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Today's Must Read
How exactly did the feds end up snagging Eliot Spitzer? We've been asking the question since the story broke on Monday. Reports from a number of news outlets have been providing more and more details so that now, with the help of the feds' filings, it's possible to piece together a reasonably detailed timeline of how the investigation went down. So, without any more ado, here it is:
7/07: North Fork Bank in New York sends a Suspicious Activity Report to the Treasury Department about transfers in Spitzer's personal accounts. The "bank's report was triggered by Spitzer's attempt to structure a $10,000 cash transaction into three parts." Spitzer also reportedly asked the bank to "take his name off the wires." The report reportedly sits "unnoticed in a vast Treasury Department database in Detroit" for several months.
Fall, 2007: Another bank, HSBC, sends a Suspicious Activity Report to the Treasury Department "about suspicious transactions connected to two shell companies, which drew the attention of investigators. That touched off an inquiry that led investigators to discover the July report on Mr. Spitzer, which showed he had made several wire transfers to those companies, according to three people briefed on the inquiry."
10/07: The FBI and the IRS-Criminal Investigative Division launch an investigation "focusing on an organization suspected of conducting prostitution and money-laundering crimes in the United States and Europe" -- i.e. the Emperor's Club VIP.
1/8/08: Investigators begin wiretaps of Emperor's Club managers.
1/26/08: The FBI stakes out the Mayflower hotel in Washington, D.C. “after concluding from a wiretapped conversation that Spitzer might try to meet with a prostitute when he traveled to Washington to attend a black-tie dinner.”
2/7/08: Authorization for wiretaps expire.
2/11/08: Investigators renew wiretaps of Emperor's Club phones.
2/12/08: Wiretaps pick up Spitzer (reportedly "Client 9") discussing payments with Emperor's Club managers and setting up a rendezvous for D.C. the next evening.
2/13/08: Spitzer has his rendezvous with "Kristen."
3/5/08: Prosecutors arrest four managers of the prostitution ring. Investigator filings in support of the arrests detail the activities of "Client 9."
Update: This post has been updated to reflect later reporting.
Josh
Zachary
Didn't Elliot know that he wouldn't have gotten caught with less than $8000 on the wire? What a buffoon.
I still want to know who leaked his name out to the media in the first place, because from all indications he was in the federal complaint as Client #9 but not named in an indictment, yet.
Something was very fishy about the timing of all of this, and they couldn't wait until the indictment to leak his name out to the media.
March 12, 2008 10:23 AM | Reply | Permalink
Leaking the contents of a Suspicious Activity Report is a federal crime. Will the leakers be prosecuted? The appearances of why they leaked this information to the media are not good.
March 12, 2008 10:43 AM | Reply | Permalink
Other questions to ask:
Was influence laundered on Spitzer's behalf? It doesn't look like it, as it seems that he just got caught up while having a tryst with a hooker.
Who was the head of the Emperor's Club, Mark Brener, connected to, if anybody? Was he laundering influence? Who else were his clients? Is it possible that Spitzer's name was passed along to one of Brener's high profile clients? Spitzer's name being dropped here before an indictment was unsealed potentially (and probably did) compromised an investigation of wider scope.
March 12, 2008 12:17 PM | Reply | Permalink
Very good point on the indictment and compromising an ongoing investigation, but.. the arrest of Brenner and Co. seems to refute that notion unless, there was even a larger fish on the list and "institutional credibility" needed to be protected.
But I'll not buy that unless Brenner starts a Deborah Jeane Palfrey act in deja-vue-all-over-again fashion.
And if Brenner does?
Then this story gets even longer legs.
I bet there is more to this story ahead, it has not run course and the pictures of Kristen are now making the net, I imagine she will schedule an interview, pose nude, and as her 5-minutes of fame waning, name some names.
March 12, 2008 9:37 PM | Reply | Permalink
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March 13, 2008 2:49 PM | Reply | Permalink
A slightly different take from Newsday:
"Millions of SARs are generated each week and flow into the Internal Revenue Service nationwide, but an analyst at the regional IRS office in Hauppauge noted Spitzer's particular SAR and singled it out for attention to criminal investigators, the sources said.
