Call it a “client relations” deduction
posted at 7:51 am on February 6, 2009 by Ed Morrissey
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Prostitutes busted in high-profile cases usually complain that prosecutors have much less interest in going after the johns than the hookers, but Kristin Davis may have a better complaint than most. Davis, who had the misfortune of having Eliot Spitzer as a client, wanted prosecutors to take a look at high-level corporate executives who used their company credit cards to pay for services rendered, including some top people from bailed-out Wall Street firms. Despite the possibility of wire and tax fraud, prosecutors took a pass:
Wall street lawyers, investment bankers, CEOs and media executives often used corporate credit cards to pay for $2,000 an hour prostitutes, according to the madam who ran one of New York’s biggest and most expensive escort services until it was busted last year.
But prosecutors in the Manhattan District Attorney’s office chose not to pursue any of the corporate titans, says Kristin Davis, who pleaded guilty last year to charges of running a prostitution business that used more than a hundred women. …
“They showed no interest,” said Davis in an interview for broadcast Friday on the ABC News program 20/20.
“Some of these guys, I was invoicing on corporate credit cards,” she said. “I was writing up monthly bills for computer consulting, construction expenses, all of these things, I was invoicing them monthly so they could get it by their accountants,” Davis said.
Davis brought the records to ABC, since she couldn’t get the district attorney interested in them. ABC confirmed the names of the executives, but couldn’t get the DA’s office to confirm or deny Davis’ story. ABC tried contacting the men on the list, and some of them denied using corporate cards — but Davis’ records strongly suggest otherwise.
Who were the clients? I’ll mention a few, but be sure to read the linked story for some of the hilarious notes associated with each:
- Merrill Lynch: managing director
- Deutsche Bank: managing director
- Goldman Sachs: investment banker
- JP Morgan: investment banker
- Lehman Brothers: investment banker
And the one that ABC loved so much, they listed it first:
- NBC Universal: vice president
Apparently, he really put the vice in “vice president”.
Had these people used corporate credit cards and had Davis bill them as she claims, they would have had these costs written off by their employers and deducted from the company’s taxes. That’s tax fraud, and had any of this deception used the mail or wire — such as electronic billing — it could become wire or mail fraud as well, all of which would be federal crimes.
So why didn’t the DA pursue it? Prosecutors have a double standard regarding prostitution, especially high-end rings like Davis ran. Police have no trouble busting johns from streetwalkers in sting operations, but they almost always avoid people like Eliot Spitzer, whom Davis claims got kicked out as a customer after demanding unprotected sex with her staff, and other clients of high-priced rings.
That doesn’t make it right, though. They should prosecute the big fish as well as the small, perhaps more than the small in this case. Tax fraud is tax fraud. Who do these men think they are — Obama Cabinet appointees?
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NBC just continues to swim in the gutter.
anniekc on February 6, 2009 at 7:55 AM
Soon enough, Edward. In time!
blatantblue on February 6, 2009 at 7:56 AM
Yes… and your point is?
And btw, I’d just like to give a shout out to all the IDIOTS AND MORONS AND INDEPENDANTS AND MODERATES AND CENTERISTS AND STAY HOME REPUBLICANS AND EVEN SOME CONSERVATIVES FOR ELECTING THE MESSIAH… Didn’t you guys do a GREAT service for America, your future and your families… Thanks guys and WTG!
/sarc
Mark Garnett on February 6, 2009 at 8:00 AM
The highly-placed executives were just doing field-studies on how to best screw the unprotected public. Of course it’s deductible.
Yoop on February 6, 2009 at 8:00 AM
Maybe NBC should update the Peacock logo.
christene on February 6, 2009 at 8:06 AM
The corporate card (generally) is a personally held responsibility. It is against company policy to use it for personal affairs, but not illegal. Reimbursement (if sought) would be an “entertainment expense” having legitimate business justification. Otherwise the cardholder pays the bill. It seems the company’s primary concern is credit card abuse, in the event an employee piles up too much debt on the corporate card.
It would be difficult for a prosecutor to prove an illegal “entertainment expense” on the books so as to prosecute a criminal conspiracy.
exdeadhead on February 6, 2009 at 8:10 AM
The Little People are too damn busy working hard, and too damn tired from it, to care or do anything about it. The obscenely wealthy corporate fat-cat’s and the District Attorneys on their political payroll bank on that.
