The Campaign Spot

Chuck Schumer’s Bad Week: Part One of Five

 

There is no incumbent Democrat Senator running for reelection this cycle who appears more politically bulletproof than Chuck Schumer of New York.

Still, for an unstoppable political juggernaut, Schumer’s not drawing unbelievable numbers in polls among likely voters. In September, he’s garnered healthy 58 percent in Rasmussen, but 54 percent in Quinnipiac and Survey USA. That’s on par with GOP challenger John Boozman’s numbers in Arkansas.

New Yorkers know the publicity-minded Schumer and know what they think of him; then-Sen. Jon Corzine, a New Jersey Democrat once tartly joked, “Sharing a media market with Chuck Schumer is like sharing a banana with a monkey. Take a little bite of it, and he will throw his own feces at you.”

Schumer’s challenger, businessman and West Point lecturer Jay Townsend, needs an issue to shake up the race, to get New Yorkers to take a second look at the brusque, pugnacious Schumer and reevaluate whether they want to give him another six years. Something like… the questions surrounding Chuck Schumer’s phone call to the SEC about the Bernie Madoff investigation.

Whistle-blower Harry Markopolos is a bit of an odd character; he is, however, credited as the man who sniffed out Bernie Madoff’s fraudulent methods long before anyone else did.

In his book, Markopolos writes, “I was told, by a government agency, for example, that New York Senator Charles Schumer called the SEC at some point to inquire about the Madoff investigation.”

Later, he says that SEC inspector general David Kotz inquired about the call: “Kotz’s questions made it obvious that he was trying to discover whether his agency was simply incompetent or it was also corrupt. He asked a lot of questions about possible interference in the investigation, ranging from asking me if I knew anything about the phone call supposedly made by Senator Schumer — I didn’t — to the possibility that Madoff had bribed team members.”

Later in the book, Markopolos flatly states that Schumer made the call: “Only Senators Chuck Schumer, who had made a phone call to the SEC, and Jeff Merkley, a Democrat from Oregon, returned. Schumer took over the questioning.”

The response from Schumer’s office doesn’t shed much light on the matter:

“The Senator would never make a call that could potentially interfere with an investigation, and he absolutely did not in this case,” Fallon wrote me in an email. “As Senator Schumer has said in the past, the country owes Mr. Markopolos a debt of gratitude for his valiant efforts to prod the SEC to uncover the Madoff fraud, but on this, someone gave him wrong information.”

A report by the SEC’s inspector general found no congressional interference in the Madoff probe.

In his book, Markopolos appears to suggest that what Schumer’s office would consider a routine bit of constituent service can have a chilling effect on a federal investigation: “There is absolutely no evidence of any wrongdoing on Schumer’s part at all, zero, an no suggestion that there was any intent on his part to interfere. Senator Schumer apparently made the call on behalf of his constituents. The problem is that the SEC is funded by Congress, so its employees are particularly sensitive to congressional inquiries. So for a middle-level SEC employee with ambitions, any case in which an important politician is involved is a case he or she wants to stay away from. It’s a lot safer to go after small potatoes.”

So a call was made, but Schumer’s office is absolutely certain that a call made by the third-highest-ranking Democrat in the Senate, who sits on both the Finance and Banking Committees, on behalf of a constituent to the Securities and Exchange Commission, had absolutely no impact on the investigation whatsoever.

Mmm-hmm.

Well, it’s not like Schumer would have incentive to help Madoff

Sen. Chuck Schumer (D-N.Y.) Monday led a long list of officeholders and groups expected to give up more than $430,000 in political contributions from Bernie Madoff and his family.

“My money, I’m returning,” Schumer said. The $6,000 Madoff gave him over the years would be sent to charity, he said.

The $100,000 Madoff donated to the Democratic Senatorial Campaign Committee, run by Schumer until last month, should also be returned, but “that is their decision,” Schumer said.

Ah.

Who did Chuck Schumer call? How close was that SEC official to the Madoff investigation? What did Schumer ask, and what did the SEC official tell the senator? We’ve never gotten answers to these questions. Bernie Madoff is the poster boy for Wall Street criminality, and the U.S. senator closest to Wall Street called the federal agency looking into him and asked someone something about the investigation. Yet this has never really caught on as an issue.

Well, no point the New York press looking into this; no point in the NRSC putting up a quick web ad or buying some ad time in the upstate markets. Schumer’s reelection is guaranteed, right?

Right?

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