Trial By Media (Part II)

From the beginning of his public career, Fife Symington has managed to survive amid a morass of white-collar-fraud allegations.

Though they tarnished him, all of the scandals came with bravura denials from Symington that inspired the faithful.

There was always an excuse and, in the case of Richard Romley's investigation of the bid-rigging at Project SLIM, there was even official absolution.

But with the Project SLIM settlements secured by Grant Woods and Rob Carey, the wrongdoing could no longer be denied.

Federal investigators expanded their grand jury investigation of suspected Symington corruption to include Project SLIM.

If the feds enlarged their scope of interest regarding the governor, the same could not be said for the local press.

There was not a single, detailed analysis in any Arizona newspaper of how the county attorney's investigation of Project SLIM ignored or avoided important, damning evidence--essentially, went in the tank. Nor did any news organization look in depth at the attorney general's success and how it was achieved.

Though a team of reporters from the Arizona Republic asked to look at the voluminous files of the attorney general's Project SLIM probe, which were now public record, the review was cursory. Nothing was published.

There was greater negligence, however. No daily news organization used the Project SLIM files as a jumping-off point to examine the relationship between Governor Symington and his accountants, Coopers & Lybrand.

The daily press was satisfied. If there had been bid-rigging--and the press resolutely stuck to the line that none had been admitted in the attorney general's settlements--the reported friendship of Symington, Coopers partner John Yeoman and Symington lieutenant George Leckie had been the only motive.

The corruption of Project SLIM, however, appeared to be much more complex than simple cronyism. In fact, there were many indications that the SLIM contracts given to Coopers & Lybrand involved a quid pro quo--that is, a financial benefit for Symington.

The relationship between Symington and Coopers & Lybrand was long-standing and surrounded by suggestions of impropriety.

The accounting firm did much more than simply supply one of its partners, Yeoman, as Symington's campaign treasurer.

Coopers & Lybrand had informally advised Symington on his early financial statements, when he was a young developer on the rise. The firm later supplied signed, official financial reports.

This critical paperwork served as the basis for lending institutions to fund Symington's multimillion-dollar high-rises.

And when creditors closed in on the highly leveraged Symington, it was Coopers & Lybrand that supplied the crucial financial reports that declared the governor unable to repay his debts.

In 1990, when trying to obtain a $10 million loan for the Mercado, a downtown Phoenix minimall, Symington reported a net worth of $12 million. One year later, in a financial statement reviewed by Coopers & Lybrand, the governor told a lender seeking repayment that he had debts of $23 million.

Thus armed, Symington maneuvered adroitly with his financial adversaries. His attorneys persuaded the Resolution Trust Corporation to forgo a lawsuit against the governor after his failed developments helped crater Southwest Savings and Loan, costing taxpayers nearly $1 billion.

When New Times began to sort through Project SLIM investigative files, research focused less upon the friendship of Symington, Yeoman and Leckie, and more upon the possible quid pro quo between the governor and the accounting firm.

The question was obvious: Were state contracts awarded to the accounting firm in exchange for benefits the firm could give to the governor?

Research eventually showed that Coopers & Lybrand had forgiven more than a quarter of a million dollars in fees that Symington owed to the firm during the very period when $4.6 million in Project SLIM contracts was awarded to the Big Six accounting firm.

And there was other evidence strongly suggesting the Project SLIM bid-rigging had been accompanied by a bribe.

New Times' John Dougherty unearthed confidential, internal Coopers & Lybrand memorandums that tied Symington personally to the effort to steer the SLIM contracts to his accountants.

As bad as the bid-rigging was, and as laudable as the attorney general's investigation of it had been, the question of cronyism versus direct payoff was certainly not satisfied by the AG's probe.

But for Arizona media in general, the attorney general's Project SLIM settlement was the end of their curiosity.

As far as the Arizona media were concerned, the matter was closed, until and unless the federal grand jury provided answers for them.

