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Political Prosecution of Elliot Spitzer

By Larry Johnson on March 11, 2008 at 5:16 PM in Current Affairs

As someone who has been involved in money laundering investigations for more than a decade, the explanation for how the Feds “stumbled” on Elliot Spitzer’s filandering stinks to high heaven. I have a very libertarian attitude on the issue of prostitution. What two consenting adults do is their own business. Of course, Spitzer is married and he has some explaining to do to his wife. But again, that is between them. And yes, I know prostitution is against the law, but it is a stupid law.

Scott Horton was first out of the blocks throwing a penalty flag on this nonsense. See his post The Spitzer Sex Sting: A Few More Questions. The explanation that the banks reported “suspicious” activity does not wash. The amounts involved were not large enough to trip such reporting. There is no denying Spitzer put himself into this position and partisan prosecutors will exploit the hell out of it. But this is a gross abuse of prosecutorial power. Spitzer’s standing as a living morality play just set him up for the colossal fall. A tragedy all around.

S. Markom

We agree on the legality of the oldest profession.

But it’s apparent you have not been following Spitzer’s brief stint as Governor or recall his tenure as Attorney General.

As Attorney General he made a big issue out of prosecuting prostitution rings. He cannot have it both ways.

As Governor he is being investigated for abuse of office regarding what is called Choppergate. When he first came to office he warned the oppositions Assembly leader not to get in his way because he was a “F–king Steamroller.” Then there was his unilateral move to try and give driver’s licenses to illegals which did not even have the support of his own Party. He had become an embarrassment to his own party and his re-election was doubtful – now it’s zero.

Other than the press reports I’m not sure of the details and I would hope that with a condition that he resign he will not be prosecuted.

The only person who abused his position was Spitzer himself and Democrats in NYS know that. The last thing NYS needed was another high level scandal like that of Alan Hevisi who was forced to resign.

alexei

I disagree with your supposition that the only person that abused his position was Spitzer. Scott Horton and ABC news has brought out the serious problems with the DOJ and the targeting of Democrats. This is the worst case of abuse of power and must be stopped. These are serious issues and underlay our whole structure of democracy.

I agree that Spitzer is culpable and a hypocrite. That said, I don’t want him to resign until all the questions that Mr. Horton’s has presented have been satisfactorily answered; and if there are any abuses by the Federal Government, they must be addressed in the appropriate manner. Whatever Spitzer did pales in comparison if is shown that there was a witch hunt perpetrated by the DOJ to malign and overthrow a duly elected official.
joe

I couldn’t agree more. This guy made his own bed and he willfully enagaged in this illegal activity for several years. I don’t care how they found out about it. He intended to beak the law when he ordered these hookers across state lines and when he set up dummy corps to engage in wire fraud.

Spitzer engaged in numerous overzealous prosecutions and it is only fitting that he be brought down by one. The only way to really beat a bully is to stand up and beat him at his own game. He got exactly what he deserved.

CK

The Mann act is still on the books. Still a federal offense. The transportation or arrainging for the transportation across state lines of woman/women for purposes of prostitution or debaucery is a federal offense.
Smurfing, or structuring financial transactions so as to avoid triggering the $10,000 transaction reporting requirement is also a federal offense.
But there is an interesting question so far unasked. who are numbers 1-8.
There is another question: were these exquisite ladies paid from his personal accounts or did he do a Rudy and charge them to his office account?
At least one report of the search of the manager’s apartment mentioned that the manager held an Israeli passport among others. Might be that Spitzer ran his member into a mossad honey trap.

http://NoQuarterUSA.net Larry Johnson

Smurfing is a specific type of structuring, and Spitzer clearly was not smurfing. Smurfing refers to guys who work for Colombian drug traffickers who are tasked on a daily basis to feed money into multiple accounts. And yes, the Mann act is still on the books, but if Kristen reports she actually paid her way to Washington, DC and that the sex was consensual, will be difficult for a slam dunk case.

I’m not arguing Spitzer was a saint or is being abused. But there is something more going on here.

