Menendez Spent Up to 87% of His Wealth Repaying Donor for Flights

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Facing questions about his relationship with a donor, the New Jersey senator appears to have emptied out his savings in an effort to put concerns to rest.

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Reuters

When Robert Menendez arrived in the U.S. Senate in 2006, he was a relative pauper in a chamber often called a millionaires' club. The New Jersey Democrat ranked 97th out of 100 senators in terms of his personal wealth, according to financial records filed that year and compiled by the Center for Responsive Politics.

So Menendez's decision last month to use his personal funds to reimburse a prominent political contributor $58,500 for two flights to the Dominican Republic came at a major cost. The repayment amounts to between 32 percent and 87 percent of the assets Menendez reported holding in bank accounts and stock, according to his latest financial-disclosure form, which was filed last year.

Menendez repaid Florida eye doctor and political donor Salomon Melgen only after his free flights aboard Melgen's plane became public and the subject of a Senate ethics complaint. A local New Jersey Republican group filed a complaint last November, alleging the senator had broken Senate rules by "repeatedly flying on a private jet to the Dominican Republic, and other locations." Menendez reimbursed Melgen the $58,500 two months later, on Jan. 4, according to his office.

In telling his own story, Menendez likes to talk about his scrappy roots. The first paragraph of the biography on his official Senate website notes that he is the son of immigrants who grew up in a tenement in Union City, N.J. Menendez, 59, rose from the local school board to mayor to state legislator to House member to U.S. senator. He recently became the chairman of the Senate Foreign Relations Committee.

As Menendez has accumulated political power, however, he has not accumulated great wealth. His 2011 financial disclosure, filed last May, lists checking and savings accounts that held somewhere between $66,003 and $165,000. (Congressional disclosure forms list assets in ranges.) He also owned stock in a single company, Metropolitan Life Insurance, worth between $1,001 and $15,000. A rental property he owned in Union City generated between $15,001 and $50,000 in income in 2011. (The property itself was valued at between a quarter-million and a half-million dollars, with Me-nendez still owing somewhere between $50,001 and $100,000 on the mortgage, the disclosure report shows.)

It would appear to be a comfortable enough living, especially with a senator's annual $174,000 salary. But not so comfortable that cutting a $58,500 check couldn't have a profound impact.

Menendez's office declined to comment on the senator's personal finances or the details of how he managed to pay back the $58,500 for the two flights.

On Monday, Menendez told CNN that paying for the flights simply "fell through the cracks."

"When it came to my attention that payment had not taken place, I personally paid for them in order to meet my obligation," he said.

Government watchdogs are dubious. They say Menendez's financial situation adds fuel to questions about his motives and whether the free flights he accepted were a simple oversight.

"For a senator that's not a Rockefeller, that's real money," said Meredith McGehee, policy director for the nonpartisan Campaign Legal Center. "It kind of makes you wonder .... If he knew in advance that the trips were going to cost him $60,000, would he have done it?"

In the years after the Jack Abramoff scandal, which involved trips abroad for politicians, McGehee said it "stretches credibility" that Menendez was unaware he was receiving a gift while boarding a private flight to a Caribbean island. "You're about to walk on a private plane, and you're a public official -- and that doesn't occur to you?" she said.

Melanie Sloan, executive director of Citizens for Responsibility and Ethics in Washington, another watchdog group, was even less charitable.

"He waited until he was caught to pay them back," she said. "If you rob a bank -- and you're caught -- you don't say, 'Take the money back and forget about it.' "

In a statement, Menendez's office defended the senator and said all flights had now been paid for. "Dr. Melgen has been a friend and political supporter of Senator Menendez for many years," the statement said. "Senator Menendez has traveled on Dr. Melgen's plane on three occasions, all of which have been paid for and reported appropriately." (The third trip was previously paid for and reported by the Democratic Senatorial Campaign Committee, which Menendez chaired in 2009 and 2010, as the senator was traveling to raise funds.)

The tale of Menendez and Melgen has taken dramatic twists and turns in recent weeks. A conservative website, The Daily Caller, first alleged last fall that Menendez had visited prostitutes during the Dominican trips with Melgen. The accusations didn't draw wide media attention until the FBI raided Melgen's Florida offices last week, though it is not clear the raid had any connection to Menendez. Menendez told CNN: "The bottom line is, all those smears are absolutely false." The FBI would not comment.

Melgen and his wife have been longtime political contributors to Menendez, dating back to the 1990s, giving tens of thousands of dollars. When Menendez chaired the DSCC in 2009, the Melgens gave the committee a combined $60,400. And in 2012, Melgen's company gave $700,000 to a super PAC dedicated to electing Senate Democrats. That group, Majority PAC, spent $582,500 on Menendez's behalf en route to his reelection last fall.

In addition to the political giving, the Melgens supported a legal defense fund that Menendez created in 2011 to fend off a Tea Party-backed recall effort. The state high court dismissed the recall effort, and Menendez used his legal fund, called the Fund to Uphold the Constitution, to pay his lawyers.

"During the proceedings, the senator appreciated those who helped defray the costs of defending our democratic system from this frivolous, right-wing attack," Menendez spokesman Paul Brubaker said.

Salomon and Flor Melgen gave a combined $40,000 in 2011 and 2012 to the legal fund, making them its largest donors.

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Shane Goldmacher is a congressional correspondent for National Journal.

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