FlatFoot on February 6, 2009 at 8:12 AM
“Misfortune” has to be a euphemism for what it must have been like having Eliot Spitzer as a client.
I mean, yuck.
BigD on February 6, 2009 at 8:13 AM
Putting Barney Fwank in charge would fix all that.
petefrt on February 6, 2009 at 8:18 AM
You are talking about the same Barney who had the gay sex club running in his basement?
gatorboy on February 6, 2009 at 8:23 AM
Maybe Barry will want to cap prostitution expenditures for execs. Rather than high-money white girls, they can be required to enagage in equal-opportunity hiring to ’spread the wealth around.’
snickelfritz on February 6, 2009 at 8:27 AM
ewwwwwww
becki51758 on February 6, 2009 at 8:29 AM
Why? Prostitution is illegal. The woman has the receipts from the card that paid for it. Why would that be difficult to prosecute?
pannw on February 6, 2009 at 8:31 AM
She has a point, she has names, credit card information…they broke the law, if she was prosecuted, they should be.
If they “did nothing wrong” then she did nothing wrong. She may have provided the service, but they are the ones who did the buying.
I think the DA is in a bit of a bind…
And you don’t think the “major New York” real estate guy is…Donald Trump, wearing what?
right2bright on February 6, 2009 at 8:38 AM
Wonder if Frank Marshall Davis got receipts from Barry?
marklmail on February 6, 2009 at 8:39 AM
And even fixed the tickets for the clients who “took too long”. There was limited parking at his apartment, meters out in front. So Barney arranged to have the clients tickets to “get lost”…but he said he didn’t know his boyfriend was running a gay bordello…boy, does he have
balls…right2bright on February 6, 2009 at 8:41 AM
I hear there may be a tax credit for this in the new stimulus plan.
flyoverland on February 6, 2009 at 8:42 AM
If I, being your average corporate peon, was to charge something on my corporate card that I could not account for…bye bye job!
jbh45 on February 6, 2009 at 8:43 AM
Legalize it, regulate it.
rbj on February 6, 2009 at 8:43 AM
Not if the madame has the recipts, credit card, times, places, and it was run through her merchant services account.
I don’t think it is too difficult to prove that the execs. were using the card for illegal activities…and if the company does not prosecute (along with the state), then they are condoning the use.
right2bright on February 6, 2009 at 8:44 AM
Yes, and, most of the executive Wall Street types that work for the above companies are Democrats, who operate under a different standard….
DL13 on February 6, 2009 at 8:47 AM
rbj:
legalize it, regulate it and tax it. Put that way I think the Escorts would prefer the status quo.
jerryofva on February 6, 2009 at 8:49 AM
You mean to tell me that prostitution isn’t “liberating oneself from virginity”? Shocking!
leetpriest on February 6, 2009 at 8:49 AM
I am not for legalization but, as a strong supporter of the 4th Amendment, I say ignore prostitution and drugs as long as they are kept off the streets.
If you believe in a right to privacy, then keep it private!
Laurence on February 6, 2009 at 8:50 AM
No doubt every one of these men is also married.
I’ve said it over and over again: men who will cheat on their wives think that no rules apply to them. They will violate other laws as well. The more they get away with it, the more they think they are bulletproof. I’ve never yet seen a sexual cheater who was honest in his work.
rockmom on February 6, 2009 at 9:04 AM
sorry but, all that’s on MY mind are those legs in the pic used for this thread!..hmm..gotta a better one of that? ;o)
eplain on February 6, 2009 at 9:06 AM
If Obama is dead set on expanding the federal government, I’m sure he can find a few tax accountants and tax lawyers in the Beltway who’d be happy to join the new Vice Division of the IRS. Like Ed has noted and the evidence strongly suggests, we have tax fraud at work here. We’re the one’s who are subsidizing this sh*t. It doesn’t have to be Obama’s priority, and it doesn’t need to be Geithner’s priortiy. But get it to the head of the IRS, and let’s make life miserable for these POS and their employers.
BuckeyeSam on February 6, 2009 at 9:43 AM
So they’re giving MSNBC’s prime-time show hosts the title of vice president now?
jon1979 on February 6, 2009 at 9:45 AM
Doth protest to much?
Just kidding…I am a guy, and you are absolutely correct. Something about the “macho” guy thing, thinking he is bullet proof..da man.
I have never seen a competent worker, that is a playa…
But I have seen many, many faithful men be superb employees…it is maybe called discipline.
right2bright on February 6, 2009 at 9:50 AM
You forgot your internet warrior tag. And that was back to your old obnoxious standard.
