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News Tuesday, Jan 14 2014

VIDEO/MEMO: Christie's State of Controversy

Jan 14, 2014

Chris Christie’s reelection last November was supposed to propel him into the pole position for the race to the White House. However, the timing of his victory coincided with the release of a damning excerpt from Double Down: Game Change 2012 by Mark Halperin and John Heilemann. Unwittingly transcribing the prologue for 2016, Halperin and Heilemann recounted the incredulity with which Romney’s VP selection committee discovered the preponderance of scandals in Christie’s wake.

“The vetters were stunned by the garish controversies lurking in the shadows of his record…[Ted] Newton told his colleagues, If Christie had been in the nomination fight against us, we would have destroyed him—he wouldn’t be able to run for governor again. When you look below the surface, Newton said, it’s not pretty.”

Some of the controversies alluded to by those possessing a cursory familiarity with Christie’s record: a defamation lawsuit from his 1994 election, lobbying for an exemption to securities regulation on behalf of an organization associated with Bernie Madoff, a lucrative contract for a U.S. attorney who had declined to prosecute Christie’s brother for fraudulent stock trading, a no-bid contract for John Ashcroft, and excessive spending during his time as a U.S. Attorney. Taken together, Christie’s career seemed to be a compilation of ethical lapses which would be unable to withstand the scrutiny of a national election.

As NBC News recently pointed out, until now Christie has been the beneficiary of positive attention from the New York media. Now the “free ride” is over as Christie is “welcome[d] to the vetting process.”

With that scrutiny finally being applied to Christie, we’re beginning to scratch the surface of just how far Christie and his team were willing to go in pursuit of a November victory that would serve as a launching pad for his presidential ambitions. Just as Christie’s marathon press conference did not answer all of the questions surrounding the George Washington Bridge lane closures, the succeeding days have raised only more questions about the potential improper use of Hurricane Sandy relief funds, canceled meetings with another mayor who declined to endorse the governor, and the use of personal emails by Christie staff in possible violation of Open Records laws.

Despite his high-profile status, Chris Christie’s record is yet to be vetted in the context of a competitive national election. So far, each loose end pulled seems to unravel a thread of corruption, abuse of power, and contempt for his fellow Garden Staters.  As Christie delivers his State of the State address today amidst a state of controversy, his inability and unwillingness to address the mounting scandals in his administration constitutes the first game changer of 2016.


Use Of Federal Funds For Tourism Ads Starring Christie

Christie Faced Federal Investigation Over Use Of Sandy Funds For Tourism Ads Starting Christie And His Family. According to the Star-Ledger, “U.S. Rep. Frank Pallone (D-6th Dist.) said that the inspector general of the U.S. Department of Housing and Urban Development will audit New Jersey’s use of $25 million of federal Sandy aid funds for a marketing campaign to promote tourism at the Jersey Shore, including a television ad that featured Christie and his family prominently during his re-election campaign.” [Star-Ledger, 1/13/14]

Firm Chosen For The Ads, MWW, Was Nearly $2 Million More But Promised To Include Christie In The Commercials. According to the Star Ledger, “The firm chosen by the state to put together tourism advertisements which featured Christie and his family, MWW, submitted a bid of $4.7 million. Another bid that was not selected would have cost $2.5 million, but the governor wouldn’t have appeared in the ads.” [Star-Ledger, 1/13/14]

MMW’s Senior Vice President Said They Pitched State On Using Christie In Ads. According to the Asbury Park Press, “But Shannon Eis, the company’s senior vice president, said in a May 2013 interview with the Press that MWW executives pitched using the governor in a starring role when they met with state officials on March 15. The contract was awarded in May. Eis in that interview said the company made it clear that Christie would have a prominent role. ‘From the creative side we had to decide who is the strongest voice communicating that we’re back from the storm, and the governor has been that voice. We put out this very huge concept that included having the governor’s office involved loud and clear,’ Eis said.” [Asbury Park Press, 1/13/14]

Asbury Park Press: Christie Administration Hid Details Of Sandy Ads. According to the Asbury Park Press, “New documents obtained by the Asbury Park Press show the Christie administration is hiding details of the $25 million “Stronger Than the Storm” advertising campaign, which now is the center of a federal probe. […]The Christie administration has taken months to release specifics about the bids and the process that led to MWW winning the contract. The state’s open records law says government records must be provided within seven business days. The latest batch of documents were delivered to the Press after the paper threatened to go to court to force their release.” [Asbury Park Press, 1/13/14]

