ROUND 2

06.06.12

Scott Walker Survives Recall, but Investigations May Zero In on Him

Walker survives his recall fight, but reports he may be the target of two separate probes into shady dealings could still bring him down, reports Matt DeLuca.

Scott Walker faced down Wisconsin’s voters, but he may yet have to do battle with the legal system.

An investigation by the Milwaukee district attorney’s office into misconduct by people tied to the controversial Wisconsin Republican during his two terms as county executive is circling closer to Walker, with one reporter alleging this week that the governor has become the target of both the probe and a separate federal investigation.

The D.A.’s John Doe investigation into associates of Walker during his time as the Milwaukee county executive, launched in 2010, has to date led to charges against six people, including Walker’s former deputy chief of staff. While Walker himself has not been charged with wrongdoing, the investigation is ongoing and over the past seven weeks Walker has transferred $160,000 from his campaign to a legal-defense fund that he maintains is to cover the expense of cooperating with the probe.

A John Doe investigation, similar to grand juries in many states, is a sub rosa investigation in which prosecutors can subpoena witnesses and bar them from publicly discussing the matter under investigation. Walker first met with prosecutors in Milwaukee County in February to discuss the investigation. He denied wrongdoing in a statement at the time, saying that he brought two defense lawyers to the meeting to ensure that he was “in the best position possible to continue aiding the inquiry.”

But the governor’s defense fund has raised eyebrows. Walker has said that the money in the fund will only go to legal fees incurred by himself or his campaign, and not his aides. Though he has not been personally charged with any crimes as a result of the investigation, he has said that he needs the war chest to cover the expense of providing documents to lead investigator and Milwaukee District Attorney John Chisholm, a Democrat.

Walker has continued to say that he does not know himself to be a target of the investigation, and that his defense fund was set up under the guidance of the state’s Government Accountability Board.

But when Walker set up the fund in March, legal experts pointed to Wisconsin statutes that seem to mean Walker would only be allowed to establish such a reserve if he had already been charged or was being investigated in connection with the John Doe probe.

“The only way you can set that up is if you are under investigation or are being prosecuted,” Michael Maistelman, who was representing Russell at the time, told reporters. “One can only draw the conclusion that either one of those two things is happening.”

Walker, though, has continued to say that he does not know himself to be a target of the investigation, and that the fund was set up under the guidance of the state’s Government Accountability Board.

How far down the rabbit hole the investigation may take prosecutors remains to be seen. The trail began in 2010, when the Milwaukee Journal Sentinel reported that a probe had begun into $11,000 that had gone missing from Operation Freedom, an annual fundraiser for military veterans and their families.

While Walker has claimed that his office was responsible for this initial probe, an investigation by the Journal Sentinel reported on May 31 that his office had in fact done everything it could to hamper the work of the district attorney. The paper said that prosecutors hoped that by reclassifying their investigation as a John Doe case, rather than an ordinary investigation, they might be able to circumvent fears of “political embarrassment” on the part of Walker’s county executive’s office.

Walker spokesman Ciara Matthews denied the claims made in the Journal Sentinel article, saying that “multiple follow-ups were made” by former Walker chief of staff Tom Nardelli to see what had happened with the missing Operation Freedom funds.

Video screenshot

Gov Scott Walker addresses supporter after winning Wisconsin’s recall election.

Two county officials who served under Walker have been charged in the probe so far with taking more than $60,000 from the veterans fund: deputy chief of staff Timothy Russell and veterans official Kevin Kavanaugh. The two stand charged of separately taking funds from the veterans’ funds, and using that money for personal expenses as well as to renew the registrations on several of Walker’s gubernatorial campaign websites.

Assistant D.A. Bruce Landgraf’s petition was included in a filing related to Russell’s case, and the former Walker confidante could prove one of the most interesting figures to watch as the case develops. Russell has been charged with pocketing upwards of $20,000 intended for Operation Freedom, about half of the total the fundraiser took in for 2010. He was a longtime aide to Walker who was promoted eight times during his tenure as county executive, and the ties between the two remained close. After becoming governor last year, Walker made Russell his deputy chief of staff.

According to prosecutors, Russell used the funds he took from Operation Freedom for personal expenses including personal trips to Jamaica and Hawaii. As county executive, Walker put Operation Freedom under Russell’s supervision. Russell’s attorney has attempted to argue, so far fruitlessly, that the charges against Russell should be dropped because they go beyond the scope of the original John Doe investigation, but it is clear that the close ties between Russell and his former boss have brought the probe closer to Walker than any politician is likely to find comfortable. The close ties between Walker and his aide were fodder for attack ads leading up to the recall, creating a political climate that last Wednesday caused a judge to move Russell’s trial to September out of concerns that the “publicity mill” could taint the judicial process for Russell, who faces up to 13 years in jail.

On Monday, it came out that Russell’s attorney was the source of documents that the Journal Sentinel columnist relied upon to show that Walker’s office had attempted to stonewall the initial inquiries that became the John Doe investigation. That’s a bad sign for Walker. While it does not seem that Russell has flipped on his boss, it has been speculated that, should he decide to flip, the effects could prove devastating for the governor.

In addition to those who have been charged, 13 people have been granted immunity in the investigation, including Fran McLaughlin, who served as Walker’s spokeswoman from 2007 to 2010. Because of the secret nature of a John Doe probe, only the names of persons who have been granted immunity are made public.

Walker’s press secretary from his time as governor, Cullen Werwie, has also been granted immunity, and other associates have had their lives disrupted in more direct ways. In September of last year, federal agents raided the home of Cynthia Archer in the expanding investigation. An FBI agent told reporters at the time that their raid of the former deputy administration secretary’s Madison residence was part of a “law-enforcement action.”

It is unclear how much impact Democrats’ efforts to make political hay of the investigation had during the recall election. A poll by Marquette University found that of the 77 percent of Wisconsin voters who were familiar with the John Doe investigation, about half said that they thought of the issue as “just more politics.” Challenger Tom Barrett did his best to stoke the flames by repeatedly demanding that Walker hand over more than 1,000 emails sent during his time as county executive. Walker has claimed that by law he cannot release the emails because they are part of the investigation, reasoning Barrett rejected.

“If he’s not a target of this investigation and he has these emails, he needs to release them so we can know once and for all whether this governor—the only governor in this country who has a criminal-defense fund—was involved in this illegal apparatus, this illegal scheme that was operating 25 feet from his office,” Barrett said at a campaign event a week before the recall.

A new wrinkle may have been added to the case this week after Current TV reporter David Shuster reported that sources close to the John Doe investigation said that Walker himself has become the target of the probe, and may be subject to a “possible indictment.” According to Shuster, this development came after Walker’s attorneys pushed for the governor to be cleared of all wrongdoing before Wisconsin voters went to the polls.

A local Wisconsin paper reported that Shuster went a bridge further on Saturday, claiming in a conference call that Walker is in fact the target of a federal investigation. The paper reported that Wisconsin Democratic Party Communications Director Graeme Zielinski was also on the call organized by state Democrats, and quoted him as saying that they have reason to believe that Walker “set up a secret computer network in the governor’s office and Department of Administration offices, and that the John Doe investigation is seeking evidence of crimes he committed in Madison.”