Senator Menendez and the Challenges of Proving Federal Corruption

Prosecutors must thread a needle

New Jersey Senator Robert Menendez, along with his wife and three co-defendants, was indicted last September on federal corruption charges. This is the second federal indictment for Menendez. In 2015 he was charged with accepting hundreds of thousands of dollars in bribes from a co-defendant, Florida eye doctor Salomon Melgen. That case ended in a mistrial in 2017, with the jury hung 10-2 for acquittal. Now federal prosecutors are back, accusing Menendez once again of accepting hundreds of thousands of dollars in bribes.  

Proving public corruption cases is always challenging. Corrupt deals take place in private, often with unspoken, knowing nods and winks. Unless the defendants are unusually clumsy, there will be no other witnesses. Unlike, for example, a fraud case, there are no victims able to come forward and help the prosecution; the “victims” – the citizens at large – usually have no idea the crime took place. The evidentiary challenges are substantial.

And then there’s the legal hurdles. In a series of decisions over the past twenty-five years, the Supreme Court has made it increasingly difficult to prosecute federal corruption. Through its cramped view of what constitutes corruption and artificially narrow interpretations of federal statutes, the Court has repeatedly thrown new barriers in front of prosecutors seeking to hold corrupt officials to account. 

Prosecutors ran into this legal buzzsaw during the last Menendez prosecution, and appears they may have learned some lessons from that experience. This current indictment is crafted to navigate the very narrow channel the Supreme Court has left open for proving federal corruption, and the facts are more in the government’s favor.

Menendez beat the rap last time. This time he may find that a lot more difficult.

The Allegations Against Menendez

The indictment charges that Menendez conspired with his wife, Nadine Menendez, and three New Jersey businessmen to engage in an ongoing bribery scheme. It alleges that Menendez and his wife accepted hundreds of thousands of dollars in bribes from those businessmen, co-defendants Wael Hana, Jose Uribe, and Fred Daibes. The bribes allegedly included cash, gold bars, mortgage payments, a no-show job for Nadine, and a luxury car. In exchange, Menendez allegedly agreed to use his power as a Senator to protect and enrich the co-defendants and to benefit the governments of Egypt and Qatar.

Robert and Nadine Menendez (credit: AP/Susan Walsh)

Acts to benefit Hana and Egypt: The indictment alleges that in exchange for bribes, including a no-show job for Nadine, Menendez agreed to take actions to benefit the government of Egypt and Hana, an Egyptian-American businessman. Hana and Nadine were long-time friends. After Nadine began dating Senator Menendez in 2018, she and Hana introduced Menendez to several Egyptian military and intelligence officials. Menendez allegedly agreed to use his influence on the Senate Foreign Relations Committee to facilitate U.S. military aid to Egypt, to keep Egyptian officials updated on information about such aid, and to provide assistance to Egypt on other matters. He also allegedly provided Egyptian officials with sensitive, non-public information, such as details about the staffing at the U.S. embassy in Cairo. As Menendez did favors for Egypt, Hana allegedly provided him with gifts including cash, home furnishings, and gold bars.

In the spring of 2019, the government of Egypt granted Hana’s company an exclusive monopoly over the certification of U.S. food exports to Egypt as compliant with halal standards. Income from this contract allegedly made it possible for Hana to pay Nadine Menendez for a “low-or-no-show job.” Concerned about the economic impacts of the monopoly, the U.S. Department of Agriculture moved to ask the government of Egypt to reconsider. Senator Menendez, allegedly at Hana’s request, called a senior USDA official to insist that the USDA drop its objections to the contract.

Acts to benefit Uribe’s associates: As a separate part of the bribery scheme, the indictment alleges that Menendez contacted a senior state prosecutor in New Jersey on two occasions and improperly tried to influence criminal cases involving two of Uribe’s business associates. In return, Uribe and Hana allegedly purchased a $60,000 Mercedes-Benz convertible for Nadine Menendez. 

Acts to benefit Daibes and Qatar: Fred Daibes was being prosecuted by the New Jersey U.S. Attorney’s Office. The indictment alleges that in 2020 Menendez improperly conditioned his support for candidates for the U.S. Attorney position on whether the candidate would be sympathetic to Daibes’ case. Menendez also contacted a senior Assistant U.S. Attorney in that office, attempting to influence how the case was handled. In exchange for these efforts, Daibes allegedly provided Menendez with cash, furniture, and gold bars.

