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Name :   Rachel Garner
Organization :   N/A
Post Date :   9/30/2005

General Comments
Comment :  (Quoted by Rachel Garner, who submitted this comment.)

SENATE ETHICS COMMITTEE CHIEF COUNSEL / DIRECTOR RESIGNS

Harris spoke with Victor Baird of the Senate Ethics Committee office  
January 9, and asked him who is responsible for ensuring that FEC  
disclosures are complete. She asked whether anyone had followed up to see  
why Senator
Hagel did not list his positions with the voting  
machine company, and she asked about his characterization of the  
McCarthy Group as an "excepted investment fund" and his failure to  
disclose that it owned ES&S. Baird was silent, and then said "If you  
want to look into this, you'll need to come in and get hold of the  
documents."

Unfortunately, according to Alexander Bolton, a reporter at The Hill,  
when he went to the Senate Public Documents Room to retrieve  
originals of Hagel's 1995 and 1996 documents he was told they were  
destroyed. "They said anything over five years old is destroyed by  
law, and they pulled out the law," says Bolton. However, when he  
spoke with Hagel's staff, they said had obtained the documents from  
Senate Ethics Committee files. Copies of the documents are available  
at OpenSecrets.org/pfds -- a repository for FEC disclosures.

In 1997, Baird asked Hagel to clarify the nature of his investment in  
McCarthy Group on his 1996 FEC statement. Hagel had written "none"  
next to "type of investment" for McCarthy Group. In response to  
Baird's letter, Hagel filed an amendment characterizing the McCarthy  
Group as an "Excepted Investment Fund," a designation for widely  
held, publicly available mutual funds. He never disclosed his  
indirect ownership of ES&S at all, but apparently no one questioned  
this omission, nor his curious characterization of the McCarthy  
Group, a privately held company that is not listed on any public  
brokerage.

Baird told Bolton that the McCarthy Group did not seem to qualify as  
an "excepted investment fund." He reportedly met with Hagel's staff  
on Friday, January 25 and Monday, January 27, 2002. Then, also on  
Monday, he stepped down. On Monday afternoon Baird's replacement, Robert  
Walker,
provided a new, looser interpretation of "publicly available" (though  
experts disagree,
saying that a privately held company like the McCarthy Group cannot be  
called "publicly
available" in order to avoid disclosing underlying assets.)

Hagel's challenger in the Nebraska Senate race, Charlie Matulka,  
wrote to Baird in October 2002 to request an investigation into  
Hagel's ownership in and nondisclosure of ES&S. Baird replied, "Your  
complaint lacks merit and no further action is appropriate with  
respect to the matter, which is hereby dismissed," in a letter dated  
November 18, 2002.