| Indictment alleges congressman's brother played key role in scheme |
| http://blog.nola.com/times-picayune/2007/06/indictment_alleges_congressman.html |
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Posted by Washington bureau June 15, 2007 8:10PM
By Bill Walsh Washington bureau - NOLA.com WASHINGTON -- Throughout a 94-page federal indictment, prosecutors repeatedly describe scenes of Rep. William Jefferson telling business executives that there is an important condition to be met before he would use his influence on their behalf: A certain family member would have to be compensated with cash, contracts or a stake in the business. And he played hardball, according to the government. While pushing an oil deal in Nigeria in 2002, Jefferson is said to have complained that the relative's stake was "insufficient." And a year later, Jefferson refused to do anything more to promote a private waste-recycling venture in the West African nation until the family share "had been revised to his satisfaction." The 16-count indictment handed up June 4 refers to the relative only as "Family Member 2," but says he is a member and president of B.E.P. Consulting Services, LLC, as well as secretary and treasurer of Jefferson Interests Inc. Louisiana corporate records show those roles belong to Jefferson's big brother, Mose Jefferson. The relationship between the brothers is a key part of a government case that charges Jefferson, D-New Orleans, with accepting $500,000 in bribes through companies controlled by the family. The consulting firm controlled by Mose got only a small share -- $21,353, according to prosecutors -- but investigators say his role as the funnel for illicit payments in a host of schemes goes provides the foundation for the racketeering charges against the congressman. Mose has not been charged and he and his attorney declined to comment for this story. He also isn't believed to be a target of the federal probe. Congressman Jefferson pleaded not guilty in U.S. District Court on June 8. The pattern alleged by the government dates to the fall of 2000 when Jefferson was approached by executives from two companies seeking to build a sugar plant in Nigeria's northernmost Jigawa State. In the local dialect, the name of the state is suggestive of the rich, loamy soil well suited for farming. Jefferson agreed to help on one condition, according to the government's indictment: "Family Member 2 would have to be compensated." It was the same condition the government says that Jefferson placed on his help in developing oil wells, untangling disputed drilling rights, developing a fertilizer plant and promoting waste recycling facilities throughout West Africa. It was also in the fall of 2000 that Mose formed B.E.P. Consulting Services, a company, the government says, that executives seeking Jefferson's help in Africa invariably signed deals with. Although four years older than the congressman, Mose has lived for the past three decades on the periphery of the spotlight cast on his kid brother. The two worked side-by-side in the cotton fields of Lake Providence, the northeast Louisiana farming community where they grew up, but their paths sharply diverged. The refined and bookish younger Jefferson would head for Harvard Law School and a promising political career in the Louisiana Senate and the U.S. Congress. The gruff eldest brother, named for the patriarch of the family, would head for Chicago where he would hone his political skills for years working in the original Mayor Richard Daley's political machine as an operative in the poor, African-American neighborhoods of the city's South side. The brothers' paths reconnected in New Orleans in the early 1980s as William emerged as head of his own political organization, the Progressive Democrats, and Mose, adept at the ways of big-city politics, served as his right-hand man. Those who watched the two work described Mose as a tireless campaign organizer who would write speeches, place signs and stir up the grassroots to get people to the polls on Election Day. "Mose is the type of person you want on your side in a campaign," said Jacques Morial, son of former New Orleans Mayor Ernest "Dutch" Morial, who was Jefferson's political mentor and later, a rival. "The guy worked 22 hours per day." But Mose was far more than just a campaign worker. He was a confidant to his brother in a tight-knit family known for its suspicion of outsiders. "I think he relied on Mose quite a bit," said Trevor Bryan, William Jefferson's former law partner. "He is the guy who, if you had an assignment, you could put it in his hands." In late 2000, with the congressman's reelection safely secured, the two brothers were concerned as much with business in Nigeria as politics in Louisiana, according to the indictment. With Rep. Jefferson's help, one of the companies seeking to build sugar refineries in Nigeria, landed a contract in July 2001 for an engineering and feasibility study on a sugar factory in Jigawa State and was paid $187,230 by a Nigerian