Herbert Stern

Revelations yesterday that Christopher Christie did not report a personal loan he made to a former top deputy at the U.S. Attorney's office is the latest in a series of self-inflicted wounds that could cost him the race for governor.  Christie had solid lead over Gov. Jon Corzine in last week's Quinnipiac poll (51%), but his own mistakes are helping the Democrats regain some lost ground.  The conventional wisdom among many political insiders is that Corzine, enormously unpopular with voters, cannot win the election, but he can make Christie lose by spending enough to raise the negatives of his Republican rival.

Making a personal loan to a close family friend is not a political liability; indeed, Corzine has made plenty of financial gifts -- sometimes to people he doesn't even like.  Christie's problem here is that he did not report that loan on personal financial disclosure statements required by the Department of Justice.  News last week that Christie discussed his upcoming campaign for governor with former White House Deputy Chief of Staff Karl Rove helps Corzine paint Christie as a conservative Republican close to an unpopular former president.  Christie's decisions - apparently legal - to award no-bid public monitor contracts to: former U.S. Attorney General John Ashcroft; David Kelley, who was the U.S. Attorney in New York who decided not to prosecute Christie's brother for illegal trading violations; and to close political allies Herbert Stern and John Inglesino, who later made major contributions to Christie's campaign, are all self-inflicted wounds.  Christie's greatest attribute is his record taking down corrupt politicians.  His greatest problem, at least right now, is that Corzine can afford to turn each of these issues into 30-second TV ads. 

Updated: Christie did not report income from the loan on his federal tax return, according to a New York Times story.

Corzine's chutzpah is clear, although in blue New Jersey that might not matter.  The governor has not exactly been the poster child for full transparency.  Starting back in 2000, he lost ground when he refused to release his income taxes (he hid behind a Goldman Sachs partnership agreement that was less important a few years later when his ex-partner, Henry Paulsen, became U.S. Secretary of the Treasury.  He has declined to release his personal e-mail correspondence with Carla Katz, who was both his girlfriend and the president of the state's largest public employee union.  He even posted bail for a lobbyist who was accused to stalking one of his closest political allies.

Former Assemblyman Morton Salkind (D-Marlboro) was sentenced to one year in prison today on tax evasion charges.  He will turn himself in on October 5.

In 2008, Salkind admitted he made false accounting entries for a real estate development in Rockaway Township. 

"The prison sentence is appropriate and just," said Acting U.S. Attorney Ralph Marra. "Salkind is a 77-year-old man who is going to federal prison and who has already paid the United States $11.5 million in taxes, penalties and interest. This is a very good outcome thus far."

Salkind, a former mayor and state Lottery Commissioner, has agreed to pay about $17 million in back taxes, interest and penalties.

State Sen. Loretta Weinberg, the Democratic candidate for Lt. Governor, say GOP gubernatorial candidate Chris Christie should disclose the details of his involvement with the federal prosecution of former Assemblyman Morton Salkind (D-Marlboro). 

"While Christie has been quick to take credit for all the accomplishments of the U.S. Attorney's office during his tenure, he has run away from the office's failures even faster," Weinberg asked. "The people of New Jersey deserve answers to critical questions about Christie's role as U.S. Attorney.  What was the policy and criteria for cases being brought to his attention as U.S. Attorney?

The Star-Ledger reported on Wednesday that Samuel Yarosh has filed a lawsuit claiming that federal prosecutors allowed Salkind, his onetime business partner, to plead guilty to a single count of tax evasion, ignoring evidence of additional fraud.  Salkind was represented by a law firm headed by Herbert Stern and John Inglesino, both political allies of Christie, the Republican candidate for governor.

"There are only two possible explanations for Mr. Christie's  assertions that he was unaware of this case- either he mismanaged the U.S. Attorney's office so that a case of this size and import could be settled without his approval or knowledge, or he is not telling the truth about what he knew and when he knew it."

