Subpoena issued to Craddick in inquiryInquiry into fund-raising violations widens
By Jay Root, Star-Telegram Austin Bureau,
Friday, Feb. 20, 2004
AUSTIN - Widening their inquiry into accusations of fund-raising violations, Travis County prosecutors issued subpoenas Thursday to Texas House Speaker Tom Craddick, state Reps. Kent Grusendorf and Arlene Wohlgemuth, and several others, officials said.
The subpoenas come as a grand jury investigates accusations that a Republican group founded by U.S. House Majority Leader Tom DeLay, R-Sugar Land, illegally funneled corporate money into the 2002 campaign to gain a GOP majority in the Texas House of Representatives.
Now, the inquiry has been expanded to include possible violations of laws designed to curb outside influence in the Texas speaker's race, officials said.
"During the course of the investigation ... possible criminal conduct in connection with the race for speaker of the Texas House of Representatives was uncovered," Travis County District Attorney Ronnie Earle said in a written statement. "As a result, the investigation was broadened once again to include those allegations."
It is the second time that officials have expanded the inquiry. Prosecutors first examined the campaign activities of the Texas Association of Business, then widened the investigation to include Texans for a Republican Majority, a group founded by DeLay. Then on Thursday, the inquiry was broadened to include Craddick's office.
Any action by the Travis County grand jury will have to occur before March, when the panel is scheduled to expire.
Craddick, who has denied any wrongdoing, confirmed that he has received a subpoena for documents related to his successful race to become the first Republican speaker in more than 130 years. Craddick, R-Midland, was elected speaker by fellow House members a little more than a year ago. The lone dissenter was Fort Worth state Rep. Lon Burnam, a Democrat.
"We intend to fully comply with the summons and cooperate with the DA's office," Craddick said in a written statement. "I am satisfied that I, and all other candidates for speaker of the House of Representatives for the 78th Legislature, conducted our races appropriately."
Austin lawyer Roy Minton, whom Craddick has retained, said the subpoena included documents such as speaker pledge cards from other members and various correspondence.
While misuse of corporate money can be a felony offense, a violation of the law governing a speaker's race is a misdemeanor punishable by a fine of up to $5,000 and a year in jail. Grusendorf, R-Arlington, declined to say what his subpoena called for, but he described the inquiry as a partisan "fishing expedition" by District Attorney Earle, a Democrat.
"They can't find anything," Grusendorf said. "They keep on looking to see if they can muddy the water in a political campaign. They didn't like the change in leadership."
vWohlgemuth, R-Burleson, who is running for a newly drawn Central Texas congressional district, also received a subpoena.
"She is looking forward to cooperating fully with the grand jury and providing any documents she may possess, even though she doesn't feel she has anything the grand jury would be interested in seeing," Wohlgemuth spokesman Todd Smith said.
Officials would not say which other lawmakers or campaign officials received subpoenas, but prosecutors were expected to file them in court today.
The subpoenas do not require the lawmakers to appear in person but compel them to produce records that are requested, officials said.
The wide-ranging investigation is exploring the limits of a century-old prohibition on the use of corporate money to influence the outcome of a Texas election.
The inquiry began after the Texas Association of Business bragged in a 2003 newsletter that its advertising campaign -- fueled with corporate money -- "blew the doors" off the 2002 election. The election produced the first Republican majority in the Texas House since Reconstruction. Not long after Earle began investigating those donations, questions surfaced about whether the business group had illegally coordinated its activities with Texans for a Republican Majority Political Action Committee, the group DeLay co-founded. The committee denied the allegations. Among the transactions that prosecutors are looking at: a $190,000 donation of corporate "soft money" from the political action committee to the Republican National Committee. A wing of the national Republican Party distributed an equal amount of noncorporate "hard money" to seven state representative candidates in Texas before the election.
Campaign watchdog groups say the transaction smacks of illegal political money laundering -- exchanging corporate money that can't be spent in a Texas election with money that can. Republican National Committee spokesman Jim Dyke said the money came and went into two separate accounts, and he described the identical sums as coincidental.
"You can't tell us what to do with our money," Dyke said. "This was actually different money coming out of a different account, which leaves it as a coincidence."
Some $1,200 in corporate money was also used to pay a legal bill for state Rep. Bill Zedler, R-Arlington, who was fighting accusations that he didn't live in his district, according to a report in The New York Times. Zedler could not be reached for comment Thursday.
Now the investigation has engulfed the 2002 speaker's race. Documents and interviews show that Craddick helped distribute at least $152,000 in campaign donations raised by Texans for a Republican Majority to several Republican House candidates.
State law forbids outside groups from contributing money or "other things of value" to influence the election of a speaker, an internal affair in which House members select one of their own to lead the chamber.
"It raises troubling questions," said Craig McDonald, director of Texans for Public Justice, which tracks political money in the state. "Why was a member of the Legislature serving as the conduit for Tom DeLay's corporate money? I think there can be no question that Tom Craddick was trying to curry favor with the Republican members he distributed money to."
Craddick spokesman Bob Richter has said repeatedly that there were no "quid pro quo" arrangements between Craddick and members who voted for him.
The state House was one of the last bastions of Democratic control in Texas. When it fell in 2002, Republicans, pressed by DeLay from Washington, went after the only one left: the Texas delegation in Congress.
With the successful passage of a new congressional map and a Democrat who defected to the Republican Party, the Texas GOP appears well on its way to gaining control of the congressional delegation. The aftereffects, observers say, could eventually elevate DeLay to the helm of the U.S. House.