BlueStateGirl

The FBI affidavit indicates that “Client-9″ paid for everything: train tickets, cab fare from the hotel and back, mini-bar or room service, travel time and hotel. (See graf 74 at top of page 2)

Does that make a difference?
CK

Actually he was smurfing as defined in the law.
That he is not a columbian drug lord is not relevant, the law does not restrict itself to finanacial transactions made by columbians. Banks are supposed to report all smurfing type transactions. Spitzer made multiple wire transfers out of various accounts and into a specific shell company account. And he asked his bank to remove his name from the wire transfers.
As a high powered prosecutor/gouvernor he might have some reason to believe that his bank would apply the proper noblesse oblige and assist him in breaking the law. They didn’t. When a gouvernor starts smurfing one can think that blackmail or kickbacks might be involved, to find that it was good old fashioned slap and tickle is a comedown of course, but once the machine is in motion it does tend to stay in motion.
The sex was a financial transaction, consensuality has nothing to do with prostitution as a crime. Sex for money without a wedding ring is illegal. An argument about whether it should be illegal has not much merit unless one is hoping for jury nullification. Prosecutors have a huge dislike for jury nullification and for those who would do their citizens duty to judge both the facts and the law.
Is there something more going on, probably. Self righteous braggarts and bullies often create enemies. Bruno in upstate NY is not a fan, the wall street types are enjoying Spitzer’s downfall, several dozen people who are in prison for running prostitution rings are smiling at the thought of their former nemesis prosecutor sharing living quarters with them.

http://NoQuarterUSA.net Larry Johnson

Ck,
You are wrong. Smurfing involves moving proceeds from illegal sources into bank accounts. The term was coined because Colombian drug lords employed folks who were tasked everyday to deposit money from drug proceeds into bank accounts in order to repatriate the money to Colombia.

Nothing that Spitzer did qualifies as Smurfing. You do not know what you are talking about.

CK

And how does one tell if the sources are illegal? He smurfed. The transactions looked like smurfings and were followed up as if they were illegal smurfings.
The law assumes that structuring transactions this way is evidence of illegal behaviour.
Structuring transactions so as not to trip the $10,000 mandatory single transaction reporting requirement is illegal. It does not matter whether the source of the funds was illegal. Your bank will rat you out to the feds, the irs, any anyone else they might be secretly required to.
So)
1) He moved monies from his accounts in multiple transaction in quantities below the manadatory single amount for reporting.
2) into a shell company account
3) asked his bank to remove his name from the transfers.
It qualifies.
The specific term “smurfing” did indeed come from the multiple little blue columbian money launderers. The law against Structuring ( smurfing ) went a bit farther in defining what would qualify as a smurf. Smurfing, it’s not just for Columbians anymore.

Cee Hussein

CK,

I read about this on YNet. The guy had three passports and it did make me think of what happened to McGreevy.

Spitzer investigated the misuse of money for Holocaust in the past.

Cee Hussein

Holocaust victims

Fleaflicker

This really does not pass the smell test. While I personally disapprove of prostitution I don’t think there is anything wrong with it between consenting adults. If people are stupid enough to pay for it then so be it.

These suspicious sums reported by the bank are suspect in themselves. How much money could they possibly be talking about for a prostitute? Was Spitzer really getting laid by prostitutes that frequently without his wife knowing something was up? And were they really worth that much money?

I think some people have been out to get Spitzer for a number of years. It looks like they got their chance. And took it.

CK

6 years
$1500-$4300 an hour.
Price is an objective thing, value is subjective.
I would appreciate knowing whatever tricks the ladies might possess that makes their hourly rate so much higher than the market clearing rate.
The banks really do not have a lot of leeway, thanks to the bedwetters who passed the Patriot act and its many kin, an american’s money is not really his at all. The banks have to report single transactions of $10,000 or more. They also have to report “patterns of transactions that have the appearance of being done only to avoid triggering the single amount report minimum.
Frequency of interaction is an unknown so far.
Maybe he was using HGH or Cialis or some other chemical aid.
If the activities end up going to a jury trial, Spitzer can only hope that one of the jury members believes in Jury nullification. It would be ironic and delicious for a prosecutor to find himself in need of a nullifier.

simon

I swear to god I thought smurfs had to do with Europeans.