Canceled Meetings With Jersey City Mayor

Christie’s 2013 Campaign Manager, Bill Stepien, Offered To Set Up Meetings With State Officials For Newly Elected Jersey City Mayor Steven Fulop. According to the Bergen County Record, “After Steven Fulop was elected mayor of Jersey City last year, Governor Christie’s campaign manager offered to help set up meetings with state officials . . . Emails obtained through an Open Public Records Act request Monday show Bill Stepien, Christie’s campaign manager, offered to arrange those meetings.” [Bergen County Record, 1/13/14]

Stepien Had Implied In His Conversations With Fulop That He Was In Touch With Chrisite Over The Meetings, Which Christie Later Denied Knowing About. According to the Bergen County Record, “Stepien implies in his conversations with Fulop that he was in touch with Christie over the meetings, which would contradict remarks the governor made at a news conference last week that he knew nothing about the cancellations. Christie said during a State House news conference last week, after it was revealed that members of his staff and his appointees at the Port Authority closed access lanes to the George Washington Bridge as political retribution, that he ‘didn’t know about specific meetings or what’s going on, but certainly, you know, I will look into all those things.’” [Bergen County Record, 1/13/14]

Bridget Anne Kelly Organized Numerous Meetings For Mayor Fulop. According to the Bergen County Record, “The records also show that Bridget Anne Kelly, the deputy chief of staff who Christie fired last week after emails obtained by The Record show she apparently ordered the lane closures, scheduled the meetings between state officials and Fulop’s administration. Starting in late June – just before Fulop would be sworn in as mayor on July 1, Kelly began communicating with Jersey City officials to organize the meetings. She scheduled a day of meetings between Fulop and Department of Transportation Commissioner Jim Simpson, who was later replaced by Deputy Commissioner Joseph Mrozek; Marc Ferzan and Terry Brody, from the Governor’s Office of Recovery and Rebuilding, which is overseeing the Superstorm Sandy recovery; Department of Community Affairs Commissioner Richard Constable; Michele Brown, CEO of the state’s Economic Development Authority; Treasurer Andrew Sidamon-Eristoff; Chief of Staff Jim Leonard; and Bill Baroni, who has since resigned from his post as deputy executive director of the Port Authority. Fulop also had another meeting scheduled with Department of Transportation officials for July 29 and also was set to meet that day with Lauren Moore, director of business advocacy at the state’s Business Action Center.” [Bergen County Record, 1/13/14]

Fulop Refused To Endorse Christie For Re-Election And The Meetings Scheduled By Kelly Were Then Canceled. According to the Bergen County Record, “But after Fulop declined to endorse the Republican governor, those meetings were abruptly canceled and contact ceased, documents show. The mayor first told The Record last week that after saying he would not endorse the governor, 10 meetings he had scheduled with members of Christie’s administration were suddenly canceled that same day. He questioned whether the cancellations – and the stalling of a bill in the state Legislature to overhaul the city’s pension system – were political retribution for his decision to support Democrat Barbara Buono over Christie.” [Bergen County Record, 1/13/14]

Almost All Of Those Meetings Were “Abruptly Canceled” In Mid-July, Most On July 18th, And Future Meeting Requests By Fulop Were Ignored. “All of the meetings, except those with Baroni, Brown and Moore, were abruptly canceled July 18, records show. Baroni canceled the next day and Brown canceled July 22. On Aug. 1, Fulop sent an email to Baroni saying ‘I wanted to follow up again with a request for a meeting.’ Then, on Aug. 18, Fulop sent another email, this time raising concerns that the meeting cancellations were ‘simultaneous to other political conversations elsewhere that were happening.’ ‘Prior to that you were always very responsive and I sincerely hope the two issues are not related as it wouldn’t in the PA, Jersey City, or the residents of the state’s best interest,’ Fulop wrote, again requesting a meeting.” [Bergen County Record, 1/13/14]

Personal Emails Used For Official Business

Christie Officials Used Private Email For Official Business. According to the Associated Press, “The use of private emails adds Christie, a possible Republican presidential candidate in 2016, to a growing list of administrations that use private email accounts and other digital services to conduct official business.” [Associated Press, 1/11/14]

ACLU Called On Christie To Require All State Employees To Use State Email For Business. According to the Star-Ledger, “The American Civil Liberties Union of New Jersey today called on Gov. Chris Christie and the state attorney general to require all public employees to use government e-mail accounts and cell phones to conduct official business, in response to the unfolding George Washington Bridge lane-closure scandal. The group said in a letter that the release of thousands of pages of e-mails and text message Friday related to the scandal showed government employees are attempting to circumvent the state Open Public Records Act by using personal accounts to discuss official matters.” [Star-Ledger, 1/13/14]

