PawletyUnlugged

Facts about Minnesota Governor Tim Pawlenty

¹  “Politicians’ Telecoms Wronged Consumers – Pawlenty, Awada, Grunseth Have Been Involved With New Access, A Minneapolis Company Accused in 7 States of Misleading Phone Consumers,” St. Paul Pioneer Press, A1, July 13, 2003.

²“Politicians’ Telecoms Wronged Consumers – Pawlenty, Awada, Grunseth Have Been Involved With New Access, A Minneapolis Company

³“Politicians’ Telecoms Wronged Consumers – Pawlenty, Awada, Grunseth Have Been Involved With New Access, A Minneapolis Company Accused in 7 States of Misleading Phone Consumers,” St. Paul Pioneer Press, A1, July 13, 2003.

⁴“Politicians’ Telecoms Wronged Consumers – Pawlenty, Awada, Grunseth Have Been Involved With New Access, A Minneapolis Company Accused in 7 States of Misleading Phone Consumers,” St. Paul Pioneer Press, A1, July 13, 2003.

⁵“Politicians’ Telecoms Wronged Consumers – Pawlenty, Awada, Grunseth Have Been Involved With New Access, A Minneapolis Company Accused in 7 States of Misleading Phone Consumers,” St. Paul Pioneer Press, A1, July 13, 2003.

⁶“Politicians’ Telecoms Wronged Consumers – Pawlenty, Awada, Grunseth Have Been Involved With New Access, A Minneapolis Company Accused in 7 States of Misleading Phone Consumers,” St. Paul Pioneer Press, A1, July 13, 2003.

⁷“Politicians’ Telecoms Wronged Consumers – Pawlenty, Awada, Grunseth Have Been Involved With New Access, A Minneapolis Company Accused in 7 States of Misleading Phone Consumers,” St. Paul Pioneer Press, A1, July 13, 2003.

⁸“Telecom Firm to Pay $2 million – New Access Had Ties To Top State Officials,” St. Paul Pioneer Press, B1, May 28, 2004; “Telecom Firm, 10 States Settle – New Access, Which Will Pay $2 Million Over Complaints, Once Had Links To Tim Pawlenty,” Star Tribune, May 28, 2004.

⁹“Politicians’ Telecoms Wronged Consumers – Pawlenty, Awada, Grunseth Have Been Involved With New Access, A Minneapolis Company Accused in 7 States of Misleading Phone Consumers,” St. Paul Pioneer Press, A1, July 13, 2003.

¹⁰“Telecom Flap – Voters Need Answers From Pawlenty,” Star Tribune, July 16, 2002.

¹¹“Telecom Flap – Voters Need Answers From Pawlenty,” Star Tribune, July 16, 2002.

¹²“Politicians’ Telecoms Wronged Consumers – Pawlenty, Awada, Grunseth Have Been Involved With New Access, A Minneapolis Company Accused in 7 States of Misleading Phone Consumers,” St. Paul Pioneer Press, A1, July 13, 2003.

¹³“Politicians’ Telecoms Wronged Consumers – Pawlenty, Awada, Grunseth Have Been Involved With New Access, A Minneapolis Company Accused in 7 States of Misleading Phone Consumers,” St. Paul Pioneer Press, A1, July 13, 2003.

¹⁴“Telecom Firm Paid Pawlenty – He Was Adviser While a Candidate,” Star Tribune, 1A, July 16, 2003.

¹⁵“Politicians’ Telecoms Wronged Consumers – Pawlenty, Awada, Grunseth Have Been Involved With New Access, A Minneapolis Company Accused in 7 States of Misleading Phone Consumers,” St. Paul Pioneer Press, A1, July 13, 2003.

 ¹⁶ “Associates Donated To Pawlenty Campaign – NewTel Board Chairman Baer Contributed $24,500 to PAC,” St. Paul Pioneer Press, A5, July 15, 2003.