And I have been seeing so many around, just on the TV, in the stores, oh, for god’s sake, in my dreams, those blueboy smurfs.

zGlad I understand the term, now…

lololololololol…
Cee Hussein

The banks really do not have a lot of leeway, thanks to the bedwetters who passed the Patriot act

CK,

Unfortunately Spitzer supported these overreaching measures

http://powerofnarrative.blogspot.com/

Shortly after the attacks on the World Trade Center, Gov. Pataki along with Attorney General Spitzer wrote the grossly overreaching Anti-Terrorism Act of 2001. Much like the federal PATRIOT Act, the Anti-Terrorism Act attempted to curtail our civil liberties in the name of national defense.

The Act sanctions “roving” wiretaps of US citizens, expands the definition of terrorist activity to include money laundering [TRIPLE IRONY ALERT!!], and eliminates the statute of limitations for all “terrorist” offenses. The Act also permits the prosecution of suspects despite a pending or prior federal prosecution, and among further offensives, Spitzer and Pataki’s bill prevents suspects from being freed due to a “technicality,” i.e. an unlawful action made by investigators and law enforcement officials in complying with federal search and seizure regulations.

BlueStateGirl

This really does not pass the smell test.

Scott Horton is on to something. Think Don Siegelman. This is for maximum humiliation.

barbh

I think it smells to high heaven also. Even Chris Matthews, was questioning it last night at one point.

It made me feel a little less tin foil and in denial when he did that. The reinforcer for me was when I read the report from ABC that Scott Horton references and to my great suprirse, they were going after him specifically!!

A very wealthy person moving this amount of money around sets off bells? It just isn’t logical to me. The ABC report also references that they thought he was being bribed, you don’t usually take money out of your account when you are being bribed, you get it put in! The withdrawal was raising bells?

Maybe I read too many mysteries, but the whole thing seems odd to me. I think Mr. Spitzer made too many powerful enemies or just the fact that he is a Dem gov. Whether he was a good governor for the state of NY? Since I’m not a resident, I won’t pass judgment.

Heartbreaking for his family. It really looks more and more to me that they were out to get him. I really don’t see that it was anybody’s business what he did. I found it interesting also in the PDF, that they were sure to record all the details that would be relavent to the Mann Act on the wiretap, that alone made me suspicious. Another thing I thought odd, was that the article said that the ring made a million since 2003 or 2004. I thought to myself, they only made a million at the rates they are charging? That just didn’t sound quite right to me, but perhaps they are hiding it somewhere….
Patrick Henry

Larry..

Looks like Spitzer just got caught up the Middle of Ongoing Federal Organized crime Investigations..Wire Taps.. and Recent Arrests..

Spitzer, of All People ..should have known Better..
Just like LIBBY..
MataHarley

According to today’s Newsday article, he broke down the over $10K payment in several wires, then called the bank after the fact, asking them to take his name off the wires.

The bank noted that was impossible as the wires left, then filed the SAR because (FTA:) “the transfer of the money that exceeded $10,000, but had been broken down into smaller amounts, the sources said.”

The FBI picked up on it, fearing there was a blackmailer involved. According to the article, it surprised them it was fees for service instead.

I agree that the oldest profession in the world doesn’t trigger my ire. It is, however, offensive that one who made a name, crusading on busting prostitution rings, also indulges himself. It is, at best, indication of a dual standard. An inherent attitude that is unacceptable as an elected official.
Taters

It is unfortunate. The right wingers are pissing with glee.
yttik

Thank you Larry, for validating what I have suspected. This case smells funny.

Obviously the response to it is all out of proportion, David Vitter and Larry Craig are still employed. Spitzer hasn’t even been charged yet and they’re already talking impeachment. Also the news mentioned that he may not be charged at all if he just resigns and goes away. That sounds kind of like extortion to me.

