Monday, February 25, 2008

If you pay me a lot of money, I won't prosecute you

In Shift, Ashcroft to Testify on Oversight Deal

John Ashcroft will discuss his work for a medical equipment company.

By Carrie Johnson
Washington Post Staff Writer
Tuesday, February 26, 2008; Page D01

Former Attorney General John D. Ashcroft agreed last night to appear at a House hearing to discuss his lucrative arrangement overseeing a medical equipment company, averting a showdown with committee members who had planned to meet today to authorize a subpoena.

The move marks an about-face for Ashcroft, who told lawmakers earlier this month that "discussing the details of my legal responsibilities, as requested, in this pending criminal case and related ongoing criminal investigation would violate my ethical obligations."

Ashcroft, who left public service three years ago to start a private consulting firm, won the contract under a settlement the company reached with federal prosecutors in New Jersey. Under a recent government policy, companies facing criminal investigation can accept such outside supervision to avoid indictment.

Ashcroft's consulting firm stands to collect between $28 million and $52 million over 18 months for reviewing the operations of Zimmer Holdings, an Indiana company that makes replacement hips and knees. Zimmer last year settled government charges over kickbacks it allegedly provided doctors in exchange for using its products.

The deal touched off criticism in New Jersey political circles and on Capitol Hill, where leaders of the House and Senate judiciary committees directed congressional investigators to examine the increasingly popular arrangements, known as corporate monitorships. Legal scholars warn they may become instruments of political patronage that involve little if any judicial oversight.

Rep. Linda Sanchez (D-Calif.), who leads the House subcommittee on administrative law, had been preparing to hold a vote today to authorize a subpoena for Ashcroft. Sanchez's chief of staff, Michael Torra, had said he was confident the panel had enough votes to move ahead.

But yesterday evening, representatives for Ashcroft informed the committee that he would answer questions about his dealings with Zimmer.

"Mr. Ashcroft has agreed to testify voluntarily in the coming weeks on the topic of deferred prosecution agreements," Torra said. A hearing date has not been set.

Mark Corallo, a spokesman for Ashcroft, did not return calls or e-mail messages.

In a Feb. 15 letter obtained yesterday by The Washington Post, Ashcroft wrote that he hoped members of Congress would respect his qualifications to serve as a corporate monitor "despite our past policy differences and my political affiliation." Ashcroft, a Republican from Missouri, was President Bush's first attorney general. Before that, he had served as governor of Missouri, state auditor and in the U.S. Senate, where he was a longstanding member of the Judiciary Committee.

Separately, the Senate Special Committee on Aging is scheduled Wednesday to hold an oversight hearing into Zimmer and four other medical equipment companies that settled kickback allegations with New Jersey prosecutors last year.

Zimmer paid the Ashcroft Group $7.5 million between last September and January, according to information provided to the Senate Special Committee on Aging. Ashcroft and about a half-dozen senior staff members of his firm are covered under a flat $750,000 monthly payment from Zimmer. Other top lawyers affiliated with Ashcroft's consulting business are billing as much as $895 per hour under the agreement, while administrative support staff members are billing $50 to $150 per hour, Senate aides said.

Bills submitted by monitors for the other four companies involved in the settlement are less than half of what the Ashcroft group has charged, averaging a total of about $2 million each, the aides said. Zimmer is by far the largest company in the investigation, and it paid most of the financial penalties to the government under the settlement.

The Justice Department is considering whether to issue "guidance or best practices" to prosecutors around the country and is examining how monitors are selected, an agency spokesman said.