Most of the attention of picking a Lt. Governor candidate has been on the Democratic incumbent, Jon Corzine.  But that doesn't mean Republican Christopher Christie is having an easy time either.  As a former U.S. Attorney, Christie was supposed to be the ethics candidate.  But a couple of self-inflicted wounds - mega million dollar federal monitor contracts for John Ashcroft, David Kelley and John Inglesino - have put Christie, who sent more  than 100 public officials to prison, on the defensive as Corzine and the Democratic Governor's Association have already spent more than $3 million basing Christie on ethics. 

Despite the heaving spending attacking him, Christie leads Corzine by twelve points in a Quinnipiac University poll and eight points in a Monmouth University/Gannett New Jersey poll.   He is the first Republican to be over 50% in an independent poll in 24 years, and some key Democratic insiders now believe Christie can win.  Imagine what the race might look like had Christie hired federal monitors not named Ashcroft and Kelley, and rejected campaign contributions from Inglesino and law partner Herbert Stern? 

Christie will have an easier time picking a running mate because he doesn't have influential officeholders from his own party putting extraordinary pressure on him to pick - or not pick - a particular candidate.  Christie has had to pay special attention to the vetting process, partly because as a former federal prosecutor the bar is set a little higher for him, and partly because he can't any more self-inflicted wounds.  Once Christie loses his lead in arguably the most Democratic state in the nation, it will be nearly impossible to get it back.

Christie may be favoring Kim Guadagno, a former federal prosecutor and state Director of Criminal Justice who has served short stints on the Monmouth Beach governing body and as the Monmouth County Sheriff.  Some say Guadagno is in Christie's comfort zone; she comes out of the same prosecutorial establishment world.  She also has no legislative voting record to pick apart, and may be relatively low-risk for the GOP candidate.  Steve Lonegan, the conservative who challenged Christie is the gubernatorial primary, sort of gave his blessing to Guadagno this week. 

If Corzine picks a Reality TV star, Guadagno can make the argument that she is the most experienced LG candidate.  If Corzine picks a Democrat with more gravitas, Guadagno could be seen as someone who held local office in a town half the size of Wasilla, and as Sheriff of a county about the size of Alaska.

Democratic Chairman Calls on Christie to Return Pay-to-Play Money

“It's time for Christie to do as he says”

TRENTON – Following a Wednesday Newark Star-Ledger editorial that asked for Republican gubernatorial candidate Chris Christie to explain a variety of no-bid contracts he handed out to associates while United States Attorney, New Jersey State Democratic Chairman and Assemblyman Joseph Cryan today called on Christie to return contributions from, and solicited by, recipients of these no-bid contracts.  The Star-Ledger editorial follows previous editorials in the Asbury Park Press and Philadelphia Inquirer questioning the candidate's judgment in handing out no-bid contracts to people he had previous relationships with.

Herbert Stern, a former U.S. Attorney and federal judge, was the UMDNJ federal monitor in 2006-07.

Former U.S. District Court Judge Herbert Stern and his law firm, Stern & Kilcullen, received $3 million in fees for their work as the University of Medicine and Dentistry of New Jersey's federal monitor, not $8 million as indicated in published reports, the law firm says.  The $3 million was paid over a two year period and involved seven different people at the firm.  The $8 million UMDNJ paid to federal monitors included fees paid to consultants not affiliated with Stern & Kilcullen, including auditors.

Stern's fees have become an issue in the gubernatorial campaign of Republican Christopher Christie, who as U.S. Attorney gave Stern a no-bid contract as part of a deferred prosecution agreement with UMDNJ in 2006.  Some Democratic lawmakers and GOP gubernatorial candidate Steven Lonegan are making an issue of campaign contributions to Christie by Stern and others at his law firm.

