Not adding up
Congressman releases statement about fake audits
By Trish Choate
Friday, March 14, 2008
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WASHINGTON ?An area congressman stepped forward Thursday to reveal the findings so far in an investigation of the finances gone awry for House Republicans?campaign fundraising committee.
U.S. Rep. Tom Cole,
揟he evidence we have today indicates we have been deceived and betrayed for a number of years by a highly respected and trusted individual,?Cole, the NRCC chairman, said in a statement.
It began coming to light Jan. 28 when the NRCC抯 new audit committee chairman was 30 minutes from what he thought would be a routine meeting with the firm a trusted consultant claimed had audited the National Republican Congressional Committee抯 finances.
U.S. Rep. Mike Conaway had been requesting the meeting for about two months, but it had never happened.
That Jan. 28 at NRCC headquarters in
揑 called the firm that we thought we抎 been dealing with,?Conaway, a certified public accountant, said. 揟hey, of course, had never heard of us.?o:p>
The discoveries triggered an FBI investigation, the prospect of federal charges for a man associated with the NRCC since 1995, and the committee抯 discovery that its numbers don抰 add up.
So far, $1.73 million in cash on hand is at issue for the organization charged with raising money to put Republicans in the House.
Cash on hand was about $740,000 less Jan. 31 than reported to the Federal Election Commission, the NRCC said in a statement.
The committee also had nearly $1 million less in the bank than claimed on its 2006 year-end report to the FEC.
Conaway of the 11th Congressional District stopped short Thursday of saying the committee is definitely missing funds.
Besides cash on hand discrepancies, there are discrepancies between how much NRCC officials thought the committee owed its bank and how much it does.
揥e are still trying to determine if that抯 just sloppy bookkeeping,?Conaway said. 揃ut our sense is that this is money that is missing.?o:p>
It appears Ward made 搒everal hundred thousand dollars in unauthorized transfers of NRCC funds to outside committees whose bank accounts he had access to,?the NRCC statement said.
That includes joint fundraising committees, the NRCC statement said. Ward apparently subsequently transferred hundreds of thousands of dollars to his personal and business accounts, dating back to at least 2004.
Exact amounts are 揳 moving target?at this point in the investigation, the statement said. Ward also didn抰 report the unauthorized transfers accurately or, sometimes, at all to the FEC. But the amount reported as outstanding on NRCC抯 credit line was $200,000 less than actually owed.
Neither Ward nor his lawyer, Ronald Machen, could be reached late Thursday afternoon.
Conaway said Ward worked his way into a trusted position at the NRCC.
揊ifteen-plus years he had been around these folks,?Conaway said. 揌e had been their friend, had been their confidant.?o:p>
He worked himself into a position where he had too much control, Conaway said.
揥e let him have too much authority without enough supervision, and he was able to take advantage of our trust to do what he did,?Conaway said.
Ward served at the committee since 1995, becoming treasurer ?and so responsible for audits ?in 2003, the statement said.
He stepped down as treasurer and became a consultant in July. As such, Ward was supposed to see to completing the 2006 audit.
The NRCC抯 own rules require an audit by an outside auditor every year, as does its bank, Wachovia, Conaway said. But the committee has had no audit since Dec. 31, 2001.
Ward faked and submitted a string of bogus financial statements to Wachovia and to committee leaders from 2002 to 2006, an NRCC media statement said.
In late January, the committee followed the advice of its law firm, Covington & Burling, to turn the matter over to the FBI.
The agency launched a criminal investigation, the statement said.
It抯 up to the FBI and the U.S. Department of Justice whether Ward faces charges, Conaway said.
揃ut I can tell you that lying to a national bank in a loan circumstance is ?a federal crime,?Conaway said, speaking generically.
The FBI did not respond to a request for comment Thursday afternoon.
Conaway said he didn抰 know Ward well although he seemed nice enough at the NRCC.
Campaign officials with Wichita Falls?U.S. Rep. Mac Thornberry and U.S. Rep. Randy Neugebauer, whose 19th Congressional District includes Young County and Archer County, said those congressmen had never had any dealings with Ward.
Ward抯 name appears frequently in Republican FEC records.
The 揳ccounting irregularities?could cast a pall over House Republican races in a tough election year, causing donors to see NRCC and its coffers as tainted.
Conaway said he hoped not, and a Republican fundraising dinner Wednesday night in
揑 feel confident telling potential donors that we have this system in place that will prevent this kind of thing in the future,?he said.
The forensic audit, which PricewaterhouseCoopers began in late January, will continue six to eight more weeks, the NRCC said.
揑t will take us where it takes us,?Conaway said.
Timeline
Nov. 3, 1995 ?Christopher J. Ward begins serving at the National Republican Congressional Committee
2003 ?Ward begins serving as NRCC treasurer and becomes responsible for financial audits. He submits a series of faked audits in the following years.
July 2007 ?Ward steps down as treasurer and becomes a consultant.
Jan. 28 ?National Republican Congressional Committee officials discover their 2006 audit has been faked, and Ward admits in an e-mail to lying about it. NRCC fires him.
Jan. 30 ?NRCC hires law firm
March 13 ?NRCC chairman, U.S. Rep. Tom Cole,
Source: NRCC statements
http://www.timesrecordnews.com/news/2008/mar/14/not-adding/