The assumption, the sources said, was that Spitzer was being victimized either by a blackmailer or an impostor. The agents also speculated that perhaps the governor was involved in some sort of political corruption, the sources said.
The agents, located at an IRS office at 1180 Veterans Memorial Hwy. in Hauppauge, joined with prosecutors in the Southern District in New York to determine the circumstances surrounding the transfer of the money and the nature of the company it was going to. The Southern District was chosen because the bank transaction had occurred in Manhattan.
Eventually, FBI agents also joined the investigation because they have greater authority to look into possible political corruption and use wiretaps."
March 12, 2008 10:33 AM | Reply | Permalink
The "bank's report was triggered by Spitzer's attempt to structure a $10,000 cash transaction into three parts." Spitzer also reportedly asked the bank to "take his name off the wires."
...and the old saw stands: it's not the crime; it's the cover-up.
March 12, 2008 10:42 AM | Reply | Permalink
I think the uncovering is more interesting, though.
The "bank's report was triggered by Spitzer's attempt to structure a $10,000 cash transaction into three parts."
What does that mean, anyway? He wired a coupla thou here and a few thou there and a busy bank flunkie, managing tens of thousands of accounts said, "Wait! That could be a 'structured' transaction! Can I borrow your calculator?" Or a clerk down at IRS said,"Whoa, Nellie! Some nameless individual out there in America is making several different payments to some company that, when combined, add up to over $10 G! And his name is Spitzer, just like that guy from New York!"
Bush's politicized Justice Dept was damned lucky that all this just fell into their laps.
March 13, 2008 11:12 PM | Reply | Permalink
It's the renewal of the wiretap on 2/11/08 that stands out to me. It had previously been allowed to lapse. We know from the unsealed indictment that by 2/7/08, the FBI had already accumulated sufficient evidence to secure an indictment of the four principals of the Emperor's Club.
On its face, it would seem that agents had tried (and failed) to catch Spitzer in flagrante delicto before, and allowed the wiretap to lapse as they wrapped up their case. It's clear that they already had Spitzer dead-to-rights on legal grounds. All of the financial transactions, which apparently would form the basis of any charge, were already amply documented. As it turned out, the wiretap provided no further evidence of structuring - in this case, Spitzer simply withdrew the cash, and send it by mail. I suppose they could go after him on Mail Fraud or Mann Act violations, but there's no indication that they will, or for that matter, that they planned to. So what on earth was their justification for reopening the wiretap, other than catching Spitzer in a maximally humiliating position?
I would love to see what agents claimed in their request for a re-authorization of that wiretap. Is there any way you can obtain a copy of that request?
March 12, 2008 10:54 AM | Reply | Permalink
What day did those illegal wiretaps that were not renewed expire? Overlap the timelines of what was going on in Congress onto the Spitzer investigation and see if there's any correlation. Maybe I'm barking up the wrong tree but there could be more here.
March 12, 2008 12:07 PM | Reply | Permalink
>
There can't be much doubt that Wall Street was maintaining a watchful eye on Spitzer's activities. That he made enemies among their ranks is hardly a revelation. I hate to see him resign as this will be an excuse to silence further disclosure into the QAT International arrests, who the other depositors, operators, and managers were, and when the holding company was created. Further discovery into potential links to the perfect laundering scheme of "faith based charity" (federal) distributions will disappear.
An earlier parallel to this lone ethics threat was a nobody Congressman by the name of Gary Condit whose popular legislative packages could have imposed catastrophic fiscal accountability on the current executive branch. (Condit was tried by the media for having a relationship with and then murdering a congressional aide). His House Bills would have forced the WhiteHouse to obstruct even more prosecution. More to the point, it seems odd that with all the investigative agencies, financial institutions, and communications companies conscripted into spying that Chandra Levy's real murderer has never been found. The lack of interest arouses suspicion of partisan complicity. But what's one more obstruction in a list that is virtually endless.
