In Your Face
The media’s fascination with the gold bars, and Senator Menendez’s missed opportunity.
“[I]t is less shameful for a king to be overcome by force of arms than by bribery.” – Sallust
On Friday, September 22, the US Department of Justice (DOJ) unsealed criminal indictments against Senator Robert Menendez, his wife, and three New Jersey businessmen. The group was charged with various bribery offenses related to Menendez’s role as a powerful member of the US Senate, where he chaired the Foreign Relations Committee. To anyone even remotely familiar with New Jersey politics, the nature of the underlying allegations is not exactly shocking. Certain politicians develop well-earned reputations for crookedness, and Menendez’s behavior has long been egregious. That he kept his grip on power after surviving his first round of bribery and corruption charges in 2015 says more about our rotten system than it does about the man himself. Predictably, although Menendez relinquished his duties as committee chair, he is steadfastly refusing to resign.
If this were just another case of a corrupt politician busted with his hand in the cookie jar, the story would have flown over the Coop without nesting. But there is something peculiar about this affair. Both the charging document itself and much of the media coverage that followed seem pointedly focused on the gold bars that Menendez received in transacting on his influence. Here’s how the indictment describes Nadine Menendez’s attempt to launder her husband’s golden cookies into cash (emphasis added throughout):
“The next day, NADINE MENENDEZ met with a jeweler (the “Jeweler”), who was friends with DAIBES and WAEL HANA, a/k/a “Will Hana,” the defendant, and texted with DAIBES about the fact that she was meeting the Jeweler. At that meeting, NADINE MENENDEZ provided the Jeweler two one-kilogram gold bars to be sold. At that time, the spot market price for gold was over $60,000 per kilogram. NADINE MENENDEZ falsely told the Jeweler, in sum and substance, that the gold came from her mother. A court-authorized search of NADINE MENENDEZ’s phone later found a photograph, taken the day of NADINE MENENDEZ’s meeting with the Jeweler, of two one-kilogram gold bars marked with serial numbers indicating they had previously been possessed by DAIBES.”
Perhaps we are being a bit paranoid but given the plethora of criminality oozing out of Washington, DC, singling out any one politician is a de facto exercise in selective prosecution, and to our ears, this case is as much about gold as it is about Menendez. In “Gold in Handcuffs?,” published in March, we warned that the tactics being used to crackdown on the crypto community could just as easily be deployed against owners of the precious metal, potentially leading to a reinstatement of the ban on private gold ownership in the US. We predicted how the propaganda supporting such a move might reveal itself:
“Now imagine Russia’s Putin and China’s Xi make gold a centerpiece of their anti-US-dollar gambit. Designing an effective propaganda campaign to justify outlawing private ownership of gold would be a relatively trivial task for the Eye of Sauron. It would look something like this:
Gold owners are rich tax cheats
Gold owners are Putin sympathizers
Gold owners are unpatriotic
Gold owners are being well compensated for turning in their bullion
Gold owners represent a national security risk
Gold owners enable organized crime, like illegal drugs and sex trafficking”
Should we have added “Gold owners are corrupting our politics” to the list?
What makes Menendez’s ill-gotten gold all the more peculiar is his failure to take advantage of one the most audacious legal loopholes Congress has ever created for itself. In a brazen institutionalization of corruption, it is perfectly permissible for US lawmakers to indulge in all manner of insider trading activities that would land the rest of us in jail. If Menendez had simply helped himself to this perk of public service he might have avoided the need to bathe in the seedy underworld of New Jersey cronyism. Take a position in a stock, work with company executives and lobbyists to insert legislation that helps move the stock in your desired direction, and profit accordingly.
Is it really that simple? How widespread is the insider trading scandal and why is such behavior still legal? Is Menendez being singled out because of the gold connection, or are we just seeing ghosts? Let’s take a trip to the nation’s capital and find out.