Reid got $1.1 million in land sale

Senate Minority Leader Harry Reid collected a $1.1 million windfall on a Las Vegas land sale even though he hadn’t personally owned the property for three years, property deeds show.

In the process, Mr. Reid did not disclose to Congress an earlier sale in which he transferred his land to a company created by a friend and took a financial stake in that company, according to records and interviews.

The Nevada Democrat’s deal was engineered by Jay Brown, a longtime friend and former casino lawyer whose name surfaced in a major political bribery trial this summer and in previous organized-crime investigations. He has never been charged with wrongdoing — except for a 1981 federal securities complaint that was settled out of court.

Land deeds obtained by the Associated Press during a review of Mr. Reid’s business dealings show:

• In 1998, Mr. Reid bought undeveloped residential property on Las Vegas’ booming outskirts for about $400,000. Mr. Reid bought one lot outright, and a second parcel jointly with Mr. Brown. One of the sellers was a developer who was benefiting from a government land swap that Mr. Reid supported. The seller never talked to Mr. Reid.

• In 2001, Mr. Reid sold the land for the same price to a limited liability corporation created by Mr. Brown. The senator didn’t disclose the sale on his annual public ethics report or tell Congress he had a stake in Mr. Brown’s company. He continued to report to Congress that he personally owned the land.

• After getting local officials to rezone the property for a shopping center, Mr. Brown’s company sold the land in 2004 to other developers, and Mr. Reid took $1.1 million of the proceeds, nearly tripling the senator’s investment. Mr. Reid reported it to Congress as a personal land sale.

The complex dealings allowed Mr. Reid to transfer ownership, legal liability and some tax consequences to Mr. Brown’s company without public knowledge, but still collect a seven-figure payoff nearly three years later.

Mr. Reid hung up the phone when questioned about the deal during an AP interview last week.

In a press conference yesterday in Las Vegas, the senator said he thought he had done nothing wrong but was willing to change his ethics report’s account of the sale if the Senate Select Committee on Ethics ordered him to do so.

“Everything I did was transparent,” Mr. Reid said. “I paid all the taxes. Everything is fully disclosed to the ethics committee and everyone else. As I said, if there is some technical change that the ethics committee wants, I’ll be happy to do that.”

The senator’s aides said that no money changed hands in 2001 and that Mr. Reid instead got an ownership stake in Brown’s company equal to the value of his land. Mr. Reid continued to pay taxes on the land and didn’t disclose the deal because he considered it a “technical transfer,” they said.

They also said they have no documents proving Mr. Reid’s stake in the company because it was an informal understanding between friends.

The 1998 purchase “was a normal business transaction at market prices,” Reid spokesman Jim Manley said. “There were several legal steps associated with the investment during those years that did not alter Senator Reid’s actual ownership interest in the land.”

Senate ethics rules require lawmakers to disclose in their annual ethics report all transactions involving investment properties — regardless of profit or loss — and to report any ownership stake in companies.

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