HOME / PRESS OFFICE

FEC Home Page

For Immediate Release
February 14, 2006

 

Contact:
Kelly Huff
Bob Biersack
Ian Stirton
George Smaragdis

FEC INVESTIGATION OF GIORDANO FOR U.S. SENATE

COMMITTEE NETS $156,169 PENALTY

Washington -- The Federal Election Commission (FEC) has completed an investigation of Giordano U.S. Senate Committee, Philip Giordano’s 2000 Senatorial Committee in Connecticut, its former treasurer and deputy treasurer and other respondents regarding numerous violations of the Federal Election Campaign Act (FECA). These violations include making and receiving excessive contributions from individuals and prohibited corporate contributions and the failure to comply with various reporting requirements.  The FEC accepted conciliation agreements from 11 Respondents with civil penalties aggregating $156,169.07.

            The FEC discovered, in the normal course of review of disclosure reports, that the Giordano campaign committee had received a number of excessive and prohibited contributions.  Among these was $300,000 from Salvatore Trovato, Mr. Giordano’s father in-law.  The funds were placed in a certificate of deposit and used by Mr. Giordano as collateral for a loan to the campaign that was reported as coming from the candidate's personal funds. Mr. Trovato has admitted the violation and agreed to pay a civil penalty of $99,000.  At the time of these events, contributions from individuals were limited to $1,000 per election.  The Commission also found reason to believe that Patriot National Bank violated the Act because the $300,000 loan it made to the campaign appeared not to have been made in the ordinary course of business or on a basis which assures repayment.  Following an investigation, the FEC determined to take no further action with respect to the bank.

            In addition, the Commission has entered into conciliation agreements with Arthur A. Watson & Company, Inc., along with several employees of the company, for making prohibited corporate contributions to the Giordano campaign.  Senior Vice President Michael Watts and company President Thomas Willsey were also found to have consented to making corporate contributions, and to have assisted Arthru A. Watson & Company in making contributions in the names of others. Arthur A. Watson & Company and its employees have agreed to pay civil penalties totaling $47,000.  The FEC also entered into an agreement with En-Tech Corporation, in which the company has agreed to a $1,250 penalty for making corporate contributions. The FEC also found reason to believe that prohibited contributions were received from six other companies, but took no further action with respect to them.

            The Act prohibits corporations from making contributions or expenditures from their general treasury funds in connection with any election of any candidate for federal office. It also prohibits officers and directors of a corporation from consenting to any contribution prohibited under that section.

            The Giordano U.S. Senate Committee admitted to knowingly and willfully violating the law by accepting and not refunding, excessive contributions from individuals in the amount of $3,500 and contributions from corporations in the amount of $6,750. The civil penalty of $919.07 contained in the conciliation agreement, represented all of the Committee’s remaining assets. James S. Paolino, the committee's former treasurer, and Thomas M. Ariola, the former deputy treasurer, signed agreements admitting to accepting excessive contributions and underreporting committee receipts.  Mr. Paolino agreed to a $5,500 civil penalty and Mr. Ariola agreed to pay $2,500. (These civil penalties reflect factors relating to the respondents’ financial condition.)

1.

MUR 5453

RESPONDENTS:

(a)  Giordano for U.S. Senate Committee

(b)  James S. Paolino, former treasurer, Giordano     Congressional Exploratory Committee

(c)  Thomas M. Ariola, Jr., former deputy treasurer, Giordano for U.S. Senate

(d)  Salvatore Trovato

(e)  Arthur A. Watson & Company, Inc.

(f)   Michael Watts, Senior Vice President, Arthur    A. Watson & Company, Inc.

(g)  Thomas Willsey, President, Arthur A. Watson & Company, Inc.

(h)  Greg Bedula, Vice President, Arthur A. Watson & Company, Inc.

(i)   James Nelson, Vice President, Arthur A.  Watson & Company, Inc.

(j)   William Wittman, Vice President, Arthur A.        Watson & Company, Inc.

(k)  En-Tech Corporation, Inc

(l)   Diabes Brothers, Inc.

(m) Diabes Brothers, Inc. II

(n)  DiBacco Plumbing & Heating,Inc.

(o)  Northeast Cosmetology, Inc.

(p)  R.P.L., Inc.

(q)  The Red Lion

(r)  Patriot National Bank

(s)  Philip Giordano

(t)   Dawn Giordano

(u)  Timothy Longino          

COMPLAINANT:

FEC Initiated (RAD)

SUBJECT:

Excessive contributions; corporate contributions; contributions in the name of another/permitting own name to be used to effect contributions; a failure to accurately report receipts; exceeding $25,000 annual contribution limit; failure to refund contributions; bank loan outside the ordinary course of business

DISPOSITION:

(a)      Conciliation Agreement: $919.07 civil penalty* [re: knowing and willful acceptance and failure to refund excessive contributions and corporate contributions]

(b)      Conciliation Agreement: $5,500 civil penalty* [re: acceptance and failure to refund excessive     contribution; failure to accurately report receipts]

(c)      Conciliation Agreement: $2,500 civil penalty* [re: failure to accurately report receipts and         knowing and willful excessive contributions;       corporate contributions]

(d)      Conciliation Agreement: $99,000 civil penalty* [re: excessive contributions; exceeding $25,000 annual contribution limit]

(e)      Conciliation Agreement: $16,000 civil penalty* [re: knowing and willful corporate contributions; contributions in the name of another]

(f)       Conciliation Agreement: $15,000 civil penalty* [re: knowing and willful corporate contributions; contributions in the name of another]

(g)      Conciliation Agreement: $13,000 civil penalty* [re: corporate contributions; contributions in the name of another]

(h)      Conciliation Agreement: $1,000 civil penalty* [re: contributions in the name of another/permitting own name to be used to effect contributions]

(i)       Conciliation Agreement: $1,000 civil penalty* [re: contributions in the name of another/permitting own name to be used to effect contributions]   

(j)       Conciliation Agreement: $1,000 civil penalty* [re: contributions in the name of another/permitting own name to be used to effect contributions]

(k)      Conciliation Agreement: $1,250 civil penalty* [re: corporate contributions]

(l-q)    Reason to believe, but took no further action* [re: corporate contributions] Sent admonishment letters.

(r)       Reason to believe, but took no further action*[re: bank loan outside the ordinary course of   business]

(s)      Reason to believe, but took no further action* [re: bank loan outside the ordinary course of       business; excessive contributions]

(t)       Reason to believe, but took no further action* [re: excessive contribution]

(u)      Reason to believe, but took no further action* [re: excessive contribution]

           

DOCUMENTS ON PUBLIC RECORD:

Documents from this matter are available from the Commission’s web site at http://www.fec.gov by entering 5453 under case number in the Enforcement Query System.  They are also available in the FEC’s Public Records Office at 999 E St. NW in Washington.

*There are four administrative stages to the FEC enforcement process:

1. Receipt of proper complaint

3. “Probable cause” stage

2. “Reason to believe” stage

4. Conciliation stage

It requires the votes of at least four of the six Commissioners to take any action. The FEC can close a case at any point after reviewing a complaint.  If a violation is found and conciliation cannot be reached, then the FEC can institute a civil court action against a respondent.                                                     

# # #