McDonnell aides expressed concern about his role in event for Star Scientific
Rosalind S. Helderman, June 4, 2013, WashingtonPost
Top aides to Virginia Gov. Robert F. McDonnell (R) expressed concerns about the governor’s participation in a 2011 event at the governor’s mansion that marked the launch of a dietary supplement made by a major McDonnell campaign donor, according to newly released e-mails.
“I don’t understand this? we are doing an event with them?” McDonnell’s communications director Tucker Martin wrote the evening before the event to Mary Shea Sutherland, the chief of staff for first lady Maureen McDonnell, who had organized the luncheon.
Sutherland had asked Martin to review and approve a news release that the donor, Star Scientific, intended to distribute about the event, which was to announce the launch of Anatabloc, its new dietary supplement.
A minute later, Martin wrote to Sutherland again.
“Are we sure we can do something like this?” he asked, copying a number of other senior McDonnell aides.
McDonnell’s deputy chief of staff Matt Conrad responded to Martin quickly, promising to take the issue to the governor’s chief of staff.
“You were exactly right to be suspicious,” Conrad, a lawyer, wrote.
The documents, released to The Washington Post under a Freedom of Information Act request, provide new information about the circumstances that led the governor and his wife to open the mansion to Star, whose chief executive had paid $15,000 for the catering at the wedding of McDonnell’s daughter three months earlier.
The e-mails show that McDonnell attended the luncheon at the urging of his wife, Maureen, catching his own advisers off guard the day before the event. The governor found time to make an appearance while his office was consumed with a series of crises, including a rare earthquake and a powerful hurricane that hit the state in the week before the reception.
Efforts that the McDonnells undertook to boost Star are now the focus of an FBI inquiry. Both the governor and his wife attended the Star lunch, which was cited by investors in online postings as a reason to believe in the company despite its shaky finances.
Besides the catering, Star and its chief executive, Jonnie R. Williams Sr., have given McDonnell and his campaigns more than $120,000 in disclosed gifts and campaign contributions.
Ultimately, McDonnell’s aides signed off on a news release after it had been revised by the company to downplay the governor’s role in the event. The final release, still available on the company’s Web site, continued to tout that a gathering was being held at the governor’s mansion to discuss the science behind the pill, which did not require FDA approval.
Martin declined Monday to elaborate on his and Conrad’s concerns about the event or why it was allowed to proceed. “We will have no further comment on this event,” he said in an e-mail.
Sutherland, who resigned her mansion position in October 2011, also declined to comment on the e-mails.
Talhia Tuck, a spokeswoman for Star, said in a statement that the company “neither sought nor received any special benefits from any public official.” She said the company was “glad to be a party of any effort to promote business and create jobs” in the state.
First lady’s role
McDonnell’s aides have said the event was not unusual for a governor and first lady who have made promoting state businesses a priority. McDonnell attended in order to recognize the Virginia-based company for offering research grants to public universities. The grants were awarded at the lunch.
The event’s $1,696 cost was paid by the governor’s political action committee. Aides have not explained why they decided taxpayers should not pay for the event if it was a legitimate part of boosting the state’s economy.
The e-mails show that the first lady was the primary force behind the event, and there appeared to be confusion about it from the start among the governor’s staff.
Just over two weeks before the event, Sutherland e-mailed the governor’s scheduler to alert her to it.
“Per the [first lady], please put lunch on Aug. 30th on the Governor’s calendar — the lunch is with a number of researchers and doctors that she is hosting that day. She wants the Governor to attend the lunch,” Sutherland wrote.
Katherine Harris, who was in charge of McDonnell’s schedule, responded that the governor wouldn’t be able to attend the lunch. He was traveling to Washington from Richmond that day for his monthly appearance on WTOP’s “Ask the Governor” radio program and would not return to Richmond in time.
“To make the most of going up there, we will be filling the day with other events/meetings and he will come home later that evening” for another mansion event, the scheduler wrote.
Sutherland responded: “The FL isn’t going to be happy about it.”
Harris then promised to discuss the matter with the governor.
Ultimately, McDonnell would likely have been unable to stay in Washington on the day of the luncheon.
It occurred in the midst of one of the most trying stretches of his time in office. In early August 2011, a lightning strike sparked a wildfire in southern Virginia’s Great Dismal Swamp that swept smoke as far as Washington and Maryland.
