Federal Prosecutor Joins SAIF Investigation, Goldschmidt a Target

September 13, 2004

Former Gov. Neil Goldschmidt is the target of an expanded investigation into SAIF Corp. that has been joined by a federal prosecutor, according to The Oregonian.

The Portland newspaper said in its Sept. 10 editions that the state-owned workers’ compensation insurance provider will soon turn over documents requested by the FBI and federal prosecutors as part of a criminal investigation.

An FBI agent and federal prosecutor requested the documents in a meeting with SAIF officials at the end of August after the FBI earlier examined SAIF-related records at the state ethics commission.

Former state Treasurer Jim Hill has said an FBI agent recently questioned him about government corruption in Oregon.

The Oregon State Police are independently investigating allegations that SAIF officials illegally destroyed public documents but it appeared the federal probe was widening, the newspaper said.

Goldschmidt, Democratic governor from 1987 to 1991, was a consultant to SAIF until last year, when he resigned his contract following reports of his $40,000-a-month fees.

The contract was managed directly by former SAIF President Katherine Keene, who said Goldschmidt provided strategic and lobbying advice but virtually no written product.

SAIF officials declined to say what records the FBI wanted, while the FBI and federal prosecutors refused comment.

Brenda Rocklin, SAIF’s interim president, said she met with FBI agent Ted Price and Assistant U.S. Attorney Lance Caldwell at their request. They asked for SAIF records but said little about what they were investigating, Rocklin said.

“They requested a lot of different documents,” said Eugene attorney Bill Gary, who is representing SAIF in the federal investigation.

Price has interviewed state Sen. Vicki Walker, D-Eugene, who filed an ethics complaint against SAIF. She declined to comment on her contact with the FBI.

Last May, Goldschmidt resigned from the State Board of Higher Education after he admitted sexually abusing a teenage girl while he was Portland mayor in the 1970s. He also withdrew from his role as chairman of a company formed by Texas investors to take over Portland General Electric from bankrupt Enron Corp.

Goldschmidt’s wife, Diana Goldschmidt, an Oregon Investment Council member, voted to approve investing $300 million in state money in the Texas company managing the PGE takeover. The vote came about the same time the former governor agreed to be chairman of the takeover effort. The Goldschmidts have said they did not know about each other’s involvement until later.

State Treasurer Randall Edwards has asked the state attorney general’s office to determine whether Diana Goldschmidt had a conflict of interest in the investment.

Copyright 2004 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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