From American Hustle to the Super PAC Hustle

  • submit to reddit

This post originally appeared at the Brennan Center for Justice’s blog.

Photo from TV monitor shows Rep. Richard Kelly, R-Fla., standing and reaching to his back pocket as he was video taped during the FBI's AbSCAM investigation. The tape was released on Thursday, Dec. 12, 1980 in Washington. (AP Photo/ Charles Tasnadi)
Photo from TV monitor shows Rep. Richard Kelly, R-Fla., standing and reaching to his back pocket as he was videotaped during the FBI's AbSCAM investigation. (AP Photo/ Charles Tasnadi)

The academy award nominated American Hustle is loosely based on the Abscam sting by the FBI in the late 1970s and early ‘80s, which brought down six congressmen, Sen. Harrison “Pete” Williams, Camden Mayor Angelo Errichetti and members of the Philadelphia City Council. The heart of the sting was a fake sheik who offered cash in exchange for official acts.

What strikes me, both watching the film (which admittedly takes many liberties and only claims “some of this actually happened”) and in researching the real and twisted tale of Abscam, is how black and white the bribery issue was for the politicians who took the cash back then.

By contrast, now we have a system where vastly more money is being spent for the benefit of elected officials — after all, think of the millions spent by super PACs, which by comparison makes $50,000 in a briefcase seem quaint. The director of American Hustle, David O. Russell, has made this point as well. As he said, “seventy-five thousand dollars in a briefcase is very innocent by today’s standards, where the Supreme Court has made legal… [unlimited election spending].”

Abscam started as a small effort to nab white collar criminals including those dealing in fake securities and stolen art, but after the Mayor of Camden became involved, suddenly the scope of the investigation expanded to other politicians across the country. The fake sheik, played by three undercover FBI agents, asked for American citizenship or permanent residency from the members of Congress. Several of the politicians said they knew how to pull strings for the sheik, including offering to introduce private bills in Congress on his behalf. Meanwhile New Jersey officials were asked to help get valuable Atlantic City gaming licenses.

American Hustle was an entertaining romp, but the truth of Operation Abscam is even stranger than fiction. The lawmakers thought they were meeting an Arab sheik and his American agent, but instead it was an undercover FBI G-Man and a con-man turned informant. Videotape rolled as the politicians took the real money from the fake sheik. According to contemporaneous reporting by ABC News, half a million dollars in bribes was paid by the FBI during the two-year investigation.

From 1978 to 1980, the bureau fabricated Abdul Enterprises Ltd. (hence the operation’s acronym Abscam) to represent the interests of the fake sheik, Kambir Abdul Rahman. Apparently, this was a plausible story to the lawmakers since it was the age of OPEC, gas shortages and petro-dollar wealth for the few who controlled the world’s oil supply. The president of the FBI’s Abdul Enterprises was con-man Mel Weinberg, who helped the FBI pull off the faux sheik scam. He is played by Christian Bale in the movie. The real Weinberg, whose life is detailed in the book The Sting Man, is 90, lives in Florida and is unrepentant about his role in Abscam.

In the Hollywood version, most of the sting takes place in New York’s Plaza Hotel. While the Plaza was one of the real locations in the sting, Abscam was more far flung, including a house in Washington, DC, that was rented from an unknowing Washington Post reporter and furnished with antiques on loan from the Smithsonian, a yacht seized in a drug raid and locations from Florida to New York. Some of the internal FBI records of the operation, like requests to spend more money for the project, are available online. Also online are internal FBI legal opinions that concluded a congressman’s failing to report a bribe broke no law.

One remarkable aspect of the sting was the timing — just four years after the Watergate hearings about bribery, corruption and money in politics led to President’s Nixon’s resignation in 1974 — congressmen and a senator were still willing to take the cash. Among those felled by the sting was Rep. Frank Thompson Jr. of Trenton, who was chairman of the powerful House Administration Committee. This is the Committee that is in charge of federal election rules including campaign finance regulations. During Watergate, Rep. Thompson was the lead author of the House Joint Resolution 1152 (to require the Watergate Special Prosecution Force to make public all information concerning Nixon’s offenses against the US). If anyone should have known better it was he.

Others involved included Reps. John Jenrette of South Carolina, Raymond Lederer and Michael Myers of Pennsylvania, John Murphy of New York and Richard Kelly of Florida, who were all convicted of bribery and conspiracy in 1981. John Jenrette was caught on tape saying he had “larceny in my blood.” Among those prosecuting Jenrette was a young Eric Holder who worked in the DOJ’s Public Integrity Section.

Although several of the lawmakers convicted as a result of the sting said that they were entrapped, the Supreme Court denied certiorari in the appeal of those convicted in Abscam — allowing the convictions to stand. The sting came to an abrupt halt when it was leaked to The New York Times.

Money in politics today mix together on a completely different scale. According to Opensecrets.org, in 2010 – the first year they were allowed — super PACs raised $81,943,192. In the 2012 election, they raised $828,224,595. We are only one month into 2014 and already, as of January 30, 2014, 912 super PACs have reported total receipts of $33,331,156.

Some of these big spenders have been skating on legal thin ice. Luckily for them, our lead campaign finance regulator is asleep on the job. For example, the FEC deadlocked 3-3 on pursuing Crossroads GPS (which has a huge associated super PAC) for potentially violating campaign finance laws.

Despite the miasma of money in our current campaign finance system, there is plausible deniability because the money is spent — nod, nod, wink, wink — “independently.” At least in the 1970s a spade was a spade and a bribe was a bribe. Today, it is not a fake company concocted by the FBI, but rather actual firms that are trying to gain political influence. As many have said before, the scandal now is what is legal — and that’s the real hustle.

The views expressed are the author’s own and not necessarily those of the Brennan Center for Justice. For more Brennan Center news, connect with them on Facebook and Twitter.

Ciara Torres-Spelliscy is a Brennan Center fellow and an assistant professor of law at Stetson University College of Law. She is the author of Safeguarding Markets from Pernicious Pay to Play: A Model Explaining Why the SEC Regulates Money in Politics.
  • submit to reddit
  • Scott Spinucci

    How could you forget PA Sen. Ray Musto? He was indicted and resigned. He’s now headed to Federal prison for accepting bribes. He was netted in a huge operation that brought down judges and other elected officials in Luzerne County, PA over the last several years.