March 12, 2008 11:19 AM | Reply | Permalink
Which is the larger crime: prostitution or the use of State security to prosecute political enemies?
Since DoJ could have brought charges earlier, the question is "why now?" The sensational nature of having Spitzer's voice on tape suggests the intent was political rather than legal. They only prosecute when they can present his voice on tape as evidence.
If he was targeted -- culled from the massive financial information picked up by NSA's search for suspicious 'terrorist' funding activities -- then shouldn't that show up in court documents? Perhaps that explains his reluctance to immediately resign; he has a little leverage.
March 12, 2008 11:32 AM | Reply | Permalink
This is quick work. I'd love to see something similar for the Goolsbee / Canadian Government story, especially as it appears to be getting much less in-depth scrutiny in the MSM.
March 12, 2008 11:42 AM | Reply | Permalink
What's funny in all this is that the outrageous prices (greed) charged by the Emperor's Club are almost certainly what precipiatated their downfall--the $10,000-plus costs people were paying ensured that SARs were going to be pulled on payments to them and their shell corporations were going to be investigated.
Dumbasses. Should have kept their prices lower.
March 12, 2008 11:45 AM | Reply | Permalink
So, paying for sex with money gets you threatened with impeachment.
But having sex with a lobbyist, then rewarding her client with government favors makes you.....qualified to be president?
March 12, 2008 11:50 AM | Reply | Permalink
...and this is what makes the Spitzer case almost irrelevant, without the exchange for influence. Sure, getting a hooker is illegal and subjectively unethical, but was he getting anything else for in other than his steam blown off?
McCain, on the other hand... if only the MSM wasn't filled with hacks and quacking penguins and instead journalists you'd see him sweating a little bit more.
March 12, 2008 12:24 PM | Reply | Permalink
Is anyone else concerned that moving a little bit of your own money around gives the government the probable cause to wiretap and set up FBI surviellance?
I guess the 4th Amendment threshold is pretty low these days.
March 12, 2008 12:07 PM | Reply | Permalink
Anybody got friends on Spitzer's staff? He might want to practice indignantly shouting "Sheeeeeeeeeit!"
March 12, 2008 1:31 PM | Reply | Permalink
The last - and most important - item appears to be unknown: Who leaked Spitzer's name to the press, when, and why (well, we know why, but what is the "official" justification)?
March 12, 2008 1:34 PM | Reply | Permalink
Spitzer Linked to a Prostitution Ring
by Dan Vera
"Everyone has a secret life" Kim says.
Spitzer. The good boy DA.
The anti-corruption crusader,
Now found to have ordered in at the Mayflower.
A $4000 dollar tab
8 floors up from
where J. Edgar and Tolson
lunched in monotony for 20 years.
"But he was sucha straight shooter," I say,
"No one saw any signs!"
"Those are the ones I immediately suspect" she says
"Those are the ones I suspect."
March 12, 2008 1:38 PM | Reply | Permalink
LOL! so true
March 12, 2008 9:38 PM | Reply | Permalink
It's fun looking at fuck-ups because they take our eyes off ourselves
I wonder, are we waiting for our leaders to fail?
http://www.huffingtonpost.com/logan-nakyanzi-pollard/eliot-spitzers-bank-job_b_90979.html
March 12, 2008 2:04 PM | Reply | Permalink
Over at democraticunderground.com someone who sounded knowledgeable was discussing the fact that spitzer was heading up a move to change the balance of power from Repub. to Dem. majority in the NT Legislature, the plans were coming very close to fruition.
sorry I cannot find the thread, it was last 2-3 days, sounded convincing.
It is interesting that the FBI and the DOJ guys were so prompt in working the case.
March 12, 2008 2:34 PM | Reply | Permalink
Where the hell were Spitzer's assistants to reign him in? It constantly annoys me that political staffers will help manage what comes out of a politicians mouth, but they won't help manage what comes out of their pants. I know it's personal. I know it's private. But jeez, talk about being enablers! Spitzer is completely responsible for his own actions but he couldn't have done this without some assistance. They should never be allowed to work for another politician again.
