Sunday, July 14, 2024

N.J. Sen. Bob Menendez escaped legal peril once. Can he do it again?

N.J. Sen. Bob Menendez escaped legal peril once. Can he do it again?

A month after his trial on federal corruption charges ended in November 2017 with a deadlocked jury, Sen. Robert Menendez settled into a booth at the International House of Pancakes in his New Jersey hometown of Union City.

In a quarter-zip sweater, the influential Democrat posed for a photograph next to a friend, who held up a small red sign bearing the words delivered by the senator outside federal district court: “To those who were digging my political grave so they could jump into my seat, I know who you are and I won’t forget you.”

The words were a declaration of Menendez’s political resurrection, a measure of how vindicated and empowered he felt after prosecutors failed to convince jurors that he helped a wealthy Florida doctor in exchange for lavish gifts. After beating back the government’s case, Menendez won reelection in 2018. And when Democrats captured control of the Senate in 2021, he regained the chairmanship of the Foreign Relations Committee, giving him influence over major foreign policy debates and cementing his place as one of the highest-ranking Hispanic leaders in the nation.

But now just six years later, Menendez is once again at the heart of a sprawling federal criminal investigation concentrating at least in part on the possibility that the senator received undisclosed gifts, according to people familiar with the probe who, like others interviewed for this article, spoke on the condition of anonymity because of the matter’s sensitivity.

The senator insists Menendez will be vindicated again. “It will amount to nothing,” he predicted to reporters earlier this year. Still, his advisers are facing the inquiry with a feeling of grim familiarity, according to people in touch with his team. Even as he has risen nationally, Menendez has remained intimately involved in local matters, weighing in on state assembly races and county leadership contests. Those dealings reflect his power in New Jersey but also have opened him up to accusations of improperly wielding his influence, according to Democratic officials, political consultants and former aides.

The federal investigation has injected unpredictability into the 2024 election, when Menendez, 69, is expected to be on the ballot seeking a fourth term and Democrats must already defend eight other seats considered vulnerable to retain control of the Senate. Jennifer Morrill, a spokeswoman for Menendez, confirmed that he intends to run.

People familiar with the investigation say federal prosecutors based in Manhattan are examining both Menendez and his wife, Nadine Arslanian, whom he said he met at the Union City pancake house, a frequent haunt, about a year after his mistrial. While the exact scope of the probe is unclear, these people said a raft of grand jury subpoenas issued over the past year sought information from a wide range of people and interests, including a New Jersey company that certifies food imports to Egypt, a New Jersey jeweler, and a state senator who sponsored stalled legislation that would have curtailed development near the Palisades cliffs along the Hudson River.

One connection through some of the seemingly disparate issues is a Menendez donor and New Jersey developer, Fred Daibes, who has transformed the Hudson riverfront communities near where the senator grew up from a blue-collar enclave into a ritzy home for Manhattan commuters. Daibes received a previously unreported subpoena last year, people familiar with the matter said. More recently, these people said, prosecutors have sought documents related to a London-based investment firm led by a member of the ruling family of Qatar that purchased an ownership interest in certain Daibes properties.

A lawyer for Daibes said the developer had been friends with Menendez for 25 years but otherwise declined to comment on the investigation. A Justice Department spokesman also declined to comment. Morrill, the Menendez spokeswoman, said the senator was “not distracted by these politically-motivated smear campaigns.”

Allies say the senator is being persecuted by a Justice Department embarrassed by its failure to convict him six years ago, while critics see the fresh inquiry as evidence of a politician who invites scrutiny by operating too close to the line. “If they are coming at him again, they better have it for real this time,” said Rudy Garcia, a lobbyist and former Democratic state lawmaker and mayor of Union City. “The government went after him once, and you saw how that turned out. I don’t know how this is any different.”

‘Not how my career is going to end’

Menendez was 28 years old in 1982 and working for the local school board when he turned on his mentor William Musto, the mayor of Union City, and testified against him at the trial that would send him to prison on corruption charges. Menendez wore a bulletproof vest because of threats against his life.

The son of Cuban immigrants, Menendez was soon elected mayor of his hometown, once called Miami’s sister city with its large number of Cuban exiles. Next, he was elected to the state legislature and to the House in 1992, representing a redrawn Latino-majority district. (Since January, the seat has been held by his 37-year-old son, Rob Menendez.)

Menendez learned to wield power by building coalitions in a sharp-elbowed state. From his perch in Washington, he continued to preside over his county’s Democratic Party, said a person familiar with the arrangement. In 2001, he helped elect the first Black mayor of Jersey City, Glenn Cunningham. When the two later fell out over a local election, the mayor labeled Menendez a “political terrorist.” Menendez said he was “offended” by the comment.

