Patriot Act aided feds in probe

Jace Radke

Tuesday, Nov. 4, 2003 | 11:19 a.m.

Federal officials used the Patriot Act to get financial records for current and former politicians as part of the ongoing political corruption probe involving strip club owner Michael Galardi's influence, sources said.

Among those whose records were accessed were Clark County Commission Chairwoman Mary Kincaid-Chauncey, former commissioners Dario Herrera, Erin Kenny and Lance Malone, Las Vegas City Councilman Michael Mack and former Councilman Michael McDonald, sources said.

It wasn't clear what the documents were but sources said the documents were related to the political corruption probe and Galardi's attempts to sway several politicians. All but Mack have been identified as potential targets or subjects of the investigation.

FBI spokesman Jim Stern confirmed Monday that the U.S. Patriot Act was used to obtain financial information in the political corruption investigation.

"A section of the Patriot Act was used appropriately by the FBI and clearly within the legal parameters of the statute," Stern told the Sun.

According to the Patriot Act's provisions the Treasury Department can request information from financial institutions, such as banks, in investigations dealing with suspected terrorists or money launderers.

Under section 314 of the Patriot Act, titled Cooperative Efforts to Deter Money Laundering, information can be provided on those "reasonably suspected based on credible evidence of engaging in terrorist acts or money laundering activities."

Stern said he couldn't comment further because of the ongoing nature of the investigation. Other federal officials also refused to say what the documents were and they refused to provide more details about the review of the records.

Gary Peck, executive director of the American Civil Liberties Union, said he has been concerned that the Patriot Act could lead to violations of civil liberties.

"If these reports are true, and the government is short-cutting the normal checks and balances, it would be precisely the kind of abuses of the Patriot Act that the ACLU and others are concerned about," Peck said. "Instances like these, if they occurred, are exactly why the Patriot Act is a threat to liberties and must be repealed.

"No one can suggest that (the current and former local politicians) are in any way, shape or form involved with terrorist activity."

Mack, who does work for Treasures strip club, said through a city spokeswoman that he had no comment on the report that the FBI had accessed his financial records.

The revelation angered Richard Wright, the lawyer who represents Mack and McDonald.

"When the FBI says we should rest comfortably because they went all the way to Washington to get this approved, I presume they went all the way to Attorney General John Ashcroft, and that shouldn't give anyone comfort," Wright said Tuesday.

"As to my client, Michael Mack, it is now public that the FBI is investigating his financial transactions," Wright said. "This is news to me.

"If the law had been followed by the FBI, this disclosure would not have occurred, because either the FBI or the financial institutions leaked the information that Mack is on the investigation list and that is a criminal act under the statute.

"When the FBI is confronted with an obvious criminal violation ... do they investigate it? No. they join in the violation by confirming it."

No indictments have been released in connection with the public corruption probe that became public with the May raids by the FBI of Galardi's office and Las Vegas clubs, Jaguars, Leopard Lounge and Cheetahs.

In a parallel investigation federal authorities in San Diego raided the Galardi-owned Cheetahs there and the offices of three San Diego City Councilmen.

Galardi pleaded guilty to one count of conspiracy to commit wire fraud in the San Diego case that involves payments of illegal campaign contributions to public officials in an attempt to loosen strip club regulations in that city.

The San Diego investigation has also resulted in the indictments of Malone and three San Diego city councilmen. Malone, Galardi and others were indicted Aug. 28 in San Diego on charges that they made illegal campaign contributions to the three councilmen to influence them to change a policy that didn't allow patrons to touch topless dancers.

Malone has pleaded not guilty to charges of wire fraud, extortion and racketeering in the case, and is free on $245,000 bond. Cheetahs San Diego manager John D'Intino also pleaded guilty to a charge of conspiracy to commit wire fraud.

All three San Diego councilmen, Charles Lewis, Ralph Inzunza and Michael Zucchet, have maintained their innocence.

A "no-touch" ordinance similar to San Diego's was considered and initially passed by the Clark County Commission last year before being repealed.

In the Las Vegas investigation, Kenny has reportedly told friends and supporters that she already has struck a deal and is cooperating with the authorities.

Sun reporter

Jeff German contributed to this story.