Monday, May 14, 2007

Giuliani's firm lobbied government

[Via AP]
WASHINGTON (AP) -- As a partner in a law and lobbying firm, Rudy Giuliani has profited from his firm's work representing corporate clients before nearly every Cabinet department, exposing himself to a wide range of potential ethical entanglements.

If Giuliani became president, his administration would be on the receiving end of regulatory requests, contract bids and policy proposals by the same clients of his Houston firm, Bracewell & Giuliani, that have contributed toward his personal net worth of millions of dollars.

Although the Republican has so far declined to identify all the companies with which Bracewell and his other firms have done business over the past five years, The Associated Press identified more than 175 as part of an expansive review of lobbying records, court filings and securities reports.

Giuliani's law and lobbying clients have included Saudi Arabia, Rupert Murdoch's News Corp., and chewing tobacco maker UST Inc.

Traditional procedures for government officials to prevent ethical conflicts - avoiding issues directly involving their former employer - would be unavailable for a commander in chief. It is unheard of for a president, when taking office, to promise to step away from a particular issue.

Bracewell alone has thousands of clients but will name only a few dozen. Since Giuliani became a partner in spring 2005, it has reported lobbying on various issues with the White House, the vice president's office, Congress and every Cabinet agency except the Department of Veterans Affairs, the AP review found.

Federal conflict-of-interest rules do not apply to the president or vice president, because they are not technically considered government employees. Giuliani isn't registered as a lobbyist for any of the interests on whose behalf his firms have acted, and he has so far declined to describe his work for them.

But appearances matter when it comes to the public's perception of conflicts of interest, and the large number of clients and issues linked to Giuliani's firms could prove a liability.

Giuliani declined to comment.

"It's clear voters are looking for an experienced leader like Mayor Giuliani with a track record of results to tackle the difficult issues currently facing our country," campaign spokeswoman Maria Comella said. She declined to describe Giuliani's work at Bracewell or how he was compensated.

Congress, the Pentagon, Energy and Education departments and the Environmental Protection Agency were among offices most frequently contacted by Bracewell & Giuliani, reports show. Issues ran the gamut:

-It lobbied the Department of Health and Human Services on Medicare coverage of power scooters and wheelchairs from The Scooter Store. The Scooter Store agreed Friday to pay a $4 million fine and surrender $43 million in Medicare claims over allegations by the Justice Department that it had defrauded the government.

-It lobbied the Food and Drug Administration on behalf of UST Public Affairs' over regulation of tobacco products.

-It tackled copyright protection and legislation on the purchase of cable TV lineups for News Corp., and DirecTV.

-It lobbied on behalf of Cornell Companies last year for U.S. Bureau of Prisons contracts. In 2004, the prison operator was named in indictments of two associates of then-Rep. Tom DeLay, R-Texas. Cornell wasn't charged but was listed among companies making political donations that prosecutors said DeLay's associates illegally laundered for use in Texas campaigns.

-It lobbied Congress on behalf of Concentrax Inc. of Houston, which was trying to raise government interest in a vehicle-tracking system called "Track Down." The lobbying work in 2005 came a few years after Concentrax settled an SEC lawsuit accusing it of falsely claiming to have won contracts for the vehicle-tracking system.

-It represented a Utah candlemaker, For Every Body, before the Consumer Product Safety Commission, which last year debated whether to require mandatory fire standards for candles.

The firm, previously named Bracewell & Patterson, took in roughly $500,000 more from Washington lobbying the first year of Giuliani's partnership than in the previous year, rising from nearly $5.8 million between mid-2004 and mid-2005 to $6.3 million between mid-2005 and mid-2006, according to Political MoneyLine.

Managing partner Patrick Oxford declined to discuss Giuliani's compensation. It is typical for a partner in a law and lobbying firm to get a share of the firm's proceeds.

"Mayor Giuliani's worldwide reputation for leadership has contributed to the firm's stature and success," said Oxford, national chairman of Giuliani's campaign. "Of course, should he be inaugurated as president, the firm's name will change."

Giuliani, then New York City's mayor, became a national hero after the 2001 attacks on the World Trade Center. He left the mayor's office in 2002 with a $3 million book deal, and last year took in $11.4 million from speeches alone.

Giuliani's Bracewell partnership is one of several enterprises. Others, past and present, include Giuliani Partners, a consulting firm; Giuliani Capital Advisors, an investment banking firm; Giuliani & Kerik, an arm of Giuliani Partners focused on security; and a security firm, Giuliani Security & Safety LLC.

Giuliani's campaign has said he is considering how and when to separate himself from his business interests. Earlier this year, Giuliani Capital was sold to Australia-based Macquarie Group for an undisclosed sum.

Besides lobbying, Bracewell represents clients in legal matters, among them AOL Time Warner, Apple Computer, Bank of America, General Electric and Southwest Airlines.

In March, the firm filed papers in a Texas case on behalf of Saudi Arabia's oil ministry - taking sides with another energy giant, Citgo, which is controlled by Venezuelan President Hugo Chavez, a Bush administration critic. After the 2001 attacks, then-Mayor Giuliani famously rejected a $10 million check from a Saudi prince to help terrorism victims.

Giuliani's enterprises have put him in league with corporations that, decades ago, he might have faced in court. An example: Naturex Inc., a French food-flavoring firm that hired Giuliani Capital Advisors to help with its 2005 acquisition of another company.

A year later, Naturex was sued by the U.S. attorney in New York - a job Giuliani once held - for violating the Controlled Substances Act. A Drug Enforcement Administration inquiry concluded Naturex had imported and exported benzaldehyde - a chemical that can be used in amphetamines and methamphetamines - more than 100 times without telling the government. In 2004, Giuliani was hired by the pharmaceutical industry to study - and testified before Congress on - the dangers of importing prescription drugs.

A spokeswoman for Giuliani Capital Advisors said Monday the firm was unaware of any inquiry by the DEA into Naturex's business at the time.

Naturex paid $325,000 to settle its case. A company spokeswoman and attorney did not respond to requests for comment.

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