N.J. Sen. Menendez, North Palm eye doctor indicted in ‘bribery’ case

U.S. Sen. Robert Menendez and North Palm Beach Dr. Salomon Melgen were indicted Wednesday in what a U.S. Justice Department official labeled a “bribery scheme” in which the powerful New Jersey Democrat accepted $1 million in lavish gifts and campaign contributions from the wealthy ophthalmologist in exchange for political favors.

In the 68-page indictment, a federal grand jury in Newark, N.J. charged the 61-year-old Menendez with 14 felonies, including bribery, honest services fraud and making a false statement for not disclosing the gifts on financial disclosure reports.

Melgen, 60, who has steered more than $750,000 campaign money to Menendez, faces all of the same charges with the exception of making a false statement.

Rumored for months, the sweeping indictment offers a detailed look at the high-flying lifestyle federal prosecutors claim the Harvard-educated physician, who was born in the Dominican Republic, offered his longtime friend.

Trips on Melgen’s private jet, stays in a luxury hotel in Paris and vacations at Melgen’s villa in Casa de Campo, a resort on the Dominican coast, were all possible for Menendez as a result of Melgen’s largess, according to the indictment.

Many of the trips either originated from or included stops at Palm Beach International Airport, according to the indictment. Many involved women whom prosecutors described as the married Melgen’s girlfriends or, in the divorced Menendez’s case, “a woman with whom he had a personal relationship.”

In return, the grand jury found, Menendez used his Senate office to help Melgen become richer and bring his foreign love interests into the country.

And, according to a federal official who is close to the investigation, Melgen’s troubles are just beginning. Within weeks, Melgen is expected to be indicted in federal court in West Palm Beach for Medicare fraud, said the official, who would not let his name be used. Melgen was paid nearly $21 million by Medicare in 2012, more than any doctor in the country.

Neither Melgen nor his attorneys were available for comment. A woman who answered a cellphone listed in the name of his wife, Flor, said she was too busy to talk. Melgen lives in a $2.1 million home along the Intracoastal Waterway in Captains Key.

In an evening press conference in Newark, Menendez proclaimed his innocence. “I am not going anywhere. I’m angry and ready to fight because today contradicts my public service and my entire life,” he told a cheering crowd of supporters.

The son of Cuban immigrants and the top Democrat on the Senate Foreign Relations Committee, he is the first U.S. senator since 2008 to face federal corruption charges. In the past, he acknowledged that he failed to pay for trips aboard Melgen’s private jet. But, he said, he later made appropriate reimbursements.

West Palm Beach attorney Jack Scarola, who represents Melgen in a long-running legal battle over more than $10 million the doctor lost in a Ponzi scheme, said he was not familiar with the allegations against his client. “I have known Sal for many years,” Scarola said. “I’ve always believed him to be an honest and honorable person and I have no information that would make me think otherwise.”

The indictment accuses Melgen of conspiring with Menendez. In return for trips and campaign contributions, Mendendez helped secure visas for the doctor’s girlfriends, all models from Brazil, Ukraine and the Dominican Republic. According to the indictment, Menendez also:

• Pressured the State Department to lobby Dominican officials to honor “Melgen’s multi-million dollar” contract to provide exclusive cargo screening services at ports in the island nation.
• Stopped the U.S. Customs and Border Protection Service from donating shipping container monitoring and surveillance equipment to the Dominican Republic because it would threaten Melgen’s exclusive contract.
• Tried to influence the outcome of the Centers for Medicare and Medicaid Services’ decision to seek millions from Melgen for overbilling Medicare.

While acknowledging contacting the federal health agency, Menendez in 2013 said he did not try to intervene on Melgen’s behalf. “The bottom line is, we raised concerns with CMS over policy and over ambiguities that are difficult for medical providers to understand and to seek a clarification of that,” Menendez said at the time.

The ongoing dispute between Melgen and the agency involves Medicare payments Melgen received for treating patients with a drug called Lucentis. Melgen administers three or four doses from each vial of Lucentis. The agency said each vial should be used to treat a single eye.

Melgen sued the agency in 2013, challenging its determination that he had been overpaid $9 million for Lucentis treatments. A federal judge in Miami in September dismissed the lawsuit but Melgen is appealing.

It is likely the dispute over Melgen’s use of the drug will be part of the looming indictment. The charges he and Menendez are now facing each carry a maximum 15-year prison sentence.

The last U.S. senator to face federal corruption charges was U.S. Sen. Ted Stevens from Alaska. His conviction was overturned due to prosecutorial misconduct. He died in a 2010 plane crash.

Editor’s Note: An earlier version of this story incorrectly stated the location of Menendez’s press conference, in which he vowed to fight the charges. It was in Newark. The story also incorrectly reported how long it has been since a U.S. senator was indicted on corruption charges. While Sen. Harrison Williams was the last senator from New Jersey indicted on corruption charges in 1980, the late Sen. Ted Stevens, of Alaska, was indicted in 2008.

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