McCord charged with extortion under the Hobbs Act, U.S. attorney says

HARRISBURG — Former Pennsylvania Treasurer Rob McCord told his neighbor, an attorney with a Philadelphia law firm doing business with Treasury, to go to the boss with this message: “If (McCord) loses and you stiffed him, every time you are trying to get something done through state government, you are going to have the State Treasurer looking to screw you.”

It was the spring, with the Democratic gubernatorial primary less than two months away, and McCord was not only trailing in the polls and desperate to raise cash, he allegedly was breaking federal law.

Federal authorities charged him with two counts of attempted extortion Monday. McCord's attorney Robert Welsh told the Tribune-Review that McCord will plead guilty Feb. 17 before Judge John E. Jones III in Harrisburg. He declined to comment on whether McCord cooperated with federal investigators.

The charges carry up to 20 years in prison and a fine of up to $250,000 on each count.

“The citizens of the commonwealth expect and deserve public officials who perform their duties free of deceit, favoritism, bias, self-enrichment, concealment and conflict of interest,” said Special Agent in Charge Edward J. Hanko of the Philadelphia Division of the FBI. “Public corruption is an erosion of the public's trust in our system.”

McCord resigned last week and said he would plead guilty for “stepping over the line” in raising campaign funds from two potential donors. He did not identify the targets of his shakedown. Federal prosecutors said the targets were an unnamed law firm and a property management company.

According to the statement of facts McCord signed, he attempted several times through April and May 2014 to get the Philly law firm to approve a $25,000 donation to him through his neighbor. The managing partner of the firm supported Republican incumbent Gov. Tom Corbett.

At one point, McCord lamented people who failed to donate sufficiently, saying “at the very least, I'm still gonna be the freakin' Treasurer. What the hell are they thinking?”

McCord believed the unnamed management company, based in Western Pennsylvania, was not living up to a commitment to make significant contributions to his campaign and put increasing pressure on a fundraiser to get the people running the company to come through, according to the charging documents.

McCord told the fundraiser that the principals of the company were “rich as gods” and needed to understand the message: “You need to be really careful about breaking your political word ... to a guy who is the sitting State Treasurer.”

At the time, he had loaned his campaign significant amounts of money to keep it afloat. According to campaign finance reports filed after the election, his campaign finished with $2.225 million in debt, all but $25,000 of it in loans from himself.

“Unfortunately, it takes a brush across policymakers trying to make a difference,” said Rep. Dwight Evans, D-Philadelphia.

In a video statement released by his attorney last week, McCord said: “I stepped over the line by trying to take advantage of the fact that two potential contributors hoped to continue to do business with the Commonwealth — and by reminding them that I could make things difficult for them. I essentially said that the potential contributors should not risk making an enemy out of the State Treasurer. Clearly, I was wrong.”

He got nearly $2.5 million from hundreds of donors who made more than 560 contributions in 2014, according to campaign finance records. Since he took office in 2009, the Treasury Department signed nearly 900 contracts with about 190 contractors, according to department data.

McCord lost the Democratic primary election, coming in third behind Tom Wolf and Allyson Schwartz.

U.S. Attorney Peter Smith recused himself from the case because he briefly worked for McCord in the Treasurer's Office; Smith had been a deputy treasurer under former Treasurer Bob Casey Jr.

First Assistant U.S. Attorney Dennis C. Pfannenschmidt is handling the case.

The case was investigated by the FBI, the state police and the Internal Revenue Service.

“Under no circumstances can Pennsylvanians tolerate extortion in the governing process,” said Barry Kauffman, lobbyist for Common Cause of Pennsylvania. “Contracts must go to the most qualified, not those who paid campaign contributions.”

“Pennsylvania has another black eye from another corrupt politician,” said Matt Brouillette, president of the Commonwealth Foundation.

Brad Bumsted is the state Capitol reporter for Trib Total Media. He can be reached at bbumsted@tribweb.com.