company. The timing described by the government coincides with Baton Rouge-based Arkel International landing a similar deal, but the company has declined to discuss it. Soon, an invoice arrived at company headquarters. It was from Mose, according to prosecutors, and sought payment for consulting on a "sugar plant project." It misspelled the name of Jigawa State. The company had agreed to pay 3 percent to 10 percent of any contracts to Providence International LLC, which the prosecutors say was controlled by the Jefferson family. Shortly after the company got its first installment from the Jigawa sugar contract, according to prosecutors, a check for $7,489 was sent to Mose. The pattern soon repeated itself, according to the indictment. On Aug. 23, 2001, an executive from another company sought Jefferson's help in drilling marginal oil wells in Nigeria's coastal region and developing food processing facilities in the central part of the country. Jefferson agreed to help, according to the indictment, but the company would have to "compensate" Mose first. Three days later, a deal was signed to give 4 to 10 percent of any food processing contracts to Providence Lake LLC, the Jefferson-controlled company, according to prosecutors. The government alleges that another agreement was inked the same day that paid Mose's B.E.P. Consulting Services hefty performance bonuses related to the oil fields. B.E.P.'s deal specified that the company would get "no less than $200,000" for every onshore oil field acquired and "no less than $500,000" for each offshore field. In addition, the agreement cut B.E.P. in for a sixth of all revenues derived from the oil strikes. The oil fields may have sounded like the sweeter deal, but it was the sugar plant, according to the indictment, that continued to pay off. In December 2001, the Jigawa State sugar contract paid another $85,914 to the Baton Rouge-based development company. Once again, according to the indictment, it was followed quickly by a consulting bill from Mose, this time with the state name spelled correctly. The company sent a check for $3,436. In April 2002, the Jigawa contract paid another $260,697. The Baton Rouge firm quickly sent a check to Mose for $10,427. Altogether, the government says, Mose's B.E.P. Consulting Services received $21,353 in cash along with promises of lucrative future earnings if other deals in Africa paid off. Mose, according to the indictment, would get paid if his brother could resolve disputed oil rights in the South African nations of Sao Tome & Principe and if the congressman landed waste recycling contracts in Nigeria. Mose and B.E.P. Consulting were not just active overseas. They were in the news in New Orleans last summer, amid a controversy revolving around nonprofit groups controlled by members of the Jefferson political family. B.E.P. owns an eight-unit complex on South Saratoga Street in Central City that serves as the unofficial headquarters for the Progressive Democrats, Jefferson's political organization. B.E.P. purchased the building for $10,000 from a corporation controlled by one of Mose's sisters, which in turn bought it from a nonprofit founded by Mose. That outfit received millions in state grants steered its way by allies of the Jefferson family -- in particular, former state representative and City Councilwoman Renee Gill Pratt, who had a long personal relationship with Mose. Pratt and others in the Jefferson camp, including state Rep. Jalila Jefferson-Bullock, the congressman's daughter, in turn used taxpayer money to rent office space in the building. City residents were spending $21,600 per year to pay for Pratt's office, which is one of eight in the complex. That's more than twice what B.E.P. paid for the building. The FBI last summer announced it was investigating the nonprofit groups. Although Jefferson engineered a variety of deals for his brother in Africa, he wasn't always happy with the results, according to the government. And when he wasn't, the indictment says, he showed no reluctance to pressure business executives to sweeten the pot. In late 2001, prosecutors say, a company approached Jefferson about getting his help in developing oil wells and a fertilizer plant in Nigeria. The company wanted to fly Jefferson to the West African nation to promote the deals with key government officials. But, as usual, according to the indictment, Jefferson refused to go unless Mose was compensated first. On Jan. 10, 2002, the company inked a deal with B.E.P. Consulting Services, according to the government. But there was a problem. Jefferson deemed the terms of the agreement "insufficient for Family Member 2," the indictment says. A company executive "assured Jefferson that Family Member 2's interest would be maintained in (the firm's) proposed projects in Nigeria," documents say. The next day, the congressman and his big brother flew to Nigeria on the company's tab. Staff writer Gordon Russell contributed to this story. Bill Walsh can be reached at bill.walsh@newhouse.com or (202) 383-7817. |