On July 17, six days after Woods and Carey announced coming to terms with Coopers & Lybrand, Leckie also settled with the attorney general. In addition to paying a $25,000 fine, he, too, was precluded from doing business with the state.

Richard Romley was temporarily humiliated. For a brief period, columnists needled Romley with their opinion that the county attorney looked like a fool, if not the handmaiden of Governor Symington, for clearing the perpetrators of bid-rigging.

With surprising deftness, however, the county attorney played his own cards.
As Deborah Vasquez's allegations first played out in the Mesa Tribune for four weeks, the county attorney helped the story build steam.

Romley asked friendly state legislators to vent their frustration with the attorney general in the press, according to two sources directly involved, both of whom requested anonymity.

The attorney general's relationship with the Legislature has never been better than caustic. In 1995, it was almost poisonous.

Though a Republican, Woods had openly challenged the statehouse and Symington in their efforts to adopt the Contract With America to Arizona. In his inaugural speech in January 1995, the attorney general defended the state's minimal strides in enforcing civil rights and environmental laws and promised there would be no backsliding. He also went on television during the annual battle over tort reform and attacked the insurance industry.

All of these positions were in direct opposition to the hard-right stances taken by Symington and the legislative majority.

In response, the Legislature ordered the state auditor general to review all of the books for the Attorney General's Office. Soon enough, Vasquez's allegations of financial fraud were added to the bill of particulars, and a second round of audits and news articles ensued.

State Senator Stan Barnes, a member of the legislative committee that oversees the auditor general, agreed to Romley's request to turn up the heat in the press.

"There is a smell coming out of the Attorney General's Office, and we've got to find out what it is," Barnes was quoted as saying.

The Vasquez "expose" had finally reached critical mass.
On July 16, only five days after the first published reports on the SLIM settlement, the state's largest newspaper, the Arizona Republic, picked up the Vasquez story for the first time, running with a front-page banner headline: "Top Woods Aide Probed Over Fund."

When the announcement of Leckie's SLIM settlement was published one day later, it wasaccompanied in the press by front-page stories quoting Romley saying he mightbeforced to investigate Woods' financial abuses.

On the very next day--July 18--the Arizona Republic made a remarkable choice.

The editors turned the opinion page over to Richard Romley, who wrote a lengthy column explaining that his investigation of Project SLIM was not suspect.

Romley's column appeared under the inviting headline "No Whitewash, No Criminal Conduct."

The following morning, Romley formally announced in the pages of the Republic that his office would investigate "serious allegations of misconduct" involving the Attorney General's Office and Rob Carey.

The hunt was on.
Subsequent press coverage provided the protective camouflage that allowed the county attorney to operate with impunity.

The state's major daily newspapers all editorialized in favor of having Romley investigate the Attorney General's Office.

When Romley held his press conference to formally announce his investigation of the attorney general--six weeks after Flatten began pumping the story--the county attorney resurrected Vasquez's blind allegation of the Joe Woods "secret cache of files."

Any reporter who might have had ethical qualms about repeating Vasquez's imagined conspiracy was now relieved of responsibility; a public official had raised the issue.

The FBI thought so little of Vasquez's alarmed hysteria that federal agents never asked the Attorney General's Office for an explanation.

The other substantive charge in Flatten's initial article, and the allegation that would ultimately drive Romley and the daily press in the pursuit of Carey, involved MLK monies used to finance the attorney general's Tucson retreat.

Using this paltry, $2,600 bookkeeping anomaly, Richard Romley would eventually threaten Rob Carey with a multicount felony indictment--unless he resigned, admitted guilt and made restitution.

But it would take months before Romley's threat could be leveled; nearly a year of disturbing journalism would create the crisis atmosphere that would give Romley's prosecutorial missiles the throw weight needed, if Carey were to be driven from office.

"Woods' Wife, Aides Took Free Plane Trips" read the headline on Bill Muller's August 10, 1995, story in the Arizona Republic.

