Home of Representative Weldon's Daughter Raided by FBI Agents

17 Oct 2006 // Oct. 17 (Bloomberg) -- An FBI raid on the home of Representative Curt Weldon's daughter was part of what one person familiar with the case said is a probe into whether the Pennsylvania Republican steered business to her consulting firm.

The raids by Federal Bureau of Investigation agents took place yesterday at the Philadelphia-area homes of Karen Weldon and her business associate, Charles Sexton, according to FBI spokeswoman Debra Weierman.

Weierman said those raids were among six carried out by the FBI ``in relation to a pending investigation.'' She said four were in the Philadelphia area and two were in the Jacksonville, Florida, area.

While Weierman declined to give further details about the raids, a person familiar with the case said they were part of a continuing investigation into whether Weldon used his position in Congress to help his daughter win consulting business.

Weldon, who is in a tight race for re-election with Democratic challenger Joseph Sestak, called the investigation politically motivated.

Weldon cited the Democratic ties of Melanie Sloan, executive director of Citizens for Ethics and Responsibility in Washington, a watchdog group that filed a complaint with the Justice Department about Weldon's activities in 2004. Sloan, a former federal prosecutor, also has been a Democratic staff member on the House Judiciary Committee.

``What I find ironic, if there is an investigation, is that no one would tell me until three weeks before the election,'' the Associated Press quoted Weldon as saying at a campaign event in Media, Pennsylvania. ``This incident was two and a half years ago.''

Report of Probe

On Oct. 13, McClatchy Newspapers reported that the Justice Department was investigating Representative Weldon's efforts from 2002 to 2004 on behalf of two Russian companies and two Serbian brothers.

Karen Weldon's firm, Solutions North America Inc., received lobbying and consulting contracts to represent those businesses, according to documents the firm was required to file under U.S. laws covering disclosure of contracts with foreign governments, companies and individuals.

The contracts included one for $500,000 to represent Moscow- based Itera International Energy; another for $20,000 a month to represent Saratov Aviation Plant, based in Saratov, Russia; and at least $240,000 to represent the family foundation of the Serbian brothers.

Signed in 2002

The firm's one-year contract with Itera was signed in 2002, according to the documents filed with the Justice Department. Itera's U.S. headquarters are located in Jacksonville. Attempts to reach the company were unsuccessful.

The contract provided a 10 percent commission for any new business that Karen Weldon and Sexton found for Itera. Igor Makarov, president of Itera, signed for the company. The purpose of the contract was ``to create good public relations so in the future Itera may sell goods and services to U.S. entities,'' the firm said in a Justice Department filing.

On the same day Karen Weldon's firm signed the Itera contract, Representative Weldon held a dinner with 30 lawmakers at the Library of Congress to honor Itera's chairman, the Los Angeles Times reported in 2004.

On Jan. 25, 2003, Representative Weldon traveled from Philadelphia to Jacksonville at Itera's expense, according to his congressional financial disclosure statement for that year. Justice Department documents show that either Karen Weldon or Sexton also traveled to Jacksonville at the same time.

Two Other Contracts

Solutions North America had two other contracts with foreign firms, according to Justice Department records. Saratov Aviation Plant paid the firm at least $20,000 a month starting in 2003. The Karic Foundation, based in Belgrade, paid at least $240,000 to Solutions in 2003 and 2004. The firm helped the nonprofit group set up an office in Washington, the documents show.

Citizens for Responsibility and Ethics in Washington filed its complaint with the Justice Department in April 2004 following a Los Angeles Times story detailing Karen Weldon's contracts and her father's ties to the Russian companies.

``We did the right thing and so has the Department of Justice,'' said Naomi Seligman, a spokeswoman for the group. ``We're glad that they are following through on the investigation.''