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Patriot Act gets mixed review in Vegas

Its use in investigation of strip clubs questioned

LAS VEGAS -- This scandal has everything: Top politicians indicted on multiple counts of accepting hundreds of thousands of dollars in bribes from the owner of local strip clubs in exchange for looser regulations of what strippers can do.

But what has this got to do with terrorism?

Nothing at all, everybody involved agrees. Yet FBI agents in Las Vegas used a provision of the USA Patriot Act to obtain the financial records of several suspects in the case. It is one of more than a dozen cases in which federal investigators have relied on the Patriot Act -- passed a month after the attacks of Sept. 11, 2001, as a response to terrorism -- for purposes unrelated to homeland security, according to The New York Times.

Part of the law, Section 314, allows federal investigators to obtain from stockbrokers, banks, and other financial institutions the records of people "suspected, based on credible evidence, of engaging in terrorist acts or money laundering." Since the law does not specifically require that the money laundering relate to terrorism, the application in a public corruption probe such as "Operation G-Sting" is permissible.

"What it points out is how certain aspects of the Patriot Act are so expansive that they allow for invasions of people's basic rights in ways that go far beyond reasonable national security needs," said Allen Lichtenstein, attorney for the American Civil Liberties Union of Nevada.

A Justice Department spokesman, Mark Corallo, insisted the section was inserted at the request of then-Senate Banking Committee chairman Paul Sarbanes, Democrat of Maryland, who sought to give the FBI new tools to fight money laundering. The provision allows an FBI agent to demand financial records without a grand jury subpoena by certifying that the suspicion of money laundering is reasonable. If a judge at trial believes the certification is inadequate, the judge may throw out the evidence, Corallo said.

"The Patriot Act was not meant to be just for terrorism," Corallo said. "A lot of the uninformed criticism was obviously misplaced."

The FBI office in Las Vegas has said Section 314 was applied in the corruption case, but would not confirm local news reports that it was used to subpoena records from the stockbrokers of the Clark County Commission chairwoman, Mary Kincaid-Chauncey; former commissioners Dario Herrera, Erin Kenny, and Lance Malone; Las Vegas City Councilman Michael Mack; and club owner Michael Galardi. The commission regulates areas outside the city limits.

In a 28-count indictment handed down Thursday, Kincaid-Chauncey, Herrera, and Malone were charged with accepting thousands of dollars in bribes from Galardi. Malone was also accused of acting as a middle man between Galardi and the commissioners after he left office in 2000. Also Thursday, guilty pleas from Galardi and Kenny were unsealed. In them, Galardi admitted to giving as much as $400,000 in kickbacks to commissioners, and Kenny conceded she took bribes via Malone in exchange for voting for laws favorable to Galardi's clubs.

Kenny was the Democratic candidate for lieutenant governor, and Herrera was a Democratic nominee for Congress in 2002. Both lost. It is unclear how Mack may be involved in the case.

The FBI probe also has resulted in the August indictment of three San Diego City councilmen on similar charges of taking Galardi's bribes through Malone in exchange for preferential treatment. The California councilmen have pleaded not guilty; the Nevada politicians are scheduled to be arraigned Nov. 21.

Kenny's lawyer, Frank Cremen, said the perplexing part of the use of the Patriot Act was that prosecutors could have subpoenaed the financial records using other laws, although not as quickly. "Quite truthfully, I don't know why they used it, but it's going to have no impact on my client," Cremen said.

But the disclosures have led to sharp rebukes from Senator Harry Reid and Representative Shelley Berkley, both Nevada Democrats. Berkley, who represents Las Vegas, has sent a letter to Attorney General John Ashcroft asking whether he believes this use of the law was appropriate.

"When I voted for the Patriot Act one day and one month after Sept. 11, I was voting to give the FBI the necessary tools to fight terrorism," Berkley said. "It was never my intention that this act would be used in garden-variety crime or political corruption cases."

Reid said this is another reminder that a careful review of the act is in order when it comes up for renewal in 2005. "We have to be tough on terrorists, but we also have to guard the privacy of American citizens," he said.

But Representative Jim Gibbons, Republican of Nevada, said the Patriot Act was designed not only to enhance antiterrorist activities, but also to modernize the way the FBI conducts investigations.

"Criminals nowadays use cheap, throwaway cellular phones and free e-mail accounts, but the laws did not address those things," said Amy Spanbauer, a spokeswoman for Gibbons. "This empowers law enforcement to keep up with modern technology so they are not hamstrung as terrorists run free."

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