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Lobbyist records show casino funds marked for Riley

BIRMINGHAM — Convicted lobbyist Michael Scanlon's records show he had planned to spend $75,000 from one of his Indian gaming clients to help Bob Riley win the Alabama governor's election in 2002.

Scanlon's company ledger shows over eight days in 2001, Scanlon withdrew $75,000 from his company's account and gave $50,000 to the National Republican Congressional Committee, shortly before the NRCC made a major contribution to Riley's gubernatorial campaign.

The ledger designates that the withdrawal on Nov. 26 was for a "bama race," and a separate page shows an expense of $75,000 was for "Riley" and that it would be "per check nrcc," The Birmingham News reported.

'Operation Orange'

The ledger listed the $75,000 under the heading "Operation Orange," the nickname he gave his promise to turn the Mississippi Band of Choctaw Indians into a political powerhouse by limiting competition for their casinos.

Riley, a Republican, ran for governor in 2002 on a promise to stop the spread of gambling in Alabama, while his opponent, then-Gov. Don Siegelman, supported a plan for a statewide lottery.

The financial records of Scanlon's company were made public by a U.S. Senate committee that investigated the $66 million Scanlon charged six Indian tribes from 2001 to 2003 and deceptions about work that was performed. Scanlon and lobbyist Jack Abramoff, who were secretly splitting the profits, have pleaded guilty as part of a sweeping investigation into public corruption involving members of Congress, government employees and lobbyists.

Former Riley staffer

Riley served three terms in Congress from Alabama's 3rd Congressional District before being sworn-in as governor in 2003. Scanlon worked for Riley as his press secretary when he first went to Congress in 1997.

A campaign spokesman for Riley acknowledged Scanlon's interest in the 2002 campaign.

"A decade before anyone knew the problems he would face, Michael Scanlon worked for Governor Riley while he was a member of Congress," Riley spokesman Josh Blades said in a written statement. "It is logical that Scanlon would want to support his former boss in his campaign for governor. Bob Riley has been a lifelong opponent of gambling in Alabama, and that fact will never change, regardless of who contributes money to his campaign."

Riley is seeking a second term in the governor's office in the Nov. 7 general election and has been criticized by his Democratic opponent, Lt. Gov. Lucy Baxley, for his alleged connections to Scanlon and Mississippi Indian gaming money.

"It's time for Bob Riley to come clean," Baxley said in a statement. "For years he has denied that Mississippi casino money came in to his campaign, but now we have proof that it did."

Claim disputed

But a spokesman for the NRCC in Washington said the organization does not allow donors to say how their donations will be spent. Four days after Scanlon gave the committee $50,000, the NRCC gave $360,000 to Riley's campaign for governor.

"If we had given Riley $50,000 I could see someone trying to make a connection, but the numbers just don't add up," NRCC spokesman Carl Forti told The Birmingham News on Friday.

The Mississippi Band of Choctaw Indians was Scanlon's most lucrative client, having paid $16.5 million to companies owned or controlled by Scanlon, including Capitol Campaign Strategies, according to the Senate committee report. The tribe paid Scanlon $4.5 million over two years to protect its gaming interests through "Operation Orange."

The ledger entry for Capitol Campaign Strategies that mentions Riley, $75,000 and the NRCC is listed under the heading of Operation Orange. Other expenses in the same ledger include paying Abramoff and Scanlon $1.2 million each, plus money to other professional campaign and polling firms.

Congress fundraiser

The NRCC is the fundraising arm for Republican congressional candidates but got involved in Riley's race for governor because Riley asked for its support.

Two other instances of Scanlon donating to groups that supported Riley have been reported earlier.

Scanlon gave $500,000 of his company's funds to the Republican Governors Association in 2002, which soon after transferred money to a related Republican committee, which in turn donated to Riley. RGA officials said last year Scanlon's money was a corporate donation and was kept separate from the $2.5 million the group sent to Riley's campaign.

Also in the 2002 campaign, Scanlon gave a total of $100,000 to four political action committees operated by Montgomery lobbyists Joe Fine and Bob Geddie. Those PACs and others operated by Fine and Geddie contributed more than $625,000 to Riley's campaign, according to campaign finance reports.

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