Bloomberg News

Edwards Used Illegal Campaign Funds to Hide Affair, U.S. Claims

June 03, 2011

June 3 (Bloomberg) -- Two-time U.S. presidential candidate and former North Carolina Senator John Edwards was indicted for allegedly accepting more than $925,000 in illegal campaign contributions to cover up an extramarital affair.

A federal grand jury indicted Edwards, 57, on six counts, including conspiracy, false statements and for accepting illegal campaign contributions. The donations came in 2007 and 2008 and were part of an effort to prevent public revelations that would undermine his presidential campaign, according to the indictment filed today in federal court in Greensboro, North Carolina.

Edwards, a Democrat, has been the subject of a two-year investigation into whether he used the funds to conceal his relationship with filmmaker Rielle Hunter, with whom he had a child, while running for president in 2008.

“Edwards knew that public revelation of the affair and pregnancy would destroy his candidacy by, among other things, undermining Edwards’ presentation of himself as a family man and by forcing his campaign to divert personnel and resources,” according to the indictment.

Edwards is scheduled to appear today in federal court in Winston-Salem. Each of the six counts he faces carries a maximum five-year prison term and potential $250,000 fine.

“John Edwards will tell the court he is innocent of all charges, and will plead not guilty,” Gregory Craig, an attorney for Edwards, said in an e-mailed statement. “He did not break the law and will mount a vigorous defense.”

White House Counsel

Craig, a partner at the Washington office of New York-based Skadden, Arps, Slate, Meagher & Flom LLP, served as White House counsel to U.S. President Barack Obama.

Edwards publicly acknowledged the relationship with Hunter in August 2008. A lawyer who served in the Senate from 1999 to 2005, Edwards was Massachusetts Senator John Kerry’s running mate in the 2004 presidential election. In January 2008, he withdrew as a presidential candidate, later revealing his affair after a newspaper reported that he fathered Hunter’s daughter.

In an interview with ABC News in August 2008, Edwards said the relationship with Hunter began in 2006 after he met her in a bar in New York. He later hired her to produce Web videos for his campaign. Edwards, who has denied providing money to Hunter, claimed paternity of her child in 2009.

In a 2009 book, Elizabeth Edwards said her husband confessed the affair in the final days of 2006, after returning home from a tour announcing his second run for president.

Elizabeth Edwards died in December after a six-year battle with breast cancer.

Federal Election Act

The Federal Election Act limits the amount individuals may contribute to candidates. The most an individual could contribute in the 2008 presidential primary was $2,300.

Edwards accepted about $725,000 from one person and more than $200,000 from another, according to the indictment.

The payments at issue were used to cover Hunter’s rent, medical visits and prenatal expenses, in addition to travel and hotel accommodations to hide her from the public, according to the indictment.

Edwards emerged on the national scene in 1998 when, with little experience in politics, he defeated North Carolina Republican Senator Lauch Faircloth. Shortly after being sworn into office, the Senate’s Democratic leaders tapped him to help handle the impeachment of President Bill Clinton.

Single Term

Edwards gave up his Senate seat after a single term in order to run for what would be the first of two failed presidential campaigns.

Though he had made millions of dollars as one of North Carolina’s top trial lawyers, Edwards ran populist campaigns in which he railed against the divide between rich and poor -- “Two Americas,” he called it -- while frequently referring to his father’s work in a textile mill.

One former federal prosecutor said the government may have a difficult time proving its case against Edwards as juries are often willing to forgive indiscretions involving extramarital affairs.

“Juries are loath to convict a public figure for mistress- related crimes,” said Ken Julian, now with Manatt Phelps & Phillips LLP in Los Angeles. “Even if he did step over the line, I think they’ll have a hard time pulling the trigger.”

The case is U.S. v. Edwards, 11-00161, U.S. District Court for the Middle District of North Carolina (Greensboro).

--With assistance from Phil Milford and Dawn McCarty in Wilmington, Delaware. Editors: David E. Rovella, Jim Rubin

To contact the reporters on this story: Sophia Pearson in Philadelphia at spearson3@bloomberg.net; Justin Blum in Washington at jblum4@bloomberg.net and; Brian Faler in Washington at bfaler@bloomberg.net.

To contact the editor responsible for this story: Mark Silva at msilva34@bloomberg.net Michael Hytha at mhytha@bloomberg.net


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