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Friday, October 31, 2008

Court Docs: GOP Donor Secretly Funneled $75K To Coleman Family

The CEO of a major marine technology company is alleging that he was pressured by a friend and associate of Norm Coleman to secretly funnel tens of thousands of dollars to the Senator's family.

Paul McKim, the founder and CEO of Deep Marine Technology, alleges in a civil suit that Nasser Kazeminy -- a longtime Republican donor, friend of Coleman, and DMT shareholder -- directed the company to send $75,000 to the Senator and his wife.

The transaction, which occurred in 2007, allegedly went as follows: DMT would make payments for services to Hays Company, even though no services would be rendered. Since Norm Coleman's wife Laurie worked at Hays, that money would be given to her in the form of 'salary.'

According to the suit filed against Kazeminy and several other defendants:

In March 2007, Kazeminy began ordering the payments of corporate funds to companies and individuals who tendered no goods or services to DMT for the stated purpose of trying to financially assist United States Senator Norm Coleman of Minnesota. In March 2007, Kazeminy telephoned B.J. Thomas, then DMT's Chief Financial Officer. In that conversation, Kazeminy told Mr. Thomas that "U.S. Senators don't make [expletive deleted]" and that he was going to find a way to get money to United States Senator Norm Coleman of Minnesota and wanted to utilize DMT in the process. Mr. Thomas later approached Mr. McKim, asking him whether this was appropriate and whether they should follow Kazeminy's orders. Mr McKim told him that it was not appropriate and shortly thereafter he also spoke with Kazeminy."


In this same conversation, Kazeminy told Mr. McKim that he [Kazeminy] would make sure there was paperwork to make it appear as though the payments were made in connection with legitimate transactions, explaining further that Senator Coleman's wife, Laurie, worked for the Hays Companies, an insurance broker in Minneapolis, and that the payments could be made to Hays for insurance. When Mr. McKin made further objections, Kazeminy repeatedly threatened to fire Mr. McKim, telling him "this is my company" and that he and Mr. Thomas had better follow his orders in paying Hays.

All told, the court documents, which were filed on Monday in a Texas district court, allege that three payments of $25,000 were sent through Hays Company to the Colemans from May 2007 through September 2007. Two of those came without McKim's approval because Kazeminy went around him. A fourth payment was "in the process of being made" before being stopped by McKim, the suit alleges.

Sen. Coleman was initially asked about these findings on Wednesday, when two investigative reporters from the Minneapolis Star Tribune cornered him at a campaign rally. He ducked their questions.


On Thursday, Coleman's campaign manager Cullen Sheehan was asked about the issue during a press conference, He claimed that "the lawsuit was withdrawn," and said he had no further details to offer. "I just know there was a lawsuit filed and it was withdrawn."

Casey T. Wallace, the attorney representing McKim, confirmed the withdrawal and said he would have more comment later in the day [updated below]. A person familiar with the case, however, emphasized that while the complaint may have been withdrawn, the charges contained within it were still valid.

"It doesn't affect that," said the official. "By withdrawing the complaint and withdrawing the petition, we are not saying now that our allegations are false."

Requests for comment from McKim and the Coleman campaign went un-returned. But lawyers familiar with Senate ethics law say that if the complaint turns out to be true, Coleman could be in hot water, possibly facing a trial and potentially jail time.

"This is why [Sen]. Ted Stevens just got convicted," said a Washington D.C.-based attorney. "If this is true and Kazeminy gave a gift -- which includes money to a candidate's family member -- it doesn't mean that you can't take it, but you would have to report it on [your financial disclosure form]... If he knew about it, and of course, all of this has to be proven to be true, then yeah," he could go to jail.

The attorney additionally noted that the firm representing McKim in this suit is Haynes and Boone, "a pretty serious law firm that is a major player in Houston. I can't believe they would have agreed to file this if they didn't have documentation to support this."

Kazeminy, a reclusive businessman who serves as chairman of Minnesota-based NJK Holding Corporation, has significant ties to Coleman. The Kazeminy family has contributed more than $75,000 to the Senator directly and has paid for flights for him and (occasionally) his wife to the Bahamas, Paris and Jordan, often described as fact finding missions. Kazeminy is even alleged to have paid for Coleman's suits, a charge that the Coleman campaign has never denied.

UPDATE: An official close to the proceedings tells the Huffington Post that the case is now going back to court. The two parties, he said, had reached an agreement to drop the suit and hammer out a settlement. But negotiations broke down and the suit has been re-introduced.

Original here

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