The story was the type of partly true, greatly hyped journalism dogging the Attorney General's Office to this day with small allegations that create a perception of large wrongdoing, where, at most, bad judgment exists. This lengthy string of flea-bite stories about plane trips was based not on independent research, but on investigations inspired or run by Romley and his allies.

As the auditor general followed the legislative directive to examine the books for the Attorney General's Office, the AG's trust fund also was examined.

Set up to pay expenses not covered by legislative appropriation, the trust was funded primarily by corporate donations.

When approached, America West Airlines contributed $5,000 in vouchers for free travel to be used at the discretion of the Attorney General's Office.

Carey took two trips on personal business, with Grant Woods' approval.
The independently wealthy Carey explained to the auditor general and the press that he had made $19,000 of in-kind contributions to cater official functions for the AG's Office. He produced the canceled checks to document his expenditures and his contention he was still owed $16,000.

Carey had not sought reimbursement for the thousands of dollars in out-of-pocket expenses and so gave little thought to using several hundred dollars in airline vouchers for the private trips.

Carey's explanation expresses an almost-childlike naivete. No one had contributed money to the Event Fund to underwrite Carey's personal travel. He should have followed the book and turned in expense reports.

That said, it is also unquestionable that Carey was out-of-pocket thousands of dollars, and that even with the airline tickets thrown into the accounting, the office had made a small fortune off Carey's generosity.

And whatever lapse in judgment he exhibited, no prosecutor except Romley could reasonably suggest Carey had engaged in criminal behavior.

As for Woods, he did indeed take his wife with him on one official trip.
In terms of judgment, it was not Woods' finest hour, either.
The irritated prosecutor said the expenditure for his wife's ticket was precisely the sort of thing they'd set up the trust to cover. He added that he would not have gone to New York if his wife had not been able to accompany him.

After all, Woods' office had already established some precedent by extending the courtesy of an airline ticket to the wife of the California attorney general when he spoke in Arizona. And the total cost of Woods' wife's ticket was $381.

The dollar figure was small enough that Woods could have simply said it was a mistake, and the story would have gone away.

Woods' pique did not serve him well in a public relations sense. In fact, it was striking just how poorly Woods and Carey responded to the press given the attorney general's reputation for media sophistication.

In the beginning, newspaper accounts were filled with legal minutiae from Woods and Carey that would have put Oliver Wendell Holmes in a coma. Then, for a while, there was no response to continuing charges of misconduct.

Even when it was apparent that the scrutiny was serious, and that the county attorney was hooking with evil intent, Woods and Carey proved capable of dumb mistakes that demonstrated they weren't paying attention.

Perhaps nothing captured the frustration of the Attorney General's Office as much as Woods' August announcement that he intended to audit Romley's Christmas party. The media ridicule accompanying this idea put a stop to the nonsense before it could proceed.

Overall, however, Woods and Carey's miscues were few as their hides were inked by the press's tattoo needles month after month.

And make no mistake, the stains on their reputations were indelible.
In August, Mesa Tribune's Mark Flatten floated the allegation by Deborah Vasquez that Carey had cooked the accounting ledger of the trust fund prior to handing it over to Romley's investigators.

But inspection of the original ledger shows that Vasquez's bookkeeping was so inept that the account balances were off by tens of thousands of dollars.

Before turning over the ledger, AG's director of Intergovernmental Affairs John MacDonald reconciled the ledger statements.

Even Romley didn't contend there had been any forgery, but that didn't stop another Vasquez charge from finding its way into print.

On November 17, the Mesa Tribune's Marty Sauzerkoph printed a Vasquez claim that was false on the face of it.

In a story announcing Vasquez's $15 million lawsuit over her departure from the Attorney General's Office, Sauzerkoph reported the attorney general stood accused of retaliating in a particularly nasty fashion against the secretary.