¹⁷“Associates Donated To Pawlenty Campaign – NewTel Board Chairman Baer Contributed $24,500 to PAC,” St. Paul Pioneer Press, A5, July 15, 2003; “Baer’s Help, Here and There, Adds Up,” Star Tribune, B1, July 22, 2003.

¹⁸“Associates Donated To Pawlenty Campaign – NewTel Board Chairman Baer Contributed $24,500 to PAC,” St. Paul Pioneer Press, A5, July 15, 2003.

¹⁹Findings in the Matter of a Complaint Regarding The Tim Pawlenty for Governor Campaign and The Republican Party of Minnesota, October 10, 2002, Minnesota Campaign Finance and Public Disclosure Board, www.cfboard.state.mn.us.

²⁰“Baer’s Help, Here and There, Adds Up,” Star Tribune, B1, July 22, 2003.

²¹“More NewTel Connections in Minnesota,” St. Paul Pioneer Press, B3, July 19, 2003.

²²“How GOP Allies Dialed Into Telecom,” St. Paul Pioneer Press, A14, July 13, 2003.

²³“How GOP Allies Dialed Into Telecom,” St. Paul Pioneer Press, A14, July 13, 2003.

²⁴“Questions and Answers Regarding Telecom Flap,” Associated Press, July 17, 2003.

²⁵“How GOP Allies Dialed Into Telecom,” St. Paul Pioneer Press, A14, July 13, 2003.

²⁶“Commerce Official’s Past Includes Telecom Trouble – Timothy Commers Was At QAI, A Company Penalized For Slamming, Not Long After, His PAC Was Sued For Telemarketing Tricks,” St. Paul Pioneer Press, A16, July 13, 2003.

²⁷“Commerce Official’s Past Includes Telecom Trouble – Timothy Commers Was At QAI, A Company Penalized For Slamming, Not Long After, His PAC Was Sued For Telemarketing Tricks,” St. Paul Pioneer Press, A16, July 13, 2003.

 

Pawlenty has thousands of reasons not to detect fraud at telecom

 

                While Governor Pawlenty was on the board of directors of and an investor in a telcom company, its largest operating subsidiary (New Access Communications) racked up complaints and fines for ripping off consumers in numerous states through telemarketing fraud.  The Governor did nothing to prevent consumers from being cheated.  At the same time, officials in the companies bankrolled both Pawlenty and his political ambitions.

 

                Consumers Complain and The States Investigate.   From December, 1999 until December 31, 2001, the governor was a member of a three person board of directors of NewTel Holdings, the parent company of New Access Communications.¹  Governor Pawlenty was also an investor in NewTel through 2002.²  New Access paid $222,000 in 2002 to settle charges it overcharged consumers or defrauded them into changing their telephone service.³  The consumers ripped off included the elderly, the mentally retarded, and those with Alzheimer’s disease.⁴  Regulators in Washington, Oregon, and Indiana concluded that New Access slammed or overcharged over 5,600 people in 2001—all while Pawlenty was on the board of its parent.⁵  Regulators in Iowa and Wisconsin also substantiated slamming complaints against the company. ⁶ Indiana and Washington regulators called their fines against New Access the largest slamming-related fines ever imposed in those states.⁷  In 2004, New Access paid over $2 million to settle similar charges in ten states which resulted in 3,000 consumer complaints for conduct dating back to the governor’s tenure on the NewTel board.⁸

 

                Pawlenty Fails To Scrutinize Wrongdoing.  Like Ken Lay at Enron or Bernie Ebbers at Worldcom, the governor claims he did not know of the fraud because “we stayed at kind of the macro financial level.”⁹  As one editorial noted, this “affair raises awkward questions about the governor’s judgment.  By joining the NewTel Holdings’ board of directors in late 1999, Pawlenty chose to enter a business, telecom marketing, with a reputation for exploiting consumers.”¹⁰  The editorial further noted that, “Once on the board, Pawlenty and other directors had a obligation to ask questions when NewTel Holdings’ largest subsidiary became the target of consumer fraud investigations in seven states; when it paid more than $200,000 in refunds and penalties; when the Better Business Bureau rates its performance as ‘unsatisfactory.’”¹¹ As one law professor points out:  a director “is not in that position to be just a potted plant.”¹²

