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Mendelsohn case started with businessman's tip

Wealthy Fort Lauderdale businessman Joel Steinger, the target of a fraud investigation, realized he was in a jam. So he went to the FBI in 2007 with an incredible story: He and major fundraiser Alan Mendelsohn had bribed Charlie Crist when he was Florida's attorney general.

Intrigued, the FBI wired up Steinger and had him record tantalizing conversations with Mendelsohn that seemed to support the allegation: Mendelsohn, in fact, boasted of bribing Crist to shut down state and federal investigations into Steinger's insurance company, Mutual Benefits Corp.

But here's what nobody but Mendelsohn knew: His claims about the governor were all a lie.

A federal indictment charges Mendelsohn, 51, a Hollywood eye doctor, with running his own con, manipulating Steinger into donating more than $1.5 million to the doctor's political committees with false promises that Crist and his top aides would thwart the state inquiry.

Later, confronted with recordings of his own words, Mendelsohn admitted it was all puffery. But the FBI was so skeptical — was Mendelsohn lying about his lies? — that agents had him call the governor's chief of staff, George LeMieux, to see if he would implicate himself as a bribe taker.

LeMieux saw right through Mendelsohn's clumsy attempt.

It was the beginning of the end for Mendelsohn — a miscalculation that undermined his credibility with the FBI and turned the spotlight on him.

The outcome: a two-year inquiry into alleged influence-peddling schemes — primarily for Republican contributors and candidates — that led to a 32-count indictment last month.

Mendelsohn is charged with defrauding fat-cat contributors who gave more than $2 million to his three political action committees. Like Steinger, they thought they were buying Mendelsohn's clout. But he allegedly spent at least $642,000 of the donations on himself and his mistress — and funneled $87,000 to an unnamed "public official" in Florida.

His trial is set for May. The Justice Department says it expects to add new defendants and charges.

Mendelsohn case started with businessman's tip 10/10/09 [Last modified: Saturday, October 10, 2009 9:20pm]
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