. The bank transfer appears to have angered aides to former Maryland governor Bob Ehrlich, who had hoped to use the money for other states races, including Ehrlich’s. But there doesn’t appear to be evidence that it was illegal.

There’s also no evidence that the Feds are looking into any of these latter three claims.
So it’s those payments to Steele’s sister’s company that appear to be where the action is. And until we get a fuller explanation of what those payments were really for, this story will probably linger.

That can’t be a prospect that will please a Republican Party that just made Steele its major national spokesman