Even by Washington standards, Sen. Bob Menendez’s ties to a former aide, a South Florida donor and an overseas port deal that could benefit the two looks unusually cozy, ethics watchdogs say.
Menendez’s relationship with Dr. Salomon Melgen drew national scrutiny after federal agents last week raided the West Palm Beach eye clinic of Melgen, the senator’s longtime friend and donor.
Last year, as Melgen poured money into Menendez’s reelection efforts, the New Jersey Democrat advocated for a mammoth Dominican Republic port-security contract held by one of Melgen’s companies, called ICSSI.
A former Menendez aide, one-time Miami resident Pedro Pablo Permuy, is slated to be a top officer for ICSSI, Melgen’s cousin has said.
Permuy also runs a business advocacy group, the United States-Spain Council, which Menendez co-chairs. It’s supported by another Melgen company and a host of well-heeled special interests on Capitol Hill.
“This web of relations raises eyebrows,” said Meredith McGehee, policy director for the Washington-based nonpartisan Campaign Legal Center.
McGhee said it’s fairly typical for a former Congress member and aide to work closely together when both leave Congress.
“But what distinguishes this relationship is that the senator is still in office,” McGehee said. “And there’s not just one link. There are many: Menendez, the former staffer, the donor, the business and the nonprofit business group.”
Complicating the situation is the wide-ranging nature of the FBI’s interest in Menendez and Melgen.
When FBI agents raided Melgen’s office, they were joined by inspectors from the U.S. Department of Health and Human Services, which is investigating potential Medicare fraud.
That probe is parallel to the FBI investigation examining the ties between Melgen and Menendez.
The FBI began examining the two after a shadowy tipster began emailing claims that Menendez and Melgen consorted with Dominican Republic prostitutes, some of whom were said to be underage.
Both men deny the charges, with Menendez telling reporters this week that the emails were a “smear.”
The tipster who leveled the allegations, starting in the spring of 2012, did so by email and likely used a pseudonym. He refused to meet with investigators.
One tip that did pan out: Menendez did use Melgen’s private plane and failed to report it or pay for it in 2010, breaking Senate ethics rules.
Only after a New Jersey Republican Party ethics complaint was filed did Menendez’s staffers check his schedule and, they said, determine Menendez had taken two trips on the plane that he should have reported as a gift or paid for.
Menendez cut a $58,500 check to Melgen, the senator’s office said. Menendez flew only three times on Melgen’s jet and properly accounted for it once, staffers said, adding that the senator has paid for personal trips to the Dominican Republic via commercial flights other times. But they did not disclose the dates or number of visits.
When the New York Times first reported Permuy’s involvement in the ICSSI deal, Permuy tried to downplay his involvement in a brief email to the newspaper.
Permuy, a Belen Jesuit Preparatory school graduate who attended the University of Miami, has since stopped answering his phone or emails.
Menendez’s spokeswoman said the senator had no idea Permuy was involved with ICSSI, which wants to X-ray port cargo as part of a contract worth as much as $500 million or more.
But ethics watchdogs have their doubts.
“That’s the howler of the day. I don’t see how the senator couldn’t have known about it,’’said Ken Boehm, chairman of an ethics watchdog group called the National Legal and Policy Center.
“Permuy is not just a former staffer,” Boehm said. “He did two stints with Menendez. Menendez advocated for this issue. And they’re together on this council? How could Menendez not really know?”
Boehm points out that Melgen’s cousin, Vinicio Castillo Seman, told reporters publicly, privately and in writing that Permuy was involved with the ICSSI deal. Castillo mentioned Permuy, a former assistant U.S. defense secretary, to rebut critics of ICSSI who noted that eye doctor Melgen had no security background.
“Why would Castillo go out of his way to say we’re going to hire this guy to run the thing?” Boehm asked.
Permuy appears to be on a first-name basis with former Secretary of State Hillary Clinton, who has received campaign money from Melgen as well. Permuy worked for Menendez in the mid-‘90s and then again in the early 2000s.
In June 2012, during the United States-Spain Council’s forum in Menendez’s home state of New Jersey, Clinton thanked “Pedro” for serving as president of the council and for his involvement in the forum, attended by Spain’s king. Menendez is the honorary chair of the group.
Clinton also name-dropped Francisco J. Sánchez, the Commerce Department’s undersecretary for international trade.
A month later, Sanchez was giving testimony at the Senate Foreign Relations Subcommittee on the Western Hemisphere when Menendez brought up contracting issues in the Dominican Republic.
“You have another company that has American investors that ... has a contract actually given to it by the — ratified by the Dominican Congress — to do X-ray of all of the cargo that goes through the ports,” Menendez said. “And they don’t want to live by that contract either.”
Menendez didn’t mention ICSSI by name.
Around the time of the council’s forum, Melgen’s Vitreo-Retinal Consultants company contributed $400,000 to a Democratic political committee, Majority PAC, that supported Menendez. In October, Vitreo-Retinal contributed another $300,000.
Majority PAC then contributed $582,500 to boost Menendez’s re-election.
The year before, Melgen and his wife contributed $40,000 to a group called the Fund to Uphold the Constitution, which successfully fended off a Republican recall effort. Prior to that, the Melgens contributed $60,400 to the Democratic Senatorial Campaign Committee when Menendez chaired it in 2009 and 2010.