Weldon Inquiry Boils As FBI Seizes Material
By John Shiffman and Todd Mason, The Philadelphia Inquirer
Oct. 17–FBI agents searched the homes and offices of U.S. Rep. Curt Weldon’s daughter, a local powerbroker, and a Russian energy firm yesterday for evidence that the Republican may have improperly steered contracts to his daughter’s lobbying firm.
The Pennsylvania congressman’s home and offices were not searched, though the raids confirmed the scope of the inquiry.
The scenes of agents carting evidence to government sedans here and in Florida came three weeks before Election Day, Nov. 7, as the 10-term incumbent faced a tight race and as Republicans nationally tried to shake stories about ethical lapses.
Weldon acknowledged yesterday that he was under investigation but declined to discuss the Russian business deals under scrutiny.
“That’s not fair to the people who had their homes invaded today,” Weldon told reporters. “In the end, I think you will find that there was nothing done that was wrong… . I haven’t helped get my daughter anything.”
His Democratic opponent, former Navy Adm. Joe Sestak, declined to comment. “You just have to wait and see,” Sestak adviser David Landau said. “Right now, it is between Weldon and the FBI.”
The FBI quickly arranged yesterday’s six searches after weekend news reports alerted the Weldons that they were under investigation, sources said. In such situations, agents fear evidence could be destroyed.
Four raids were conducted in the Philadelphia region and two in Jacksonville, Fla., officials said:
In Philadelphia, agents carted boxes from Karen Weldon’s three-story brick house on Queen Street. She could not be reached for comment yesterday.
In Delaware County, FBI agents blocked off Kelli Lane leading to the Springfield home of Charles P. Sexton Jr. and removed at least one box and a bag of material. Sexton, who could not be reached for comment, is a longtime ally of Weldon’s and has been a power in Delaware County GOP politics for more than three decades. As agents removed items from Sexton’s home, they strolled past a “Weldon for Congress” yard sign.
In Media, agents raided the offices of Solutions Worldwide Inc., the public relations firm Sexton and Karen Weldon run. The firm won $1 million in contracts from a Serbian family and two Russian energy firms, including the Itera Group, which has offices in Jacksonville.
In Center City, agents searched the offices of a lawyer, John Gallagher, a Weldon friend who has conducted extensive business in Russia and former Soviet republics. Gallagher referred Russian clients to Solutions North America, now Solutions Worldwide, a lawyer for the company told The Inquirer in 2004. Gallagher did not return a phone call yesterday.
In Jacksonville, agents searched Itera’s offices and the home of an Itera executive. Company officials did not answer the phone yesterday and an executive reached by cell phone declined to comment.
Five company officials each gave Weldon’s campaign $2,000 on April 20. They are general counsel Steven Koegler, part-owner Lazar Finker, board member Theodoros Kavalieros, Nikolaos Kavalieros, and corporate financial officer William Chattin.
None of them responded to requests for comment.
FBI spokeswomen Jerri Williams in Philadelphia and Debbie Weierman in Washington confirmed the sites of the searches but said they could not discuss an open investigation. “Details regarding those investigations cannot be provided because the accompanying affidavit is sealed,” Williams said.
Weldon said yesterday he believed the criminal investigation was instigated by an April 2004 letter to former Attorney General John Ashcroft from Melanie Sloan, director of Citizens for Responsibility and Ethics in Washington, a watchdog group.
Sloan’s letter cited a Los Angeles Times report that said the congressman actively helped Itera, which later awarded Karen Weldon’s firm a $500,000 contract. In her letter, Sloan said the alleged father-daughter arrangement seemed like bribery.
On Sunday night, Curt Weldon lashed out at Sloan and said in a phone interview that the leaks late Friday were “a gross abuse of the election process.” In a statement yesterday, he called it “dirty, partisan politics at its absolute worst.”
Sloan said yesterday that she was as surprised as Weldon to learn of the FBI’s investigation. Her letter, after all, was written 30 months ago, she said.