Following a perfunctory no comment from the attorney general, the reporter wrote, "After she resigned and took her allegations about the King fund to the county attorney, Woods' office canceled the health insurance on her children without allowing her to continue the coverage under the COBRA option provided by law, she contends." COBRA, the Consolidated Omnibus Reconciliation Act, is a federal program that provides accessibility to health coverage for a period of time to those who leave jobs that include health care as a benefit. The attorney general has no control over the COBRA program.

If Rob Carey were as vengeful as a Balkan chieftain, he still would have no control over the COBRA health insurance. He could not deny Vasquez her COBRA coverage if he wanted to.

The Attorney General's Office mailed the application for COBRA to Vasquez. The routine form asked for her signature to extend coverage.

The correspondence, a copy of which is on file at the Attorney General's Office, is devoid of the usual insurance jargon. It could not be more straightforward.

"By Federal Law [COBRA], you are entitled to extend your group health plan coverage due to the fact that you have reached one of the five qualifying events that requires the State to extend your group health plan coverage," reads the opening sentence of the letter.

Vasquez claimed that she was told by someone in the Attorney General's Office, over the phone, that her insurance had been canceled.

Kim Bidle, the orientation/benefits specialist who handled Vasquez's insurance, denies Vasquez's story.

And the explanation from Vasquez--that she had been told orally her coverage had been canceled--is hardly satisfactory.

Vasquez had been a legal secretary for more than 20 years. She knew enough to get to the bottom of the issue if, in fact, there was any misunderstanding about the COBRA coverage; the health care of her children, after all, hung in the balance.

And as Bidle's letter to Vasquez made clear, there was plenty of time to resolve any confusion.

"You have 60 days to complete, date, sign and return the enrollment form to my attention," concluded Bidle's letter.

As with much of her filing in the Attorney General's Office, Vasquez never took care of the paperwork needed to retain health insurance.

Yet the charge that Carey had personally denied her medical care would take on a life of its own in the press.

Journalists, ignorant of how the federal health-care program is administered, simply repeated the charge without ever determining its accuracy. It was considered enough to allow Carey the space to deny the allegation.

During the course of the year, coverage of Rob Carey's handling of the trust fund and his dealings with his former secretary Vasquez took on a rhythm as dependable as the lunar cycle.

A journalist would be leaked a document, or Vasquez would make a charge, and when Carey or Woods were asked for response, the prosecutors would go into a fetal position, offering little or no comment--thereby allowing the writer to whack them like piatas.

The year closed out with a holiday wrap-up that included two stories in the Arizona Republic about Deborah Vasquez and Rob Carey. The pieces were written by Bill Muller.

One story, played on the front page, detailed County Attorney Romley's focus on the Dash Inn restaurant and bar in Tempe; Carey was part owner of the business.

The Dash Inn article begged the question: In stories that stretched from June 8 to December 28, how was it that the substance of Romley's secret grand jury investigation appeared to be getting more press than the Phoenix Suns?

Muller demonstrated, however, that even when Carey provided documentation instead of simple denial, reporters already had the story written in their minds.

Even Carey's generosity was portrayed as suspicious.
On several occasions when the AG's Office hosted banquets--for example, Christmas parties and employee-appreciation luncheons--Carey donated the food from the Dash Inn restaurant.

Press reports accused him of profiteering by steering the commerce to his own business, an illegal act.

Not a single reporter bothered to check Carey's claim that the food was sold at cost. And if there was no profit, no law was broken.

Carey wrote checks for the cost of the catering out of his own personal account. He paid the Dash Inn so that his business partners were not stuck with the expense of his largess.

In an interview for this article, Carey's former business manager at the Dash Inn confirmed that they did not take a profit off the catering.

"The food was provided at cost," says Jim Skoda. "We didn't make a penny off of it; in fact, it was a pain in the ass. It was done as a favor to Rob, which is what I told the county attorney."

The second of Muller's December 28 articles told you everything you needed to know about the story's slant from its headline:

Like the Mark Flatten piece that kicked off the coverage on Rob Carey, Muller's article was full of wild distortions and half-truths.