On Aug. 23, the state was hit by a 5.8-magnitude earthquake that was felt along the Eastern Seaboard and caused damage to buildings near its epicenter in Louisa County. On Aug. 27, Virginia was battered by Hurricane Irene, which killed four people and caused widespread power outages and flooding.
“This has been quite a week,” McDonnell said on the “Ask the Governor” program on the morning of the Aug. 30 Star luncheon.
“seriously, we are so hurricane centric here I don’t have time to focus on this,” Martin wrote Sutherland in their initial exchange about the Star event.
Even Martin Kent, the governor’s chief of staff and top aide, appeared confused about the event hours before it took place.
“When is this planned? We need to discuss first,” he wrote. “Is the Governor aware of his inclusion in this release?”
Still, McDonnell put in an appearance at the Star lunch, stopping in between his morning trip to Washington and a late afternoon trip to suburban Richmond, where he conducted a hurricane relief press briefing at Virginia’s Emergency Operations Center along with U.S. Homeland Security Secretary Janet Napolitano and U.S. Agriculture Secretary Tom Vilsack.
Change in emphasis
In June — three days before her daughter’s wedding — Maureen McDonnell flew to Florida to attend a gathering of doctors and investors discussing anatabine, a chemical found in tobacco and other plants that is the key ingredient in Star Scientific’s Anatabloc pills.
There, she expressed support for the product and said she believed it could be used to lower health-care costs in Virginia.
“In a brief talk, she offered the Governors mansion for the ‘launch’ of Anatabloc that Star is now packaging and readying to go to market,” investor John Faessel, who attended the event, wrote in an online stock newsletter at the time.
As the mansion event approached, the documents suggest that aides sought to stress the research grants offered by Star Scientific and downplay the support the McDonnells were providing to the company.
On the day before the event, a Star official sent Sutherland what she described as a “final draft” of the company’s planned news release.
That version mentioned the attendance of the governor and his wife at the launch event and included a quote from Williams thanking the first couple for their support of Star and its subsidiary, Rock Creek Pharmaceuticals.
“All of us at Star and Rock Creek are very grateful to the Governor and Mrs. McDonnell for their interest in our research and product development,” said Williams in the draft.
“NO WAY this can go as written,” Sutherland responded to the company official. “You can call me . . . and I’ll talk you through the issues.”
In response, company officials removed all direct references to the governor and first lady. “Hope this works better,” the Star executive wrote.
“A group of Richmond area physicians and healthcare providers are gathering at the Virginia Governor’s mansion today to learn more about the state of the research on Anatabloc,” the final release read.
In internal mansion documents, the event was described only vaguely as a lunch for Virginia scientists, which appears to have sparked questions among aides.
“I hope I’m not losing my mind completely. . . . do you know anything about a ‘Lunch for Virginia Researchers’ scheduled at the Mansion for the 30th?” the governor’s scheduler wrote to the director of the mansion in mid-August.
But the event's true purpose was clear.
“That’s the lunch MM is hosting for jonnie williams,” the mansion director wrote back.
Sentiment: Strong Buy
MORE DETAILS EMERGE IN MCDONNELL SCANDAL
Gov. McDonnell described as aware of gifts from Virginia businessman
Carol D. Leonnig and Rosalind S. Helderman | Washington Post | August 31, 2013
Virginia Gov. Robert F. McDonnell was aware of gifts and financial help provided by a wealthy Richmond area businessman during the same months the governor and his wife took steps to help his company, according to people familiar with documents and interviews gathered by federal investigators.
For example, MCDONNELL (R) WAS PRESENT AT A CHARITY AUCTION IN 2011 WHEN THE CHIEF EXECUTIVE OF STAR SCIENTIFIC, WHICH MAKES A DIETARY SUPPLEMENT, SUCCESSFULLY BID ON A FASHION TOUR OF NEW YORK FOR THE GOVERNOR’S WIFE IN FRONT OF A CROWD OF ONLOOKERS, WITNESSES SAID.