Prior To Revelation Of Personal Emails, A Newspaper Was Told Leaked Emails In Bridge Scandal Did Not Exist.  According to the Associated Press, “Emails disclosed this past week show a top Christie aide asking the Port Authority of New York and New Jersey to shut down three lanes on the busy George Washington Bridge, resulting in major backups for days last September. Those emails were leaked to reporters last week, even though one newspaper requested them nearly a month ago, only to be told they didn’t exist… The Record of Bergen, N.J., said it filed an open-records request last month asking for emails related to the Port Authority’s decision to close the bridge lanes. The request specifically sought emails between David Wildstein, a Christie-appointed Port Authority official, and employees in the governor’s office.” [Associated Press, 1/11/14]

Christie’s Office Informed The Record That No Wildstein Emails Matching The Request Were Found. According to the Associated Press, “The newspaper received a response from Christie’s office 10 days later, stating that the office ‘reviewed its records’ but did not find any responsive emails. Weeks later, however, emails similar to what The Record asked for were made public after being obtained under subpoena by state Assembly Democrats.” [Associated Press, 1/11/14]

New Jersey Law Says Officials Could Be Fined $5,000 For Violating Open Records Act. According to the Associated Press, “New Jersey law says officials can be disciplined and fined up to $5,000 for violating the open-records act, and that agencies have to reimburse a requestor’s attorney fees if the state loses an open-records lawsuit.” [Associated Press, 1/11/14]


Sued For Defamation And Forced To Publicly Apologize After Making False Statements About Political Opponents

Christie Was Sued For Defamation For Falsely Accusing A Freeholder Opponent Of Being A Target Of Criminal Inquiry. According to the New York Times, “Mr. Christie’s critics say he well knows the political damage a candidate can suffer from even the specter of an investigation. When he ran for freeholder in the mid-1990s, he was sued for defamation for falsely accusing a political opponent of being the target of a criminal inquiry. Mr. Christie ultimately offered a public apology as part of a settlement. ‘Chris Christie acts as judge, jury and executioner when his office leaks information about an investigation involving someone running for office,’ said Julie Roginsky, a Democratic strategist. ‘He knows, better than anyone else, that it’s almost impossible for candidates to defend themselves from those kind of charges during a campaign.’” [New York Times, 2/13/08]

Christie And The Plaintiffs Reached An Undisclosed Settlement In November 1996. According to Chris Christie: The Inside Story of his Rise to Power, “The lawsuit ended with a settlement in November 1996. Terms weren’t disclosed, but as part of it Christie formally apologized to Lauery and Tamm in a one-page letter published as an advertisement in Morris County daily and weekly newspapers.” [Ingle, Bob and Symons, Michael G., Chris Christie: The Inside Story of his Rise to Power, Macmillan, 2013, Page 49]

Christie Was Forced To Publicly Apologize As Part Of The Settlement. According to the Newark Star-Ledger, “In November, Christie was forced to publicly apologize for running a misleading campaign ad in 1994. That settled a defamation suit filed by Cecelia Laureys and Edward Tamm, the Republican freeholders he and O’Keeffe ousted in the primary.” [Newark Star-Ledger, 1/3/97]

Christie Said He Should Have Said “Inquiry” Instead Of “Investigation.” According to the Associated Press, “Christie said the problem was regrettable but relatively small: He used the word ‘investigation’ when he should have used ‘inquiry.’” [Associated Press, 5/29/09]

Lobbied On Behalf Of A Securities Industry Association That Included Bernie Madoff

2001: Christie Lobbied On Behalf Of The Securities Industry Association. According to The Record, “In the following list, the clients are represented by the lobbyist’s firm, and not necessarily assigned to the individual lobbyist… Lobbyists: Chris Christie and Bill Palatucci Firm: Dughi, Hewit & Palatucci Clients: Securities Industry Association; Hackensack University Medical Center, College Savings Bank, Garden State Limousine.” [The Record, 8/6/01]

As A Lobbyist, Christie Tried To Block Securities Fraud From Being Included Under The State’s Consumer Fraud Act. According to the New York Times, “Mr. Corzine’s advisers point out that New Jersey is seeking to recoup losses from Lehman Brothers. Before Mr. Christie became the United States attorney, they note, he worked as a lobbyist and represented the Securities Industry Association in its effort to block securities fraud from being included under the state’s Consumer Fraud Act.” [New York Times, 10/5/09]