But after months of reporting the story, there was absolutely no excuse for ambush journalism. If the topic merited stories during such an extended period, then someone like Muller had an obligation to do more than lob a mortar shell of allegations into the attorney general's slit trench, and then call Carey for comment on the carnage.

Here is what Muller did.
First, he affected a gee-whiz tone, projecting amazement that Carey's lawyers had shown up at Vasquez's unemployment hearing. This effectively made the prosecutor a heel in the article.

Lest anyone miss his point, Muller quoted Vasquez commenting on the presence of the lawyers:

"I almost started to laugh, it was so absurd," said Vasquez, 44, who was accompanied by her 14-year-old daughter at a September hearing to ask the state for unemployment benefits. "I mean, this was a DES appeal hearing."

Then, Muller colored the argument by portraying the hearing as unfair and suggesting that Carey's lawyers intimidated the waif, Vasquez. Once again her lack of COBRA coverage was invoked by the writer and, wherever possible, the deprivation and poverty forced upon her by Carey were described.

The article was disingenuous on a number of levels.
This was hardly an ordinary unemployment hearing. Half of the lawyers in the Attorney General's Office had already been questioned by investigators who were taking witnesses before Romley's grand jury.

Vasquez was seeking unemployment compensation, which is normally unavailable to those who resign, based on her contention that Carey's illegal behavior--misuse of the AG's trust fund--forced her to leave.

Of course Carey's lawyers were present; she was there to make an official record of her former boss's supposed criminality.

It is true that Carey's lawyer, Paul Eckstein, is well-known. As Arizona's premier First Amendment attorney, he has, over the years, represented most of the media outlets in the state, including the Arizona Republic and New Times.

In all that time, no one with any sense has used his name and the term "intimidation" in the same sentence. And to imply that Vasquez, a legal secretary for 21 years, was terrified of any lawyer is just plain storytelling.

But Muller's questionable reporting is not a matter of shading.
When Muller called, the lawyer took extra steps to make sure that the reporter was given relevant data, rather than a brusque "no comment."

Because the arena was an unemployment hearing, and not a secret grand jury panel, Eckstein said he made a point of telling Muller that Vasquez had been offered another post within the attorney general's vast complex before she resigned. Therefore, her unemployment claim was doubly spurious; not only had she resigned, but she had refused a comparable job that would have kept her salary and health benefits intact.

Had this information been included in Muller's article, however, the pose of Vasquez as an abject victim--a victimhood that the writer had carefully crafted--might have lost some of its holiday luster.

Eckstein also provided the reporter with a tape recording of the entire unemployment hearing, so Muller could hear for himself the details and tone of what was said.

In denying her request for review, the Appeals Board for the Department of Economic Security cited the very same tape when it addressed Vasquez's charge of intimidation.

"The tape reflects that the employer's attorney did not raise his voice, or otherwise act improperly. On the contrary, the record establishes that the claimant improperly and unreasonably refused to answer a properly phrased question ..."

Vasquez simply refused to be cross-examined, bolting from the witness stand and telling the hearing officer to keep the unemployment money.

There was a parade of witnesses who contradicted Vasquez.
Not a single sentence from this enormous record found its way into Muller's article.

When he described the Anna Ott kidnaping rescue, the reporter recycled Vasquez's claim that she had acted on her own without a supervisor's input.

"Because the office's directors were in a meeting, Vasquez coordinated the case with Mesa authorities, who ultimately saved the child ...," wrote Muller.

But that isn't what Vasquez said at the hearing.
That was Vasquez's old version of events, a sequence that Muller apparently picked up from dated newspaper clips. Muller did not return repeated phone calls.

At the unemployment hearing, Vasquez changed her story.
Had Muller bothered to listen to the tape in his possession, he'd have heard Vasquez say for the first time that she actually secured permission to personally handle the abduction.

