LAS VEGAS -- This scandal has everything: Top
politicians indicted on multiple counts of accepting hundreds
of thousands of dollars in bribes from the owner of local strip
clubs in exchange for looser regulations of what strippers can
do.
But what has this got to do with terrorism?
Nothing at all, everybody involved agrees. Yet FBI agents
in Las Vegas used a provision of the USA Patriot Act to obtain
the financial records of several suspects in the case. It is
one of more than a dozen cases in which federal investigators
have relied on the Patriot Act -- passed a month after the attacks
of Sept. 11, 2001, as a response to terrorism -- for purposes
unrelated to homeland security, according to The New York Times.
Part of the law, Section 314, allows federal investigators
to obtain from stockbrokers, banks, and other financial institutions
the records of people "suspected, based on credible evidence,
of engaging in terrorist acts or money laundering." Since the
law does not specifically require that the money laundering
relate to terrorism, the application in a public corruption
probe such as "Operation G-Sting" is permissible.
"What it points out is how certain aspects of the Patriot
Act are so expansive that they allow for invasions of people's
basic rights in ways that go far beyond reasonable national
security needs," said Allen Lichtenstein, attorney for the American
Civil Liberties Union of Nevada.
A Justice Department spokesman, Mark Corallo, insisted the
section was inserted at the request of then-Senate Banking Committee
chairman Paul Sarbanes, Democrat of Maryland, who sought to
give the FBI new tools to fight money laundering. The provision
allows an FBI agent to demand financial records without a grand
jury subpoena by certifying that the suspicion of money laundering
is reasonable. If a judge at trial believes the certification
is inadequate, the judge may throw out the evidence, Corallo
said.
"The Patriot Act was not meant to be just for terrorism,"
Corallo said. "A lot of the uninformed criticism was obviously
misplaced."
The FBI office in Las Vegas has said Section 314 was applied
in the corruption case, but would not confirm local news reports
that it was used to subpoena records from the stockbrokers of
the Clark County Commission chairwoman, Mary Kincaid-Chauncey;
former commissioners Dario Herrera, Erin Kenny, and Lance Malone;
Las Vegas City Councilman Michael Mack; and club owner Michael
Galardi. The commission regulates areas outside the city limits.
In a 28-count indictment handed down Thursday, Kincaid-Chauncey,
Herrera, and Malone were charged with accepting thousands of
dollars in bribes from Galardi. Malone was also accused of acting
as a middle man between Galardi and the commissioners after
he left office in 2000. Also Thursday, guilty pleas from Galardi
and Kenny were unsealed. In them, Galardi admitted to giving
as much as $400,000 in kickbacks to commissioners, and Kenny
conceded she took bribes via Malone in exchange for voting for
laws favorable to Galardi's clubs.
Kenny was the Democratic candidate for lieutenant governor,
and Herrera was a Democratic nominee for Congress in 2002. Both
lost. It is unclear how Mack may be involved in the case.
The FBI probe also has resulted in the August indictment of
three San Diego City councilmen on similar charges of taking
Galardi's bribes through Malone in exchange for preferential
treatment. The California councilmen have pleaded not guilty;
the Nevada politicians are scheduled to be arraigned Nov. 21.
Kenny's lawyer, Frank Cremen, said the perplexing part of
the use of the Patriot Act was that prosecutors could have subpoenaed
the financial records using other laws, although not as quickly.
"Quite truthfully, I don't know why they used it, but it's going
to have no impact on my client," Cremen said.
But the disclosures have led to sharp rebukes from Senator
Harry Reid and Representative Shelley Berkley, both Nevada Democrats.
Berkley, who represents Las Vegas, has sent a letter to Attorney
General John Ashcroft asking whether he believes this use of
the law was appropriate.
"When I voted for the Patriot Act one day and one month after
Sept. 11, I was voting to give the FBI the necessary tools to
fight terrorism," Berkley said. "It was never my intention that
this act would be used in garden-variety crime or political
corruption cases."
Reid said this is another reminder that a careful review of
the act is in order when it comes up for renewal in 2005. "We
have to be tough on terrorists, but we also have to guard the
privacy of American citizens," he said.
But Representative Jim Gibbons, Republican of Nevada, said
the Patriot Act was designed not only to enhance antiterrorist
activities, but also to modernize the way the FBI conducts investigations.
"Criminals nowadays use cheap, throwaway cellular phones and
free e-mail accounts, but the laws did not address those things,"
said Amy Spanbauer, a spokeswoman for Gibbons. "This empowers
law enforcement to keep up with modern technology so they are
not hamstrung as terrorists run free."
###