I also remember attorney-gate and how some attorneys said they were canned for not particpating in politically motivated prosecutions. In Wa state, specifcally for not prosecuting fabrications of election fraud and delivering the governor’s office to the Republicans. So there is a precedent for politcally motivated prosecutions and people should be suspicious.
jwrjr

Spitzer absolutely should have known better. That, by itself, makes the whole thing stink that much more. Sort of like Monica Lewdinsky. I wouldn’t be surprised if it is discovered some time in the future that both cases were set up by the repubs.

CK

How exactly do you set up a man to spend 80K on hookers over an extended period?
Bill Clinton had a long time reputation as a horndog. Putting a pretty little thing in a thong into his office staff might be doable. Making sure he hit on the pretty little thing is not a guaranteed slam dunk.
Spitzer went to the escort service, it didn’t come to him. As far as we can see, he did not get a discount on the services.
I am neither a shrink nor a defense attorney, why Spitzer bought sex is for others to examine.
As a generality, purchased sex is really two things, the sex which might be something one cannot get or cannot get in a way he enoys at home, and the knowledge that the seller will not be there in the morning. Hollywood movies aside, purchased sex is not a gateway drug to love and marriage.
And even at 5500 an hour, it is still just a piece-work job.

Mr.Murder

It seemed too clean a break. granted it was indeed a bad break for Spitzer.

They were phishing his finances.

It does not remove the culpability. However, the worst way to be seen smurfing is to donate the minimum amount to a campaign as a flag that you’re working low end items. Why not stay one dollar under and forgo disclosure? Because it sending a signal to those you back that results will come your way if you continue to thread the web of paybacks.

It’s traditional nomenclature for such items. A certain candidate right now had just such a flag go up regarding some questionable business in his state.

As for Eliot, he got off light, he’s not taking money from the same ones he’s paying. Usually that’s the way you protect your own stake in the illegal enterprise. Work off the presumption that people in it to the level you are will be motivated by their own self interest to avoid disclosure.
QuietOne

I don’t doubt that Spitzer was a target, but you might want to look into SAR a bit more. That is an issue in itself. You may have been reported, too. The standard is not limited to only a specific monetary amount. It is a real “Big Brother” standard now and the bank standard for generating a report is governed by CYA.
QuietOne

Also, maybe this was just a “Pretty Woman” type of prostitution, but you have to look at a lot more than that surface before making that determination. Trafficking, slavery, underage girls, violence, drugs, and lots of other unsavory things often go along with that business. What else was going on? Do we know?
Mary

Am I the only one appalled that some bank can just go rifling through a bank account to see what you are spending your money on? First illegal wire tapping, and now nosey bankers? They could actually be potential blackmailers.

CK

Not some bank
All banks
Not some accounts
All accounts
Supposedly this makes you more secure.
You could have voted for someone who would actually work to repeal these laws.
Instead you have a choice among three candidates who love these laws.
I find cash in hand is nice stuff. And given that any savings account you might find pays less in interest than the prevailing rate of inflation, cash in hand is not a bad form of security.
Except that if you are stopped by a security officer, and you have cash on you, the cash can and will be confiscated as proof of nefarious behaviour on your part.
yttik

You’re not the only one. I’ve been appalled by how much power banks have and how much they can violate your privacy. If you make a big enough deposit or withdrawl they notify the IRS. You’re contantly being tattled on and your job becomes always having to be prepared to defend yourself. It’s your money, but you always have to be able to justify how you got it and how you’re spending it. It might make sense if they’re tracking foreign billionaires or something, but when it comes to a dinky company like me doing payroll or paying bills, it gets annoying. And invasive. And time consuming.