 

Pawlenty and His Campaign Score Big With Telecom Officials’ Contributions. The Governor was recruited to join the board by his long-time political associate, Elam Baer (with whom Pawlenty persuaded Jon Grunseth to run for governor in 1990).  Baer was chairman of the New Access board and CEO of NewTel Holdings.¹³

 

Baer and his companies and their officials gave at least $179,000 in direct payments, stock or political contributions to benefit Tim Pawlenty since 2000.

 

The governor personally received about $70,000 from Baer’s companies.  While Pawlenty ran for governor, one of Baer’s other companies, Access Anywhere, paid Pawlenty $4,500 per month, or about $60,000, even though Pawlenty cannot account for what he did to earn the money and did not even know where the company is located.¹⁴  (Click here to learn more about these payments.)  Pawlenty also got another $10,000 for being on the NewTel board.¹⁵

 

                Baer and officials connected to his companies gave even more to benefit Pawlenty’s political ambitions. All told, they gave at least $109,000 to Pawlenty’s campaign or party organizations or committees promoting his candidacy.

 

Pawlenty received at least $14,950 in direct contributions from officers, investors, or employees (or their relatives) of New Access or NewTel.¹⁶

 

Baer donated $24,500 to a political committee called “Minnesotans for Lower Taxes,” which bought ads promoting Pawlenty in the nomination contest against Brian Sullivan.¹⁷

 

Baer and another NewTel board member (former Republican fundraiser James Holmquist) together gave $57,000 to the Minnesota Republican Party on August 28, 2002, after Pawlenty secured the endorsement.¹⁸  One day before the contribution, the Republican Party purchased video footage of Pawlenty and about a week later began to run ads on Pawlenty’s behalf which later were ruled illegal and resulted in one of the largest campaign fines in state history.¹⁹  (Click here to read more about how the Pawlenty campaign illegally coordinated “independent expenditures” with the Republican Party.)

 

Baer and his spouse gave $13,000 to Minnesotans for America’s promise, which in late 2000 tried to draft Pawlenty to run for the US Senate.²⁰  This committee was reportedly run out of NewTel’s  offices.²¹ 

 

Now fast forward to after Governor Pawlenty is elected:

 

                The Foxes Guard the Henhouse.  The Minnesota Department of Commerce regulates telecommunications companies in Minnesota, including New Access.  The governor appoints the Commissioner of Commerce, who is supposed to zealously regulate the integrity of the marketplace.

 

                After Pawlenty was elected governor, Baer recommended Glenn Wilson as Commissioner of Commerce.²²  Baer had met Wilson in the 1980s when Wilson was part of the Reagan Administration.  “I called Pawlenty and I said, this guy is a star and you should get him,” said Baer.²³    Baer interviewed Wilson for his job.²⁴  And then Pawlenty got him.

 

                Wilson then hired Pawlenty campaign manager Tim Commers as a Senior Executive Officer at the Commerce Department to regulate the telecom industry.²⁵ Commers had been the marketing director for a telephone company founded by Baer—QAI--which was fined $200,000 by California regulators for improperly switching consumers’ service.²⁶  Commers had also previously been found by the Minnesota courts to have engaged in telemarketing fraud in connection with a PAC he ran.²⁷

 

                Is it just a coincidence that the Pawlenty Commerce Department never took any regulatory action against New Access for its telemarketing fraud?

THOUSANDS OF CONSUMERS WERE RIPPED OFF

WHILE PAWLENTY PLAYED RIP VAN WINKLE ON BOARD OF TELECOM

WHOSE OFFICIALS BANKROLLED HIS POLITICAL AMBITIONS