As Of 2001, Madoff Was A Member Of The Securities Industry Association’s Trading Committee. According to USA Today, “Given the destruction, any hopes for a quicker reopening were fruitless. The World Trade Center towers housed a nerve center of key telecommunications links to data systems and telephones. ‘The communication lines people use to run all systems are still experiencing difficulties,’ says Bernard Madoff, chairman of Madoff Investment Securities and member of the Securities Industry Association’s trading committee.” [USA Today 9/14/01]

Gave A Lucrative Contract To A U.S. Attorney Who Declined To Prosecute His Brother For Fraudulent Stock Trading

The SEC Alleged That Todd Christie “Pervasively Engaged In Fraudulent And Other Improper Trading.” On April 12, 2005, the SEC filed an Administrative Proceeding, alleging that 20 former New York Stock Exchange Specialists – including Todd Christie – “engaged in a persuasive course of fraudulent trading.” According to the Administrative Proceeding, “The Division of Enforcement alleges that between 1999 and mid-2003 these specialists pervasively engaged in fraudulent and other improper trading by executing orders for their firms’ proprietary accounts ahead of executable public customer or ‘agency’ orders that were placed through the Exchange’s electronic trading system, known as the DOT system. Through these transactions, these specialists violated their basic obligation to match executable public customer buy and sell orders and not to fill customer orders through trades from their firms’ proprietary accounts when those customer orders could be matched with other customer orders.” [Securities And Exchange Commission, Administrative Proceeding, File No. 3-11893, 4/12/05]

2005: U.S. Attorney David N. Kelley Made The Decision Not To Bring Criminal Charges Against Todd Christie, But He Brought Charges Against 15 Other Traders Charged At The Same Time. According to the Associated Press, “The brother of New Jersey U.S. Attorney Christopher Christie was among 20 former Wall Street specialists who used their positions with the New York Stock Exchange to enrich themselves and their companies at the expense of investors, authorities said…Fifteen of them were also charged criminally for fraudulent trading. Christie wasn’t one of them. Christie, who specialized in IBM, AOL and AIG stocks, resigned his job with Spears Leeds in 2003 after news of the SEC’s probe leaked out. U.S. Attorney Christopher Christie had no comment on the charges, spokesman Michael Drewniak said Wednesday. Megan Gaffney, a spokeswoman for New York U.S. Attorney David Kelley, who brought the criminal charges against the others, declined comment when asked why Christie wasn’t among them.” [Associated Press, 4/13/05]

2007: Christie Appointed David N. Kelley The Federal Monitor For Biomet Orthopedics, Inc. As Part Of The Company’s Deferred Prosecution Agreement. According to a U.S. Department of Justice’s Federal Bureau of Investigation Newark Field Office press release obtained via US Fed News, “Five companies that account for nearly 95 percent of the lucrative market in hip and knee surgical implants have avoided criminal prosecution over financial inducements paid to surgeons to use their products by agreeing to new corporate compliance procedures and federal monitoring under 18-month agreements with the Department of Justice, U.S. Attorney Christopher J. Christie announced today. Zimmer, Inc., Depuy Orthopaedics, Inc., Biomet Inc., and Smith & Nephew, Inc., have executed Deferred Prosecution Agreements (DPAs), which will expire in 18 months if they meet all of their respective reform requirements… Biomet Orthopedics, Inc., also of Warsaw, Ind., will pay $26.9 million, and has agreed to be monitored by David N. Kelley, the former U.S. Attorney for the Southern District of New York in Manhattan, and now a partner at Cahill, Gordon and Reindel in New York City.” [US Fed News, 9/27/07]

The Value Of Kelley’s Contract With Biomet Was Not Disclosed. According to the Newark Star-Ledger, “Ashcroft, Christie’s former boss, was chosen to monitor one of the companies, Zimmer Inc., in a contract worth as much as $52 million. Kelley was chosen to monitor Biomet Inc., but no contract value has been disclosed.” [Newark Star-Ledger, 4/7/09]

Investigated After Giving John Ashcroft A $52 Million No-Bid Contract

Christie Named John Ashcroft As The Federal Monitor Of Orthopedics Company Zimmer Holdings, As Part Of A Deferred Prosecution Agreement With Several Companies. According to the Associated Press, “Biomet will pay $26.9 million; DePuy, $84.7 million; Smith & Nephew, $28.9 million; Stryker will not be paying any money; and Zimmer will pay $169.5 million and be monitored by former U.S. Attorney General John Ashcroft. The U.S. Department of Justice began investigating the industry in 2005 regarding concerns that companies may have paid kickbacks to orthopedic surgeons in return for favoring their products.” [Associated Press, 9/27/07]

