A federal investigation has been launched into the financial dealings of New Jersey Sen. Robert Menendez and a nonprofit agency he has helped over the years, sources said. The U.S. attorney's office has subpoenaed the agency's records pertaining to a house once owned by then-congressman Menendez, sources told NewsChannel 4's Brian Thompson.
Menendez, a Democrat, has denied there was anything wrong with his renting the house to the North Hudson Community Action Corp. for more than $3,000 a month, even as he was working to obtain millions of dollars in federal grant money while he was a congressman.
Menendez campaign spokesman Matthew Miller released a statement saying the senator's dealings with the agency had already been approved by authorities in U.S. Congress.
Suppoena timing questioned
"This transaction was already approved by the House Ethics Committee, and the U.S. attorney will find that Bob Menendez did nothing but support a well-respected agency in the exact same manner that he has supported other non-profits in the state," the statement said.
"We're troubled by the timing of this subpoena in the middle of a political campaign, but the facts are that the NHCAC has received federal funds for over 35 years because they provide education and health care services to New Jerseyans who need it the most."
Menendez is locked in a close race with Republican state Sen. Tom Kean Jr. Both campaigns have traded ethics charges.
Also Thursday, a Republican state lawmaker alleged that Menendez violated ethics rules by trying to block a merger involving a company in which he holds stock.
'Public office for personal gain'?
State Sen. Diane Allen, R-Burlington, said she planned to file a complaint with the Senate Ethics Committee early next week. Menendez served in the House for 14 years before being appointed in January by Gov. Jon Corzine to serve out the remaining year of his Senate term.
Allen alleges that in 2003, Menendez sponsored legislation to ban media mergers he said would create monopolies in Spanish language broadcasting. Allen alleges Menendez wanted the merger to fail because his stock would have gone down. The merger ultimately went through.
"Ethics rules say you cannot lobby on behalf of organizations when you stand to make some money by it," Allen said. "I fear that Sen. Menendez has trouble discerning that line between what is ethical and what is not."
Menendez campaign spokesman Matthew Miller said Menendez, along with other Democratic lawmakers, fought the "mass media consolidation because it hurts consumers."
Kean campaign spokeswoman Jill Hazelbaker said this is just another example of Menendez "using his public office for personal gain."
According to Menendez's latest financial disclosure form, he holds stock in Florida-based Spanish Broadcasting System Inc. worth between $1,000 and $15,000. But Miller said Menendez sold his SBS stock earlier this year, taking a significant loss. He did not have a specific figure.
SBS is the largest Hispanic radio broadcasting company in the United States. Menendez has received nearly $25,000 in campaign contributions from SBS and its executives, according to documents filed with the Federal Election Commission.
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