- The Washington Times - Monday, August 8, 2011

Alan Kessler, longtime member of the the Board of Governors for the U.S. Postal Service, resigned last month just weeks after an investigation concluded that he pressured postal officials in a real estate transaction involving a personal friend.

The probe by the Office of Inspector General for the U.S. Postal Service (USPS) found that Mr. Kessler used his position for more than a year to involve himself in a real estate dispute between USPS and an investment company in Florida.

The inspector general’s investigation was first reported by the Federal Times, which obtained a copy of the findings through the Freedom of Information Act.

The probe centered on Mr. Kessler’s involvement in a real estate deal between the USPS and a Florida investment company, Post Office Associates. At issue was a property in Sarasota that included a post office and vehicle maintenance facility.

The report said USPS sought to exercise its option to buy the property for $825,000. It was purchased for $575,000 in 1988, but was worth $12 million in 2008 and the company thought it should get more than what the post office was slated to spend.

Investigators said Mr. Kessler learned about the deal when he was contacted by Douglas Band, whose family members were partial owners of Post Office Associates, according to the report.

Mr. Kessler told investigators he knew Mr. Band through political ties to former President Bill Clinton, the report said. Mr. Kessler was a member of Mr. Clinton’s transition team, and he served as a national finance chair to then Sen. Hillary Rodham Clinton’s 2008 presidential campaign. Mr. Band remains an aide to Mr. Clinton and served in the Clinton Administration from 1995 to 2000.

According to the report, Mr. Kessler got himself involved internally at USPS in the land deal dispute in multiple instances. In one email to the USPS General Counsel, Mary Anne Gibbons, Mr. Kessler warned that while he does not involve himself in day-to-day postal operations, he also said he doesn’t hesitate to pass along “matters of serious concern.”

He warned that the dispute seemed to be headed to “significant and possibly difficult litigation unless reasonable heads prevail.”

According to the report, “Governor Kessler made numerous inquiries with Gibbons ‘pushing the concept of shouldn’t you be trying to resolve this’ and constantly challenging whether (USPS) should be fighting this out.”

In March 2010, when USPS lawyers explained their legal position on the dispute, Mr. Kessler “expressed doubt”, the report said.

“Governor Kessler argued strongly, stating ‘this isn’t the slam dunk you folks think … I think you’re gonna have a problem with the judge.”

Investigators also said Mr. Kessler’s position on the dispute mirrored those of representatives from Post Office Associates, whose partners included the Band Family Partnership, Ltd. The report also said Mr. Band held a personal financial interest in Post Office Associates.

USPS offered to settle the matter, but postal officials said the offers weren’t good enough and referred the matter to the Justice Department to force performance of the original contract, the report said.

What’s more, the report said that in similar cases in the past, USPS has won in court. The Justice Department sued Post Office Associates last year, and a notice of settlement was filed in the case last week, according to court filings in federal court.

One of Mr. Kessler’s attorneys, Pamela Marple, said her client has not seen the report, “but during the review he demonstrated that he was committed to encouraging the Postal Service to respond to the public and third parties in a respectful and responsive manner consistent with its best interests. The matter is concluded.”

In a letter last month to Louis J. Giuliano, chairman of the board of governors, Abbe Lowell, another attorney for Mr. Kessler, added that Mr. Kessler “at all times acted and communicated with the best interest of the USPS in mind.”

“Of course, Mr. Kessler could not control what outside individuals or USPS staff sent to him or what they might say outside his presence, but all material demonstrates that all of his communications and efforts were appropriate,” Mr. Lowell wrote, adding that Mr. Kessler “gained nothing personally from theses communications.”