And if I hear another person talk about how sad it is that his political career is basically over, I'm going to puke. NOBODY is talking about how sad it is for his wife and kids. All they can harp on is what a tragedy it is that Spitzer's career is in the toilet, how much potential he had, how the government was out to get him, etc. Boo FRICKETY HOO! I don't feel bad for the guy, or the people who worked for him. How about some damned sympathy for his betrayed family?
March 12, 2008 2:55 PM | Reply | Permalink
The four ringleaders convicted were:
Mark "Michael" Brenner, 62 of Cliffside Park, NJ
(a dual US - Israeli citizen)
Cecil Suwal, 23 of Cliffside Park, NJ (aka Katie)
Temeka Rachelle Lewis, 32, of Brooklyn, NY
Tanya Hollander, 36, of Rhinebeck, NY
Errata
- Yesterday, on the Situation Room, CNN established that Mark Brenner was an "Enrolled Agent" of the IRS.
- Tanya Hollander's home in Rhinebeck, NY is next door to that of a Joseph Michenfelder who works for National Political Services, Inc of New York, NY.
Is Joe Michendorfer or National Political Services relevant here?
And isn't Cecil a man's name? Was "Katie" really a guy?
March 12, 2008 2:59 PM | Reply | Permalink
Well howdy that is a juicy clusterfuck if I've ever seen one.
March 12, 2008 4:26 PM | Reply | Permalink
The Feds will spare no expense to take out a Democratic politician: two wiretaps were authorized, and at least one stakeout near Spitzer's hotel room. The stakeout was wholly unnecessary to prosecute under the theory that Mr Spitzer attempted to structure cash transfers so as to avoid triggering cash reporting rules. Did the FBI bug the hotel room, too? Is this how we want law enforcement money spent? Unfortunately, the DOJ has no resources available to charge ex-White House employees who ignore a Congressional subpoena regarding the politicization of prosecutions.
March 12, 2008 3:41 PM | Reply | Permalink
Citoyen92 - thank you! Nice post, informative links. And thank you, TPM, for being an exceptional WebSite!
March 12, 2008 3:57 PM | Reply | Permalink
TPM alum Justin Rood has more about Brener's IRS connection over at The Blotter.
The NY Post is reporting that Brener actually lived in Monmoth Junction, NJ (that's part of South Brunswick, NJ) and that 23 year old Cecil "Katie" was his girlfriend.
NY Post is also reporting that a disgrunted working girl has been collaborating with the FBI on this project since 2006.
March 12, 2008 4:15 PM | Reply | Permalink
I gotta wonder if Mark Brener had the same sort of pedigree as Golan Cipel. Anybody have the ability to check out this sort of thing?
March 12, 2008 4:41 PM | Reply | Permalink
you use to post libertypost, welcome... but you are so euro-centric LOL
Didn't somebody get banned connecting the dots on Cipel at libertypost when Goldi went into a fetal position over the serendipity of the degrees of seperation w/dat?
Reminds me of that MEI/food for oil list
FYI Joshua Micah Marshall has won some awards, been mentioned in congressional testimony, (now in national archives) and followed the DOJ antics and firings.
In 2000 it was FreeRepublic, in 2004 there was no real internet sigmoid web-site, in 2008 it is here.
You can't quantify the "now of buzz" or the moment on the web.. but yeah, the best live news site and commentary.
March 12, 2008 9:49 PM | Reply | Permalink
Libertypost? No idea what that is. I didn't start touching web news forums until 2006. TPM has though by far been the best source for this sort of news lately, since it seems every other site has dove into campaign trenches.
But I am very euro-centric, for what it's worth.
March 12, 2008 10:31 PM | Reply | Permalink
Something isn't adding up. we've been told that Spitzer was "not" targeted, and that the US government only targeted the agency, then detected Spitzer.
