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FBI affidavit details Jefferson’s dealings

http://www.nola.com/newslogs/tpupdates/index.ssf?/mtlogs/nola_tpupdates/archives/2006_05_21.html#143233
By Bill Walsh
and Bruce Alpert
Washington bureau - NOLA.com

WASHINGTON — The tony Ritz-Carlton in northern Virginia was the spot for the latest meeting between Rep. William Jefferson, D-New Orleans, and Lori Mody, a wealthy businesswoman he was secretly working with to launch telecommunications deals in West Africa.

It was July 30, 2005, and, after the morning meeting, the two walked to the hotel parking lot. Jefferson reached into her car trunk and pulled out a leather briefcase containing $100,000 cash meant to grease the palms of Nigerian officials.

He slipped the case into a reddish-brown cloth bag, placed it on the seat of his Lincoln Town Car and drove off.

Unknown to Jefferson, Mody also had been working with the FBI, which videotaped the transaction from several vantage points. Four days later, agents would raid Jefferson’s home on Capitol Hill and recover $90,000 in a freezer, where stacks of $100 bills were wrapped in aluminum foil and stored in frozen-food containers.

That colorful — and potentially damning — tableau came to light Sunday in an affidavit released by the FBI. Agents had used the affidavit to persuade a federal judge to let them search Jefferson’s congressional office a day earlier.

Jefferson has not been charged, and last week he declared his innocence, saying he has never sought anything for himself or his family in return for performing the duties of a congressman. On Sunday, his attorney Robert Trout blasted the government, saying the disclosure was “part of a public relations agenda and an obvious attempt to embarrass Congressman Jefferson.”

The 95-page document is certain to raise the pressure on the congressman, who said last week that he wouldn’t resign despite an ongoing House ethics investigation. The affidavit quotes him on a wiretap telling Mody, “I make a deal for my children,” and at another point, “I’m in the shadows, behind the curtain.” It even captures him laughing at their cloak-and-dagger methods “as if the FBI is watching.”

Agent Timothy Thibault’s affidavit provides the most detailed accounting yet of the federal bribery probe of the eight-term congressman, which has already resulted in guilty pleas by two of Jefferson’s associates. A northern Virginia grand jury has been hearing evidence in the case.


At the center of the yearlong probe is a small Kentucky telecommunications company called iGate, which had developed novel technology to transmit high-speed Internet service across copper wires such as those used in developing countries in West Africa.

As part of his guilty plea earlier this month, iGate CEO Vernon Jackson said he paid more than $450,000 and millions of shares of iGate stock to a company, identified Sunday as ANJ Group LLC and operated by Jefferson’s wife, Andrea, in exchange for the congressman’s help.

The FBI affidavit released Sunday suggests a far broader and lucrative scheme was afoot, alleging that Jefferson also sought and received bribes directly from a “cooperating witness,” who sources say is Mody and who was to provide financing for the iGate ventures in Africa.

Among other things, the documents say:
— The FBI videotaped Jefferson receiving a stock certificate from Mody for a company set up in Nigeria to promote iGate’s technology. Jefferson predicted the deal would generate $200 million annually after five years.
— Jefferson told Mody that he wanted a similar financial stake in the business in Ghana.
— Jefferson sought $10 million in financing from Mody to take over iGate and install “confidants” on the new board. In two payments, Mody wired $89,225 to the ANJ Group LLC, a company controlled by Jefferson’s family.
— Jefferson lent $4,800 of the money Mody gave him to an unnamed congressional aide. Another $4,900 was given back to the FBI by one of Jefferson’s attorneys.
— The FBI claims it has uncovered “at least seven other schemes in which Jefferson sought things of value in return for his official acts.”

According to the affidavit, Mody triggered the FBI investigation in March 2005. She had paid $3.5 million to acquire the rights to iGate’s technology but grew wary when Jackson, the company CEO, refused to comply. Believing she had been defrauded, Mody went to the FBI and soon began wearing a wire.

Through Brett Pfeffer, a former aide to Jefferson who pleaded guilty in January, a dinner meeting was set up between Mody and the congressman. They decided to go ahead with the iGate deal in Nigeria. But first, Jefferson told Mody, a key palm needed to be greased.

In a recorded conversation, Jefferson said that a top Nigerian official was scheduled to arrive in Washington shortly. Jefferson described him as a businessman “who has more deals than the man in the moon” and “He’s a very, well, the word might be ... corrupt.”

The official, Jefferson later said, could be bribed by funneling money through a charitable foundation run by the official’s wife, which Jefferson called a “front.”

The official’s name is redacted from the search warrant affidavit, but it is believed to be Nigerian Vice President Atiku Abubakar, whose Maryland home was also raided in August by the FBI. His wife, Jennifer, operates an AIDS foundation in Washington, D.C. Neither could be reached for comment on Sunday.

