May 27, 2008 11:26 PM UTC

Roll Call Jumps Gun on Schaffer-Related Fraud Trial

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• by: Colorado Pols

We sheepishly explained to our readers Friday morning that we had been given bad information the night before regarding the felony fraud trial of the former head of the National Renewable Fuels Foundation (NAFF), whose board of directors during the time of the alleged fraud included Senate candidate Bob Schaffer. Contrary to our original update, the trial had not (and still has not as of this writing) ended, and the jury is deliberating the roughly two dozen counts in question.

We hate reprinting bad information, but we know “real” media outlets hate it even more. With that in mind, Roll Call reports:

Former Rep. Bob Schaffer (R-Colo.) has been named as a possible witness by prosecutors in the sentencing phase of a federal tax evasion and embezzlement case involving a former business associate who was found guilty of illegally using funds from a 2002 Congressional earmark…

At issue is a 2002 earmark tucked into what was at the time the Veterans Affairs, Housing and Urban Development, and Independent Agencies appropriations bill. The provision provided $3.7 million for the National Alternative Fuels Foundation for the development of a new type of fuel, and was to be administered by the Environmental Protection Agency.

NAFF was run by Orr, a Colorado businessman who operated a number of fuel- and energy-related companies and nonprofits in the state.

According to sources familiar with the case, the EPA’s inspector general launched an investigation into the case shortly after the contract was awarded in response to concerns that NAFF was not properly managing the grant. Although no formal public report was ever written, IG investigators eventually concluded that Orr had been misusing federal funds, using them to pay himself a $250,000 salary, and that the work the foundation had been doing was not substantial, according to these sources.

Schaffer, who lost a 2004 GOP Senate primary to beer magnate Pete Coors, left Congress in 2002 and took a position on NAFF’s board of directors in October 2004, according to his personal finance filings with the House.

According to Wadhams, Schaffer joined NAFF in part because of his interest in the development of alternative fuels.

Schaffer is “intrigued by the technology that the company was working on … the fact is Bob has had a longstanding interest in renewable fuels technology,” Wadhams said.

Wadhams also said Schaffer’s interest in NAFF – and his decision to join the board in 2004 – came about on the recommendation of longtime political associate Scott Shires.

Shires ran some of Schaffer’s local and statewide political campaigns, including fundraising operations and campaign committees.

However, Schaffer’s relationship with NAFF was short lived. According to his disclosure forms, Schaffer left the board in March 2005. Wadhams said his departure was a direct result of news that federal investigators were looking into the group and Orr’s handling of the earmark.

Without disclosing any sources or methods, we just want to say it’s unsurprising that we both got the case’s status wrong. And it’s safe to say that both we and Roll Call are making our own phone calls to the court today.

Very interesting additional detail from Wadhams anyway, now we know what he’ll say when the verdict actually comes in. Just one problem: dumping responsibility for this on Scott Shires (whose connection to the alleged NAFF fraud–and to Schaffer–is very well known) doesn’t absolve Schaffer in the least. Even if this excuse from Wadhams is true, and Schaffer was ‘duped’ by Shires and Orr into lending his good name to this allegedly fraudulent enterprise…does that in any way help? Can Schaffer save face by claiming to be clueless about what was going on around him? Isn’t that what he said about Jack Abramoff?