Christie Recommended The Ashcroft Group Without Telling His Superiors Or Taking Bids From The Public. According a staff editorial in the Baltimore Sun, “‘Sweet deal’ is too simplistic a description of the contract given to a firm headed by former U.S. Attorney General John Ashcroft to monitor an out-of-court settlement negotiated by federal prosecutors in New Jersey. U.S. Attorney Christopher J. Christie recommended his former boss’ firm, the Ashcroft Group, for the contract last fall without notifying anyone – including his superiors in Washington – or soliciting any public bids. It was a sweet deal, but it also qualifies as a big dose of favoritism. Windfall would accurately describe the staggering amount of money Mr. Ashcroft’s firm is expected to earn over 18 months – $28 million to $52 million – for monitoring the agreement with Zimmer Holdings.” [Editorial – Baltimore Sun, 1/13/08]

Attorney General Michael Mukasey Announced He Would Investigate The Deal Between The Ashcroft Group And Zimmer Holdings. According to United Press International, “Former U.S. Attorney General John Ashcroft’s Washington consulting firm is under investigation regarding a large New Jersey contract awarded without bidding. Attorney General Michael Mukasey said there were concerns of favoritism in the 18-month deal made last fall in which the Ashcroft Group is to receive $28 million and $52 million, the New York Times reported. The contract involves a third-party — the Ashcroft Group — monitoring Zimmer Holdings, a medical supply company in Indiana, as part of an out-of-court settlement reached in New Jersey. New Jersey’s top prosecutor, U.S. Attorney Christopher Christie, struck the deal without outside bidding. Christie worked for Ashcroft between 2002 and 2005, which prompted the inquiry, the report said. Justice Department officials told the Times the internal inquiry by the Criminal Division began several weeks ago and no public announcement was made.” [United Press International, 1/10/08]

As U.S. Attorney, Exceeded Travel Allowances With Expensive Hotel Stays

Between 2004 And 2008, Christie Spent More Than Permitted On 23 Of 30 Business Trips. According to the Daily Record, “Records turned over so far show Christie exceeded the government lodging allowance on 23 of 30 business trips taken between 2004 and 2008. In some cases, his travel vouchers were approved first by Brown, then certified by a third person. Christie, who was Brown’s supervisor, signed off on her travel, either in advance or when she submitted vouchers, the records show.” [Daily Record, 10/14/09]

Christie Exceeded Federal Travel Guidelines By Billing Taxpayers For Over $400 Per Night On Hotels On 14 Of 16 Business Trips In 2008. According to the Daily Record, “The Republican candidate for New Jersey governor, who has campaigned on a platform of ethical integrity and cutting government waste, regularly spent beyond federal guidelines on business travel while U.S. attorney, records show. The newly released travel records show that Chris Christie occasionally billed taxpayers more than $400 a night for stays in luxury hotels and exceeded the government’s hotel allowance on 14 of 16 business trips he took in 2008. ‘Generally, U.S. attorneys, assistant U.S. attorneys and all federal staff stay within the government rate,’ said Justice Department spokeswoman Melissa Schwartz. ‘The government rate is not a suggestion, it’s a guideline.’ Christie said he stayed in more expensive hotels only when cheaper ones weren’t available. ‘We always went for government rates first,’ he said. ‘I don’t think there were a lot of stays in five-star hotels over seven years.’” [Daily Record, 10/14/09]

A Department Of Justice Inspector General Report Found That Christie “Did Not Comply With The Travel Regulations Or Show That His Lodging Costs Which Exceeded The Government Rate Were Appropriate.” According to a U.S. Department of Justice report, “In sum, we concluded that U.S. Attorney C did not comply with the travel regulations or show that his lodging costs which exceeded the government rate were appropriate. The U.S. Attorney or his staff did not make an adequate effort to determine whether the government rate was available within a reasonable distance of his meetings. Most of the justification memoranda that we found simply stated that the government rate was unavailable, but provided no substantiation for this claim. In four cases, there was no justification memorandum at all.” [U.S. Department of Justice, “A Review of U.S. Attorney Travel that Exceeded the Government Lodging Rate,” November 2010]

Christie Was Identified As “Attorney C.” According to, “Christie was not identified by name in the government report, but government sources have said he was ‘U.S. Attorney C,’ CNN confirmed.” [, 11/1/13]

Published: Jan 14, 2014

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