Ted Kennedy's brother-in-law pleads guilty to bank fraud charges

He must have made one heck of a deal because in Febuary this was reported...

Ray Reggie, a businessman and Democratic operative with close ties to prominent politicians ranging from former President Clinton and U.S. Sen. Ted Kennedy to former New Orleans Mayor Marc Morial, was charged by federal prosecutors Wednesday with attempting to defraud three banks of millions of dollars.

Reggie, 43, known for his web of political contacts at all levels of government, is a member of one of Louisiana's pre-eminent political families, and until 2002 ran one of the largest advertising-placement firms in the state.

That company, Media Direct LLC, is at the heart of the charges filed Wednesday in parallel bills of information in New Orleans and Baton Rouge.

If convicted, Reggie faces up to 35 years in prison and a $1.25 million fine on the bank fraud and conspiracy charges.

http://www.freerepublic.com/focus/f-news/1335061/posts

Reggie helps in case vs. Clinton aide
Source says calls taped as part of plea
Friday, April 22, 2005
By Gordon Russell and Martha Carr
Staff writers

New Orleans media consultant and Democratic Party operative Ray Reggie worked with the FBI to secretly tape phone conversations that are expected to figure in the case against U.S. Sen. Hillary Clinton's former aide David Rosen as he is tried next month on charges of filing false campaign finance reports, according to a source close to the case.

Reggie's cooperation with the federal probe surfaced Thursday as he pleaded guilty to two federal bank fraud charges unrelated to the Rosen case. One of the bank fraud charges cost Hibernia National Bank $3.5 million, prosecutors said.

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Reggie, 43, signed documents essentially conceding his guilt in the bank case in August 2002, yet he was not charged by the government until Feb. 2. In the 30-month gap, Reggie became a government witness in hopes of securing a lesser sentence, the source said.

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The documents cited by the Sun suggest the FBI has sought to use Reggie as an informant in other probes as well. In the same memo, prosecutors wrote that the federal investigators wanted to use their witness in an inquiry into "a prominent political figure who may be involved in illegally soliciting foreign nationals to contribute to national political campaigns," the Sun reported.

The FBI also asked the witness to tape calls "with targets of an investigation into alleged political corruption in Louisiana," the newspaper said. The scheme described in the memo involved an unnamed state senator and a "fraudulent contract worth $5 million."

Though Reggie has close ties to former Mayor Marc Morial, whose administration has been under close scrutiny by Letten's office, the Sun makes no mention of Reggie providing information related to that probe.

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In addition to his work on campaigns for both Clintons, Ray Reggie worked on former Vice President Al Gore's 2000 presidential bid and helped raise money for U.S. Sen. John Kerry, a close friend who was the Democratic presidential nominee in 2004. Locally, he worked on the mayoral campaigns of Marc Morial and former New Orleans Police Superintendent Richard Pennington.

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Though written terms of the plea agreement were not available Thursday, Ellis, Reggie's lawyer, said prosecutors have agreed in principle to "cap" Reggie's sentence at a maximum of five years in prison. The sentence could be far less -- depending, presumably, on the level of his cooperation.

Though judges tend to accept such agreements, they are not bound by them. Barbier, who was nominated by President Clinton, is free to ignore the agreement and use his discretion in sentencing Reggie, Ellis said.

According to a summary of the bank fraud case filed by Letten's office Thursday, Reggie's legal troubles date to 1999, when he began making "cross deposits" into business accounts at Union Planters and Whitney banks, artificially inflating the balances in both accounts.

More...

http://www.nola.com/news/t-p/frontpage/index.ssf?/base/news-3/1114149370214990.xml

A New Orleans Times-Picayne story is summarized on a page accessible here (footnotes omitted) and carries the following information about Reggie:

[He] became a consultant to well-known Democratic leaders including former President Clinton, former Vice President Gore, and U.S. Senators Hillary Clinton and Edward Kennedy. He also worked on the local campaigns of former New Orleans Mayor Marc Morial and Police Superintendent Richard Pennington. Ray Reggie, 43, engaged in fund raising, planned strategy, and placed advertising — the latter through Media Direct, his Poydras Street company in New Orleans which, at its peak in 2000, had about 40 employees and about $60 million in posted annual revenue.

Following the 2000 election season, Ray Reggie's business took a downward turn, and he set about to support his company by using several dubious schemes. Allegedly, he shifted funds from one bank to another to make his business appear more solvent than it actually was. He allegedly also fabricated documents to create the impression that his business had millions of dollars worth of work contracts and used the bogus contracts to convince lending institutions to advance him loans.

In one instance, Ray Reggie allegedly had an employee lease a mailbox in Washington, DC and impersonate a contracting officer for the U.S. Census Bureau. Reggie allegedly claimed to have a $18.5 million contract with the U.S. Census Bureau and allegedly used the bogus accounts receivable to apply for additional bank loans. Hibernia National Bank has sued Reggie for defaulting on a $6 million loan, and he allegedly is in debt to two other commercial lenders who advanced him money based on falsified claims. In the midst of its financial crisis, Media Direct ceased operation in 2002.

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