SEPARATELY, THE EXECUTIVE, JONNIE R. WILLIAMS SR., FLEW THE GOVERNOR AND HIS WIFE ON A WEEKEND TRIP TO CAPE COD, IN MASSACHUSETTS, OVER LABOR DAY WEEKEND LAST YEAR. AND WILLIAMS REPEATEDLY ALLOWED THE GOVERNOR, HIS SONS AND STAFF TO PLAY GOLF AND BUY GOLF GEAR AT ELITE RICHMOND AREA COUNTRY CLUBS, RUNNING UP MORE THAN $7,000 ON WILLIAMS’S TAB, ACCORDING TO THE DOCUMENTS TURNED OVER TO AUTHORITIES.
EACH OF THESE NEWLY PUBLIC EXAMPLES OF WILLIAMS’S GENEROSITY CAME ON TOP OF MORE THAN $150,000 WORTH OF VALUABLES AND MONEY THE WASHINGTON POST HAS PREVIOUSLY REPORTED — GIFTS THAT WILLIAMS PROVIDED TO THE GOVERNOR’S FAMILY OVER MORE THAN 18 MONTHS IN 2011 AND 2012.
PEOPLE FAMILIAR WITH ACCOUNTS THAT WILLIAMS AND OTHERS HAVE PROVIDED TO INVESTIGATORS, AS WELL AS WITNESSES INTERVIEWED BY THE POST, SAY EACH OF THOSE GIFTS CAME WITH THE GOVERNOR’S KNOWLEDGE — CONTRASTING WITH AN ASSERTION BY MCDONNELL’S ATTORNEYS THAT HE WAS IN THE DARK ABOUT THE EXTENT OF THE GIFTS WILLIAMS BESTOWED ON HIS FAMILY.
Attorneys for the governor and first lady Maureen McDonnell argued to federal prosecutors two weeks ago that the governor should not be charged with any crimes, in part because of this ignorance, people familiar with the sessions said.
The governor could not have been influenced to improperly help the Star Scientific executive, they asserted, based on gifts he didn’t know about at the time. The couple’s attorneys told prosecutors that Maureen McDonnell worked to hide Williams’s gifts because she feared her husband’s disapproval, the people said.
What had been an unusually fast-paced investigation has hit some delays as prosecutors consider the evidence, including the governor’s account and new information, several people familiar with the probe say.
In recent weeks, the governor’s legal team lost a secret court battle to withhold from prosecutors internal office communications, those people said. McDonnell’s attorneys said the papers were protected by attorney-client privilege because they concerned communications between the governor and some staff members who are lawyers.
Prosecutors have now asked the governor’s and first lady’s attorneys to return for a second round of discussions no later than the week of Sept. 15, during which prosecutors are expected to lay out the key elements of the case, said a person familiar with the schedule.
Prosecutors could decide whether to file charges after the meetings, the person said. But the timing is somewhat tricky, because voters go to the polls Nov. 5 to select McDonnell’s successor, and prosecutors may want to avoid a perception that their work is influencing the results, people familiar with the investigation said.
A spokesman for the U.S. attorney’s office declined to comment.
Rich Galen, a spokesman for the governor’s legal team, said the “evidence is clear” that McDonnell complied with state disclosure laws, which require that elected officials report all gifts worth at least $50 but do not require that gifts to immediate family members be made public.
McDonnell has disclosed receiving $9,650 in gifts from Williams and Star Scientific, including private plane trips and a summer lake-house vacation.
On Friday, Galen said that Williams’s version of events cannot be trusted, and he stressed that neither Williams nor his company received any state grants, loans, contracts or similar tangible state benefits. Bill Burck, an attorney for Maureen McDonnell, said it is not surprising that the first couple socialized with Williams, since they were all friends.
Galen noted that a Star spokeswoman has previously said that the company never sought any special benefits from the state.
Williams and other Star Scientific officials have provided investigators with extensive details of gifts Williams gave to the governor and his relatives, and in some cases, their accounts differ from the governor’s about McDonnell’s role and knowledge, according to people familiar with the evidence.
Those accounts show that Williams arranged to be reimbursed by his company for many of the gifts, a sign that he viewed the gifts as a business expense that would pay dividends to the company.
The company has told investigators that corporate officials initially were not aware that Williams was tapping company accounts to pay for gifts to the McDonnells, other than when Williams formally sought reimbursement for plane trips he provided to McDonnell for campaign events, according to people familiar with their accounts.
