No Violations Found in Hiring of G.O.P Consultant by Enron
The New York Times
March 11, 2003
By RICHARD A. OPPEL Jr.
WASHINGTON, March 10 - The Federal Election Commission
has concluded "there is no reason to believe" that the decision by the Enron
Corporation to hire Ralph Reed, the Republican consultant, was actually
an unreported sham "in-kind" contribution designed to help George
W. Bush's 2000 presidential campaign.
Commission documents released today also indicated that
Mr. Reed was paid about $300,000 by Enron in the years leading up to the energy-trading
company's collapse, according to the terms of contracts between his firm, Century Strategies, and Enron.
The decision by the elections commission, made a month ago
and disclosed today, came after Judicial Watch, a conservative public interest group,
last year accused Mr. Reed; the Bush-Cheney campaign; Enron;
and Mr. Bush's long-time political aide, Karl Rove, of violating federal campaign rules.
The complaint followed a Jan. 25, 2002, article in The New York Times
that quoted close associates of Mr. Rove as saying he had recommended Mr.
Reed to Enron as Mr. Bush, then the governor of Texas, was considering whether to run for president.
The deal, the associates of Mr. Rove had said, was intended to ensure
that Mr. Reed supported the Bush campaign - and would not use his
considerable skills to help another candidate - while keeping
Mr. Reed off the Bush payroll at a time when Mr. Bush did not want to be linked too
closely with him. Mr. Reed had gained prominence
as executive director of the Christian Coalition.
According to the election commission documents, there were three
contracts between Enron and Mr. Reed's firm for government-affairs services
from September 1997 to November 2001, the month that Enron, based in Houston,
neared bankruptcy as an accounting scandal spread.
The first contract, dated Sept. 30, 1997, was to pay $114,000 over 12 months, plus expenses.
The second, dated Oct. 6, 2000, but retroactive to Sept.
1, 2000, was to pay $75,000 over six months.
The third contract, dated July 19, 2001, was to pay $30,000 a month.
During the investigation, Enron officials told the election commission
that neither Mr. Rove nor anyone else connected with Mr. Bush "had anything
to do" with Mr. Reed's hiring.
In an interview last year, however, Mr. Rove said he had praised
Mr. Reed's credentials in a conversation with an Enron lobbyist about the job. "I
think I talked to someone before Ralph got hired," Mr. Rove said then.
"But I may have talked to him afterward."
The Times article also quoted Mr. Rove and Mr. Reed as saying
that the Enron contract had nothing to do with the Bush campaign.
In its decision, the election commission concluded
that "Enron would have retained Century Strategies irrespective of the 2000 presidential election
or of Bush's testing the waters for that election."
Among the reasons it cited were that Century Strategies did "substantial" work
for Enron during the first three months of the first contract, though
terms of the contract allowed the firm apparently
"to receive payments for several months thereafter despite doing little or no additional work."
It also said that Enron had approached James Carville,
a leading Democratic political strategist, to do similar work, and that the initial contract with
Mr. Reed was terminated in February 1999, about the same time the Bush campaign got under way.
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