Reed's fees all paid by casino | ajc.com

By JIM GALLOWAY , ALAN JUDD
The Atlanta Journal-Constitution
Published on: 11/03/05
WASHINGTON — Ralph Reed's anti-gambling work in Texas and Louisiana was funded by an Indian tribe that derives all of its income from a single casino, according to U.S. Senate testimony Wednesday.

Reed, the former Christian Coalition leader who is running for lieutenant governor of Georgia, is an avowed opponent of legalized gambling. He has said he never knowingly accepted gambling money.

But Washington lobbyist Jack Abramoff, who hired Reed to manage the campaign, made it clear to Reed that he was working for the Coushatta Tribe of Louisiana, according to a Feb. 11, 2002, e-mail released after the hearing.

And testimony Wednesday before the U.S. Senate Indian Affairs Committee indicated that the tribe has no source of income besides its Grand Casino Coushatta, Louisiana's largest land-based casino with 3,000 slot machines and an annual income of $300 million.

In a prepared statement after the hearing, Reed said he had been assured by Abramoff's law firm that his payments did not come from gambling. If they did, Reed said, "it was contrary to my understanding. Nevertheless, I accept responsibility for any difficulty this may have caused the grass-roots citizens and religious leaders with whom we worked, which I deeply regret."

Source of cash obscured

The revelations of Wednesday's hearing and documents released later follow months of reports about Reed's anti-gambling work as a subcontractor to Abramoff, his longtime friend. Abramoff is now the target of several congressional and criminal investigations into whether he defrauded his tribal clients. Reed has not been accused of wrongdoing.

Wednesday's hearing, the fourth in a series, examined Abramoff's dealings with the Coushatta tribe, which wanted to block competition — whether from rival tribes or private gaming interests.

Payments to Reed's firm, Duluth-based Century Strategies, were sent through third-party organizations that obscured the source of the money, according to testimony and documents. U.S. Sen. Byron Dorgan (D-N.D.) alleged the shuffling of funds was conducted "at the request of Mr. Reed ? because of Reed's concern about being publicly associated with gaming money."

The e-mails indicate Reed was aware of the circuitous route his payments were making, but Reed's campaign staff disputed that it was done at his request.

"The false charges of Senator Dorgan have a lot more to do with partisan politics than they do with the facts," said Reed spokeswoman Lisa Baron. "The law firm [of Abramoff], not Ralph, directed how Century Strategies was paid for its work."

A staffer for Dorgan said his allegation was based on unpublished testimony from a witness, not the 318 pages of documents released Wednesday.

According to testimony at earlier hearings, Reed was paid a total of at least $4 million to drum up public opposition to the expansion of gambling in Louisiana and Texas, with money from the Coushattas.

Reed engaged in sophisticated TV, radio and grass-roots campaigns that involved some of the biggest names in the American evangelical movement, including James Dobson of the Family Research Council and Pat Robertson, founder of the Christian Coalition.

But according to the e-mails, Reed's connection to the Coushattas was a closely guarded secret. In a March 21, 2001, e-mail to Robertson, Reed declared that he was working "on behalf of the pro-family forces in Louisiana and we would love to have a message from you."

Sen. John McCain (R-Ariz.), chairman of the Senate Indian Affairs Committee, described the activities of Abramoff — once the most powerful Republican lobbyist in Washington — as "breathtaking."

Testimony ranged from Abramoff's alleged attempt to influence officials in Washington who decide which tribes are permitted to open casinos, to Reed's involvement with the Coushattas.

Tribal leaders and their attorney testified that Reed was hired by Abramoff to address threats — some real, some exaggerated — to the tribe's prize jewel: the Grand Casino Coushatta in Kinder, La.

In past statements, Reed has said that while he knew of Abramoff's long list of gambling clients, he didn't know his anti-gambling efforts in Louisiana and Texas were being financed by casino cash. That distinction has become important to his current Republican campaign for lieutenant governor, which has relied in large part on his connections to the Christian evangelical community.

In e-mails, Reed and Abramoff often relied on euphemisms, making references to "our clients" or "our friends" or even "the originating entity."

But on Feb. 11, 2002, Reed e-mailed Abramoff with a local Louisiana newspaper article that noted the Coushattas were attempting to block a bid by the rival Jena Band of Choctaws to open a competing casino.

Within the hour, Abramoff replied: "That's our client. We did the [press] release."

Baron, the Reed spokeswoman, said the e-mail exchange carried no significance. "We did not know that the Louisiana Coushattas were contributing to our efforts until press accounts in 2004," Baron said.

'Bring out the wackos'

In testimony, current and former Coushatta leaders described the path that $400,000 took to reach Reed's consulting firm. It went from the tribe to Southern Underwriters, a company run by the tribe's chief financial officer. From there it went to the American International Center, a think tank whose chief officer was an odd-jobbing lifeguard. Then the money went to Reed's firm.

"The payments were made to Ralph Reed. This was done with the whole council's approval," William Worfel, a former tribal government official, testified. Asked if Reed knew the origin of the money, Worfel replied: "I don't want to speculate, but he should know."

Reed's activities fit a pattern explored in a previous hearing of the Indian Affairs committee.

Two years earlier, Reed had worked with Abramoff, fighting a state lottery and video poker legislation in Alabama, largely through that state's Christian Coalition chapter. Financing came from the Mississippi Band of Choctaws, another Indian tribe with casino interests to protect.

In that case, Reed and the Choctaws said the money came from the tribe's non-gaming businesses — although e-mails indicated Reed helped hide the cash's origins by funneling it through other organizations.

Reed had also helped kill a proposed ban on Internet gambling on behalf of eLottery Inc., an Abramoff client eager to sell state lottery tickets on-line. But the Coushattas may have been Abramoff's richest client.

"As Mr. Abramoff had learned with other clients, mobilizing and manipulating the Christian Coalition was an effective way to turn back potential gaming competitors," Dorgan said.

In an e-mail sent to Kathryn Van Hoof, a former outside lawyer for the Coushatta tribe, Abramoff's partner, Michael Scanlon, boiled down Reed's importance to the project: "Simply put, we want to bring out the wackos to vote against something and make sure the rest of the public lets the whole thing slip past them. The wackos get their information [from] the Christian right, Christian radio, e-mail, the Internet and telephone trees," Scanlon wrote.

Jim Galloway reported from Washington. Alan Judd reported from Atlanta.