Ethics report: Trip planners coordinated with Rangel’s office

Rep. Charles Rangel (D-N.Y.) asked the ethics committee in
2006 whether he could solicit corporations to pick up costs for a Caribbean
business conference he and other members of Congress have attended for years,
according to the House investigative committee’s report on the matter.

His staffers also prepared a memorandum for him in 2008
that discussed HSBC bank’s decision to pull out of the conference after press
accounts questioned the propriety of the Caribbean conference, and offered
suggestions on how Rangel could help prevent HSBC from bowing out.

{mosads}HSBC later donated $25,000 for the trip to St. Maarten,
$10,000 more than it provided to the same Caribbean conference the year before.

When questioned by the ethics panel’s investigative
subcommittee about the matter, Rangel said he was unaware of the corporate
sponsorship of the Caribbean conferences and stated that he “did not know what
HSBC was,” according to a report issued by the ethics committee’s investigative
subcommittee that reviewed the matter.

The ethics committee on Thursday admonished Rangel,
chairman of the Ways and Means Committee, for improperly accepting
reimbursement for two trips to the Caribbean and ordered him to repay the
costs.

In doing so, however, the panel found that two of his
staffers, including his former chief of staff who was later fired – knew that
corporate sponsors were underwriting the trip in violation of new House rules
put in place after Democrats won the majority in 2006.

The committee did not find that Rangel himself was aware
of the improper corporate sponsorship, but still found that he broke House gift
rules by attending the conferences because he is responsible for his staffs’
knowledge and their actions.

The panel also exonerated four other members who attended
the event who said they were unaware of the corporate sponsorships.

After reviewing the investigative report, ethics watchdogs
are questioning Rangel’s and the other members’ truthfulness about their
knowledge of the corporate sponsorship.

“It stretches credulity to think that, after asking the
ethics committee about corporate donations in 2006 and after his staff had
prepared a memo for him in 2008 about corporate contributions and after
arriving and seeing extensive corporate signage at the event, that Rep. Rangel
was oblivious to the role that corporate sponsors were playing in these trips,”
said Meredith McGehee of the Campaign Legal Center.

“It is not enough to say he was unaware.  For members
of Congress, the correct standard to be applied is ‘known or should have known,’”
she said.

The investigative subcommittee’s report details numerous
interactions between Rangel’s staff and the planners of the 2007 and 2008
Caribbean conferences in question. The Carib News Foundation, a non-profit
affiliated with a newspaper catering to the Caribbean immigrant community in
New York City, purported to be the sole sponsor of the trip when in reality,
the ethics committee found that several corporations, including Citigroup,
HSBC, Verizon, IBM, American Airlines and others, provided the money for the
conferences at Caribbean beach resorts and the first-class air travel
associated with it.

In addition to the HSBC memo, Karl Rodney, who heads the
Carib News Foundation, told the investigative subcommittee that he included a “cc”
to Rangel himself on letters soliciting corporations to become sponsors of the
trips.

When asked why he did so, Rodney said it was for “informational
purposes because he knew Rangel’s office had an interest in the conference and
Caribbean interests.

“As I mentioned in my response to counsel, Mr. Rangel has
always had an interest in the conference and through the years we worked with
his staff as we have gone through the planning of the conference,” Rodney told
the subcommittee, according to the report. “We sent it to him strictly for his
information. He didn’t instruct us to. We didn’t ask him to. We sent it
strictly as information.”

Rangel’s name, along with other members of Congress who
did not attend the conference, also appeared on letters soliciting AT&T and
American Airlines to become sponsors for the 2007 conference.

Language in each of the letters invites the corporations
to “become one of the corporate sponsors of this history-making event.”

Letters to AT&T, Citibank, IBM, Macy’s East, HSBC Bank
and Pfizer also promised prime sponsors “prime access to key elected officials
through [a] private reception, seating at luncheon and dinner, photo
opportunities, etc.”

Each letter contained the text “cc: Congressman Rangel” at
the bottom.

Rangel’s counsel Michelle Sherwood wrote him a memo in 2008 after it
appeared that HSBC Bank had threatened to withdraw its support as a result of
an article in the New York Post questioning the propriety of the 2007
conference.

Faye Rodney, Karl’s wife, contacted Rangel’s New York
district office in late September, to let the office know about HSBC’s
withdrawal and to request Rangel’s support in convincing the bank to remain a
sponsor.

In a memo written to Rangel about HSBC, Sherwood noted
that Faye Rodney had called to “express her distress, displeasure, and great
concern that executives from HSBC Bank informed her that they intend to pull
their financial support from the 2008 Carib News Foundation Conference,”
according to the report.

The memo also noted that Faye Rodney spoke with Sherwood,
Jim Capel and Elbert Garcia (all Rangel staffers) regarding HSBC Bank’s
decision and informed them that the Foundation’s “other major sponsor ATT [sic]
is holding strong, but the revelation that HSBC is pulling out might well
rattle other sponsors and put the future of the conference in jeopardy.”

The memo also suggested possible solutions to prevent HSBC’s
withdrawal of sponsorship, including that Rangel or his office staff contact
Bill Thompson, then-Comptroller of the City of New York, as well as Mayor
Michael Bloomberg, to see if they could convince HSBC to keep its sponsorship.

“After conferring with [Rangel staffers] George [Dalley]
and Emile [Milne], we determined that there are several options we might
explore to preserve HSBC’s commitment to the Conference,” Sherwood wrote in her
memo to Rangel.

The memo also noted that Thompson has “has consistently
indicated” that he would “do whatever is necessary” to support Rangel.

HSBC officials told the investigative subcommittee they
were never contacted by anyone from Rangel’s office, or by Thompson or
Bloomberg.

In testimony before the committee, Rangel said he did not
read the memo written by Sherwood and said Dalley, his former chief of staff,
may have read it. He also denied discussing the matter with any staffer and
said he never recommended any of the actions suggested by Sherwood in the memo.

Rangel also said he had never seen the corporate
solicitation letters before and did not know why his name would appear on them.
He also said he did not notice any corporate logos or banners placed on large
signs and at the speaker’s podium at the conference.