Updated: 4:32 p.m.
A former House Appropriations Committee staffer who founded one of the top lobbying firms in Washington, D.C., pleaded guilty Friday to making $386,000 worth of illegal campaign contributions, but there is no indication he is cooperating with prosecutors in an investigation of Members of Congress.
Paul Magliocchetti, the founder of the PMA Group lobbying firm, was indicted in August on eight counts of making illegal campaign contributions and three counts of making false statements. The firm was raided by the FBI in November 2008 and shut its doors in March 2009.
He initially entered a “not guilty” plea in August, but he changed his plea Friday in a federal court in Alexandria, Va., lodging a guilty plea to two counts of illegal contributions and one of making false statements. Judge T.S. Ellis accepted a motion to dismiss the other five counts.
“I provided my mother-in-law and father-in-law and some of the kids money to give campaign contributions,” Magliocchetti said.
Magliocchetti is scheduled to be sentenced Dec. 17 and faces a possible maximum penalty of up to 15 years in jail and $1.7 million, though prosecutors indicated they will seek a sentence of about six years.
The August indictment alleged that Magliocchetti used his own funds and PMA corporate money to reimburse PMA staff, family members and two Florida acquaintances for making donations to political committees at his direction. Magliocchetti and his family made $1.5 million in political contributions from 2000 through 2008, according to a CQ MoneyLine study of campaign finance records.
The guilty plea only covers contributions made from 2005 to 2008 because the statute of limitations had expired on prior contributions.
A statement of facts Magliocchetti signed said, “Political contributions to campaign committees and political action committees of various candidates for federal office … were a key part of Magliocchetti’s plan to increase PMA’s profile and its profitability.” But the government conceded that Magliocchetti carried out the scheme “unbeknownst to the federal campaigns.”
“From 2005 through 2008, Magliocchetti used members of his family, friends and PMA lobbyists to make $386,250 in illegal federal campaign contributions,” the statement says. Magliocchetti directly and indirectly instructed these individuals to write checks out of their personal checking accounts to specific candidates for federal office. At various times, for the purpose of making these contributions, Magliocchetti advanced funds or reimbursed these individuals using personal and corporate monies.”
Roll Call reported in February 2009 that Magliocchetti had added to the PMA board two men from Florida who had no apparent connection to politics or lobbying who became prodigious donors to candidates favored by the firm.
John Pugliese, one of the board members the company added, was described in campaign finance records as a sommelier at the Ritz-Carlton hotel on Amelia Island, a beach resort area in northeastern Florida. The other, Jon Walker, was the marketing director for the Golf Club of Amelia Island, a luxury golf course.
From June 2005 to the end of 2008, the two men donated more than $160,000 to Congressional campaigns that were receiving support from other PMA employees and clients.
Despite pleading guilty, Magliocchetti disputed some facts with prosecutors in court. When prosecutors alleged that he had reimbursed staff members for making campaign donations, Magliocchetti said: “We gave our people bonuses and very high salaries. … There was never any direction … I didn’t know what they did with the money.”
Federal attorney Justin Shur said Magliocchetti tracked illegal donations via a spreadsheet, but Magliocchetti said he only used the spreadsheet to ensure donors were not exceeding campaign donation limits.
Magliocchetti also denied the prosecution’s allegation that he was scolded by an in-house ethics attorney for his campaign contributions.
He said an ethics expert had been invited to explain campaign finance regulations.
“I don’t recall ever being admonished,” Magliocchetti said.
A Justice Department official declared victory in the case.
“Mr. Magliocchetti is answering for his brazen disregard for the law to achieve political influence and enrich himself,” U.S. Attorney Neil H. MacBride said. “Campaign finance laws give transparency to political contributions and protect the public’s ability to see who’s really funding a campaign.”
Mark Magliocchetti, Paul Magliocchetti’s son, pleaded guilty in August to making illegal corporate campaign contributions at his father’s behest.
Mark Magliocchetti signed a statement of facts in August acknowledging that he made campaign contributions “to maintain and increase [the PMA Group’s] lobbying business” and that he “received money to cover the cost of his and his wife’s contributions” from his father and the PMA Group.
The total illegal contributions made by Mark Magliocchetti and his wife “exceeded $120,000 but was less than $200,000,” the statement concluded.
The House ethics committee in February closed an investigation of PMA’s connections to House Members, concluding that while there is a widespread perception among lobbyists and contractors that making campaign donations helps them secure earmarks from Members of Congress, the committee found “no evidence that Members or their official staff considered campaign contributions as a factor when requesting earmarks.”
The report did find that PMA “employed strong-arm’ tactics,” threatening retaliation against Members who did not support their earmarks, and “pushed or directed company executives to maximize personal or Political Action Committee campaign contributions and to attend specific fundraisers while pursuing earmarks.” But the committee concluded that Members were unaware of the pressure PMA was putting on clients and were unresponsive to threats from the lobbyists.