This represented a startling reversal and would have given Muller's story a dramatic news peg.

But none of what you're about to read appeared in Muller's article.
"I explained to them what had happened," testified Vasquez. "And I said, 'What should I do with this information?'

"Mike Cudahy's the head of the criminal division there," explained Vasquez on the stand. "And Mike said to me, 'Contact the Mesa PD, right away.' So that's what I did. I contacted Mesa, and then I put Mesa PD in touch with Oakland PD. Oakland PD then faxed the felony warrants over to Mesa, and that was basically the end of it for the afternoon."

Of course, if Muller had listened to the evidence handed to him on a platter, and Vasquez's remarkable new version of events, he would also have had to print that, at the same hearing, testimony was introduced in which Cudahy denied giving the secretary any such direction. In fact, Cudahy denied even talking with Vasquez on May 16, 1995. He underscored these points by saying that she had never been in his office--on that day or any other.

Ignoring these new facts, Muller milked the pitiful-victim angle. He even passed along the idea that when Vasquez challenged Carey and Woods, the prosecutors saw to it that Vasquez would never work in this town again.

"Vasquez says she is paying the price for telling her story and has found herself caught in the switches of Woods' powerful political machine," wrote Muller. "Since resigning, Vasquez said she has been unable to find work and is cleaning houses and baby sitting. She said she sent out resumes."

One of the places she did not send out a resume is the largest legal secretary placement bureau in the state, Kelly's Referrals.

A spokesperson for Kelly's said the job market for legal secretaries since the end of May, when Vasquez quit, has been particularly vigorous; the market has offered at least a couple of hundred job openings, the spokesperson said.

A computer check showed that Vasquez never registered with Kelly's, though she could have done so without charge.

Asked if Vasquez's tangled dispute with Carey would have kept the secretary from working again in the private sector, the Kelly representative said no. Such a dispute simply wouldn't be an issue, the rep said.

When interviewed for this series, Vasquez expressed less interest in gainful employment than in research into the background of Attorney General Grant Woods.

Collaborating with private investigators, Vasquez has accumulated a new set of files on the Attorney General's Office, the kind of conspiracy paperwork that is the hallmark of the obsessed.

Which, of course, is her right.
But, at the same time, it is a shiftless sort of journalism that portrays Vasquez as Muller portrayed her--someone denied the opportunity to work by a now-ten-month-old dispute with Carey.

Like the overwhelming majority of reporters who have written about this subject, Muller was easily satisfied by the siren's song of Vasquez's tale, the victim's lament. It was the easy story to tell.

Muller concluded his article: "The hard part is it's Christmas," she said. "There's not even money for a small tree or small gifts. They're waiting (her kids) and waiting."

Which, unfortunately, was true.
The question, however, is whose responsibility is that?
It is a difficult thing to look at a woman like Deborah Vasquez, someone whose path has been more difficult than most people's, and ask: Why haven't you taken work?

It is so much easier to regurgitate her claim, as Muller did: "Those who would talk to me, after they found out I was involved in a confrontation with Grant Woods, they dropped me like a hot potato."

The real dilemma, however, does not involve the antagonism between Vasquez and Carey.

The big-picture problem centers on the unquestioning coverage of Vasquez and her complaints by Arizona journalists--journalists who provided the cover that allowed County Attorney Richard Romley to bury Rob Carey.

Starting with Vasquez's petty and false allegations on the MLK luncheon, and with the press as a shield, Romley roamed the state of Arizona looking for anything, anything at all on Carey.

Romley accumulated tiny, isolated bits of data so he could write a legal memorandum that had been accumulated snowflake by snowflake, until he had a snowball.

But it was the press that provided the blinding white blizzard of allegations that buried Carey.

Rob Carey got in trouble not because he is guilty of any criminal wrongdoing, but because his friend Grant Woods is an elected official whose job is to lead the Attorney General's Office, not shovel snow.

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Michael Lacey
Contact: Michael Lacey

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