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Judicial Watch, Inc. is a conservative, non-partisan educational foundation, which promotes transparency, accountability and integrity in government, politics and the law.

Judicial Watch, Inc. is a conservative, non-partisan educational foundation, which promotes transparency, accountability and integrity in government, politics and the law.

Because no one
is above the law!


Tom Fitton's Judicial Watch Weekly Update

Senator Rangel Fails to Pay His Taxes

September 12, 2008

From the Desk of Judicial Watch President Tom Fitton:

Rangel Nailed Again – Failed to Pay Taxes on Caribbean Resort Property

Charles B. Rangel, Chairman of the House Ways and Means Committee, the committee in charge of writing tax policy for the entire nation, “forgot” to pay taxes on $75,000 income he received from his rental property in the Dominican Republic.

Here’s the scoop according to The Washington Post:

Rep. Charles B. Rangel (D-N.Y.) acknowledged yesterday that he had not lived up to the “higher standard” expected of members of Congress, but he maintained that he should not be punished politically for failing to disclose and pay taxes on rental income from his Caribbean resort property.

The Ways and Means Committee chairman, who is battling three ethics controversies, said he would file amended tax returns and pay federal, state and local taxes he owes — an amount that his attorney, Lanny Davis, estimated at more than $10,000 for 2004 to 2006. Rangel’s accountants are working to determine his tax liability for the rest of the 20 years that he has owned the three-bedroom villa in the Dominican Republic, Davis said.

Rangel, 78, said he regretted his failure to account for the $75,000 in income the property generated, calling the omission “irresponsible.”

But it gets worse. News reports also surfaced this week that Rangel paid no mortgage interest on the property for over 10 years! According to the Associated Press, “[Lanny] Davis [Rangel’s lawyer] said Rangel did not know until very recently he had not been charged interest for more than a decade.”

(By the way, I’m not surprised at all to see former Clinton special counsel and long-time apologist Lanny Davis representing yet another corrupt public official.)

With respect to the other “ethics controversies” noted by the Post, as I reported to you in July, Rangel allegedly used his congressional office to raise funds from corporations that have business before his committee in order to bankroll his Charles P. Rangel Center for Public Service. Rangel has also been accused of using his influence to keep four extremely rare rent-stabilized apartments (in others words, cheap) in Harlem while his neighbors are being subjected to eviction.

Has Rangel learned anything from this slew of scandals that bear his name? Not at all. After the Rangel Center scandal broke, the New York congressman chose to stage a publicity stunt, filing an ethics complaint against himself, rather than accepting responsibility for his actions. When asked about his recent tax scandal, Rangel boasted, “I’m a lucky old son of a gun…Ain’t nothing going to stop me from getting back here next year.”

Given the House Ethics Committee’s shameless record of ignoring wrongdoing by members of Congress, Rangel can say that with confidence. But without question in my mind he has no business running a major congressional committee. And if he had any shame, he’d retire gracefully.

Fannie and Freddie Expose the Corruption Culture in Washington

The federal government announced earlier this week that it has seized control of mortgage giants Fannie Mae and Freddie Mac in a $200 billion corporate bailout, the largest in the nation’s history. The shock waves are being felt not only in the financial markets, but also inside the Beltway as the two companies face allegations of corruption and cronyism. The whole bailout (and other federal actions) seems very socialist and dirigiste to me. But I’ll leave the free market to critique our economic conservative friends. The one thing that is certain is that the collapse was avoidable, but oversight was lax because of the casual culture of corruption that pervades this city.

Overall, Fannie and Freddie have spent more than $180 million over the last 10 years to lobby their friends in Congress, making sure that nothing happened in Washington they didn’t want to happen. According to, “The two government-chartered companies run a highly sophisticated lobbying operation, with deep-pocketed lobbyists in Washington and scores of local Fannie- and Freddie-sponsored homeowner groups ready to pressure lawmakers back home.” (Fannie Mae was also nabbed in an all-too-familiar accounting scheme where the company’s profits were overstated so that top executives could reap huge cash bonuses.)

Of course, with the bailout, that has all changed — for now anyway.

