Menendez Denies Wrongdoing Amid Political Corruption Probe

U.S. Sen. Senator Robert Menendez addresses the media in advance of an event with U.S. President Barack Obama December 15, 2014 at Joint Base McGuire-Dix-Lakehurst, New Jersey.

Photographer: Mark Makela/Getty Images

U.S. Senator Robert Menendez denied wrongdoing and vowed he won’t leave office as the Justice Department is said to be preparing corruption charges against the New Jersey Democrat.

“I have always conducted myself appropriately and in accordance with the law,” Menendez told reporters in a defiant tone Friday night in Newark. “I am not going anywhere.”

Menendez faces a grand jury inquiry into whether he illegally promoted the business interests of a friend and campaign donor, Salomon Melgen, a Florida ophthalmologist. The U.S. Justice Department will probably seek charges in the next few weeks, said a person familiar with the inquiry who asked not to be identified because it isn’t public.

Investigators are probing the senator’s actions for the eye doctor in a billing dispute with the Centers for Medicare and Medicaid Services and in Melgen’s effort to offer port security services to the Dominican Republic.

“As to Dr. Melgen, everyone knows he and his family, and me and my family, have been real friends for more than two decades,” said Menendez, 61. “We celebrate holidays together, have been there for family weddings and funerals, and have given each other birthday, holiday and wedding presents -- just as friends do.”

Menendez read a statement in English and Spanish, chopping the podium with his hand for emphasis at the Newark Hilton. He declined to answer questions, citing the investigation.

Holder Approval

CNN reported earlier Friday that Attorney General Eric Holder had approved a request by prosecutors to proceed with the case. Holder, traveling with President Barack Obama in South Carolina, declined to comment.

Menendez, the top Democrat on the Senate Foreign Relations Committee, was its chairman until January when Republicans took control of the chamber. A former U.S. representative, he was appointed to the Senate in 2006, was elected to a full term later that year and won re-election in 2012. He served as chairman of the Democratic Senatorial Campaign Committee during the 2010 campaign.

The Justice Department’s Public Integrity Section and the Federal Bureau of Investigation began the probe two years ago in Florida. It has shifted to a federal grand jury in Newark, where a Melgen family member testified late last year, according to another person familiar with the matter.

$8.9 Million

The U.S. ruled in 2009 that Melgen overbilled Medicare by $8.9 million in 2007 and 2008 for an eye medicine he uses on patients in his four South Florida clinics. Melgen also owns a company that sought to provide X-ray inspection services of shipping containers at Dominican ports. That firm has been unable to get the Dominican government to honor the contract.

Menendez previously said he wrote a $58,500 check in 2013 to reimburse Melgen for two 2010 trips the lawmaker took to the Dominican Republic on Melgen’s private jet.

In 2012, Melgen’s business gave more than $700,000 to Majority PAC, a super-political action committee that supports Democratic Senate candidates. The committee spent $582,500 to help Menendez win re-election.

Melgen’s one-story brick house in a gated community of North Palm Beach, Florida, had five SUVs and luxury cars parked in its driveway Saturday. A woman identifying herself as Melgen’s sister said through a cracked door that the eye doctor wasn’t home.

In a 2013 interview with Bloomberg News, Melgen said, “The senator and I have become like brothers, like friends.”

“I talk to him weekly. I see him once a month. Not right now, since this whole thing has started. But we enjoy each other’s company,” he said. “To me, he’s the leader of the Hispanic community. I believe in him.”

Menendez has visited Melgen’s Dominican house “many times,” as well as his home in North Palm Beach, he said.

Two Raids

U.S. agents have twice raided Melgen’s offices as part of the Medicare billing probe. Menendez’s office has said he sought to clarify regulations that led the agency to rule that Melgen overbilled Medicare.

Should Menendez step down or be forced to resign, Governor Chris Christie, a potential Republican candidate for president, would seek to build support among primary voters by appointing a conservative, said Brigid Harrison, a political science professor at New Jersey’s Montclair State University.

Harrison isn’t expecting a vacancy.

“Menendez, who has been the subject of numerous investigations, would probably not step aside in any big hurry,” she said, adding there are few “repercussions for staying in office.”

Christie declined to comment on the matter Friday night in Florida, where he was giving the keynote address at a fundraiser for the Republican Party of Palm Beach County.

Grand Jury

On Feb. 27, the New Jersey Law Journal reported that two aides to Menendez had refused to answer questions by the grand jury. The Law Journal cited a sealed opinion inadvertently posted on the website of the U.S. Court of Appeals in Philadelphia and then withdrawn because it involved a confidential grand jury investigation.

The Law Journal cited the following from the opinion:

Menendez and his staff met on June 7, 2012, with Marilyn Tavenner, then the acting administrator for the Centers for Medicare and Medicaid Services, to advocate on Melgen’s behalf in the billing dispute. Menendez later called Tavenner to follow up, and Menendez and Nevada Democrat Harry Reid, then the Senate majority leader, met on Aug. 2, 2012, with Kathleen Sebelius, then-Health and Human Services secretary.

On the port security contract, Kerri Talbot, Menendez’s former chief counsel, sent an e-mail to a staff member at U.S. Customs and Border Protection. She asked the agency to refrain from donating used screening equipment to the Dominican Republic to help a contractor controlled by Melgen make a sale.

Speech or Debate

The dispute before the appeals court involves Talbot and Michael Barnard, a legislative assistant on health-care issues, who were called to testify and said they wouldn’t answer questions, citing the Constitution’s Speech or Debate Clause. Courts have interpreted the clause to mean lawmakers and their aides can’t be prosecuted for legislative acts.

Barnard refused to answer 50 questions before the grand jury about Menendez’s conversations with Tavenner and Sebelius, and communications between the senator’s office and Alan Reider, a lawyer and lobbyist for Melgen at Arnold & Porter LLP in Washington.

Talbot refused to answer grand jury questions about whether Menendez would invoke the Speech or Debate Clause to challenge the government’s use of e-mails with Customs and Border Protection.

U.S. District Judge Anne Thompson granted a motion by prosecutors on Nov. 25, ruling that the aides must testify. In its Feb. 27 ruling, a three-judge appellate panel reversed that decision and returned the matter to Thompson.

The judge must analyze each communication in dispute to determine whether it is a legislative act or not. If considered legislative, the aides can claim that the Speech or Debate Clause applies.

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