Cee Hussein

yttik,

Last year I gave a contractor a check to pick up extra supplies he needed. He went to my bank to cash it. They didn’t want to give him the money!!
I almost had to show up in person.

bob h

Spitzer’s status as a high elected official obviously affected the bank-IRS reporting requirements (as though a filthy rich man like Spitzer were taking bribes). What is to stop them from doing this to any high elected Democratic official?
mimi

Come on people! This is about HYPOCRISY! No one cares about the sex or the money he spent on it or how he got busted. This is about a man with such a tremendous EGO, ARROGANCE and in-your-face attitude. It’s about someone who was faililng MISERABLY at governing. Someone who rode to office with a HUGE LANDSLIDE victory due to his posturing and proclaimations for change and cleaning up gov’t. People believed him, I believed him and gave him my vote. And he turned out to be a LIAR and a FRAUD.

Now who does this remind you of??? Instead of defending this dead-in-the-water loser, we should be using this to our advantage about the difference between posturing and governing. About substance and the lack of.

Come on people….. let’s make it work!

yttik

Maybe he is a liar and a fraud. But we’ve got someone in the white house who lied about WMD and has caused the deaths of thousands of troops and close to a million Iraqis. So where are the calls for him to resign? Where are the threats of impeachment? Where are the criminal charges?

And speaking of simply lying about sex, why do Vitter and Craig still have their jobs?

CK

They still have there jobs because they did not prosecute and jail any prosties. They still have their jobs because they only vote to criminalize consensual sex between people of the same sex.
The fraud in the white house will have served fully his two terms, he will start another war sometime before election day under the belief that Amurcans will not elect a black or a woman when the country is in a real war.

Cee Hussein

Mimi,

I told you when the story broke that I suspected something more was going on.

Who decided to target him?

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http://www.ThisCanadian.com BlueBerry Pick’n

La rage
The Thieves of Virtue: legislating morality undermines representative government.

…if enough laws legislate morality, no representative gov’t official is beyond the reach of legal intimidation…

think about it.

is it a crime because its a crime…? or because its VICE crimes make it easier for Power to keep their feet on your Human Rights-seeking neck?

… how exactly does *a vice crime* impact one’s ability to do their job? the fact a vice is a policed & monitored *activity*… not the activity… thus, you create a society where *nobody is perfect enough to do their job on THE ELECTORATE’s behalf*… & for whom does that works out?

isn’t government about putting a representative in place to potentially level the playing field so we have a *shot* at justice in a culture where Money & Power have no interest in our free participation?

its about our COMPLIANCE & SUBMISSION.

“Serf-fulfilling” @ Montebello: Police accused of using provocateurs at Security & Prosperity Partnership Summit

Are we naturally mean? thoughts on Howard Zinn’s “The Myth of the Killer Instinct“

Join the Revolution: get laid

~~~
Spread Love…

BlueBerry Pick’n
can be found @
ThisCanadian
~~~
“We, two, form a Multitude” ~ Ovid.
~~~
“Silent Freedom is Freedom Silenced”
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http://www.economyincrisis.org/ Shroomduke

Eliot Spitzer was “taken out” because he stepped on too many toes, this is part of the Bush Cabal’s “WAR ON WHISTLEBLOWERS”!

“In 2001, Spitzer investigated subprime-mortgage giant Household International for misrepresenting the terms of loans. Household paid $484 million—at the time, the largest settlement for victims of predatory lending ever.”

Any questions?

Remember the Sheriff?
A.G. Eliot Spitzer nearly arrested the subprime crisis. http://nymag.com/news/intelligencer/51831/

http://saveandrewgarib.com/?page=templates/article&articleid=140

OK, maybe I am paranoid but, what if the Economic Disaster was engineered? Three questions come to mind,
1. who?
2. why?
3. how?
Why would anyone burn down his home or business? Sounds insane but it happens.

Who, Those who stand to gain Wealth & Power
Why, For Finnancial, Political and personal reasons
How, This didn’t happen overnight and it is a long and complex issue but I suggest anyone interested does their own research! The answers are out there… do du dooo do duuu

google “Economic Disaster Engineered”

This is no accident, you can NOT screw up this badly by mistake!

Larry Johnson (Bio)
@noquarterusa

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