Like Enron, bankrupt Global Crossing was major Washington donor, lobbyist

WASHINGTON (AP) _ The nation's fourth-largest bankruptcy has gotten scant attention in Washington because it occurred around the same time as the largest. But like Enron, Global Crossing Ltd. was a

Friday, February 15th 2002, 12:00 am

By: News On 6

WASHINGTON (AP) _ The nation's fourth-largest bankruptcy has gotten scant attention in Washington because it occurred around the same time as the largest. But like Enron, Global Crossing Ltd. was a major player in the capital.

The fiber optics and communications company made hefty campaign contributions, lobbied Congress aggressively and cultivated relationships with the politically influential.

The 5-year-old company, which filed for bankruptcy protection last month, first appeared as a major campaign contributor in 1999 and has made nearly $3.5 million in political donations since then, according to the Center for Responsive Politics, which studies money in politics. Enron and its executives gave $2.9 million in the same period.

Lobbyists have been paid more than $4 million and Global Crossing's leaders have relationships with politicians in both parties, including two former presidents. Former Defense Secretary William Cohen sits on Global Crossing's board.

The company, based in Bermuda but run out of offices in California and New Jersey, has needed government approval for its undersea cables and its rapid acquisition of other telecommunications companies. The company also has won contracts with several agencies, foreign governments, even NATO.

``Telecommunications is a heavily regulated area,'' said Larry Makinson, the Center for Responsive Politics' executive director. ``If you're trying to do new things in that area, you're going to need some green lights from the federal government to fulfill your business plan.''

Global Crossing's campaign contributions have come in large chunks _ unregulated soft money to both parties, favoring Democrats but not to the extent that Enron directed its money to Republicans.

Lawmakers on key committees have been a focus.

One of those panels, the House Energy and Commerce Committee, has begun to examine Global's decline, said Ken Johnson, spokesman for chairman Billy Tauzin, R-La. Tauzin has received $2,000 from Global.

``We're in the very early stages of gathering information and facts,'' Johnson said. ``We're not turning a deaf ear. But obviously, most of our resources are committed to the ongoing Enron investigation.''

A second House committee may look at Global employees' retirement accounts, which were frozen as company stock took its last, steep plunge.

Even as Global's stock price was hovering just above $1 a share in December, the company's political action committee was giving $2,500 apiece to Democratic Sens. Tom Harkin of Iowa and Carl Levin of Michigan and $500 to Rep. Robert Ehrlich, R-Md.

Those contributions capped a year in which Global gave campaigns more than $700,000, most of it in soft money. In late March, Global sent $100,000 in soft money to the National Republican Congressional Committee, the campaign organization for House Republicans. A week later, the Democrats' Senate campaign fund got $25,000. In June, Democrats received $75,000 while the GOP took in $110,000.

During the presidential campaign, George W. Bush received $68,950 in Global contributions.

What did Global Crossing expect for its money? Nothing, said Rebecca Yeamans, a company spokeswoman. ``We share a strong commitment to being corporate citizens and part of that is being part of the political process,'' Yeamans said.

No one in Congress has gotten more from the company than Sen. John McCain, R-Ariz., formerly the chairman and now the ranking Republican on the Senate Commerce Committee. McCain collected $31,000 from Global Crossing employees for his presidential campaign in March 1999. That same month, McCain, at the company's urging, asked the Federal Communications Commission to encourage the development of undersea cables for transmitting telecommunications signals.

McCain did not respond to requests for an interview this week. The centerpiece of his presidential campaign _ changing campaign finance law _ passed the House this week, and its supporters said accounts of Enron's Washington largess helped sway wavering lawmakers.

The company's largest payout to a lobbyist was the $2.5 million it paid Anne Bingaman, a former antitrust official in the Clinton administration.

Bingaman, the wife of Sen. Jeff Bingaman, D-N.M., said she dealt with the FCC and executive branch agencies on issues related to Global's core business: undersea fiber optic cables. ``I did not make presentations to nor lobby any members of Congress or staff,'' she said.

Global paid Bingaman in cash and stock options, she said. When she sold most of her company stock in January 2000, she posted a profit of more than $1 million, according to her husband's financial disclosure report.

Global is bidding on a defense communications contract that was initially awarded to the company and then rescinded last year amid complaints from competitors that the company may lack the ability to provide secure and fast Internet services and, in any event, should be ineligible because it is based in Bermuda. Yeamans would not describe specific lobbying efforts, but Global hired a Washington law firm to lobby on defense issues. It also added Cohen to its board last year.

And Levin, who received the December campaign contribution, is chairman of the Senate Armed Services Committee.

Company founder Gary Winnick has golfed with President Clinton, an outing arranged by Terry McAuliffe, a political fund-raiser who now is chairman of the Democratic National Committee.

Winnick offered McAuliffe a chance to invest in the company early. McAuliffe invested $100,000, which blossomed into a nearly $18 million profit when he sold his stock in 1999 on the recommendation of his broker, said Jennifer Palmieri, McAuliffe's spokeswoman at the DNC.

``Winnick came to Terry through a guy they both know as a business associate. Terry just invested his money and did nothing else,'' Palmieri said. ``To try to compare it as a political analogy to Enron is just ridiculous.''

The company's other co-chairman, Lodwrick Cook, a former oil company executive, is a longtime friend and supporter of two ex-presidents _ Ronald Reagan and George Bush.

Bush received a reported $80,000 worth of Global stock options for a speech he made in Tokyo in 1997. At one point, that holding was worth $14.4 million, according to The Wall Street Journal. It is not known whether Bush sold the stock.