Menendez also allegedly accepted cash and gold bars from Daibes in exchange for making statements in support of the government of Qatar at a time when Daibes was seeking a major investment from a Qatari-owned investment company.

The Search Warrant: Federal agents executed a search warrant at the Menendez home in June of 2022. During the search they recovered more than $480,000 in cash, along with gold bars, home furnishings, and the Mercedes, all of which the government claims were provided as bribes.

Gold bars recovered during the execution of the search warrant

The Criminal Charges

After reciting all the facts of the different aspects of the alleged scheme, the indictment charges three corruption counts. All three allege bribery, under different legal theories. Bribery requires proof that a public official corruptly agreed to be influenced in carrying out his public duties in exchange for something of value. The corrupt deal in a bribery case is often referred to as a quid pro quo, or “this for that” – if you give me this, I will do that for you. 

Count One charges all the defendants with conspiring to violate 18 U.S.C. 201, bribery of a federal public official. Section 201 is the primary federal bribery statute. Count Two charges all defendants with conspiracy to commit honest services wire fraud which, as discussed below, is another bribery theory. Count Three charges only Senator and Nadine Menendez with conspiring to commit extortion under color of official right under the Hobbs Act, 18 U.S.C. 1951. That statute also has been interpreted by the Supreme Court to be basically equivalent to bribery.

In sum: three different corruption counts, each relying on the same facts, and each charging bribery using a different legal theory. As discussed below, it is significant that each count charges a conspiracy to commit the offense, not the offense itself.

[Side note: a superseding indictment returned in October added a fourth count, charging a conspiracy to have Senator Menendez act as a foreign agent for Egypt in violation of the Foreign Agents Registration Act, or FARA. Since that’s not really a public corruption charge, I won’t be discussing it here.]

The Supreme Court and Public Corruption Law

In a series of cases dating back to the 1990s, the Supreme Court had made it increasingly difficult to prosecute federal corruption cases. Let’s begin with United States v. Sun-Diamond Growers of California in 1999, where the Court essentially held that it’s not a crime to have a public official on general retainer. 

Sun-Diamond: The federal bribery statute, 18 U.S.C. 201, prohibits both bribery and the lesser crime of gratuities. Sun-Diamond involved a challenge to a popular prosecution theory at the time known as a “status gratuity.” Prosecutors charged that by providing the Secretary of Agriculture Mike Espy with a series of gifts, agricultural co-op Sun-Diamond sought to curry favor with Espy in the hopes that he might act in their interest down the road. Prosecutors argued that a gratuity could be based simply on a public official’s status and ability to exercise power on behalf of the gratuity-giver.

The Supreme Court disagreed. It held that the language of section 201 requires that a gratuity be directly linked to a particular, identified official act by the public official. Simply providing a series of gifts because of the official’s position is not sufficient.

If a businessman provides a public official with a series of gifts over time and expects unspecified favors in return as the need arises, most people would probably consider that corrupt. But after Sun-Diamond, prosecutors can no longer prosecute based on such a relationship. They must prove beyond a reasonable doubt that a particular gift was linked to a particular, identified official act. 

Skilling: In Skilling v. United States, decided in 2010, the issue was a popular public corruption theory known as honest services fraud. Instead of defrauding a victim of money or property, the defendant in an honest services fraud case defrauds the victims of their intangible right to fair and honest services owed to them by someone.

Honest services fraud was particularly popular with public corruption prosecutors in the decade following Sun-Diamond. It provided a vehicle for prosecutors to charge a corrupt relationship without necessarily meeting Sun-Diamond’s requirement of a direct, one-to-one link between gifts and official actions. Prosecutors could charge an ongoing corrupt relationship — a pattern of gifts and favors — under the more malleable honest services fraud statute.

But in Skilling the Supreme Court held that honest services fraud must be limited to cases that involve bribes or kickbacks. More general allegations of an ongoing pattern of gifts and favors, or of conflicts of interest or other corrupt behavior, would not suffice. As a result of Skilling, honest services fraud is now subject to the same stringent quid pro quo requirements of bribery law – it is really just bribery by another name. 

McDonnell: The Court’s 2016 decision in McDonnell v. United States further restricted the scope of federal corruption law. In McDonnell the Court held that even if prosecutors prove a direct quid pro quo arrangement where a public official accepts secret gifts in exchange for exercising the power of his office, that might not be enough to establish bribery.

