For Immediate Release: For More Information Contact:

Wednesday, November 15, 1995 Gary Ruskin (202) 296-2787

Nader Files Ethics Complaint Against Gingrich

Over "Volunteer" on Telecom Issues Who Is A Telecom Entrepreneur

Ralph Nader and the Congressional Accountability Project filed an ethics complaint against House Speaker Newt Gingrich (R-GA) for apparently allowing telecommunications entrepreneur Donald Jones to act as a de facto staff person on telecommunications issues and legislation within Gingrich's Congressional offices.

The complaint was filed with the House Committee on Standards of Official Conduct ("House Ethics Committee"), and was officially transmitted to the Committee by Rep. George Miller (D-CA). The complaint alleges that Gingrich's relationship with Jones appeared to violate the House Code of Official Conduct, and House Rule 45, which prohibits private funding of House offices.

"Speaker Gingrich should not have turned over some of his staffing on an important telecommunications bill to a telecommunications entrepreneur. That's like turning over a rabbit to a hungry lion," said Ralph Nader. "Who was there to protect the consumers against raids on their rights, their pocketbooks, or the U.S. Treasury?"

In a November 10, 1995 Wall Street Journal article titled "Gingrich Backer Had Unusual Access As a Volunteer in the Speaker's Office," Phil Kuntz wrote:

[Jones] wasn't a member of the speaker's staff. Nor was he a lobbyist. Instead, he was a volunteer in Gingrich's office for up to three days a week, helping the Speaker on what Mr. Jones says were technical aspects of telecommunications matters, among other tasks....[Mr. Jones's telecommunications] holdings are concentrated in a business called Cyberstar that has cable interests in Wisconsin and the Virgin Islands, and also this year invested $1.8 million to start a partnership called US Cyber that sells Internet access and related services....His volunteer job, by all appearances, made him almost a de-facto member of the speaker's staff....He described his telecommunications role this way: "The content of the House bill is the subject of daily negotiations involving the speaker, committee chairmen, and a constant parade of TelCo CEO's. I participate as an observer and interpret and analyze the subtleties of the meeting for the speaker."

"Donald Jones looks like Gingrich's idea of lobbying reform," said Gary Ruskin, Director of the Congressional Accountability Project. "The big problem with such an arrangement is that most Americans are shut out of the legislative process while the corporate special interests get the special provisions, exceptions, loopholes, favors and benefits that they want."

Jones is listed in the Fall, 1995 "Smithsonian Campus on the Mall" catalogue as "president, Earning by Learning Foundation... and Telecommunications director for Speaker of the House Newt Gingrich, United States Congress, Washington."

An October 16, 1995 Boston Globe article by Robert Jordan stated that "In effect, Jones, who has ownership and interests in the telecommunications industry, is working out of Gingrich's office, discussing and apparently influencing legislation that has a direct impact in the telecommunications industry."

On November 11, 1995 the Marietta Daily Journal printed an Associated Press article which stated that Jones "owns 80 percent of Cyberstar, a firm with cable interests in Wisconsin and the Virgin Islands."

Nader noted that the book "Contract With America" by "Gingrich, Armey, and the House Republicans" trumpets the importance of "wresting power from special interests groups and returning it to the public." The book also states "if we break the contract, throw us out."

"It looks like Gingrich ought to be retiring effective 5:00 PM today," Nader said.

The letter from Nader and Ruskin to the Ethics Committee states:

That the Speaker would apparently allow a telecommunications executive to act as 'Telecommunications director for Speaker of the House Newt Gingrich' in negotiations over telecommunications legislation -- which may affect Jones's own holdings directly -- is cause for alarm. Speaker Gingrich should be severely reprimanded if he has provided a telecommunications executive, and the interests he represents, with special and inappropriate favors, access, power, and advantages in the legislative process on telecommunications issues. Speaker Gingrich's behavior in this matter is highly corrosive to the public trust, and appears to be in violation of the House Code of Official Conduct. The Code states: 'A Member, officer, or employee of the House of Representatives shall conduct himself at all times in a manner which shall reflect creditably on the House of Representatives.'"

Even Speaker Gingrich's own counsel warned Jones about possible improprieties in his "volunteer" arrangement with Gingrich. According to a November 11 article in the Washington Post, "Sue E. Wadel, the speaker's counsel, wrote Jones on Feb. 2, informing him of the House rules covering his volunteer service. 'The provision of in-kind services by an individual such as yourself could be deemed an improper subsidy of official activity,' she wrote, adding that Jones' advice 'must be given on an informal policy basis.'"

The new complaint against Gingrich is similar to a previous complaint filed by Nader and Ruskin, and transmitted by Rep. Miller to the Ethics Committee on February 13, 1995. That complaint cited Joseph Gaylord's activities within Gingrich's office as an improper in-kind contribution to the Speaker's offices.

House Rule 45 prohibits "unofficial office accounts." The House Ethics manual explains that "this means that outside private donations, funds, campaign contributions, or in-kind goods or services may not be used to support the activities of, or pay the expenses of, a congressional office." The ethics complaint argues that Mr. Jones's activities appear to be an improper in-kind contribution to Speaker Gingrich's Congressional office. Such in-kind contributions are improper because they allow the appearance, or the actuality, of influence-peddling.

The Ethics Committee's letter of "Guidance on Intern, Volunteer, and Fellow Programs" states that "A member or House office may accept the temporary services of a volunteer, provided the Member or office has a clearly defined program to assure that: (1) the voluntary service is of significant educational benefit to the participant; and (2) that such voluntary assistance does not supplant the normal and regular duties of paid employees." The Guidance notes that the House Select Committee on Ethics allowed "Intern, fellowship, or similar educational programs that are primarily of educational benefit to the individual, as opposed to primarily benefitting the Member or office, and which do not give undue advantage to special interest groups." Jones's "volunteer" status in the Gingrich office does not appear to conform to the Ethics Committee's letter of guidance.

Speaker Newt Gingrich now has six ethics complaints pending against him before the Ethics Committee. The first complaint against him was filed with the Ethics Committee on September 7, 1994 -- more than 14 months ago. Since then, the Ethics Committee has issued no Resolution of Preliminary Inquiry, nor authorized an outside counsel investigation, nor produced even a preliminary written report on the Gingrich investigation.

"The Ethics Committee's incompetence and sloth has been repeatedly demonstrated during the course of this so-called investigation of Gingrich. Chairwoman Nancy Johnson should immediately appoint an independent, outside counsel to perform a full and thorough investigation into the charges against Speaker Gingrich," Ruskin said. "Unless an outside counsel is appointed with broad scope and powers, any decisions by the Ethics Committee on the Gingrich case will raise more questions than they will settle."