Recusal Time, Again

Bribery Scandal Highlights Conflicts of Interest for AG Sessions and Links to Sen. Strange

Whether or not Attorney General Jeff Sessions survives in office, it won’t silence the hubbub in his home state of Alabama over a major bribery scandal that highlights Sessions’ conflicts of interest and could lead law enforcement to examine the role of his hand-picked successor, Senator Luther Strange, in the controversy.

The mess, which some commentators have started calling “Alabama’s Watergate,” stems from the recent admission by a state lawmaker, Oliver Robinson, that he accepted $360,000 in bribes. According to a Justice Department press release, the payments came both from an executive at Drummond Coal, one of the state’s largest companies, and an attorney at Balch & Bingham, its powerful law firm based in Birmingham. The press release says the bribes were part of a scheme to block expansion of a local Environmental Protection Agency Superfund site full of arsenic, lead, and carcinogenic hydrocarbons that threatened to cost the coal company tens of millions of dollars in cleanup costs.

“This case gets at the heart of public corruption in Alabama,” Robert Posey, the Acting US Attorney in Birmingham, said in June when accepting the state lawmaker’s admission of wrongdoing. “Well-funded special interests offer irresistible inducements to public officials. In exchange, the officials represent the interests of those who pay rather than the interests of those who vote. Here a public official betrayed his community to advocate for those who polluted their neighborhoods.”

Lawyers for Robinson, the bribe-taking lawmaker, say he is cooperating with authorities. And in a state rife with corruption—the governor, the head of the legislature, and the state’s chief judge have all been removed from office in the last year—law enforcement continues to investigate the bribery scandal.

The case is not widely known in Washington, though it has become the talk of Alabama. Luther Strange, who is a frontrunner for an August 15 Republican primary to retain his Senate seat, has seen that primary morph into a proxy battle between the GOP establishment, led by Senate Majority Leader Mitch McConnell, and insurgent forces including informal Trump advisor Roger Stone. Strange’s primary opponents have evoked the corruption case to attack him. And for the White House, the investigation may provide further evidence that Sessions is “beleaguered“—as President Trump recently put it when criticizing his Attorney General for recusing himself in the Russia probe—because of a conflict of interest in that investigation.

Campaign Contributions and Official Acts

Sessions has so far said nothing publicly about the matter.

The Justice Department declined to comment.

In a possible link to the case, a Balch newsletter from December 2015 reports that its lobbyists met with then-Senator Sessions to discuss an emissions issue linked to the Birmingham Superfund site. Sessions has long been critical of the EPA, restrictions on carbon emissions, and other measures opposed by the coal industry. Sessions has also received around $300,000 from Drummond and Balch political action committees as well as from their employees since the late 1990s. Consistently, Drummond and Balch rank among the second and third largest sources of campaign contributions to Sessions.

For Sessions personally, ties to the Balch law firm run deep as, over the years, he has installed various Balch attorneys in key positions on his Senate and Justice Department staffs. One former staffer, who currently practices environmental law as a Balch partner, was at Sessions’ side as an advisor during his confirmation hearings to be Attorney General in January.

Even before Sessions was approved by the Senate and took command at DOJ, he appointed another Balch partner to the sensitive position of  Acting Assistant Attorney General for Environment and Natural Resources at the Department. Among other duties, that division litigates on behalf of the EPA in Superfund cases, and other matters.

Prior to his DOJ appointment by Sessions, the Balch partner, Jeffrey Wood, was a registered lobbyist for another coal industry giant, but apparently not for Drummond. However, earlier this year, Wood recused himself from any matter at the Justice Department involving Balch and “specific matters involving other clients for whom he provided legal services in the last two years.” In a list of those “specific matters,” the Justice Department cited “matters related to the ... Birmingham [Superfund] site,” the polluted zone at the heart of the bribery scandal. Wood’s former Balch partner, environmental lawyer Joel Gilbert, has been identified in the Alabama press as one of two persons designated by the DOJ, though not by name, for having paid bribes related to that Superfund site. Gilbert has not been charged and did not respond to a request for comment.

“We are aware of the recent arraignment of [Alabama lawmaker] Oliver Robinson and the allegations included in the plea documents. We take these matters seriously, and are taking all appropriate steps to assess the situation,” said a spokeswoman for Balch in a written statement to the Project On Government Oversight. “We are cooperating fully with government authorities, and we are deeply committed to upholding the ethical standards of our profession and our firm.”

The Alabama press also identified another bribery suspect as a Drummond executive, David Roberson, who Federal Election Commission records list as a campaign contributor to Sessions. Neither Drummond nor Roberson responded to a request for comment. Roberson has not been charged.