Jerry Kilgore, an attorney for Williams, declined to comment, as did Abbe Lowell, Star’s attorney.
People familiar with the probe say Williams and the company have turned over records showing that he paid for golf outings for the governor at elite country clubs in the Richmond area a half-dozen times between May and September 2011. The records are also said to indicate that Star reimbursed Williams that year for $7,500 in greens fees, golf equipment and apparel for the governor, his twin college-aged sons and members of his staff.
Star, likewise, underwrote a trip Williams arranged for the governor and first lady to Cape Cod a year ago, paying for private plane travel and a stay at a seaside inn.
The governor’s disclosure form appears to report the gift, noting that Star paid nearly $7,400 for flights between Richmond and Massachusetts, lodgings and event expenses in 2012.
The disclosure form doesn’t note these details: that the first couple went together to the Cape, joined by Williams, Williams’s wife and Johns Hopkins University doctor Paul Ladenson, who has served as a top consultant to Star. The weekend was part of a campaign by Williams to sell the governor and other top state officials on his company’s new dietary supplement, Anatabloc, the people said.
Ladenson, who also attended a luncheon hosted by the first lady at the governor’s mansion to mark the launch of Anatabloc in 2011, did not respond to requests for comment.
Virginia State Police records show taxpayers paid $2,967.83 for the governor’s protective detail to join him for the five-day stay at the Chatham Bars Inn, a hotel once described by Boston Magazine as a likely haunt of a modern-day Jay Gatsby.
That same Labor Day weekend, Williams also used personal credit card reward points to pay for McDonnell’s then-24-year-old daughter, Rachel, and a friend to fly to Florida for a vacation, according to people familiar with his account. The trip was described as a graduate school graduation present.
Another example of Williams’s gift-giving submitted to investigators involved a September 2011 fundraiser in Richmond for the American Cancer Society, which Williams attended as a guest of the first lady. The event, “Cure By Design,” featured a fashion show with cancer survivors as models and an auction of clothing and other fashion-related items.
Williams arranged for a male model with whom he is friends to travel to Richmond from New York for the event and escort Maureen McDonnell down the catwalk, recalled designer Alex Garfield, who served as a celebrity auctioneer at the event. Pictures on the charity’s Facebook page show the governor and first lady posing with Williams, the model and Garfield.
Garfield recalled that as the auction began, the governor appeared on the stage to take part. In front of a large audience, Williams agreed to pay $15,000, the winning bid, to give the first lady one of the evening’s most prized items: a weekend in New York and a tour of the fashion district conducted by Garfield.
“The governor was standing on the stage next to me,” Garfield said. “We were watching everybody. If he knew [Williams], he knew it.”
Although Williams paid for the trip, Garfield indicated that the first lady hadn’t claimed her prize.
McDonnell has said he once considered Williams — whom he met shortly before his 2009 campaign for governor — a “family friend.”
“The McDonnells and Williams families were friends. They socialized together because of their friendship. The notion that there was anything else to it is just plain wrong,” Burck, the attorney for Maureen McDonnell, said Friday.
Since news emerged that Williams is cooperating with prosecutors, the governor’s spokesman has described the executive as someone long in trouble with government entities. On Friday, Galen said Williams needs to “appear to be cooperating” to avoid his own legal troubles.
Galen called Williams “hardly a credible source” and said evidence will show that Williams repeatedly “falsified his expense accounts with respect to his claimed dealings with the Governor and Mrs. McDonnell.”
In an e-mail exchange with The Post, Galen did not address the most recently discovered gifts from Williams to the governor and his family.
McDonnell apologized last month for breaching the public’s trust in his interactions with Williams. But he has also said publicly that he was not aware of all of Williams’s gifts.
For example, attorneys for the first couple told prosecutors in their August meeting that Maureen McDonnell did not initially tell her husband that Williams took her on a $15,000 shopping trip in New York in spring 2011. Nor did she tell him that Williams was the source of a $6,500 Rolex watch, inscribed with the words “71st Governor of Virginia,” which she gave the governor for Christmas that year, the McDonnells’ attorneys said.
Many of McDonnell’s loyalists have long maintained quietly that the governor was a victim of his wife’s excesses and was so busy with state business that he had little time to monitor her behavior.
