Web of Influence

Ties between Menendez and controversial donor more extensive than previously thought

Bob Menendez, Salomon Melgen / VOXXI
BY: Mary Lou Byrd

February 11, 2013 9:00 am

A controversial Democratic donor now under federal investigation has affiliations with numerous Latino groups that have allowed him access to high-level Obama Administration officials.

United States Spain Council (USCC), a 501(c)(3) nonprofit organization, lists SFM Holdings, of which Melgen is the president and general partner, as an organizationalmember of the council.

Melgen’s connection to USSC links him to his long-time friend Sen. Bob Menendez (D., N.J.). Menendez is the honorary chairman of the council.

Both Menendez and Melgen are under investigation. Menendez is facing a Senate ethics probe for his relationship with Melgen while the FBI and Department of Health and Human Services is investigating Melgen for possible Medicare fraud.
Menendez and Melgen are also under suspicion for Menendez’s intervention on Melgen’s behalf regarding a port security contract.

Melgen, Menendez’s top contributor and a heavy contributor to the Majority PAC run by former lieutenants of Senate Majority Leader Harry Reid (D. Nev.), stood to make between $500 million and $1 billion over 20 years if that contract was enforced.
Menendez’s former aide, Pedro Pablo Permuy, is the president of USCC. Permuy could also have benefitted from the Dominican Republican port security contract, which Menendez advocated in talks with State Department officials and at a hearing over which he presided last July, according to aNew York Times report.

Menendez claimed he did not know Permuy was involved in the port contract. Permuy denied being either a board member or an employee of the port security company.

“His answer was coy,” said Ken Boehm, chairman and co-founder of the National Legal and Policy Center. Boehm noted that Permuy did not answer the question, but rather stated he was not currently affiliated with the company.
Boehm pointed out that Permuy has worked for Menendez for years during his tenure as a congressman and said the senator was being “more than disingenuous” to indicate he was shocked his former aide would be involved in the port security deal.
The USSC’s mission is bringing “U.S. and Spanish corporate leaders, top government officials, and leaders in education and culture promote stronger ties between the two countries,” according to its website.
The U.S. Spain Council did not respond to requests for comment.
Another key member of the council is Univision, which has largely avoided stories on the Menendez scandal. Univision did not respond to request for comment.
Former Secretary of State Hillary Clinton, transportation secretary Ray LaHood, and other top officials from the Obama administration attended the council’s 2012 forum in New Jersey. Clinton thanked Menendez and Permuy in her opening remarks:
I also want to thank my long-time friend and former colleague – I think it’s fair to say that Senator Bob Menendez is truly one of the most effective, determined, dedicated public servants in our country. … Thanks also to Juan and Pedro [Permuy] for their co-chairing and presidency of the U.S.-Spain Council.
Melgen is also a member of the New America Alliance (NAA), a group co-founded by Henry Cisneros. VOXXI, the media company of which Melgen is the chairman of the board, is a media partner of the NAA, and Univision is also a sponsoring organization of the NAA.
Menendez’s affiliation with the NAA includes his attendance at many of its summits. He also initiated one of the NAA’s goals, issuing a press release asking Fortune 500 companies to identify the number of Hispanics on its corporate boards and serving in senior level positions. The NAA’s goal was to increase Hispanics serving in high-level jobs in major corporations and at financial institutions.

The NAA asked “what the story is regarding and what about NAA will be mentioned” before agreeing to comment on the connection. Questions sent by email to NAA’s Lisa Rodriguez regarding Melgen’s membership and its partnership with VOXXI went unanswered. Additionally, a question about whether the NAA does vetting of its members was not answered.

Univision president Cesar Conde gave the opening remarks at the NAA’s First American Latino National Summit held in Florida last September. The moderator at the summit was Maria Eleana Salinas, who is the co-host “Noticiero Univision” and “Aqui y Ahora.” The summit’s sponsors included Univision and VOXXI.

Other high-level Democrats have also attended other NAA events. The NAA’s 10th anniversary gala was attended by many in the Obama administration, including President Obama’s senior adviser Valerie Jarrett; outgoing secretary of the interior Ken Salazar; White House director of urban affairs policy Adolfo Carrion; deputy director of the National Economic Council Diana Farrell; White House director of intergovernmental affairs Cecilia Munoz; and director of administration Moises “Moe” Vela.
Sens. Menendez and Mark Warner (D., Va.) and Reps. Charles Gonzales (D., Texas), Jim Himes (D., Conn.), and Nydia Velazquez (D., N.Y.) alsoattended the gala.

Another Latino group, the nonprofit National Hispanic Media Council (NHMC), issued a statement last week defending Menendez, saying it stood with the New Jersey senator “as some in the ‘news’ media use unsubstantiated allegations to smear him. The senator has devoted his life to serving the public and deserves to be judged based on facts, not hearsay.”
The Free Beacon asked for clarification of the statement in an email exchange with Inez Gonzalez, the executive vice president of the NHMC.

“We don’t think that all the stories referring to the senator are an attack on his character,” Gonzalez said. “Late yesterday, after our statement went out, the Washington Post released an investigative piece on the senator. Our statement referred to conservative websites such as the Daily Caller and also Bill O’Reilly who rely on anonymous sources to spread allegations linking the senator with underage prostitution.”

Daily Caller Spokeswoman Nicole Roeberg disputed the NHMC’s comments.

“Our sources were not anonymous. We didn’t release their names, but we posted their videos on our website, with their faces blocked out, to respect their privacy,” she said. The women interviewed from the Dominican Republic told the Daily Caller they were “paid to have sex with the senator, and they do have names and faces,” said Roeberg.

Fox News did not respond to requests for comment.

The NHMC did not have comment on the other “unrelated allegations,” said Gonzalez.

“NHMC wasn’t aware that Dr. Melgen had a media company, we don’t know Dr. Melgen,” Gonzalez said when asked about Melgen’s possible ties to the NHMC. “As far as I know, we have had no dealings with him or his company.”

However, the NHMC’s claim that it had no dealings with Melgen’s company, VOXXI, is not the case. The Free Beacon found numerous stories in which VOXXI interviewed and quoted the NHMC president in articles and the NHMC president was a panelist alongside VOXXI’s president at an NAA summit.