ROCHESTER, Minn. — U.S. Rep. Jim Hagedorn has released an internal review of his office's expenditures on printing and mailings conducted through two firms with connections to staff members.
The holiday-weekend release of the report comes less than two weeks after the Minnesota Republican visited Rochester and avoided answering questions on the subject, citing the ongoing review.
In a statement released Sunday, Sept. 6, the first-term congressman indicates he wants to move beyond the controversy.
“I’ve taken corrective action and provided all available information to the House,” Hagedorn said. “My focus moving forward is continuing my work to promote the interests of southern Minnesotans by sustaining our farmers, supporting small businesses, and maintaining our fine rural hospitals.”
The concerns stem from the 1st District congressman’s taxpayer-funded constituent mail, which is known as "franked mail," and two of the companies paid to handle the mailings since he took office.
One company, Abernathy West, reportedly has ties to Hagedorn’s former chief of staff, Peter Su; and the other, Invocq, was co-owned by John Sample, a part-timer on the congressman’s staff. Reports on how much was spent vary, but most agree more than $300,000 was paid to Abernathy West and Invocq received approximately $60,000.
Hagedorn hired prominent ethics attorney Elliot Berke to start a review of the issue in June.
Berke has worked with former congressman Duncan Hunter, who is currently serving an 11-month prison term for misusing campaign funds, and Aaron Schock, who resigned in 2015 amid a scandal involving misuse of campaign funds.
In his report, Berke said Hagedorn became aware of possible excessive mail services charges on June 18 and took action, including initiating the review, within 48 hours.
Other steps cited include firing his chief of staff, calling for added office staff training and re-establishing a policy requiring pre-approval of contracts from pertinent House committees or administrative offices.
“The internal review confirms that soon after Congressman Hagedorn became aware of possible excessive franked mail pricing, he took immediate action and implemented corrective steps, ultimately self-reporting it to the House Ethics Committee,” Berke said in a statement released by the congressman.
The Minnesota DFL, however, said the review doesn’t go far enough.
“The report confirms that there still needs to be an independent investigation and Congressman Hagedorn owes it to the people of southern Minnesota to publicly release all relevant correspondence including text messages, emails, and letters prior to Election Day,” the party stated in a news release Monday, Sept. 7.
Hagedorn is being challenged for his 1st Congressional District seat by DFL candidate Dan Feehan, who Hagedorn narrowly defeated in 2018.
DFL Chairman Ken Martin said Hagedorn should have been aware of the conflicts.
“Congressman Hagedorn is responsible for using almost half a million of our tax dollars to line the pockets of his employees,” he said in Monday’s statement. “This corruption within Hagedorn’s office went on unchecked for months until media reports exposed it to the public, at which point Hagedorn lied to the public and tried to deflect blame.”
Berke said Hagedorn has taken responsibility for issues raised.
“Congressman Hagedorn fully agrees that he is ultimately responsible for actions of those in his employ, even when those actions are taken without his knowledge,” Berke said. “But upon thoroughly reviewing this matter for more than two months, I can state with certainty that Congressman Hagedorn acted in good faith and did not personally direct, profit or intend for his office to bypass any established office procedures or potentially or technically violate any rule of the House.”
According to the internal review, Abernathy West shared office space and phone service with Artemis ESB, whose CEO is Szu-Nien Su, the brother of Hagedorn’s former chief of staff.
The report states Peter Su and representatives from Abernathy West did not cooperate with the investigation. As a result, the review reports it remains unclear why Peter Su contracted with Abernathy West and whether his brother had a direct connection to the firm.
The findings, however, report Abernathy West charged Hagedorn’s office significantly more than the fair market for its services.
The same was stated for Invocq, but the review also cites Sample as apologizing for inadvertent charges and agreeing to return $16,500.
The report also states that Sample did not believe his ownership interest in Invocq violated standards of conduct. He had been suspended when the review started, but was reinstated on July 9.
“Congressman Hagedorn acted in good faith and did not personally direct, profit or intend for his office to bypass any established office procedures or potentially or technically violate any rule of the House,” Berke stated at the end of his report on Saturday, Sept. 5.
Here’s how events played out, according to the internal review funded by Rep. Jim Hagedorn’s office:
- June 8: An article appears in LegiStorm, titled “Rep. Hagedorn spent 40 percent of his 2020 budget in just 3 months,” and raising concerns about expenses.
- June 18: Hagedorn hires Elliot Berke to conduct an internal review of costs his office incurred by franked mail vendors.
- June 19: Peter Su’s employment with Hagedorn’s office ends. It is unclear whether John Sample is suspended on the same day.
- July 9: Sample’s employment is reinstated.
- July 30: Hagedorn notified the Committee on House Administration about the internal review.
- Aug. 10: Hagedorn filed a self-report with the Committee on Ethics .
- Sept. 5: Berke finalizes internal review.
- Sept. 6: Hagedorn releases review.