——————————————————
I would have to agree with many here about legalizing and regulating it. We’ve got examples of legalized prostitution in Nevada: clean, safe workplaces, the employees are working in a friendly, safe environment, and the customers are assured of safe practices and no prosecution.
Notice the word I used most: safe. That’s what really needs to be addressed. Yes, I understand that serious implications that nationwide legalization would entail. I realize it might shape society. However, I happen to like the idea that pimps would be out of a job, and a lot more woman would not be beaten or killed.
I also totally agree with Ed, although to my knowledge the high-end rings usually involve less violence. Exit question: How long till Bathtub Boy’s receipts surface?
MadisonConservative on February 6, 2009 at 10:09 AM
I do have some personal experience in this area. As a young appointee in a previous Administration, I was hit on numerous times by older married men. I was told point blank that I needed to “lift my skirts” if I wanted a promotion. And every one of those scumbags ended up in jail on public corruption charges. I saw the mentality up close and personal. Many men who achieve power, whether in politics or business, think screwing around comes with the territory, a sort of droit du seigneur. This is one of the reasons I despise Bill Clinton so thoroughly. If he’ll do it to his wife, he’ll do it to the country (or to the company and its shareholders.)
I’ve also known many great men who were faithful to their wives and honest and successful in their work.
rockmom on February 6, 2009 at 10:11 AM
$2000 an hour hookers in a down economy doesn’t sound like more bang for the buck.
whitetop on February 6, 2009 at 10:19 AM
Ah conservatives. In a post that clearly illustrates that we live in a class stratified society and provides one of the many examples of that, what’s the focus? Blame Obama. Apparently, Obama created class double standards via the tax problems of two his nominees (two of which have been dumped therefore indicating that in his administration there are consequences for not doing what’s right). It’s shocking that people can be presented day after day with evidence that we do not live in a meritocracy, and we just have an expanded aristocracy. But I guess admitting that might admit that what passes for “free market conservatism” really is just apologizing for corporate interests, even when they blatantly commit crimes that ruin other people’s lives and get them labelled “sex offenders.” Yay America.
DeathToMediaHacks on February 6, 2009 at 10:23 AM
Bush said he pushed aside free market principles to “save the economy”. He was about as conservative as The One in that regard. Don’t knock what hasn’t been tried in years.
MadisonConservative on February 6, 2009 at 10:27 AM
Well, at least you were “hit on”, just think of all the lonely women sitting in their cubicles that never get “hit on”.
So the secretary comes into my office, closes the door, leans over with her cleavage more then exposed, and tells me the controller hit on her…I have to say, sit back, cover up, and tell me again (and no one could have told her to raise her skirt, there was no more “up”).
I ended up firing the controller (and true to your thesis, he was not doing the job he was hired to do), and telling her to straighten up and look more professional. Some women also don’t “get it”.
right2bright on February 6, 2009 at 10:27 AM
I’m not sure it’s ever been tried. But the phrase “free market” sure sounds a lot better than “corporatist” and “upward distributionist” but that’s all the post Reagan GOP has ever been.
DeathToMediaHacks on February 6, 2009 at 10:28 AM
DTMH: Put the crack pipe down. And why does someone who calls themself “DeathToMediaHacks” always seem to toe the MSM line? What’s up with that?
And as to the girl in the picture – someone get her a cheeseburger, stat!
Merovign on February 6, 2009 at 10:31 AM
Bush attempted to in the early years, but the lingering effects of the dot com crash were played up as a result of the tax cuts Bush implemented, so he played politics. The democrats cockblocking him on updated CRA regs 6 years ago probably didn’t bolster his confidence either. So, in the end, he gave up the fight(though I’d go so far as to say he had no more fight left after the battle he’d been put through), and went “bipartisan”. Just like McCain. Look how that’s worked out for us.
MadisonConservative on February 6, 2009 at 10:32 AM
Gee, someone wrote about class stratified society…guess they feel everyone is “equal”, that everyone makes the same amount of money, everyone contributes the same.
The wonderful news is that we have economic classes, and we can move about them…or at least used to.
If you make $35,000 a year as a salesman, then hit a big year or two with a large account, bounce up to $150,000, then you are killed with taxes. You are just paying off the college debt, the 2nd on the mortgage, just getting ahead…but taxed up the yazoo for a couple of good years.
