RICHMOND, VA - Former Virginia Gov. Bob McDonnell, once viewed as a rising star in the GOP, and his wife were indicted Tuesday on federal corruption charges accusing the couple of accepting tens of thousands of dollars in loans, shopping sprees, money for their daughter's wedding -- and even a joyride in a Ferrari -- from the owner of a company that makes health supplements.
The 14-count indictment portrays the former governor as deeply entrenched in credit card debt even before he took office and willing to accept lavish gifts from Star Scientific CEO Jonnie Williams, who hoped the first couple's endorsement for his products would yield big profits for his company.
McDonnell appeared Tuesday night at a hastily called news conference in Richmond to strongly deny any wrongdoing and denounce what he said was an "unjust overreach" by federal prosecutors.
"I did nothing illegal for Mr. Williams in exchange for what I believed was his personal friendship and his generosity," said McDonnell, who was flanked by his wife, daughter and son-in-law as he read from prepared remarks.
McDonnell vowed to "use every available resource and advocate" to fight the charges.
While still in office, McDonnell apologized for accepting the gifts and repaid thousands to Williams. Limited to a single term by state law, McDonnell left the executive mansion earlier this month in disgrace, his approval numbers low and his political future in tatters. At one time, McDonnell had been considered a possible running mate for Mitt Romney, and the governor's seat has opened the door to higher office since Thomas Jefferson held the post from 1779 to 1781. McDonnell delivered the 2010 Republican response to the State of the Union Address, and became chairman of the Republican Governors Association in 2011.
Twelve of the counts are punishable by up to 20 years in prison each, and two are punishable up to 30 years. Fines can range from $250,000 to $1 million.
The 43-page indictment portrays a cozy relationship between the McDonnells and Williams that began even before he took office, with many of their interactions initiated by Maureen McDonnell. In 2009, just before the governor's inauguration, first lady Maureen McDonnell wrote to a senior staffer for her husband: "I need answers and Bob is screaming about the thousands I'm charging up in credit card debt. We are broke, have an unconscionable amount in credit card debt already, and this inaugural is killing us!"
Even before they took up residence in the governor's mansion, Williams was offering the family money. He was known as a donor who allowed the McDonnells use of his private jet on the campaign trail. In December, he was willing to pay for an Oscar de la Renta dress that the cash-strapped first lady could wear to the inauguration. Although she was the one who asked for the dress, she later refused the offer at the staffer's urging. But the partnership between Williams and the McDonnells was already underway.
However, the indictment says Maureen McDonnell cut a deal with Williams about two years later: if he bought her dresses and accessories for her daughter's wedding and the couple's anniversary, she would make sure he had a prime seat next to her husband at a political event in New York City.
Williams paid her nearly $20,000 tab at stores like Oscar de la Renta and Louis Vuitton, the indictment says. As promised, Williams was seated next to the governor at the event on April 13, 2011.
The indictment also details a $50,000 loan Williams made to the McDonnells in May 2011, along with $15,000 for their daughter's wedding. The money was later used to pay for catering costs for the wedding, as well as payments totaling nearly $20,000 for the family's credit cards.
Then, in June, Star Scientific began jockeying for grant money that could be used for researching the potential health benefits of one of its products, Anatabloc. The grants could not be given to for-profit entities; but Star Scientific was financially strapped, so company officials began reaching out to state research universities, asking them to apply for the grants to conduct the research. And the company held up two of the state's most visible figures in asking the universities to do its bidding: the governor and his wife, who supported researching the company's products.
The next month, the McDonnells enjoyed a lavish vacation at Williams' multimillion-dollar home on Smith Mountain Lake, which included free reign over Williams' personal Ferrari and a boat rented just for the occasion. Williams arranged for a staffer to deliver the luxury sports car from his Richmond home to the vacation estate 160 miles away, and Maureen McDonnell snapped a photo of her husband driving the car and emailed it
to Williams on July 31.
The very next day, Williams was in a meeting with the McDonnells and a senior adviser in the state health department, pitching Star Scientific products and even suggesting that government employees could serve as a control group for research studies.
That same day, Maureen McDonnell asks Williams to buy her husband a Rolex watch. Even Williams is hesitant at first, asking if a senior government official would actually wear such a thing. But Williams acquiesced, buying a Rolex with "71st Governor of Virginia" engraved on the back that McDonnell later received as a Christmas gift.
Later that month, Star Scientific made an important announcement in a press release: The company was launching its signature product at a reception at the governor's mansion, with university research scientists in attendance.
For months afterward, Maureen McDonnell frequently appeared at events held by Star Scientific and discussed the company's virtues. Later that year, however, she sold more than 6,500 shares of stock she owned in the company, wanting to avoid having to report it on public disclosure forms.
Then, in February 2012, the McDonnells discussed transferring 50,000 shares of Star Scientific stock that they could use as collateral for a loan for their failing real estate business, MoBo. However, to avoid having to disclose the stock on public forms, Williams instead loaned the McDonnells $50,000. To avoid raising suspicion that Williams was loaning them the money, he told his assistant to void a check that listed Maureen McDonnell in the memo line and to write a new check.
As the gifts piled up, the governor's endorsements appear to have become more blunt. In March 2012, the governor pulled a bottle of Anatabloc from his pocket during a meeting with the secretary of administration during a discussion of reducing health care costs. He told her that he personally took the supplement, and that it worked.
By February 2013, the scheme began to unravel. The indictment says Maureen McDonnell lied about being longtime friends with Williams, even though he was only an acquaintance even as late as 2009. She and Bob McDonnell then tried to cover up the $50,000 loan. Maureen McDonnell also returned the clothes Williams had bought for her, suggesting his daughter could use them or that he donate them to charity.