In early 2006, Menendez was appointed to a vacant Senate seat. As he ran for a full term months later, his campaign was shadowed by a federal investigation into a nonprofit agency that paid him rent while getting millions of dollars in federal grants. No charges were brought, but the investigation sharpened his sense of grievance. “We have seen an orchestrated series of leaks, bogus ethics complaints and outright fabrications since the beginning of this campaign,” he argued at the time.

Once ensconced in the Senate, Menendez amassed influence over divisive issues of foreign policy, bucking presidents of his own party over everything from diplomatic relations with Cuba to foreign policy toward Iran.

But a new investigation soon tested his mettle. The probe began with unproven allegations in late 2012 that the senator and a friend in South Florida had patronized underage prostitutes. Menendez denied the claims, which the FBI investigated but failed to substantiate, according to an affidavit filed by an agent.

The salacious details made no appearance in an indictment brought against Menendez in 2015. Instead, the government accused him of accepting private flights, luxury vacations and campaign donations from the friend, the deep-pocketed doctor Salomon Melgen, in exchange for political favors.

Menendez indignantly denied wrongdoing. In a video message to supporters, he invoked his experience testifying against his old mentor in Union City. “I started in public service fighting corruption in government,” he said. “That is how I began my career, and today is not how my career is going to end.”

At trial, prosecutors argued that Melgen’s largesse amounted to bribery, designed to elicit the senator’s help with a Medicare dispute and a port security contract in the Dominican Republic. Lawyers for the two men said they were simply good friends. Ten of 12 jurors agreed, and when the Justice Department indicated that it would retry the senator, the judge issued an opinion eviscerating the government’s primary allegations: “no there there,” he wrote. The Justice Department reversed course days later and dismissed the matter.

Not long after the trial, the Senate Ethics Committee “severely admonished” Menendez for accepting unreported gifts. He was elected to another six-year term in 2018. Melgen faced harsher sanctions after a separate trial. Convicted on health-care fraud and related charges, he was sentenced to 17 years in prison but was granted clemency by President Donald Trump on his last day in office in January 2021.

Menendez and Melgen remain close, speaking frequently on the phone, said a person familiar with their relationship. According to the White House, Menendez was among those who supported clemency for the doctor. Melgen did not respond to a request for comment.

New beginnings and a sprawling probe

Thirteen months after his legal near-death, Menendez met Arslanian at his hometown pancake house, according to the couple. After a five-month courtship, he proposed in front of the Taj Mahal in India, he told the New York Times shortly after their October 2020 wedding. It was a second marriage for both. She praised his humor and intellect. He said she had “this aura about her.”

Arslanian, 56, was born in Beirut to Armenian parents who fled the Lebanese civil war and raised her in New York, she said in a 2020 interview with the Armenian Report. She attended New York University. Photos reviewed by The Washington Post show her posing in the years before she met Menendez at a restaurant opening and a fashion show, as well as with cast members from the reality television shows “Mob Wives” and the “Real Housewives of New Jersey.”

She was identified in news reports at the time of her marriage to Menendez as an international business executive. Not long after they met, she registered a company called Strategic International Business Consultants, according to registration paperwork. The June 2019 filing with a state agency included markings showing it had been faxed by the law firm of Donald Scarinci, a longtime Menendez ally and the best man at his 2020 wedding. Scarinci did not respond to a request for comment.

Menendez’s personal financial disclosures show Arslanian earned a salary from her business consultancy and a medical testing company in New Jersey. He also reported that she owns more than $100,000 in gold bars. In 2019, she began an unpaid role on a Hackensack Meridian Health pediatric advisory committee, said a spokesman for the health system, who did not respond to a question about how she was chosen for the position. An attorney for Arslanian declined to comment.

Prosecutors have sent at least half a dozen subpoenas to people and companies, and the connections among them are not fully clear. Some watching the widening aperture of the investigation said the seemingly loosely related inquiries make it difficult to judge where the government’s investigation may be headed.

“I don’t think they have him yet,” said Joseph Hayden Jr., a prominent New Jersey trial attorney. “It’s obviously a serious investigation, but when you have subpoenas all over the place, it’s not a tight and narrow case. It looks like they’re fishing.”

Some of those who have received subpoenas were part of Arslanian’s social world before she met Menendez, according to people familiar with the matter. In particular, she is friends with two people who have had roles at IS EG Halal, a New Jersey company that certifies that the preparation of meat entering Egypt adheres to Islamic law.

In 2019, the Egyptian agricultural ministry awarded IS EG Halal exclusive authorization to sign off on meat imports, creating concern within the Department of Agriculture, in part because the company had no prior experience with halal verification, documents show. A USDA spokesperson did not respond to repeated requests for comment, and it is not clear if the Egyptian decision is of interest to investigators.

