Post Number: 450
Best of Black Box?
Votes: 37 (A keeper?)
|Posted on Monday, May 9, 2005 - 3:18 pm: ||
by Bev Harris & Kathleen Wynne
Large payments from Diebold are fueling influence-peddling for a $45 million Cook County/Chicago voting machine contract. Diebold has been lobbying both Ohio and Cook County/Chicago through a small corporation called ACG Group LLC, formed by a Republican and two well-connected Democrats. According to one of ACGs partners, Diebold is making payments directly to the individuals and payments are also flowing through ACG. These payments are then paid out to others. When asked what the payments to others are buying, Black Box Voting was told by Andrade that the Diebold funds pay “subcontractors.” We asked what the subcontractors do, and were told that they do “largely persuasion.”
Discuss this article here:
Election reform advocates are noticing something: Neither Republicans nor Democrats seem to have much interest in real reform. Black Box Voting has been looking into the process of voting system procurement. What we are finding explains a lot. Both Republicans and Democrats have been cashing in, and both parties may have become too beholden to take effective corrective action. Instead of real efforts to get at the truth, we are seeing attempts to control the message, with “investigations” and “reform” actions that appear to be little more than window dressing.
In 2001, Anthony Celebrezze Jr. -- a former Democratic Ohio secretary of state and attorney general -- met with a powerful Republican, John Sununu, to discuss a project selling Global Election Systems (now Diebold Election Systems). Sununu is a former governor of New Hampshire and was White House Chief of Staff under George H.W. Bush.
Sununu disappeared from the paperwork. In June 2003, Celebrezze formed a corporation with Pasquale “Pat” Gallina, a close associate of late Cuyahoga County (Cleveland) Republican Chairman Robert E. Hughes. Gallina had also been the campaign manager for former Republican Cleveland Mayor Ralph Perk. Together, Celebrezze and Gallina set out to sell Diebold machines to the state of Ohio, but a few weeks after forming the corporation, Celebrezze died of heart failure.
Diebold’s surviving Ohio lobbyist, Pasquale “Pat” Gallina, has quite a checkered past. His earlier business partners include Andrew Shission and Joseph LoConti -- both targets of federal investigations because of alleged links to organized crime. Shission was an accountant for the Hell’s Angels who had been indicted for two murders, but was acquitted. He then went to jail on tax evasion and obstruction of justice. Joseph LoConti was convicted of failure to file tax returns on time.
A third partner, Dr. Juan Andrade Jr., joined Gallina and Celebrezze to form a Diebold sales entity, called “ACG Group, LLC.” Andrade, a national pillar of the Hispanic community, founded the U.S. Hispanic Leadership Institute (USHLI). He is closely connected to the Democratic power structure, and is the recipient of the prestigious Presidential Citizens Medal, bestowed by President Bill Clinton. Andrade is an outspoken critic of the Bush Administration, and donated heavily to John Kerry in 2004.
Dr. Juan Andrade Jr.
Black Box Voting conducted a videotaped interview with Andrade on April 28 in his office at USHLI. Andrade had scheduled an interview with another journalist. Knowing that Andrade was quietly accepting large monthly payments from Diebold, Black Box Voting managed to piggyback into the interview, to ask Andrade questions about his Diebold activities. We made it clear immediately to Andrade at the beginning of the interview that we were from Black Box Voting, and that we would have additional questions. He agreed to answer our questions, and also said that Black Box Voting is taken seriously and does very important watchdog work.
Andrade admitted that he has been receiving a monthly retainer from Diebold, but refused to say how much. Black Box Voting has obtained independent records showing that Andrade has been receiving an unusually high fee, $20,000 per month, from Diebold. Accounting records from Diebold list such fees as “Success Fees” but Andrade referred to them as his “retainer” for helping sell the machines, and said that “the money goes to me, and through the company.” Andrade stated that the funds flowing through the ACG Group pay “subcontractors to help with some of the work, the same kind of work.”
“One person can’t do this job alone in a county this size,” he said. When asked what the subcontractors do, Andrade referred to the payments as “largely persuasion” to gain public support. Black Box Voting has been unable to find anything “public” about the Cook County/Chicago Diebold deal.
Andrade is not registered as a lobbyist with either the state of Ohio or Illinois, but says he is registered in Cook County. Illinois law requires him to register in the county where he is doing business, to disclose how much he is being paid, and to provide statements every six months listing what he spends, on whom, and for what. (1)
Andrade has been considered a voting rights leader for the Hispanic community. He has received an award from Bill Clinton. Yet, he seems to have been very quiet about his involvement with Diebold. We were unable to locate any document or news article showing that Andrade has mentioned that he is one of Diebold’s highest-paid lobbyists. When asked, Andrade said that he disclosed his relationship with Diebold in Dec. 2003. We asked him where this was disclosed, Andrade said it was at "our conference" [USHLI?] and added that he had resigned as Executive Director of USHLI in Dec. 2003, though he remained as president. However, as of today, May 9, 2005, he is still listed on the USHLI Web site as “President and Executive Director” (2). Black Box Voting interviewed Andrade in his USHLI office. (The ACG office is located in the same building.)
Andrade’s description of disclosure doesn’t quite hang together. The USHLI annual conference was held in September 2003, not December, and the ACG Group (“Andrade Celebrezze & Gallina”) was incorporated in Ohio in June 2003. If Andrade’s name was on a corporation to sell voting machines in June, why did he not disclose it to his constituency until December?
