Democrats call for probe into alleged backdoor deal involving John Swallow

New Utah A.G. said he did not broker 'bribe' to Harry Reid

Published: Saturday, Jan. 12 2013 8:45 p.m. MST

Utah Attorney General John Swallow talks with supporters at the Hilton in Salt Lake City on Election Day, Tuesday, Nov. 6, 2012.

Jeffrey D. Allred, Deseret News

SALT LAKE CITY — A week into his first term, Utah Attorney General John Swallow faces a political firestorm over accusations that he helped broker a deal in 2010 to derail a federal investigation into an embattled St. George businessman.

Utah Democrats have called for a special prosecutor from Washington, D.C., to conduct an independent probe of the allegations against Swallow. Republicans were mum on Saturday.

Jeremy Johnson told the Salt Lake Tribune that Swallow, a Republican, would arrange through another person for him to pay Senate Majority Leader Harry Reid $600,000 to get the Federal Trade Commission to back away from an investigation into Johnson's Internet marketing company, iWorks.

Johnson supported his contention with emails, financial records and a transcript of a secretly recorded April 2012 conversation with Swallow, who served as Utah Attorney General Mark Shurtleff's chief deputy before succeeding him last Monday.

Swallow issued a statement late Saturday calling Johnson's claims false and defamatory and a desperate attempt to secure a better deal in the federal criminal case against him.

"I did not broker a deal to pay a $600,000 'bribe' to Senate Majority Leader Harry Reid to make the investigation go away," he said.

Swallow said Johnson presented himself in 2010 as an honest businessman who was not being treated fairly by the FTC. He said he introduced him to a friend and former client who had experience working with federal lobbyists and might be able to help him work with regulators.

The new attorney general said he now regrets meeting with Johnson. "I will learn from this mistake and do everything possible to make sure my actions are transparent and make sure our office will be vigilant in going after anyone who defrauds the public," Swallow said.

Johnson through his attorney declined further comment Saturday.

Utah Democratic Party Chairman Jim Dabakis said Saturday he would send a letter to U.S. Attorney General Eric Holder asking that a special prosecutor be sent to Utah to "look at it from A to Z."

"This seems to be very, very ugly chapter and we need to make sure no rock goes unturned," he said. "If all this doesn't come out, if there's a hint of a cover-up, it will be hard for the attorney general and his ability to govern — and bad for the state."

Dabakis, a state senator, said he hopes Gov. Gary Herbert and Swallow would join him in calling for an independent investigation.

State Republican leaders said they wanted more information before making any statements on the matter.

Utah Republican Party Chairman Thomas Wright was out of town and did not return a call to his cellphone. Party Executive Director Ivan DuBois said with Wright away, the state GOP had no comment.

Herbert also had no immediate comment, according to a spokesman.

"The only thing I would say at this point is that it all seems too fresh to make judgments in any direction," said Kirk Jowers, a Republican who heads the University of Utah's Hinckley Institute of Politics.

But "it's hard to imagine a more difficult way to start your term as attorney general than under the cloud of these allegations," he said.

According to the Tribune, Swallow did more than arrange for Johnson to contact someone who could help him get out from under the FTC investigation.

Johnson told the paper Swallow suggested Reid could make regulators go away for a price. He said Swallow at first wanted $2 million to enlist Reid's help. Johnson, whose company wasn't making as much money at the time, said he negotiated the figure to $600,000.

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