There is some risk involved as political rivals of former U.S. Attorney Christopher Christie seek to make Herbert Stern an issue in the 2009 gubernatorial campaign.  A former Federal Judge and U.S. Attorney, Stern is a man of considerable gravitas.  Making him look like a common pay-to-play lawyer could backfire if they seek to impugn his integrity. 

Stern was a career prosecutor who went from law school to trying Homicide cases as an Assistant Manhattan District Attorney. (He was the DA sent to the scene when Civil Rights leader Malcolm X. Shabbaz was murdered.) He spent four years as a trial attorney for the U.S. Department of Justice's Organized Crime and Racketeering Section. When Frederick Lacey became the new U.S. Attorney for New Jersey in 1969, he hired Stern as Chief Assistant. The two met a year earlier during the prosecution of Peter Weber, the powerful head of the New Jersey Operating Engineers Union. Stern was the prosecutor and Lacey was the defense attorney; Stern won.

Stern was named U.S. Attorney in 1970, when Lacey became a Federal Judge. In 1974, Stern joined Lacey on the bench and was replaced by his deputy, Jonathan Goldstein, also a career prosecutor.

This trio of federal prosecutors won national attention for their war on political corruption and for their aggressive prosecution of organized crime figures. While nominally Republican (they were appointed by Richard Nixon and Gerald Ford at the suggestion of GOP U.S. Senator Clifford Case), they were viewed as fairly non-political. In fact, they took town several key members of Republican Governor William Cahill's administration; that scandal contributed toward Cahill's defeat in the 1973 GOP primary.

Before leaving office as U.S. Attorney last year, Christopher Christie hired Samuel Stern, the son of former U.S. District Court Judge Herbert Stern, to work as a federal prosecutor.  Samuel Stern started work last month in the Appeals Division of the U.S. Attorney's office in Newark.  His hiring came during the days before Christie left to became a candidate for Governor.

Herbert Stern, who also served as U.S. Attorney, was picked by Christie to serve as federal monitor of the University of Medicine and Dentistry of New Jersey in 2007 after the Justice Department entered into a deferred prosecution agreement with UMDNJ.  Stern's law firm, Stern and Killcullen, received a reported $3 million in legal fees from the no-bid contract.

Stern, his law partners, and their spouses have contributed $23,800 to Christie's campaign for the Republican nomination for Governor.  Through public financing, Christie received an additional $47,600 in matching funds through the seven contributions.  Republican gubernatorial candidate Steve Lonegan and State Sen. Loretta Weinberg (D-Teaneck) have called on Christie to return the Stern contributions.

State Sen. Loretta Weinberg (D-says that GOP gubernatorial candidate Christopher Christie should return nearly $24,000 in campaign contributions from a law firm that received a lucrative federal monitor contract while Christie was the state's U.S. Attorney. 

Christie entered into a deferred prosecution agreement with the University of Medicine and Dentistry of New Jersey in 2006 after it admitted to committing Medicare fraud.  He named Herbert Stern, a former federal judge and prosecutor, to the $500-per-hour post as monitor.  His law firm, Stern and Killcullen, received a reported $8 million in legal fees from the contract.

Citing reports filed with the New Jersey Election Law Enforcement Commission, Weinberg says that Stern and his partners, former Morris County Freeholder John Inglesino and Kevin Killcullen, and their wives each gave the maximum contribution of $3,400 to the Christie campaign.

TRENTON - Citing published reports that Republican gubernatorial candidate and former U.S. Attorney Christopher J. Christie has received almost $24,000 in campaign contributions from a law firm with principals that benefited from a no-bid contract, Senator Loretta Weinberg today called upon the Christie campaign to give the money back.  According to ELEC reports, the Roseland law firm Stern and Killcullen’s partners Herbert Stern, Kevin Killcullen and John Inglesino all contributed the maximum amount allowed under law of $3,400.  The three partner’s wives all contributed the same maximum of $3,400.  According to reports, Mr. Inglesino also contributed the maximum allowed of $3,400 from an election fund for a total of $23,800.