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February 08, 2013

No Matter Which Way You Turn In The Menendez Story, You Run Into Corruption and Self-Dealing

I've given up on this story-- not because there's nothing there, but because there's too much there to even keep straight.

Menendez might be saved due to the fact he's got so many corrupt irons in so many self-dealing fires that no one can follow it all without a flowchart and a predisposition to nerdy completism. If corruption were redundant money-sucking Star Wars action figures, Bob Menendez would be George Lucas.

Just some of the latest: "Untouchable.

According the developing accounts, NJ Sen. Bob Menendez has a special relationship with mega-donor Dr. Salomon Melgen. In addition to campaign contributions, Dr. Melgen allegedly flew Sen. Menendez to the Dominican Republic on his private plane and may have provided the Senator with prostitutes. That soap opera, though, obscures a more troubling connection. According to a report in the Washington Post, Sen. Menendez intervened at least twice on behalf of Melgen in a billing dispute he had with Medicare.

[details of the dispute omitted]

According to the Post, Sen. Menendez pressed HHS officials on the matter on at least two occasions....


A second former federal official recounted that Menendez’s name came up repeatedly when Melgen was interviewed by investigators from the Justice Department and the inspector general’s office at the Department of Health and Human Services.

“He was using Menendez more as a character reference,” the official said. “He thought he was untouchable.”

Melgen, meanwhile, set up an Occupy-style "grassroots" (really astroturf) organization to shellack Bank of America.

Why? Because of the principle? Because the bank was Too Big To Care (the name of the organization)?

Of course not. It was all about exerting political pressure to settle a private dispute over money.

But a grassroots effort may have been less important to Melgen than pressuring his allies on the Senate Banking Committee for new regulations. His friend and political beneficiary Sen. Menendez has sat on the banking committee since he joined the Senate in 2005.

Melgen has called himself a “victim” of Wall Street “greed.” In 2005 he sued Banc of America Securities, then an investment subsidiary of Bank of America, after he lost $15 million in what he claimed was securities fraud. He alleged that his entire investment was transferred into the account of a failed trader in order to help him cover a margin call.

He lost a lower court challenge and is case is now in appeals purgatory. But who knows, the stroke of a legislator's pen might make everything turn out right.

Now, all this said, it's important to keep in mind that it's hard to distinguish sleazy self-dealing from criminal self-dealing, and just because there is reason for suspicion does not mean there are grounds for prosecution.

Every man is innocent until proven guilty. Every man. Let us not betray our small-l liberal heritage by forgetting this elementary rule, nor let us snidely insinuate facts we don't know to be true.

L to R: Salomon Melgen, Bob Menendez, and a less-guilty man,
for purposes of comparison

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posted by Ace at 02:55 PM

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