In November of that year, FBI agents used a search warrant to seize phones, computers, cash and gifts from Wael Hana, the president and founder of the company, according to a court filing by his attorney. Federal prosecutors handling the case told his attorney the following month that he was not a target of their investigation, according to the filing, which sought the return of his property. Hana is a friend of Arslanian’s, according to a person familiar with the matter. Over the years, he has given her a watch and other gifts, said the person, who maintained that his generosity predated her marriage to Menendez.

Arslanian is also friends with a New Jersey lawyer who registered IS EG Halal and served on its board of directors, he said in an interview with The Post. The lawyer, Antranig Aslanian Jr., said he was subpoenaed and asked about agreements with various clients and whether he knew Menendez. He said he had known the senator’s wife for years through the local tightknit Armenian American community and may have introduced her to Hana, who used to have an office in his building.

NBC 4 New York has reported that prosecutors are examining whether people involved with Hana’s halal meat certification company provided Menendez or his wife with a Washington apartment, a Mercedes-Benz and other gifts. Morrill, the Menendez spokeswoman, said, “We are not going to respond to every false allegation made by anonymous sources.” A spokesman for Hana denied that any such gifts changed hands.

“Any allegations about cars, apartments, cash, and jewelry being provided by anyone associated with IS EG Halal to Senator Menendez or his wife at all, let alone in exchange for any kind of favorable treatment, are totally without basis,” said the spokesman, Steven Goldberg, who also said Menendez played no role in the contract with the Egyptian government.

Authorities have sought information from a wide range of additional people, including a jeweler in Bergen County, Vasken Khorozian, who told The Post that he is friends with Menendez and his wife and spoke about a year ago to law enforcement. Khorozian said officials were interested in gifts that may have been given to the couple and that he told them he could not help them with their inquiry, he said. “I’m a poor guy,” Khorozian said in an interview. “I don’t give gifts.”

Daibes, the powerful developer responsible for remaking New Jersey’s “Gold Coast” on the Hudson River, has also been a focus of recent subpoenas, people familiar with the matter said. One issued this month to Nicholas Sacco, a state lawmaker and mayor of North Bergen, N.J., who was one of the sponsors of a stalled state bill that would have hemmed in local development, asked for communications with Menendez, Arslanian and Daibes, according to a person familiar with the document. A spokesman for Sacco said the New Jersey lawmaker has been assured he is not a target of the investigation, and he is cooperating.

Daibes has ties to the halal meat certification company as well. A lease agreement shows that a Daibes business partially owns the property where IS EG Halal is located. The lease identifies the property’s other landlord as a business operated by the Qatari investment firm, which has been another focus of federal inquiries in recent weeks, according to people familiar with the matter.

The investment firm, Heritage Advisors, registered a company in New Jersey last year that bought ownership interest in a swath of Daibes properties, part of an investment earlier reported by the Daily Beast. A spokesman for the investment firm declined to comment. Daibes is awaiting sentencing after pleading guilty in April 2022 to a federal banking crime in a case unrelated to Menendez.

‘God forbid you whisper and he hears’

Menendez, again under investigation, has not shrunk from public view.

In recent weeks, he was photographed at an event honoring a friend’s law firm hosted by the Hispanic Bar Association of New Jersey. In May, the senator was among a throng of public officials to deliver remarks at the Bergen County Democratic Committee’s spring fundraising gala, ticking off a list of Democratic Party priorities in upcoming elections, placing particular emphasis on abortion rights, according to people who were there. In Washington, he has helmed hearings about foreign policy toward Russia.

More than a dozen Democratic officials and operatives in the state, most of whom asked to speak anonymously for fear of blowback, said the news that he is again in government crosshairs is being met by knowing eye rolls, but not whispers, said one Democratic consultant, “because God forbid you whisper and he hears. He’s got good ears.”

Information on the investigation is in short supply, even for other top Democrats in the state. Sen. Cory Booker (D-N.J.) has asked local political operatives what is known about the investigation, according to a person in touch with him. His office did not respond to requests for comment.

Democrats involved in the 2024 election in New Jersey said it was difficult to predict how a new case against Menendez might affect the prospects for their party, especially in a presidential cycle when Democrats in the state will be motivated to keep the White House out of Republican hands.

But some pointed to warning signs for Menendez. A virtually unknown primary opponent, Lisa McCormick, captured nearly 40 percent of the vote in 2018. This cycle, a small town Democratic mayor is among those who have already filed to challenge Menendez in the primary. A credible Republican opponent has not emerged.

Unlike when the senator stood trial in 2017, the New Jersey governor’s office is now held by a Democrat, Phil Murphy, who would get to name a replacement if Menendez were to leave office. When asked about the investigation last year, Murphy called the senator “an incredibly valuable and important partner.”

Fellow Democrats, who have seen Menendez escape legal peril before, say they are watching the situation closely. “My plan is to support him in 2024, but we have to see,” said John Currie, a former chairman of the state party. “We have to see how things play out.”

Alice Crites, Shayna Jacobs and Razzan Nakhlawi contributed to this report.

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