As a legal matter, ignorance could be helpful to the governor if it helps him convince prosecutors that he was not taking action in exchange for Williams’s gifts and that his wife was not working on Williams’s behalf when she used her role and state offices to help the company.
Attorneys for the governor and first lady maintain that he also was initially unaware that she on several occasions bought stock in Star Scientific, purchases that gave his family a financial stake in the company as she was simultaneously promoting the company at Star events across the country.
They have said publicly that the governor’s actions to help the company were limited, were not out of the ordinary and were not undertaken as part of any exchange with Williams.
Those actions are even less problematic, they have argued to prosecutors, when paired with how little he knew about his wife’s actions.
Prosecutors are now weighing that claim, along with Star corporate records and other evidence they have gathered over a months-long investigation. People familiar with Williams’s account have said that the executive has told prosecutors that he and the governor had discussed ways to help Star.
The governor’s allies have bemoaned leaks of allegations that have surfaced in the probe, and Galen said in a written statement that the leaks were intended to “harm the reputation of Governor McDonnell and his family.”
“It is important for citizens to take much of what Mr. Williams says with a grain of salt,” Galen said.
Sentiment: Strong Buy
BOB MCDONNELL FRIENDSHIP WITH DONOR JONNIE WILLIAMS GROWS FRACTURED
BOB LEWIS | 08/16/13 | AP
MARTINSVILLE, Va. -- FOR FOUR YEARS, JONNIE R. WILLIAMS SR. AND GOV. BOB MCDONNELL SHARED A FRIENDSHIP THAT AFFORDED WILLIAMS ACCESS TO THE PINNACLE OF VIRGINIA POLITICAL POWER AND PROVIDED MCDONNELL AND HIS FAMILY A TASTE OF THE GOOD LIFE THE MULTIMILLIONAIRE CORPORATE EXECUTIVE LOVED TO FLAUNT.
THAT FRIENDSHIP IS NOW STRAINED – IF NOT DEAD – AS A FEDERAL CRIMINAL INVESTIGATION INTO THEIR RELATIONSHIP PUSHES THEM IN CONFLICTING DIRECTIONS, CREATING AN ELECTION-YEAR SCANDAL THAT HAS CONSUMED THE FINAL MONTHS OF THE GOVERNOR'S TERM.
"We had a very positive relationship for three or four years," a somber McDonnell told The Associated Press this week in one of the most frank and open public discussions he has held yet on the subject. "Right now, we're just in a different situation."
Williams, through his attorney, Jerry W. Kilgore, declined to be interviewed for this story.
The men became friends in 2009 and 2010 when Williams' then-obscure nutritional supplement-making company, Star Scientific Inc., contributed $108,448 in corporate jet travel to McDonnell's gubernatorial campaign and political action committee. Williams became even more generous with personal gifts or loans to the McDonnell family that topped $145,000, including five-figure checks to two daughters for their weddings and a $6,500 Rolex watch engraved for the "71st Governor of Virginia."
McDonnell, who carefully couched his relationship with Williams in the past tense during the AP interview, said the enterprising venture capitalist had been his kind of guy: a self-made man from working-class stock who, like the governor, got his start in the health care services and supplies field. Both are in their late 50s. They discovered they had even both honeymooned in the same spot, Bar Harbor, Maine.
"I admire people who are entrepreneurial, who are finding ways to create opportunities in Virginia and that's one of the reasons that when I first met him back in '09 (or) '10 that we established a friendship," McDonnell said. "We both had big families. He had four kids, I had five.
"We had interesting early discussions about the field of health care and about our families," he said.
The McDonnell and Williams families grew quite close. Williams and his wife, Celeste, were familiar faces at official Executive Mansion functions and, even more important, personal mansion guests of the governor and first lady Maureen McDonnell. They were on a select list of guests for the private 2011 wedding of Cailin McDonnell and gave her a $15,000 check as a gift. Williams gave Cailin's sister Jeanine a $10,000 check before her wedding this spring. Maureen McDonnell was Williams' guest on a New York City shopping spree, and she persuaded him to buy the governor the expensive timepiece, The Washington Post reported.
With the friendship in full bloom, Star Scientific representatives were lobbying senior McDonnell administration officials to include the company's anti-inflammatory supplement, Anatabloc, in every state employee's basic health benefits package. The request was denied, and a review by Democratic former Attorney General Anthony Troy found no evidence that either Williams or the company received any benefit, appointment, or other special treatment from state government during McDonnell's term.
