Florida Man Indicted In Alleged Fraudulent Lobbying and Fund Raising Scheme
WASHINGTON – A Florida doctor was charged today by a federal grand jury in Ft. Lauderdale, Fla., with allegedly orchestrating a fraudulent political fund raising and lobbying scheme through which he secretly diverted to himself more than $350,000 from contributions to political organizations he controlled, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division. Alan D. Mendelsohn, 51, of Hollywood, Fla., is also charged with fraudulently concealing an additional $274,000 in payments he allegedly directed his lobbying clients to make to third parties on his behalf, including tuition payments to his children’s schools, in an effort to circumvent lobbying disclosure rules and other reporting requirements.
The 32-count indictment charges Mendelsohn with mail and wire fraud, aiding and abetting mail and wire fraud, and making false statements to federal agents. Mendelsohn will make his initial appearance today at 11 a.m. before U.S. Magistrate Judge Lurana Snow in Ft. Lauderdale.
According to the indictment, beginning in approximately 1999, Mendelsohn, a practicing physician, was involved in lobbying members of the Florida legislature and other state officials for legislation and budget expenditures of importance mainly to ophthalmologists. The indictment alleges that in approximately late 2002, Mendelsohn was asked by various lobbyists and businesspeople if he would use his political connections to assist their clients in obtaining and defeating legislation and in obtaining other favorable government action. According to the indictment, beginning in approximately 2002, Mendelsohn allegedly created a series of political organizations and corporations for the purpose of soliciting and then transferring contributions between the entities in ways that would be difficult to trace.
Beginning in approximately 2002, through a pattern of false representations and promises, Mendelsohn allegedly solicited and received more than $2 million in donations to the political organizations he controlled from persons for whom he agreed to provide lobbying and other services. According to the indictment, Mendelsohn allegedly represented to the contributors that their funds would be used for media and other campaigns on political issues of importance to them and to support political candidates. In fact, the indictment alleges that Mendelsohn secretly diverted more than $350,000 in contributed funds to his personal use and benefit through payments made in ways that were misrepresented or concealed entirely in required public disclosure reports for the political organizations. The indictment alleges that Mendelsohn used the diverted funds, in part, to purchase a residence and a car, to pay for tutors and tuition for his children, to pay his personal credit card bills, and to pay bonuses to an employee of his medical practice.
The indictment also alleges that Mendelsohn falsely represented to a contributor that he secured bribery agreements with senior government officials. During 2003 and 2004, the indictment alleges that Mendelsohn falsely represented to the contributor that he had brokered an agreement with senior government officials to close an ongoing criminal investigation by state officials in Florida of the contributor and others in exchange for campaign donations and other payments totaling more than $1 million. The indictment also alleges that in subsequent conversations in 2007, Mendelsohn falsely told the contributor that senior government officials had agreed to exert pressure on federal prosecutors investigating the contributor to close the investigation in exchange for $400,000 in contributions. As a result of Mendelsohn’s false representations, the contributor caused more than $1 million in payments to be made, as directed by Mendelsohn. The indictment states that, in fact, no such unlawful agreements to close any investigations had been made with any public officials.
The indictment alleges that in order to increase his power and influence as a lobbyist so that he could obtain more contributions and consequently more funds for himself, Mendelsohn made approximately $87,000 in payments to a now-former public official. These payments, which were made from the political organizations Mendelsohn controlled, were disguised as payments for consulting services rendered by an intermediary to whom the checks were written. In addition, the indictment alleges that Mendelsohn undertook or directed others to undertake actions to conceal the true source of certain campaign contributions. The indictment also alleges that Mendelsohn caused income and expense amounts to be falsely characterized or omitted in the books and records of political organizations and corporations he controlled and from public disclosure reports that required the accurate reporting of income and expenditures.
Mendelsohn also allegedly made several material false statements to federal agents investigating these allegations beginning in late May 2007. For example, according to the indictment, Mendelsohn falsely denied that he had represented to one of the contributors that he had secured an agreement with senior government officials to terminate the state investigation involving the contributor. Mendelsohn also falsely claimed that he did not receive any personal benefit from using his political connections. In addition, the indictment alleges he falsely denied that he ever received any financial benefit from the political organizations for which he solicited contributions and controlled.
An indictment is merely an accusation. All defendants are innocent until proven guilty.
The charges of mail and wire fraud each carry a maximum penalty of 20 years in prison and a $250,000 fine. The charges of false statements each carry a maximum penalty of five years in prison and a $250,000 fine.
This case is being prosecuted by Senior Trial Attorney Mary K. Butler and Trial Attorneys Justin V. Shur and Eric G. Olshan of the Criminal Division’s Public Integrity Section, headed by William M. Welch, II, Chief. This case is being investigated by the FBI’s Miami Field Office.