The indictment accuses Harvey Whittemore of devising a scheme to solicit campaign contributions from family members and employees in 2007 and skirt federal election law limits by reimbursing them.
Neither the indictment nor prosecutors identified the recipient of the contributions that sparked the federal indictment, but suspicion has swirled in Nevada that it was Reid.
Whittemore has donated thousands of dollars to Reid, Republican Sen. Dean Heller and Democratic Rep. Shelley Berkley, but Reid got the bulk of the donations: more than $100,000 in a single day in March 2007 from Whittemore, family members and employees of his former company, Wingfield Nevada Group Holding Co.
In March, as it became clear Whittemore was the target of a federal investigation, all three politicians said they would donate his contributions to charity. The indictment says Whittemore concealed his scheme from the elected official, and a spokeswoman for the Justice Department says that person is “a potential witness,” not a defendant.
Reid had no knowledge that Whittemore’s contributions to him or other federal officials were allegedly unlawful, spokeswoman Kristen Orthman said Wednesday in a statement.
“Sen. Reid believes that this is a very serious matter, and he has full confidence in the American justice system,” Orthman said.
Whittemore, 55, of Reno, was charged with one count each of making excessive campaign contributions and making contributions in the names of others, and two counts of making false statements to a federal agency. Combined, the charges could get him 20 years in federal prison and $1 million in fines.
Dominic Gentile, Whittemore’s lawyer, said in statement to The Associated Press that Whittemore “always acted in a law abiding manner, well within his constitutional rights and with complete transparency.”
“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 statement said.
A judge signed a warrant for his arrest, but authorities said they expected he would surrender for a court appearance Thursday in U.S. District Court in Reno.
Whittemore was once a powerful figure in Nevada politics and legal circles. As a lobbyist, he represented big casino clients and tobacco companies, and was a partner in the Lionel, Sawyer & Collins law firm. He now has a small private office in Reno.
He was also a developer with big dreams for a sprawling Coyote Springs master-planned community about 60 miles north of Las Vegas. The plan was to build 160,000 homes and a Jack Nicklaus Signature-designed golf course on 43,000 acres off U.S. Highway 93 straddling the Clark and Lincoln county line.
In 2004, Congress agreed to accept $10.4 million from Whittemore to move a federal power line easement across U.S. 93 to allow the development to proceed. But the development has been in limbo since the economy soured and Nevada’s once booming housing market imploded.
Prosecutors allege Whittemore met with the unnamed politician in February 2007 and agreed to try to raise $150,000 for the official’s campaign committee.
Reid had become the Senate majority leader several weeks before, after Democrats won the upper chamber majority in 2006.
The following month, Whittemore solicited employees, family members and their spouses to make maximum campaign donations and reimbursed them with personal checks and wire transfers, according to the indictment.
On March 28, 2007, authorities allege that a Whittemore employee transmitted $138,000 in contributions to the elected official’s campaign committee. Two weeks later, the campaign committee “unknowingly filed false reports with the FEC stating that the conduits had made contributions, when in fact, Whittemore had made them,” prosecutors said.
Prosecutors also allege Whittemore tried to conceal some of the reimbursements by telling employees they were bonuses, and at times gave them back more than their original campaign donation.
Federal law in 2007 capped individual campaign contributions to a candidate at $4,600. The law also prohibits making contributions in another person’s name to hide the identity of the true donor.
The investigation into Whittemore’s campaign contributions began after his former business partners, Thomas Seeno and Albert Seeno Jr., filed a civil lawsuit against him in state court in Las Vegas accusing him of misappropriating millions from Wingfield Nevada Group to support a lavish lifestyle including private jet flights, home improvement projects and entertainment.
Whittemore responded with a civil lawsuit in federal court, saying the Seenos were falsely accusing him of fraud and embezzlement.