Stranger Danger

Strange himself is likewise no stranger to Balch and its coal company clients. Drummond was Strange’s third top contributor during his time in Alabama state politics, according to a review of campaign finance records maintained by the Alabama Secretary of State. In the ongoing primary race, Strange has received the $5000 maximum allowed contribution from Balch’s political action committee and $5000 from Drummond’s CEO and $2700 from another top Drummond executive.

Another state lawmaker, John Rogers—who also has received thousands in Drummond campaign contributions—reportedly told federal investigators that he too was offered coal company bribes in a meeting attended by Strange when Strange was serving as Alabama’s Attorney General. Strange has brushed aside allegations of his attendance at the meeting as “fake news,” and Rogers has since recanted. But according to press reports, the lawmaker’s account of Strange was shared with several additional persons.

One of those persons turned out to be the President of Alabama’s Christian Coalition, who is running against Strange in the Senate primary and has been endorsed by Trump advisor Roger Stone. The Christian Coalition President announced at a press conference that the lawmaker had told him the same story about Strange’s presence when the bribes were offered to Rogers, and repeatedly labeled Strange, “Mr. Corruption.” Strange fired back, saying, "Anyone who desperately spreads salacious gossip against their brother in Christ needs to hit the confession booth."

As Alabama Attorney General in October 2014 and January 2015, Strange filed letters with the EPA stating that the state would not provide any funding for the cleanup of the Birmingham Superfund site, located in a poor African American neighborhood. The Drummond Co. donated $25,000 to Strange’s campaign two weeks before the first letter in October 2014 and another $25,000 a month after the second letter in January 2015.

In July, another primary challenger to Strange filed a complaint with the Alabama Ethics Commission questioning the timing of Drummond’s contributions and Strange’s letters to the EPA.

Rat’s Nest of Conflicts

The federal bribery investigation is currently headed by an Acting US Attorney who will be replaced if and when President Trump’s nominee for the position receives Senate confirmation.

That nominee, Jay Town, is a county prosecutor who twice advised Strange in political campaigns and whose selection as Trump’s choice was reportedly strongly endorsed by Attorney General Sessions.

Taken together, the tangle of financial and political ties involving Sessions, Strange and Town on one side, and the firms and individuals reportedly under investigation in the bribery scandal on the other, create a rat’s nest of conflicted interests.

The newly filed ethics complaint against Strange and publicly reported allegation of his presence at a meeting where bribes were offered is likely to attract the notice of law enforcement.  

Further complicating matters is the Senate’s tradition of consulting home-state Senators on nominations for US Attorney positions—known as the “blue slip” process. That tradition means Strange would have been consulted in the selection process for Jay Town as the Trump administration’s nominee for US Attorney for the Northern District of Alabama.  As such, Jay Town could end up evaluating Strange’s role, if any, in the Birmingham bribery scandal, as well as deciding on any other subsequent plea bargains or prosecutions in the case.

For this reason, it is imperative that, when Jay Town comes before the Senate Judiciary Committee for confirmation as US Attorney, he be asked to provide an account of discussions he may have had about the bribery case. He must be asked whether two of his political patrons—Senator Strange or AG Sessions (who strongly recommended him for the job)—their subordinates, or anyone connected with Drummond or Balch may have discussed the matter with him.

Any involvement Senator Strange may have had in selecting Town to take over the office leading the bribery probe could cast a shadow on the integrity of the inquiry. Looking ahead, Strange will need to take steps to avoid tainting the Justice Department’s conduct of the case through his influence in Congress—including abstention from a confirmation vote on Town’s nomination. And Town may need to recuse himself from the bribery case as well.

As for Sessions, he said during his own confirmation hearing before the Senate Judiciary Committee, that, “if a specific matter arose where I believed my impartiality might reasonably be questioned, I would consult with Department ethics officials regarding the most appropriate way to proceed.”

And, in this case, DOJ regulations are clear:

“…no employee shall participate in a criminal investigation or prosecution if he has a personal or political relationship with…Any person or organization substantially involved in the conduct that is the subject of the investigation or prosecution; and substantial interest that would be directly affected by the outcome of the investigation or prosecution.”

DOJ’s regulations are in addition to other government-wide standards of ethical conduct that require honest and impartial public service, and the avoidance of “any actions creating the appearance” of a conflict of interest.

Sessions recently said his recusal regarding the Russian interference investigations was "consistent for the Rule of Law and an attorney general who doesn’t follow the law is not very effective in leading the Department of Justice.“

If Sessions remains in office as Attorney General, he must make clear he is not involving himself in any aspect of the Alabama bribery scandal. Regulations require that he formally recuse himself as investigations move forward and decisions are made about whom to charge with criminal offenses, including employees at Drummond and Balch. Given Sessions’ long history with both, not to mention his ties to officials who are or could be involved in the case, he can do no less.

Albert Chen, J.C. Baez, and Daniel Van Schooten contributed to this report.

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