Sworn statements from at least four Democratic Party officials and Carey campaign consultants tell a different story.
These officials, in little-noticed testimony before a Senate committee and in a continuing criminal probe in New York, portray McAuliffe as a prime mover in a plan to find Democratic contributors for Carey's faltering 1996 re-election campaign in exchange for Teamsters contributions to Democratic Party accounts.
The testimony depicts McAuliffe, a close friend of former President Bill Clinton and one of the party's most prolific fund-raisers, as one of the main intermediaries between Carey's campaign and the Democratic Party.
In the end, the Democrats apparently never found a donor for the Carey campaign, but it was not for lack of trying. According to trial testimony and statements given to Senate investigators, the effort began in April 1996 and continued through much of the general election campaign that year.
So far, in addition to the Carey indictment, federal prosecutors have obtained convictions of four former Carey aides on charges that they sought to launder union funds through outside organizations into the Carey campaign. Under federal law, it is illegal to use union funds to pay union campaign expenses.
Given testimony suggesting McAuliffe's repeated efforts to find a donor for Carey's campaign, McAuliffe's statements may take on new importance as he assumes the reins of the party and as federal prosecutors in New York intensify their probe of the 1996 Teamsters election.
After a yearlong lull, the U.S. Attorney's Office in Manhattan three weeks ago indicted Carey on charges that he lied to investigators when he said he knew nothing about aspects of the money-laundering scheme.
"From the position he [McAuliffe] is in right now, merely being called as a witness in this case would just be devastating to the party," said Richard Leebove, a consultant to Teamsters president James P. Hoffa. "You bring him in in any way, that is a problem."
McAuliffe, through a spokesman, declined to discuss the case. But his lawyer, Richard Ben Veniste, said McAuliffe was assured by federal prosecutors that he was not a target of the probe.
"This matter has been reviewed time and again, and every time Terry McAuliffe said something that put him in the public light, once again there is this regurgitation," Ben Veniste said. "He was not a target of the investigation, and he has had no further contact with [authorities] since he received these assurances three years ago."
McAuliffe's own account of his actions in connection with the Carey campaign in 1996 has changed over time. When first questioned by Senate investigators under oath on June 6, 1997, he said he knew nothing about the case.
"I didn't do anything with the Teamsters," McAuliffe told investigators. "Someone, obviously at the Teamsters ... contacted me [and] said they wanted to be helpful, as simple as that."
Later that year, in another deposition before Senate investigators, McAuliffe said he was surprised when news of the scandal broke.
"All I know is, when the first story or when the first stories on the Teamsters came out, I didn't have a clue about any of this," he said, referring to the Carey fund-raising effort.
In the same deposition, McAuliffe said that at one point in 1996 he was approached by Carey campaign consultant Martin Davis, who offered to raise Teamsters money for the Democrats. McAuliffe told investigators he turned the matter over to another DNC fund-raiser. He said he had no specific recollection of Davis' asking him to help raise money for Carey.
"I don't remember him specifically asking for that," McAuliffe testified. "Could he have said: `Terry, I'd love it if you could help me. I am running Ron Carey's campaign'? I don't remember it. He certainly could have. I don't recall it. But once he was out of my office, I was done with it."
Then, on Feb. 4, 2001, the day after he was elected Democratic National Committee chairman, McAuliffe appeared on NBC's "Meet the Press" and said: "We [Democratic officials] discussed it. We decided we wouldn't touch it. We didn't do any money."
The Senate investigators, working for the GOP-controlled Senate Governmental Affairs Committee, reached this conclusion:
"In sum, the committee concludes that Terry McAuliffe and/or other officials of the DNC participated in efforts to engage in a contribution swap scheme. Such efforts included soliciting an illegal contribution for Carey's campaign."
Since the committee issued its report March 10, 1998, federal prosecutors have elicited additional testimony from witnesses who contend that McAuliffe took an active part in trying to find a contributor for Carey's campaign.
According to testimony by Richard Sullivan, former finance director for the DNC, in the criminal trial of former Teamsters political director William Hamilton, McAuliffe initially approached him with a proposal to find a donor for the Carey campaign in April 1996.
Sullivan testified that McAuliffe told him that if Democrats were able to find a contributor for Carey, they would be more likely to get money from the Teamsters, "possibly up to a million dollars."
According to trial testimony and evidence obtained by Senate investigators, a short time later Sullivan and Democratic fund-raiser Laura Hartigan gave Davis, the Carey campaign consultant, a memo instructing the Teamsters to make $236,000 in political contributions to various state Democratic parties around the country. The contributions were credited to McAuliffe on Democratic tally sheets that keep track of how much money fund-raisers bring in.
"In your conversations with McAuliffe [and other union and Democratic officials], was it clear to you that raising money for the Carey campaign was linked to getting money from the Teamsters union?" Sullivan was asked during the trial.
He answered yes.
By early July, according to sworn testimony from various Democratic officials, Sullivan and other Democratic Party fund-raisers thought they had found a Democratic donor for the Carey campaign in Judith Vasquez, a Filipino businesswoman.
According to testimony before the Senate Governmental Affairs Committee, Vasquez, who was contacted by DNC fund-raisers with the proposal, had agreed to make a $50,000 contribution to the Carey campaign. But she pulled out of the deal after her lawyers told her it likely would be illegal.
McAuliffe's efforts to find a donor for the Carey campaign continued into the fall, according to testimony. Matthew H. Angle, then executive director of the Democratic Congressional Campaign Committee (DCCC), testified in the Senate investigation that McAuliffe approached him at least once during the fall of 1996 to see whether he could find someone to give money to Carey's campaign.
"I initiated a discussion with Terry on other matters related to fund raising," Angle told Senate investigators in sworn testimony. "In the course of the conversation, he brought up or asked if we knew anybody that could or would write a check to Ron Carey and that if we could help Carey, then perhaps we could get contributions back to the DCCC."
One other Democratic aide, Rita M. Lewis, then the deputy executive director of the Senate Democrats' fund-raising political action committee, remembered a similar conversation with McAuliffe in his role as head of a Democratic fund-raising group called Unity 96, which sought to coordinate fund raising between the DNC and the Senate and House Democrats' PACs.
"Terry said that if ... we could find a donor for Ron Carey's election, they'd be more apt to give Unity 96 donations," Lewis said.
Lewis' testimony was later corroborated by Sullivan, who testified in the Hamilton trial that he remembered McAuliffe raising the issue of contributions for the Carey campaign as many as three times at Unity 96 meetings.
During the Hamilton trial, Carey's campaign manager, Jere Nash, testified that he, too, understood McAuliffe would be raising funds for Carey. Nash testified that he had been assured by Davis that McAuliffe was trying to find some money for the Carey campaign. Based on those assurances, Nash said he repeatedly urged Carey to call McAuliffe to thank him.
(c) 2001, The Philadelphia Inquirer.
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