Jefferson later told Mody that the unnamed official demanded 50 percent of profits from a joint venture launched in Nigeria and would probably need $500,000 up front, $100,000 of which was in the briefcase she handed to Jefferson three months later.

Jefferson was also seeking a share for his family, the affidavit says. In December 2004, Jefferson had demanded a 5 percent to 7 percent share of the Nigerian business for his five daughters, “to be split equally among them.” At a dinner meeting in May with Mody, the number went up.

On scraps of paper, the two passed messages back and forth across the table, cryptically negotiating in writing with symbols and figures that Mody later turned over the FBI. In one Jefferson wrote the letter “c” and then “18-20.”

“The ‘c’ is like for children,” he said. “I wouldn’t show up in there ... I make a deal for my children. It wouldn’t be me.”

As they continued to scribble notes, Jefferson laughed.

“All these damn notes we’re writing to each other as if we’re talking, as if the FBI is watching,” he said.

In June, the FBI listened and watched when Mody delivered a stock certificate to Jefferson over dinner. It transferred 30 percent of Mody’s new Nigerian company to another firm called Global Energy & Environmental Services. Jefferson told her it was a Nigerian company “in the name of (his) children which has been in existence for the past two to three years,” according to the FBI affidavit.

Jefferson told Mody that a son-in-law ran Global and that another son-in-law should be employed in the joint venture “to run things in Nigeria.”

In July, Mody and Jefferson met again to discuss the possibility of replicating the Nigerian deal in Ghana. He was to travel to Ghana that month and meet with top government officials to promote iGate.

“As far as Ghana goes,” Mody asked him over dinner, “are you happy with the 30 percent in Ghana?”

According to the affidavit, Jefferson pointed to a scrap of paper on which was written, “WJ 30%.” He scratched out “WJ” and wrote instead, “Global.”

Even as they discussed the future, Jefferson was worried about the financial stability of iGate, according to the FBI document. He confided to Mody he had grown frustrated with the CEO, Jackson, and the company’s deepening debt.

“I’m not going to let him let me use my good offices, whatever they are, and then to make arrangements and then blow it out. I’m not gonna to do that,” Jefferson said.

Jefferson proposed buying a controlling interest in iGate by way of ANJ, “a Louisiana company controlled by Jefferson and kept ostensibly in the name of his wife and children,” the affidavit says. Jefferson proposed that Mody finance the takeover with $10 million, allowing him to install “several confidants” on the board and demote Jackson.

According to the FBI, two installments totaling $89,222 were deposited in a New Orleans bank account belonging to the ANJ Group.

Details of numerous other Jefferson business deals still under investigation were blacked out of the affidavit, as was the name of another target of the investigation. It seems that because of Hurricane Katrina, some New Orleans banks have been slow to produce documents requested by authorities. But the FBI detailed one deal involving a Nigerian company called NetLink, known as NDTV, which had agreed to finance iGate’s business before Mody entered the scene.

The deal is significant because it introduces another cooperating witness besides Mody “with first hand knowledge of the transaction,” the affidavit says. The witness told the FBI that Jefferson demanded $5 per subscriber for the broadband service in Nigeria.

But in early 2004, NDTV pulled out of the deal and sought its $6.5 million investment back. The company hired attorneys in the United States and they wrote to Jefferson suggesting that he had violated criminal and civil laws in the Nigeria.

The letter, recovered in the search of his home in August, said Jefferson had received money for his help in the deal.

“I have also attached a list of your bank accounts through which you insisted money be paid (which it was) to you in relation to the iGate/NDTV transaction,” the lawyer wrote.

The attorney included a list of bank accounts belonging to ANJ Group and Jefferson Interests Inc., which the FBI said was controlled by the congressman.

Evidently concerned that the Republican Bush administration would be attacked for investigating a Democratic congressman, the FBI took steps to insulate itself.

The affidavit says the agency set up “special search procedures” such as having agents not working on the case search Jefferson’s office and having all documents screened by a multiagency “filter team” also unconnected to the case. Jefferson would be alerted about anything deemed “privileged,” and documents would be kept from prosecutors unless approved by a federal judge.

The FBI document suggests that the 59-year-old Jefferson saw himself at the end of his political career, which has spanned 16 years in Congress and several terms in the Louisiana legislature.

At one point, Mody asked him how long he planned to continue.

“I’m going to get your deal out of the way,” he said. “I probably won’t last long after that.”

Bill Walsh can be reached at bill.walsh@newhouse.com or (202) 383-7817. Bruce Alpert can be reached at bruce.alpert@newhouse.com or (202) 383-7861


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