|The Ron Carey Campaign
Teamsters Investigators Win Ruling on Talks
By Frank Swoboda Washington Post Staff Writer
NEW YORK, June 12 -- The manager of Teamsters President Ron Carey's reelection campaign has refused to cooperate with federal authorities investigating charges of illegal campaign financing, government prosecutors told a U.S. Court of Appeals today.
Under questioning from the bench, Assistant U.S. Attorney Karen Konigsberg said Jere Nash, Carey's campaign manager, had invoked his Fifth Amendment right against self-incrimination in what she said was "an ongoing criminal investigation" of the Teamsters election.
However, the three-member appeals panel ruled late today that attorneys for the Carey campaign may disclose what Nash has told them about the financing of Carey's election campaign -- the same conversations that Nash has refused to discuss with Justice Department investigators.
Carey narrowly defeated James P. Hoffa, the son of the former Teamsters president, last November by a vote of 226,593 to 209,896 in government-supervised elections. Hoffa has since filed protests with federal elections officials alleging the Carey campaign used illegal campaign funds to pay for a last-minute mailing and get-out-the-vote telephone campaign to win the election.
Nash met last March with campaign attorneys from the New York firm of Cohen, Weiss & Simon to discuss the allegations against Carey. He contends that those conversations were privileged because they involved a client-attorney relationship. A lower court said no, because the attorneys represented the campaign, not Nash, and therefore there was no privilege. The appeals court today agreed.
Nash's attorney, Christopher Mead, said he did not know whether Nash would appeal the ruling.
Barbara Zack Quindell, the federal elections officer appointed by the Justice Department to oversee the Teamsters elections, had told the court that Nash's refusal to answer questions has impeded her ability to certify the election results. If she does not certify them, she will order a new election.
The ruling today will allow Quindell to proceed with her investigation as well as aid federal prosecutors in the criminal case.
The sudden swirl of allegations and court actions is putting new pressure on Quindell to order a new election. The Hoffa campaign already has called for new elections and demanded that Carey step down. If new elections were ordered, they would most likely involve all national officers in the union.
Teamster spokeswoman Nancy Stella said today that Carey was fully cooperating with the election investigations and has instructed all members of both the union and his election campaign, including Nash, to cooperate.
The Carey campaign has paid back more than $200,000 in disputed campaign contributions.
Last week, federal authorities charged Martin Davis, a Washington, D.C., political consultant, with mail fraud, alleging that he diverted money from the Teamsters for use in the Carey reelection campaign. Davis, who could receive a five-year prison sentence and a $250,000 fine, pleaded not guilty to the charges and was released on $100,000 bail. The charges against Davis were originally contained in an election protest filed by Hoffa.
Government sources said they expect other criminal charges, possibly this month, against individuals connected with the Teamsters elections.
The charge against Davis alleges that he used a Massachusetts telemarketing firm owned by Michael Ansara to illegally launder money for the Carey campaign. Davis allegedly solicited contributions from Ansara's wife and then gave a Teamsters contract to Ansara's firm, but allowed him to overcharge for the work performed as a way to repay him for the donations, according to the government complaint. Ansara has pleaded guilty to one count of conspiracy and is cooperating with federal authorities.
It is illegal under federal labor law for any employer to contribute to a union election campaign. It is also illegal for a union to contribute money or services to the election campaign of another union, except under narrow special circumstances.
The government alleged that the campaign contributions in the Davis case were made to a group called Teamsters for a Corruption Free Union. Quindell, in a letter to Hoffa's attorneys, said the campaign group produced and mailed 886,000 pro-Carey leaflets to Teamsters members during the first week of last November, just as the government was sending mail ballots to Teamsters members. Quindell said Carey's total direct mail campaign in November was approximately 2 million pieces of mail including those produced by the Teamsters for a Corruption Free Union.
Campaign finance reports filed May 8 by the Carey campaign also show that the campaign owes the American Federation of State, County and Municipal Employees union -- a strong supporter of Carey -- $129,735 for "phone calling" last November, according to new protest allegations filed by the Hoffa campaign.
"It's an unpaid bill. We have treated them so far as everyone else we sell services to. We expect to collect it all," said AFSCME attorney Bob Lenhard.
The Carey financial reports also show that Cohen, Weiss & Simon contributed at least a $200,000 in "in kind" services to the Carey campaign. Such contributions are legal under federal labor law.
@CAPTION: RON CAREY
@CAPTION: JAMES P. HOFFA
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