A key figure in the sex scandal that led to U.S. Sen. John Ensign’s resignation has been indicted on federal felony charges stemming from his lobbying of Ensign on behalf of Allegiant Air.
No other Allegiant official or employee is accused of wrongdoing. Allegiant spokesman Jordan McGee said the company would not comment on “ongoing legal proceedings.”
Allegiant now accounts for about half the passenger traffic at Bellingham International Airport.
A U.S. Senate Select Committee on Ethics investigation report, released May 10, found that the Nevada senator had used his influence to help former aide Douglas Hampton get work with Allegiant. Ensign’s advocacy on Hampton’s behalf appeared to be part of an effort to placate Hampton, after Hampton learned that the senator was having an affair with his wife, Cynthia Hampton.
Douglas Hampton eventually broke his silence. In June 2009, he told Fox News about Ensign’s conduct, setting in motion the chain of events that eventually led to Ensign’s May 2011 resignation.
Hampton’s first job after leaving Ensign’s office in May 2008 was as an outside consultant for Allegiant, and he eventually was named Allegiant’s vice president of government affairs.
Cynthia Hampton also worked for Ensign as campaign treasurer. Douglas Hampton had learned of the affair in December 2007, according to the Senate report.
The seven-count indictment against Douglas Hampton was handed down in March 2011 by a grand jury in U.S. District Court in Washington, D.C. Six of the seven counts involve actions that he took on Allegiant’s behalf, in alleged violation of the Honest Leadership and Open Government Act of 2007.
That act forbids a former congressional staffer from lobbying his former employer and co-workers for one year after leaving his or her congressional post. The indictment charges that Hampton began trying to use his contacts in Ensign’s office on Allegiant’s behalf just days after he left his job in the senator’s office.
Hampton’s indictment does not mention Allegiant or Ensign by name. It refers to “United States Senator A” and “a low-cost airline carrier that was headquartered in Las Vegas, Nevada.” But the 75-page Senate Select Committee report leaves no doubt that the indictment is referring to Allegiant.
Ensign, a Nevada Republican, resigned from the Senate effective May 3, 2011, after admitting his affair with Cynthia Hampton. Public attention later focused on revelations that Ensign’s parents gave the Hamptons a $96,000 payment about the time that the couple left their jobs with Ensign’s office in the wake of the affair, but well before that affair became public knowledge.
The 75-page Senate investigation report found that Douglas Hampton got more than money. Ensign also made “an extraordinary effort to market Mr. Hampton to Nevada businesses and individuals,” including Allegiant, beginning in February 2008. That was about two months after Hampton learned about the affair between his wife and his boss.
The report further states that “Mr. Hampton’s primary, if not only, marketable asset for a lobbying practice was his relationship with Sen. Ensign, and a number of persons whom Sen. Ensign urged to hire Mr. Hampton testified that they considered his access to Sen. Ensign and his office to be the primary reason they would consider hiring him.”
The investigation report notes that as Ensign recruited lobbying clients for Hampton, he never warned anyone that Hampton would be legally barred from contact with his office for one year.
Before Hampton left his Senate job, the report says, Allegiant agreed to hire him as “an outside consultant for government affairs.”
“Allegiant had a longstanding relationship with Sen. Ensign through two of its executives, (CEO) Maury Gallagher and (vice president) Ponder Harrison,” the report says.
Hampton started trying to help Allegiant even before he left his job in Ensign’s office, the report says.
“In April 2008, his last month in his position as administrative assistant (to Ensign,) Mr. Hampton suddenly developed an interest in policy issues pertaining to aviation. He did not recuse himself from issues related to his future client as required by Senate Rules, but rather actively engaged on them where he had not before, essentially getting a head start on his lobbying career,” the report says.
The Senate report provides an intriguing glimpse of how senators and their staff work to influence federal regulatory agencies on behalf of their constituents. The report says that on urging from Hampton, the senator and his staff intervened with the U.S. Department of Transportation after that agency accused Allegiant of misleading its customers in the way it was displaying its add-on fees on its website.
Department of Transportation regulators initially wanted to impose a heavy fine on Allegiant, but the company denied wrongdoing and contested the regulators’ charge. Hampton lobbied Ensign’s office on the issue, and the senator contacted Mary Peters, Secretary of Transportation in the Bush administration, to discuss the matter.
John Lopez, Ensign’s chief of staff, played the key role in helping to resolve the matter on terms more favorable to Allegiant.
After some of Ensign’s other staffers reported “grave concerns” about Hampton’s conduct, Ensign had ordered Lopez to act as the sole point of contact with Hampton on matters related to Allegiant and other companies.
Lopez, who gave sworn testimony to a special counsel under a grant of immunity from prosecution, said the purpose of that arrangement was to provide a layer of legal protection for the senator, who was aware that Hampton’s conduct was highly questionable.
Lopez told the committee that he contacted key Department of Transportation staffers about the Allegiant issue on several occasions at Hampton’s urging.
Eventually the feds agreed to settle the matter with a consent order calling for a $50,000 penalty. Just $10,000 of that was due in cash, with another $15,000 to be spent on changing Allegiant’s website display. The other $25,000 would be charged only if Allegiant violated the consent order.
The Republican senator apparently did not lose all access to the Department of Transportation after Democrat Barack Obama moved into the White House.
The Senate report says that at Hampton’s urging, Ensign arranged a March 2009 meeting between Allegiant CEO Gallagher and Ray LaHood, Obama’s Secretary of Transportation.
The Senate committee has sent its report to federal prosecutors for possible further action against Ensign for “aiding and abetting” Hampton’s alleged offenses, as well as for obstruction of justice, making false statements, and campaign finance law violations.
INVESTIGATION DOCUMENTS For the letters and reports on the investigation: http://ethics.senate.gov/
Click on "Special Counsel’s Report of the Preliminary Inquiry" under May 12, 2011.