Glaring misdeeds
Justice was done, but Stockman’s massive fraud should have been stopped sooner.
It took a full month for federal prosecutors to present all of the evidence they’d assembled to convict former U.S. Rep. Steve Stockman of 23 felonies for his role in a vast conspiracy of fraud and money laundering that stretched all the way from a run-down motorcycle shop in Webster to banks in Cairo.
But if our campaign finance and federal disclosure laws really worked, Stockman’s bizarre behavior might have been detected and stopped decades before he made it to Congress. Instead Stockman completed two two-year terms — and on the side swindled more than $1.2 million with the help of idealistic staffers-turned criminal accomplices.
Wind back in time to the 1990s when Stockman mounted his first race for the U.S. representative. Already red flags were popping up about questionable practices prosecutors later identified as vehicles for massive fraud: He’d already created on-paper companies based in post office boxes. His campaign “borrowed” corporate funds that were never repaid. And one of the devoted assistants (who later pleaded guilty as his criminal accomplice) already was involved in misusing campaign funds to mass mail fake “newspapers,” the Federal Campaign Commission found in one of several related investigations.
The FEC did fine Stockman’s campaign in the 1990s — but there was no criminal probe. When he ran for Congress again in 2012, the wife of one of his Republican opponents again filed a complaint. His campaign again mass mailed fake newspapers to Texas voters and later misidentified donors. This time the FEC took no enforcement action.
During his 2013-2015 term, Stockman never disclosed the mysterious source of his $350,000 income as federal law requires or explained his paper empire of post office boxes and mysterious corporations. During trial, one ex-staffer revealed that Stockman required his congressional staffers to take an ethics test, but skipped it himself. “He said he wasn’t planning to go because then they might hold him to the rules.”
Why would he worry? As a congressman, neither Stockman or his campaigns faced any real consequences. The FEC didn’t fine his campaigns again. (In fact, the FEC rarely fines anybody – only 15 candidates were fined last year.) No one forced him to disclose his income either.
Federal candidates and congressmen are required to identify their donors and explain their income for good reasons. Disclosure helps provide a window into how members make and invest money, who pays for their travel, and helps shed light on funny business, the influence of special interest groups and potential conflicts of interest. (You can view other congressional disclosures here.)
After investigative reporters from the Houston Chronicle and the Sunlight Foundation exposed some of Stockman’s many reporting irregularities, other Congress members (who’d presumably taken their own ethics tests) called for official investigations. In June 2014, the Office of Congressional Ethics had “substantial reason” to believe that both Stockman and his aides broke a host of campaign finance laws and House ethics rules, and recommended further action. But the House Ethics Committee didn’t take disciplinary action against Stockman either. He finished his term and went on to divert more money into more fake newspapers in a failed run for Senate against U.S. Sen. John Cornyn.
The Department of Justice has a tiny unit called the Public Integrity Section created after Watergate in 1976 to combat corruption. It handles so-called “elections crimes” and sensitive investigations of congressmen and federal judges. Its 30 attorneys are extremely busy these days — with a caseload that in 2016 included 734 cases against federal, state and local officials, according to its latest report to Congress. His trial happened more than three years after his term in office ended. And that trial revealed that a pattern of diverting campaign funds and donations through paper companies and into his own pockets that lead to the April 12 conviction.
Ultimately, justice was done in a case that revealed Stockman to have been one of the most crooked Texas congressman in history. But it would be nice if our election laws and congressional committees could hold unscrupulous candidates and lawmakers responsible long before they win elections, finish their terms, collect all their federal government paychecks and do more than $1 million in damages.