Andrade told Black Box Voting that he got his start on Hispanic issues in Chicago, but we have found that he set up shop first in Columbus, Ohio, during a time while Gallina and Celebrezze were also in Columbus. (3)(4)(5) He started with a group called the Ohio League for Hispanic Affairs in 1977. He never mentioned having ever been in Ohio in the interview.
Andrade’s Illinois organization started as “Mid-West Voter Registration and Education Project.” Later, Andrade changed the name to “Midwest/Northeast Voter Registration and Education Project. Still later, he changed the name to “U.S. Hispanic Leadership Institute”. (6)
Andrade told us that initially, Diebold had approached him and what he brought to the table was not “technical” expertise. He made a decision to work for Diebold based solely on Diebold’s presentation on the machines, and admitted that he did not seek any independent evaluation of their ability to count votes securely or accurately. This was the extent of his due diligence.
When we asked Andrade why he, as a high-profile leader in the area of Hispanic voting rights, would get involved at all in selling voting machines, he replied that he had tried everything else. He had done voter registration. He had fought redistricting battles. He had been involved in mentoring and training leaders. Now he wants to put the machines of his choice into Cook County. He said that sometimes it is surprising who you have to get into bed with.
We, too, were surprised at Andrade’s poorly disclosed bedfellows. Internal Diebold memos (7) obtained by Black Box Voting show that Andrade has been included in the decisionmaking loop with elite level managers and executives at Diebold Election Systems, Inc. (DESI): Andrade has been included in meetings and discussions with DESI Chief Financial Officer Greg Loe, Senior manager Dave Byrd, and national staffing head Beatta McInerney.
Black Box Voting is governed by a majority of board members who are minorities. This interview, and this story, is one of the most difficult we have ever done. The conflicts inherent in this blurring of lines among politicians, leaders, lobbyists and vendors, combined with the apparently habitual failure of everyone to properly disclose, is at the very root of our problems with election integrity. This story, and those that will follow in the Money Trail series, illustrate real-world issues that we will need to grapple with in order to achieve lasting change.
UPCOMING -- Part II: Gallina and the Ohio Players
Dec. 2001: Sununu, Celebrezze and Gallina met in Columbus to discuss selling voting machines to the state of Ohio. (8) We could not find any of them on the Ohio “List of Legislative Agents” registered as lobbyists for Diebold. (9)
June 2003: Andrade, Celebrezze and Gallina formed “ACG Group LLC,” to sell Diebold voting machines to Ohio and Cook County/Chicago. (10) According to Andrade, “ACG Group” stands for Andrade, Celebrezze and Gallina. (11) Ohio corporate documents show that it was registered under “Pat Gallina Consulting.” The name ACG reflects involvement of Andrade.
July 2003: Anthony Celebrezze died suddenly, reportedly of a heart attack. (12)
Aug. 2003: “Pat Gallina Consulting” was registered with the state of Ohio, (13) two months after it was listed as the incorporating agent for ACG Group LLC. Corporate documents are signed by Pasquale A. Gallina.
Dec. 17, 2003: ACG group was registered in the state of Illinois (14), with Andrade as corporate agent and Gallina’s address listed as the repository for corporate documents.
CORRECTION: This article originally stated that Andrade was formerly partners with two convicted felons, naming LoConti and Shission. LoConti was convicted of a misdemeanor, not a felony. According to Joseph E. LoConti, in correspondence to Black Box Voting on June 22, 2005, he has not been convicted of a felony. What he was convicted of was two(2) counts of failure to file 1983 and 1984 Federal Tax Return on time. Not failure to file tax returns.
(1) Illinois and Cook County requirements for lobbyists
(2) USHLI Web page from May 9, 2005: Dr. Juan Andrade Jr., Executive Director and President
(3) Corporate documents, Ohio League of Hispanic Affairs
(4) Mar. 24 1991 - The Cleveland Plain Dealer "Cabinet pick's ties to Hell's Angel probed in '86"..."Gallina was the personnel director for the Ohio Lottery Commission until his resignation in December 1978, after he was named in a lawsuit that prompted federal, state and local officials to investigate alleged contract kickback schemes at the commission."
(5) Jul. 5 2003 - The Associated Press: "Obituaries in the News" "Celebrezze Jr. was elected as a state senator in 1974. In 1978, he was elected secretary of state and in 1983 he was elected attorney general."
(6) Illinois Sec. State corp docs: Note that all three entities have the same number, meaning they are the same entity with a name change:
Midwest Voter Registration & Education Project
Midwest/Northeast Voter Registration & Education Project
U.S. Hispanic Leadership Institute
(7) Diebold internal communications obtained by Black Box Voting
(8) Dec. 6, 2001: Cleveland Plain Dealer, “Tubbs Jones for governor not very likely”
(9) Ohio Lobbyist listings 2000-2005: 2000 2001 2002 2003 current
(10) Corporate documents from Ohio Secretary of State for ACG Group
(11) Videotaped interview, Apr. 28 2005, by Black Box Voting: 2-min clips
video clip 1
video clip 2
video clip 3
(12) News article about Celebrezze death: Jul. 5 2003 - The Associated Press: "Obituaries in the News"
(13) Corporate documents from Ohio Secretary of State for Pat Gallina Consulting
(14) Illinois Secretary of State, corporate information for ACG Group LLC
Black Box Voting recommends a moratorium on new spending on voting systems until problems with quality and procurement procedures are resolved.