When the FBI began interrogating people close to McDonnell in an ongoing inquiry into whether he used the authority of his office to benefit Williams or his company, however, the friendship began to fray. Then this month, it became clear that it had snapped.
In July, McDonnell publicly apologized for accepting Williams' undisclosed largesse and announced he was returning all tangible gifts and repaying the monetary gifts and loans.
"I know who my friends are, and I have been blessed over the last 22 years to have a lot of great friends," he said.
Earlier this month, Williams and his company announced their cooperation with federal authorities and said they expected to avoid criminal charges.
Citing advice from his private legal team, McDonnell would not discuss any aspect of the investigation with the AP.
Rich Galen, a spokesman for the governor who is working with McDonnell's lawyers, was not so reticent.
"Apparently, the U.S. government has given Star Scientific a free pass for unspecified misdeeds in return for the testimony of Jonnie Williams," he said in response to word that Williams and his company were cooperating witnesses.
"Governor Bob McDonnell has had a 37-year unblemished record of military and civilian government service. Jonnie Williams has been in trouble with government entities since the earliest days of his business career," Galen said in an email statement first shared with The Virginian-Pilot newspaper last weekend.
While Williams has had success, he's also run afoul of federal and state regulators. A former optical business was fined for fitting contact lenses without a license, and later failed. Williams also had to pay back nearly $300,000 in ill-gotten profits after the Securities and Exchange Commission accused him of using research with false claims to promote a medical business.
Star Scientific, meanwhile, is facing a federal securities probe focused on transactions involving its securities since 2006 and three shareholder lawsuits alleging the company made false or misleading statements to boost Anatabloc.
Galen said neither McDonnell nor his lawyers know what Williams or company officials have told investigators, "but, at a minimum, there is a wariness among the legal team about Mr. Williams."
For his part, Williams has refrained from commenting publicly about the case or his friendship with the governor.
The specter of prosecution has taken a visible toll on the 59-year-old McDonnell. His hair is grayer. His trademark Irish grin is seldom seen. He has lost weight, which he ascribes to a new workout regimen. There is a new weariness about him, even apart from his demanding 22-city tour promoting his administration's initiatives – an annual weeklong swing that this year was to have been his victory lap.
Barred by Virginia's unique constitutional prohibition from serving consecutive terms, McDonnell should be fulfilling a lame-duck governor's role as cheerleader-in-chief and rainmaker for Republican Ken Cuccinelli, the GOP nominee as his successor, at this late stage in Virginia's neck-and-neck governor's race.
Last August, McDonnell was enormously popular, a rising Republican governor, a top campaign proxy for Mitt Romney and on Romney's vice-presidential short list. Now, the scandal has rendered him politically radioactive, forcing the GOP to fight on with its sitting governor on the sidelines.
"We've had better years," lamented Wendell Walker, the longtime chairman of the Republican Committee for Virginia's 6th Congressional District. "As a Christian, I believe in forgiveness. I'm not one of those guys who's going to throw someone under the bus."
McDonnell has drawn inward, finding solace mostly with family.
"I don't watch TV," he said. "I have pretty much stayed away from reading the headlines because I'm doing other things with my time now that are more productive."
One McDonnell friend who huddled with him during a stop Monday in Lynchburg was Jerry Falwell Jr., chancellor of Liberty University and namesake son of the late founder of the school and the Moral Majority. He's not sure McDonnell has really lost any friends.
"I think when something like that happens, your friends are still your friends and your enemies are going to pretend like they were your friends," Falwell said, "but they always were your enemies."
Sentiment: Strong Buy
Where would we be without Elk's reportage? Anything new with ACTC? The Bollingers are getting tight. Do you feel the squeeze? Any pressure? Is that why you love, love , love possible scandals where a Governor allowed people to die. . . Oh that was the POTUS, sorry.
BOMBSHELL ALLEGATION: VIRGINIA GOV'S FAMILY TOOK $145K FROM CEO
Rosalind S. Helderman, July 9, 2013, The Washington Post
RICHMOND — A prominent political donor gave $70,000 to a corporation owned by Virginia Gov. Robert F. McDonnell and his sister last year, and the governor did not disclose the money as a gift or loan, according to people with knowledge of the payments.