However, the timeline tells the opposite story:
We're told that the wiretaps didn't occur until 8Jan, about three months after Spitzer was linked.
- Why wasn't Spitzer, when he first was linked with the agency in "Fall 2007" put under surveillance?
- Why should we believe the assertion, "But we were only looking at the Emperor Club, then ran across Spitzer's name. . ." when the reverse appears true: Spitzer was supposedly linked with the transfers?
- How, again, did the US government trace cash transfers; or were these, in fact, wire transers that "excluded" his name? [Something doesn't make sense on that explanation as, even if his name were "removed" from the wire transfers, he should have known the account would be traceable to him.]
Again, not hearing a straigh story: How did the US government know to trace the cash which was not connected with Spitzer; but being supposedly deposited in these larger accounts?
Something else must have happened to link the "uknown source of money that was below 10K" with these accounts. Using the US government's logic, then any wire transfer is suspicious until proven innocent. That certainly explain why US citiens have been detained without warrants, and subjected to warrantless interrogations to explain cash transfers related to lawful conduct.
Is there something else about the DHS domestic interrogations they'd like to explain before we find o ut US citizens, after being rendered, were threatened with proseuction for discussing the conditions of their abuse?
March 12, 2008 4:59 PM | Reply | Permalink
It might be interesting to use photos to illustrate the timeline: Happy; Sad.
March 12, 2008 6:51 PM | Reply | Permalink
You have to hand it to him, he was wearing his lapel flag to the very end.
March 12, 2008 6:52 PM | Reply | Permalink
Why didn't she realize Spitzer was governor? Because he didn't add his name on her MySpace "friends" list.
Spitzer's quote [Added]:
March 12, 2008 7:12 PM | Reply | Permalink
I think we should consider examining her blog, to find the times when the Governor was able to impart significant intellectual themes. This may provide valuable clues to the TPMM timeline. Consider this analysis.
- Is it possible to examine her blog for clues that the FBI was conducting a sting against "the unknown man"?
- How did her writing style and critical thinking skills improve since she first met "the unknown man"?
- Is there evidence that her interactions with the NY State's most powerful, now resigned leader, had a substantial impact on her ability to conduct oversight of her legal counsel?
Look at this sophisticated decision-tree of thinking. Who would have thought things would change:
That's right: It doesn't matter if you do a background check on the guy; just think about "feeling good". Who knows, maybe one day you'll wind up on the TPMM comment page. Highlighted on the TPMM page? ["Good," check]
March 12, 2008 7:24 PM | Reply | Permalink
Thanks testing, now I just have to look and see if I have mutual friends with this girl... meh.
March 12, 2008 8:06 PM | Reply | Permalink
Consider adding this to the timeline:
1. Date Spitzer watched the movie, The American President, thought, "I could get a girlfriend, invite her to the White House, be famous like Michael Douglas. I'll say, 'No comment. I'm the President. This is privileged.' "
2. Date FBI reminded him he still had a wife, who was supposed to be his girlfriend.
3. Date GOP in the legislature said, " No American Presidency for you, Elliot."
March 12, 2008 11:10 PM | Reply | Permalink
Well, now that the picks are out, WTF was he thinking. He spent 5k an hour for HER????? He ruined his life for HER?????? He was totally ripped off. She's no hottie. At 5k per hour you would think at least that she would be smokin. She wasn't. This guy is a total loser.
March 13, 2008 10:46 AM | Reply | Permalink
An interesting take on it: http://www.findingdulcinea.com/news/politics/March-April-08/Why-Was-Spitzer-So-Reckless.html
March 13, 2008 11:00 AM | Reply | Permalink
She's your run of the mill Jersey Shore Princess, which perhaps to Elliot, could have been quite a fantasy. Me myself? I'm personally sick of them, all so vapid and plastic.
March 13, 2008 11:24 AM | Reply | Permalink
Subsequent reporting suggests the wire transfers were not of concern until someone notified the bank of Spitzer's activities:
March 17, 2008 5:56 PM | Reply | Permalink