Meanwhile the really big buck guys, the guys who support Obama, they have all the shelters set up, so they pay no taxes…Buffet, the big supporter, paid less taxes then his secretary, and will pay less under Obama.
Remember, congress sets the tax code…it has been a democrat congress.
They are stopping the middle class from rising above their humble life…they are placing a block wall of taxes to stop people from moving out of lower and middle income….meanwhile, the low income get rebates for not doing anything but sucking up govt. money.
right2bright on February 6, 2009 at 10:36 AM
When you can show me anyone in the MSM using the word “corporatist” you’ll be on the verge of almost making a legit argument. Until then I suggest you watch/read/listen to the MSM alot more closely than you currently do.
And I’d contend that the major shift in corporate culture from Reagan forward is what precipitated things like the dotcom crash. We slowly but surely de-emphasized the importance of domestic production in the name of higher profits. We emphasized speculative markets, lightning fast trading, and Madoff style ponzi steams and said “look! this is what happens when you have the capital gains tax cuts/corporate tax cuts that Reagan put into effect, more capital investment, yay!” And yay indeed…for a while. But when your economy is principally organized around wall street investment rather than the ability to actually make something that people and the world want to buy, eventually the system crashes. Boom, bust, boom, bust. It’s what our economy did in the 1880s, at the Great Depression and then once again it’s what our economy has done under Reagan style policies. I mean did people see Glengary Glenross? Talk about prophetic.
As for what Bush did or didn’t do. I don’t blame bush for the wall street crash. I also don’t blame the CRA as originally intended, as I (and Ben Bernanke) have said, the communities which were meant to benefit from the CRA were doing what they were supposed to do. It was those who saw an opportunity to abuse the act that need to be shot (many of them Democrat politicians). I blame Bush for cutting taxes during a massively expensive war and during other expansions in the Federal government. Don’t get me wrong, Reagan did this too. But he didn’t do in a world with other strong currencies or a rising rival superpower in China. In fact, we know, he did it as the Soviets were crumbling under their own weight. And he also didn’t do it while spending 500 billion dollars on one war, lord knows how much we’ve spent in Afghanistan as well. And if people aren’t going to own up to the economic disaster of “free market conservatism” at least own up to the economic follies of neo-conservatism which also has run the roost this past 8 years. It is kind of amazing to me that conservatives look at 6 consecutive years of GOP control and say “none of this is our fault.”
DeathToMediaHacks on February 6, 2009 at 10:45 AM
So wait…you’re claiming that, because Reagan put in incentives for investment and abilities for more recapitalization, that he himself somehow brought about globalization of industry? Are you out of your mind? It was well on its way before he was even governor of California, my friend. I’d quite sooner blame people like David Rockefeller with their globalist rhetoric for that. Reagan was the one attempting to bolster domestic industry. Unlike your new boy Obama, he wasn’t keen on nationalizing industry in order to bolster domestic growth.
MadisonConservative on February 6, 2009 at 10:53 AM
God you’re purposefully and unnecessarily dumb. The thing that makes a class stratified society bad is when differences in income give people an advantage or a disadvantage before the law. Lady justice is meant to be blind and her scales are not to tipped by a shiny diamond put on one side of the other. Clearly that’s what my post was about. But if you really want to have it out about taxes, lets.
Yes someone making 35,000 a year and someone making 150,000 a year should pay different tax rates. Is your argument that the taxes and mortgage (which isn’t a tax, but an investment) make your standard of living unchanged from the person who’s making 35,000 bucks a year? You’re only able to afford the same things, the same kinds of life? I seriously, seriously doubt that. After income taxes, after your chosen investment of a house via a mortgage payment you there’s money left over to enjoy yourself a bit, the whining from folks who make 6 figures falls on deaf ears for me.
Amazing. And yet your side looks at them and shrugs while looking at someone with a job that puts them in the “rebate” zone and says “those lazy f*ckers should die.” If you get a tax rebate that means you have a job and considering how sucky those jobs tend to be, you’re probably not lazy. To me the ire should be against those at the top who use shelters to avoid paying their obligation to a society that has given THEM so much by buying their products or working for their corporation (at increasingly low wages) but to even suggest that they might have an obligation to society just to pay the tax rate as it is, is to be called a socialist. I’ll never understand it.
DeathToMediaHacks on February 6, 2009 at 10:54 AM
The fix is in. Wall Street will be protected.