The donor, wealthy businessman Jonnie R. Williams Sr., also gave a previously unknown $50,000 check to the governor’s wife, Maureen, in 2011, the people said.
The money to the corporation and Maureen McDonnell brings to $145,000 the amount Williams gave to assist the McDonnell family in 2011 and 2012 — funds that are now at the center of federal and state investigations.
Williams, the chief executive of dietary supplement manufacturer Star Scientific Inc., also provided a $10,000 check in December as a present to McDonnell’s eldest daughter, Jeanine, intended to help defray costs at her May 2013 wedding, the people said.
Virginia’s first family already is under intense scrutiny for accepting $15,000 from the same chief executive to pay for the catering at the June 2011 wedding of Cailin McDonnell at the Executive Mansion.
All the payments came as McDonnell and his wife took steps to promote the donor’s company and its products.
The payments to the corporation, confirmed by people familiar with the transactions, offer the first public example of money provided by Williams that would directly benefit the governor and not just his family.
The money went from a trust, controlled by Williams, to MoBo Real Estate Partners, a limited-liability corporation formed in 2005 by McDonnell and his sister, the sources said.
McDonnell viewed the payments to MoBo and to his wife as loans and not gifts, according to three people familiar with the transactions. State law requires elected officials to disclose their personal loans but not loans made to their corporate interests.
Tucker Martin, a spokesman for the governor, declined to comment on the payments other than to say that McDonnell has been diligent in filling out legally mandated disclosures.
“The rules that I’m following have been rules that have been in place for decades,” McDonnell said Tuesday on a Norfolk radio show. “These have been the disclosure rules of Virginia. I’m following those. To, after the fact, impose some new requirements on an official when you haven’t kept record of other gifts given to family members or things like that obviously wouldn’t be fair.”
State law requires the disclosure of any gift valued at more than $50, but gifts to family members are exempt.
Jerry Kilgore, an attorney for Williams, declined to comment on the payments. A spokesman for the U.S. attorney investigating the payments also declined to comment.
On state-mandated disclosure forms, McDonnell indicated that a member of his immediate family owed money to an unnamed individual creditor in 2011 and 2012. In one year, he described the creditor as someone in “medical services.” In the other year, the governor said the creditor was in “health care.” Star Scientific makes nutritional supplements.
The form did not specify the exact amount owed; the governor checked a box saying it was between $10,001 and $50,000.
The people familiar with the payments, who spoke on the condition of anonymity because of the sensitivity of state and federal investigations of the governor, differed on whether any kind of payment plan had been established to reimburse Williams. They agreed that none of the money to the corporation or Maureen McDonnell has been repaid.
Revelations of the additional payments came as a federal grand jury was scheduled to hear testimony in the case this week. Separately, state prosecutors in Richmond are looking into whether the governor has complied with all disclosure laws.
McDonnell has said that Star Scientific received no special benefits from his administration and that any actions he or his wife took to boost the company were standard for any administration promoting state-based enterprises.
The $145,000 in payments from Williams came in addition to other undisclosed gifts that Williams gave to the governor’s family, including $15,000 in luxury clothing he bought for Maureen McDonnell and a $6,500 Rolex watch she asked him to purchase so she could give it to her husband.
McDonnell has disclosed receiving $9,650 in gifts from Williams, including private plane trips and the use of a summer lake-house vacation.
Williams’s first payment to the McDonnell family came in a $50,000 check made out to Maureen McDonnell from his trust on May 23, 2011, the people familiar with the transactions said. That was the same day Williams wrote a separate check for the catering at Cailin McDonnell’s wedding.
Then, in March 2012, Williams wrote a $50,000 check from his trust to MoBo, which was followed by an additional $20,000 payment to the corporation that spring, the people said.
In annual financial-disclosure forms, McDonnell has indicated that he owns a stake in MoBo, which he reported was associated with two Virginia Beach rental properties he purchased in 2005 and 2006 with his wife and his sister, who is also named Maureen.
The name of MoBo, formed in 2005, apparently comes from the combination of the names “Maureen” and “Bob” and is the entity that makes mortgage payments on the homes and pays for the properties’ renovations and upkeep. ………..
Sentiment: Strong Buy