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Harry Reid Disavows Report Linking Him to Bribery Case

(Douglas Graham/CQ Roll Call File Photo)
(Douglas Graham/CQ Roll Call File Photo)

Senate Majority Leader Harry Reid broke days of silence on Sunday evening to deny any knowledge or involvement in a Utah case in which a man claims to have funneled money to others in an attempt to get the Nevada Democrat to intervene in a Federal Trade Commission case.

“Senator Reid has no knowledge or involvement regarding Mr. Johnson’s case,” a statement from Reid’s office said. “These unsubstantiated allegations implying Senator Reid’s involvement are nothing more than innuendo and simply not true.”

A Utah man told federal investigators that he channeled money through the state’s new attorney general in a bid to convince Reid to intervene in stopping an FTC investigation against him.

“The truth is the worst thing I think I’ve done was I paid money knowing it was going to influence Harry Reid,” Jeremy Johnson told the Salt Lake Tribune. “So I’ve felt all along that I’ve committed bribery of some sort there.”

Johnson has been charged by federal prosecutors in Utah with felony bank fraud, money laundering and other offenses, court records show. The Salt Lake Tribune reported that plea negotiations with the federal government broke down Friday.

Johnson says that Utah Attorney General John Swallow — before he held the office — connected Johnson with a businessman named Richard Rawle, who was described as “Harry Reid’s contact.” Rawle’s family owns a chain of payday lending operations called Check City. Rawle has made campaign contributions to Reid’s efforts, but also to a host of other politicians on both sides of the aisle, including Utah GOP Sens. Mike Lee and Orrin G. Hatch, campaign filings show.

Swallow, not Reid, appears to be the target of Johnson’s allegations, since he is the one identified as the intermediary between Johnson and Rawle. Swallow denies any criminal wrongdoing. Swallow, a Republican, is the new attorney general in Utah.

“I can say this emphatically: I have never had a financial arrangement with Mr. Johnson and no money has ever been offered or solicited,” Swallow told the Utah newspaper. The publication also said it was unclear if any of the money transferred to an operation set up by Rawle ever reached Reid or his political operations. Rawle himself is now deceased.

According to the Salt Lake Tribune, a request for comment from Reid’s office on Friday was denied. Roll Call requested comment on Saturday, but Reid’s office did not respond until late Sunday.

Reid has been involved in a bribery case before, but was on the side of law enforcement at the time. During Reid’s time as chairman of the Nevada Gaming Commission, Reid participated in a sting operation in late 1978 in which a man named Jack Gordon offered him a bribe.

In the current case, it appears that Johnson thought he would be paying a total of $600,000 in two installments to get the support of Reid for getting the FTC off the case of an Internet company he operated called I Works. But after he paid some of the money, Johnson said the FTC proceeded with the case.

According to court records from that matter, the FTC determined that Johnson and his associates operated a wide variety of websites that purported to offer free products and services and opportunities to make money, when in reality the websites collected credit card information of consumers and charged them repeatedly beyond the small shipping and handling charges identified on the original offer.

The FTC contended that these additional charges were sometimes disclosed deep in the fine print.

“Defendants immediately enroll consumers in multiple expensive online Negative Option Continuity plans whereby consumers are charged recurring fees or other additional fees until they affirmatively cancel enrollment in the plan,” the FTC said in a January 2011 court filing.

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