The tentacles of the Fannie and Freddie debacle reach deep into Washington and both political parties. Again, from

Franklin D. Raines, a former budget director in the Clinton White House, was paid $90 million in the five years he served as Fannie’s CEO. He resigned amid an accounting scandal in 2004 with a $19 million severance package, though it was later whittled down after court challenges.

Former Clinton FBI Director Louis Freeh sits on Fannie’s board today. Bush White House veteran Stephen Friedman was once a board member, and former Bush trade representative and State Department official Robert Zoellick did a tour as a Fannie executive vice president.

Freddie’s foundation has its own list of heavy hitters. Among its former board members are Rep. Rahm Emanuel (D-Ill.), a confidant of Democratic nominee Barack Obama, and Harold Ickes, a senior adviser to both President Clinton and Sen. Hillary Rodham Clinton (D-N.Y.). From the Republican side, David Gribbin, an aide to Vice President Cheney, once sat on the board, and Robert Glauber, a former Treasury undersecretary, is on the board.

Another so-called “confidant” of Barack Obama, by the way, was none other than James Johnson, the former Fannie Mae CEO who was forced to resign from Obama’s Vice Presidential vetting committee after the press reported Johnson had received preferable mortgage interest terms. (Johnson was also linked to shady fundraising practices when he was the head of the company.)

(And don’t worry, the mortgage expert Charlie Rangel will continue to help oversee the mortgage companies in Congress.)

The fact is big government leads to more corruption. And it doesn’t get much bigger than Fannie Mae and Freddie Mac, which dominated the $12 trillion home loan market, especially now that the federal government is running the whole show. The companies took care of both political parties, took more risks with the urging of their allies in Congress, and taxpayers are left holding the bag.

Arguably, this is the biggest government corruption scandal in our nation’s history. But because “everyone” in Washington is involved, you won’t hear a peep about it from our nation’s Establishment.

Judicial Watch, on the other hand, has more than a few leads to investigate and I’ll keep you informed as to what we find.

Corruption Issue Makes a Comeback in Presidential Campaign?

As you know, Judicial Watch neither supports nor opposes candidates for political office, but I can’t help but notice a welcome change that has occurred in the race for President of the United States. Have you noticed the renewed focus on the issue of corruption following the Republican National Convention?

It came roaring back when John McCain decided to tap Sarah Palin as his vice presidential running mate, touting the Alaska governor’s record in tackling government corruption in her own state and in her own party. Then, during his convention speech, McCain devoted a significant amount of attention to discussing the Republican Party’s willingness to countenance corruption in its own ranks (an unusual move for a partisan event).

“We were elected to change Washington, and we let Washington change us,” McCain said. “We lost the trust of the American people when some Republicans gave in to the temptations of corruption.”

(Some honest Democrats say this about the Clinton years – and that’s why Hillary is not the nominee of their party.)

Ironically, I first took serious notice of Senator Obama because Democrats put him in front of an ethics bill that passed the Senate in early 2007. I remember thinking that he made a smart move as a freshman Senator by taking on this important issue. And now with Palin, who has a notable record in the area of government ethics, I pray Washington’s “culture of corruption” will receive a serious discussion in next few weeks. Who knows, maybe the candidates will be forced to make good on promises they’ve made after they’re elected!

9/11 Anniversary

This week saw the seventh anniversary of the September 11, 2001 terrorist attacks on the United States.

The anniversary reminds us why it is so important to have honest and ethical people in public office. We face threats to our nation from terrorists and international outlaw nations and we expect our elected officials to be on the ball and watchful. If corrupt politicians are engaging in shady fundraising practices, extorting money, or accepting bribes, they are necessarily distracted from fulfilling their duty to make sure we are protected from terrorist threats. So it is not a stretch to say that it is a matter of national security that our government and its leaders be free from corruption.

Of course, our thoughts and prayers are with the victims of the murderous attacks and their families. We also express our gratitude to the multitudes of firemen, policemen and other responders who gave and risked their lives to save the lives of their fellow Americans, and to the members of the U.S. military fighting every day against the scourge of Islamic terrorism.

Until next week…

Tom Fitton

Judicial Watch is a non-partisan, educational foundation organized under Section 501(c)(3) of the Internal Revenue code. Judicial Watch is dedicated to fighting government and judicial corruption and promoting a return to ethics and morality in our nation’s public life. To make a tax-deductible contribution in support of our efforts, click here.


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