News and events revolving around the ousting of CIA agent Valerie Plame.

Friday, November 25, 2005

Leak Investigation: For Libby and Rove, Legal Woes—And Bills - Newsweek Periscope -


Nov. 28, 2005 issue - As special counsel Patrick Fitzgerald continues his probe into the CIA leak affair, the probe is taking an escalating financial toll. I. Lewis (Scooter) Libby, the indicted former vice presidential chief of staff, has set up a legal defense fund to pay the bills of his high-priced lawyers. In an effort to raise $5 million, the trust has assembled a board of major Republican fund-raisers, lobbyists and prominent neoconservatives. The chair: Melvin Sembler, a wealthy Florida real-estate developer and ex GOP finance chief who, ironically, was President George W. Bush's ambassador to Italy when the embassy in Rome first got the forged yellowcake documents that helped trigger the affair. Others include ex CIA director (and outspoken Iraq-war supporter) James Woolsey, ex GOP presidential candidate Steve Forbes, former senator Fred Thompson, ex U.N. ambassador Jeane Kirkpatrick and lobbyists Bill Paxon and Wayne Berman (whose wife is the White House social secretary). During a conference call last week, Libby thanked the participants. "The money is pouring in," said Barbara Comstock, a spokeswoman for the group. But because it was set up after Libby left the White House, the fund is private—and donors won't be disclosed.

Libby may not be the only one with pressing financial needs. Deputy White House chief of staff Karl Rove recently took out a $100,000 line of credit from Wells Fargo Bank, according to real-estate records obtained by NEWSWEEK. The loan is secured by Rove's vacation home in Rosemary Beach in the Florida Panhandle worth more than $1 million, according to his most recent financial disclosure. Rove signed the loan papers on Oct. 22—just nine days after he testified before the grand jury for the fourth time. A White House spokeswoman said Rove's new line of credit is "unrelated" to his legal expenses. But any Rove legal debts—which won't have to be publicly disclosed until next year—could bring attention to his relationship with Patton Boggs, the D.C. powerhouse lobbying firm, where his lawyer in the leak case, Robert Luskin, is a partner. Lobbying records show Patton Boggs represents a battery of foreign governments, corporations and others with interests before the government. Rove has been involved in White House meetings involving at least one big Patton Boggs client: the Office of Hawaiian Affairs, which paid the firm $400,000 earlier this year to lobby for a controversial native-Hawaiian recognition bill. Patton Boggs lawyer Ben Ginsberg, a Rove friend and big GOP lawyer who recommended he hire Luskin, is a principal on the case. The White House—which recently ordered all staffers to take an ethics training course—declined to say if there is any policy for Rove to recuse himself from issues involving Patton Boggs clients. "All ethical obligations are being met," said spokeswoman Nicole Wallace.

—Michael Isikoff and Holly Bailey

© 2005 Newsweek, Inc.


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