Virginia Governor Bob McDonnell was charged with bribery under honest services fraud and Hobbs Act extortion (two of the theories used in the Menendez case). Because those statutes do not define bribery, the parties agreed to use a definition from the federal bribery statute, 18 U.S.C. 201(b)(1)(A), which defines bribery as a public official accepting something of value in exchange for agreeing to be influenced in the performance of an “official act.”

Before McDonnell, courts generally defined “official act” to encompass anything done in the course of official duty or under the color of the office. But relying on the precise statutory language of Section 201(a), the Court in McDonnell narrowed that definition.  It held that bribery requires the public official to agree to exercise government power or take some action to resolve a particular question or dispute, or to pressure another official to do so. The Court held that arranging meetings, making phone calls, or providing access to other government officials in exchange for secret gifts did not amount to bribery because those were not official acts within the meaning of the statute.

McDonnell means that public officials are free to sell access to the powers of their office and do a wide variety of political favors in exchange for secret gifts — a direct quid pro quo — so long as their actions do not rise to the level of an official act as defined by the Court. As a result, fights over the scope of “official acts” are now a part of almost every federal corruption case.

[Another side note: there are ways to violate 18 U.S.C. 201 that do not require proof of an official act.  For example, subsection (b)(1)(C) prohibits bribes in exchange for a public official agreeing to do or omit to do an act in violation of his or her official duty. Prosecutors referred to this subsection in the Menendez indictment, but have since said in court papers they intend to rely only on the “official act” theory.]

The Speech or Debate Clause

Another hurdle for corruption prosecutors is the Constitution’s Speech or Debate clause. Article 1, Sec. 6, Cl. 1 provides that for “any Speech or Debate in either House” a Member of Congress “shall not be questioned in any other Place.” In any corruption prosecution of a Senator or Representative, the defense invariably argues that the prosecution is based on their legislative acts and thus is barred by the Speech or Debate clause.

This is a complicated topic and I won’t go into depth here. I did write this longer post about Speech or Debate back during Menendez’s first trial, if you’re interested in a deeper dive:

Senator Menendez and the Speech or Debate Clause

In summary, the clause protects legislative acts, meaning acts that are integral to the process of researching, debating, writing, and passing legislation. But it does not shield everything a Member of Congress does. In particular, the Supreme Court has held that when legislators interact with the executive branch – to advocate for certain policies, for example – those generally are not legislative acts. Constituent services, public speeches, campaigning, and other activities not related to passing legislation likewise are not protected. 

There is one critical distinction that comes into play in a case like this: only the legislative act itself is protected, not a promise to perform that act. The crime of bribery is complete when a public official agrees to perform an official act in exchange for something of value. The government is not required to prove the act was actually carried out – the crime is the deal itself.

For example, a Senator may be charged with bribery for agreeing to vote a certain way in Congress in exchange for a bribe, even though the act of voting would be protected by the Speech or Debate clause. Prosecutors will be prohibited from introducing evidence about the vote itself, but could still prosecute the Senator for the corrupt agreement.

The Legal State of Play

Distilling all of these legal principles, it becomes clear that prosecutors must thread a needle to prove their case. They can’t simply prove that Menendez received hundreds of thousands of dollars in secret gifts because of his official position and general willingness to do political favors for the co-defendants - even though to most people that sounds like corruption.  Prosecutors must prove that gifts were linked to an agreement by Menendez to do something specific in return. But what he agreed to do can’t just be any exercise of his discretion or act taken under color of his office - it must be something that meets the definition of an “official act” as spelled out in McDonnell. And while proving all that, prosecutors must avoid running afoul of the Speech or Debate clause.

Menendez, for his part, understandably wants to put the government in a sort of Catch-22. He argues that many of his actions referred to in the indictment were not official acts and therefore cannot be the basis of a bribery charge. And to the extent the indictment does refer to official acts, he claims the government is barred from proving or prosecuting him for those acts by the Speech or Debate clause. In other words, whatever Menendez did, it either wasn’t an official act or is immune under Speech or Debate.

Heads I win, tails you lose.

The Strength of the Government’s Case

Despite all the challenges outlined above, prosecutors are in a strong position to avoid a repeat of the last Menendez trial. That’s true for a few different reasons.

Benefits of a Conspiracy Charge

One notable aspect of this indictment is that all of the charges are conspiracy charges. The defendants are charged with conspiring to commit the relevant corruption offenses, not with actually committing them. (By contrast, the 2015 Menendez indictment contained multiple individual counts of bribery and honest services fraud and only a single count of conspiracy.)