Charles Martel on February 6, 2009 at 10:54 AM
You’re correct, neo-liberalism knows no party and our elite class decided to become corporatist as early as the seventies. But Reagan could have made different decisions and, at the very least, corporate culture was somewhat more responsible prior to Reagan.
DeathToMediaHacks on February 6, 2009 at 10:55 AM
It’s also amazing we’re talking prostitutes on here when unemployment hit 7.6 today and this came out.
http://www.huffingtonpost.com/2009/02/06/paulson-misled-tarp-overs_n_164589.html
DeathToMediaHacks on February 6, 2009 at 10:58 AM
Reagan was dealing with the effects of a severe recession fouled up by his three predecessors. Unless he wanted to start moving on government-owned businesses, and he didn’t, he tried to do the impossible: shrink government, return the power to the people, while fighting the evil empire through military and arms spending. He turned out to secretly be Stretch Armstrong, and for all intents and purposes, succeeded. The ensuing attitudes taken by the companies were not of his doing. They were free to revitalize domestic production, and they didn’t. Had he made the decisions for them, he would have gone back on the core of his principles: getting government the hell out of the way.
To an extent, Bush was dealing with the same situation, except he gave up on government trimming pretty damn quickly. Conservatives who tried to curb that were cast aside as the current GOP came into power, which was just a few years before we lost congress. Hopefully, Michael Steele’s purge will cleanse us of these dips**ts once and for all. Maybe we can look forward to some real “Hope and Change” in 2012.
MadisonConservative on February 6, 2009 at 11:08 AM
Maybe she should take the evidence to the NY State Attorney General -
Andrew?
Andrew?
Are your there?
Wander on February 6, 2009 at 11:25 AM
Oh hell, why not just come right out and say it Ed, you know it’s true, we have devolved into a caste system not unlike India, we’re still just in denial in this country about how far it has gone.
MB4 on February 6, 2009 at 11:42 AM
Guess some animals are more ‘equal’ than others.
GarandFan on February 6, 2009 at 11:45 AM
Thanks for reminding me and thanks for the compliment!
Mark Garnett on February 6, 2009 at 12:17 PM
However you did forget to say I was right about how radical this Messiah was going to be… I guess even us far right wing nut jobs can get one right every now and then… My warnings, rantings and calls for action (calling, e-mails, ect.) have been varified. The attacks on Rush and freedom of speech, ect. have again proven how radical this POS is.
Mark Garnett on February 6, 2009 at 12:24 PM
I never have a problem with the root of your message. You’re aware we largely agree. I have a problem with people who tape down their caps lock and put the bold tag around their entire post. Rants which are designed to appeal with font rather than substance are obnoxious.
MadisonConservative on February 6, 2009 at 12:33 PM
Heard Brian Ross on our local radio station this morning here in Minneapolis. Sounds like they are going to spill the beans tonight on 20/20. Have never watched before but this one might be entertaining… He said one of the johns always requested that the hooker come fully loaded which meant that she needed to bring cocaine!
sabbott on February 6, 2009 at 12:40 PM
Mark Garnett on February 6, 2009 at 12:45 PM
eplain on February 6, 2009 at 9:06 AM
You might want to eyeball that ‘gal’ a little closer. Tall, big feet, no butt….
PersonFromPorlock on February 6, 2009 at 12:53 PM
What was that Obama was saying about two sets of rules?
PappaMac on February 6, 2009 at 1:31 PM
Hey no wonder i keep feeling like im being SCREWED by
WALL Street
Banks
Congress
House of representatives
IRS
hell their is a lot of SCREWING going on around here
To Quote my faovite philospher the immortal
“Bugs Bunny”
Theirs something awfully screwy going on around here
jcila on February 6, 2009 at 2:20 PM
Professional courtesy.
Maquis on February 6, 2009 at 2:42 PM
I really wish someone like the punisher would come along and start administering lead. Geez.
Some people are alive only because it is illegal to shoot them.
Chaz706 on February 6, 2009 at 4:26 PM
FWIW the legalization angle doesn’t interest me on this story at all. The prostitution itself is almost incidental except as an unallowable, fraudulent corporate expense. (Not discounting why they chose to do it, just sayin’…) To me this story is all about corporate and tax fraud, and that’s a big big deal.
It’s time to throw these clowns into the pile with the rest of the crooks and have them face the music like everybody else. Way to go ABC! Make the DA sweat a little, then a little more, then a little more…
RD on February 7, 2009 at 2:58 AM
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