Feds file criminal case against lobbyist, developer Whittemore

Onetime political power broker Harvey Whittemore, accused of funneling thousands of dollars in illegal campaign contributions to Senate Majority leader Harry Reid, was indicted Wednesday by a federal grand jury in Reno.

Whittemore, 55, an attorney and former lobbyist who wielded much influence within Nevada's political hierarchy, was charged with four counts: making excessive campaign contributions, making contributions in the name of another and two counts of making a false statement to a federal agency.

An arrest warrant was issued Wednesday for Whittemore, who has denied wrongdoing. But he is expected to voluntarily appear in court in Reno today to enter a plea of not guilty.

If convicted, Whittemore faces up to 20 years in prison and a $1 million fine.

"Mr. Whittemore allegedly used his family members and employees as conduits to make illegal contributions to the campaign committee of an elected member of Congress," said Assistant Attorney General Lanny Breuer of the Justice Department's Criminal Division in Washington, D.C. "Furthermore, according to today's indictment, he attempted to conceal his crimes by lying to the FBI.

"Our campaign finance laws establish maximum limits on individual contributions, and failure to adhere to those rules jeopardizes the integrity of our elections. We will continue to pursue those who engage in such conduct."

Nevada U.S. Attorney Daniel Bogden added: "We remain committed to investigating and prosecuting illegal behavior that jeopardizes the integrity of our elections and corrupts our political process."

The case is being handled by the U.S. attorney's office and the Criminal Division's Public Integrity Section, which prosecutes public corruption.

The indictment does not identify Reid, a powerful Nevada Democrat on Capitol Hill.

But a review of March 2007 campaign fundraising reports by the Las Vegas Review-Journal shows Reid received about $150,000 from Whittemore and his family and associates. No other federal candidate across the nation received that much money from Whittemore in March 2007, according to the reports.

Reid spokeswoman Kristen Orthman, issued a statement late Wednesday.

"The Whittemore family gave money to local, state and federal officials over many years," she said. "At no time did Senator Reid have any knowledge that Mr. Whittemore was engaging in these alleged unlawful contributions to Senator Reid or any elected official.

"Senator Reid believes that this is a very serious matter, and he has full confidence in the American justice system."

The six-page indictment alleges that Whittemore met with a federal elected official in February 2007 in Las Vegas and agreed to raise $150,000 by the March 31, 2007, campaign finance deadline.

Whittemore then "knowingly devised a scheme and plan whereby he used family members (employees), and their respective spouses as prohibited conduits through which to funnel his own money to" the elected official's campaign, the indictment alleges.

At the time, federal law allowed a maximum $4,600 to be contributed to a campaign by an individual and $9,200 by a couple.

The indictment alleges Whittemore reimbursed those who contributed to the campaign $5,000 for an individual $4,600 contribution and $10,000 for a $9,200 contribution by a couple.

Whittemore is alleged to have paid his associates through checks and wire transfers from his personal account. The indictment alleges he tried to conceal the reimbursements by calling them bonuses.

In all, Whittemore unlawfully contributed about $138,000 to the federal elected official's campaign coffers, the indictment alleges.

The indictment said that Whittemore duped the elected official's campaign committee into believing the campaign contributions came from the individuals, "when, in truth and in fact, as defendant well knew, the contributions came from the funds of the defendant."

Whittemore is accused of lying to both the FBI and the Federal Election Commission, which regulates campaign contributions.

On Wednesday, Whittemore's lawyer, Dominic Gentile, issued a statement vowing to fight the charges.

"It is clear to us and it will be clear to a jury that Mr. Whittemore always acted in a law-abiding manner, well within his constitutional rights and with complete transparency," Gentile said. "We respectfully, but strongly, disagree with the government's interpretation of both the facts and law applicable to this case as well as the decision to indict Mr. Whittemore."

The investigation became public Feb. 9, as FBI agents fanned out across the state at some 30 locations to serve subpoenas on Whittemore business associates, family members and employees.

The Review-Journal first reported that agents were interested in sizeable contributions that Whittemore and his associates made to Reid's re-election campaign in March 2007.

Allegations had surfaced that employees of Whittemore's former development company, Wingfield Nevada Group Holding Co., and its subsidiaries were used to donate to political campaigns and were later reimbursed by Whittemore with company money.

Reid's campaign received the $138,000 in March 2007 from some 30 Whittemore associates, including his family members and his employees and their spouses.

Whittemore and his wife, Annette, also contributed $9,200 about the same time, bringing the total money bundled by Whittemore close to $150,000. Their contributions, however, were not considered conduit contributions.

Over the years, Whittemore and his family have donated tens of thousands of dollars to Nevada politicians. Reid and other elected officials - including Sen. Dean Heller, R-Nev., and Rep. Shelley Berkley, D-Nev. - said they dumped some donations and cut ties with Whittemore in the wake of the FBI's investigation.

At the height of his powers as a lobbyist, Whittemore represented some of the state's biggest industries in Carson City, including liquor and tobacco and gaming. Sometimes called the "64th legislator," he had the highest level of access to lawmakers. He also oversaw the Reno office of Lionel, Sawyer & Collins, one of Nevada's premier law firms.

But in recent years, Whittemore, who once considered Reid among his closest friends, had turned his attention away from lobbying to land development.

At the time of his big push to contribute money to the majority leader's campaign, Whittemore was orchestrating the development of Coyote Springs, a master-planned community in Southern Nevada. With the help of Reid and other members of the Nevada congressional delegation, Whittemore sought to overcome several governmental hurdles because of county water issues and federal land issues.

But in 2008, the 43,000-acre development stalled because of the housing crash and economic recession and has languished ever since and is subject to its own lawsuit.

The forerunner to the federal investigation was a multimillion-dollar lawsuit Whittemore's former business partners filed in Las Vegas, alleging Whittemore embezzled $44 million from the Wingfield Nevada Group.

The company is controlled by Thomas Seeno and Albert Seeno Jr., two brothers who partnered with Whittemore in his master-planned communities in Northern and Southern Nevada, including the Coyote Springs community.

Whittemore responded with his own $60 million lawsuit in Reno federal court against the Seenos, accusing them of racketeering, extortion and defrauding him through their partnership.

The Seenos say they have a "confession" by Whittemore in which he admits to using company money to support his lavish lifestyle and maintain his political connections.

Whittemore said he never made a confession or admitted to a crime or fraud, but "under the threat of death and/or bodily injury" prepared agenda items as talking points for a meeting with the Seenos.

Both lawsuits are mired down in legal process, but on Friday a judge could set a trial date in the Clark County case.

Contact reporter Jeff German at jgerman@review journal.com or 702-380-8135. Contact Francis McCabe at fmccabe@reviewjournal.com or 702-380-1039.