Rather than focus on proving that a single corrupt transaction satisfies all the requirements described above, the conspiracy charges allow the government to prove an ongoing pattern of conduct. That pattern encompasses all the different schemes outlined above, all the different acts by Menendez, and all the different bribe payments. Prosecutors will need to prove only an agreement to commit one or more official acts as part of the conspiracy. Not everything Menendez is alleged to have done needs to be an official act; many of his actions can just be seen as evidence of the conspiracy in action. 

Menendez may have a decent argument that some of his actions alleged in the indictment, such as meeting with Egyptian officials at a restaurant or speaking to a state prosecutor over whom he has no authority, are not official acts as defined in McDonnell. But that won’t matter, as long as the government proves other official acts as part of the conspiracy. And some of the acts Menendez is alleged to have agreed to do in exchange for the bribes, such as approving foreign aid to Egypt or pressuring officials at the USDA regarding Hana’s contract, will definitely qualify as official acts.

The Agreement is the Crime

As with most bribery cases, the government has a ready response to Menendez’s Speech or Debate claims: the crime is making the deal, not actually fulfilling it. Prosecutors will need to prove only that Menendez agreed to take official acts – such as approving specific military aid to Egypt – in exchange for something of value. They don’t need to prove that he actually did it.

This is also true for conspiracy charges. The crime is the deal, the agreement to pursue criminal activity. It’s not necessary that the crime that was the object of the conspiracy actually succeed.

To the extent the Speech or Debate clause prevents the government from introducing evidence of some of Menendez’s legislative actions, that’s merely an issue for trial. The judge may rule that prosecutors are prohibited from presenting that evidence. But nothing prevents them from proving that Menendez made a deal to take official acts in exchange for cash, gold bars, or other gifts.

That’s why the Speech or Debate claims ultimately will fail, as they did in Menendez’s first trial. At most, the clause will limit some of the evidence the government is able to introduce. It’s certainly not a basis for the court to dismiss the entire indictment, as Menendez has requested. 

But those Speech or Debate claims could result in substantial delays. If the judge denies Menendez’s motion to dismiss, he will be entitled to appeal that decision prior to trial. Because the claim is a right not to be tried at all, this is one of the few issues that entitle a defendant to such a pretrial, or interlocutory, appeal - similar to Trump’s claim of presidential immunity in his D.C. prosecution. In the prior Menendez prosecution, the appeals of his Speech or Debate claims delayed the trial for about 18 months.

The Nature of the Bribes

Another thing prosecutors have going for them in this case is the nature of the bribes. In the last Menendez prosecution, most of the alleged big-dollar bribes were contributions from Melgen to Menendez’s PACs or campaign funds. These were within legal limits and were properly reported. The government alleged that Menendez undertook official acts for Melgen in return for the donations.

Proving that campaign contributions were actually bribes is not impossible, but the bar is very high. The Supreme Court has held that because such contributions are otherwise lawful, to establish corruption prosecutors must show a very clear agreement to be influenced in exchange. It’s not enough merely to show that a donor made a contribution and the politician later did something that favored the donor. That may smell fishy, but that alone does not prove corruption. Indeed, in Washington, that happens every day.

After the Menendez mistrial in 2017, the judge threw out the counts that were based on PAC and campaign donations. The judge said no reasonable juror could have found that the government met its burden of establishing a corrupt deal, and dismissed those charges with prejudice. With their case gutted, prosecutors decided to drop the remaining charges and not re-try the case.

This case presents no similar hurdles. The alleged bribes here were not properly reported and documented political contributions that can be explained away as simply politics as usual. They were secret gifts that included gold bars, envelopes stuffed with cash, and a Mercedes. Whatever other explanations there may be, the defense is not going to be able to argue that these were routine and lawful political donations.

Threading the Needle

As I said at the outset, proving these cases is always challenging. Supreme Court decisions have made proving corruption ever more difficult. As a result, prosecutions of public corruption have steadily declined over the past two decades.

With all that said, prosecutors in the Menendez case appear well-positioned to overcome those obstacles and put on a compelling case. Even in this legal environment, when the corruption is brazen enough, it’s possible to hold public officials accountable. This will be a hard-fought case, but the outlook for Menendez is much more ominous than it was during his first trial.