“You can see that this had nothing to do with this election cycle,” Sloan said. “It’s bad news for Mr. Weldon, but we thought he should have been under investigation all along… . How could his daughter get clients like that at age 29? How can she lobby her father?”
The Inquirer reported in 2004 that Curt Weldon had contacted administration officials on behalf of Itera and also had complained to senior White House official Karl Rove about Itera’s treatment by federal trade officials.
In late September 2002, Weldon arranged a dinner at the Library of Congress to honor Itera chief executive Igor Makarov. Six days later, Itera paid $500,000 to Karen Weldon and Sexton’s firm.
For The Inquirer’s 2004 report on the deals, Weldon said: “The stuff I’ve done with these companies is documented, and it is substantive. I don’t have anything to apologize for.”
William Canfield, a lawyer for Curt Weldon, did not return a phone call. He told CNN that Weldon provided the House Ethics Committee with “gruesome detail” about his daughter’s lobbying. “He recognized the potential appearance problems here,” Canfield said.
Curt Weldon said the committee “sent me a letter saying basically that they closed the case.” Congressmen on the committee declined to discuss it, citing confidentiality, their spokesmen said.
Russ Caso, Weldon’s chief of staff, declined an Inquirer request to review the ethics committee’s letter. “That is up to the lawyer,” he said.
Polls show the race between Weldon and Sestak for the Seventh District, which covers much of Delaware County and parts of Chester and Montgomery Counties, is a dead heat.
The Republican faithful in Delaware County won’t be put off by the probe, Weldon’s campaign manager, Michael V. Puppio Jr., predicted. “They probably are as concerned about the timing of this, three weeks before the election, as he is.”
With three weeks remaining in the campaign, Weldon must be careful. As any criminal defense lawyer would tell him: Anything he says publicly about the Russia deals or his daughter’s business, even inadvertently, might come back to haunt him if charges are brought.
On the other hand, the congressman’s inability to answer questions raised by the probe will cast a pall over his reelection campaign.
“I just have to keep plugging along as best I can,” Weldon said.
U.S. Rep. Curt Weldon’s daughter, Karen, and the congressman’s longtime ally, Delaware County GOP powerhouse Charles P. Sexton Jr., were hired to do public relations work by two Russian firms and by people the congressman has helped.
They started a PR firm in 2002 called Solutions North America, the Los Angeles Times first reported.
It is now known as Solutions Worldwide Inc.
In 2002, Karen Weldon and Sexton received a $500,000 contract from the Itera Group, a giant Russian natural-gas supplier, while the congressman was lobbying the federal government on behalf of the company. The FBI apparently is investigating that contract.
Itera was controversial because of questions about how it acquired vast natural-gas fields in post-Soviet Russia. The company was trying to expand in the United States, but in March 2002 the federal Trade and Development Agency withdrew a $868,000 grant to the firm.
Weldon later that year praised the company as “a great source” for U.S. energy firms seeking joint ventures. Weldon criticized the trade agency’s decision, lobbied presidential adviser Karl Rove, and on Sept. 24 helped arrange a dinner in honor of Itera and its chairman. The PR contract was signed Sept. 30.
A lawyer for Karen Weldon and Sexton told The Inquirer in 2004 that the Russian clients came from a Philadelphia immigration lawyer, John Gallagher, a friend and longtime associate of Curt Weldon’s.
A Russian aerospace firm, Saratov Aviation, hired Solutions for $20,000 a month in 2003. During the same period, Weldon was lobbying the Pentagon to consider buying an experimental aircraft that Saratov was developing. Weldon is vice chairman of the House Armed Services Committee.
In March 2003, Solutions was hired for $240,000 on behalf of Dragomir and Bogoljub Karic, alleged to be political intimates of Slobodan Milosevic, the former Serbian leader who died while on trial for war crimes. The Treasury Department had put their names on a list of Serbians banned from doing business in the United States because of their support for Milosevic, and later prevented them from getting visas. Weldon disputed those allegations.
By John Shiffman and Todd Mason. Inquirer staff writers Mitch Lipka, Patrick Kerkstra and Mark Fazlollah contributed to this article.
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