Michael E. Horowitz, President Obama’s nominee as the Justice Department’s top watchdog, has earned more than $4 million since last year as an attorney representing the likes of Pfizer Inc., Dow Chemical Co. and Cablevision Systems Corp. But he is keeping the identities of nearly a dozen other clients secret on newly filed ethics forms.
Federal ethics rules require nominees to disclose clients and customers so ethics officials and the public can vet potential conflicts of interest. But because of a narrow exception to the rules, Mr. Horowitz is withholding about half of his client list, meaning he essentially will have to police himself on any potential conflicts.
The secrecy is permitted thanks to an exception that allows attorney-client confidentiality to trump government disclosure mandates in limited circumstances, such as when a client has been involved in secret proceedings.
Nominated last month to be the Justice Department’s inspector general, Mr. Horowitz noted on a recent disclosure form filed with the Office of Government Ethics that the names of 11 clients were being withheld “where the representation involved a grand jury or other nonpublic investigation and the client name was not made public.”
Under federal ethics rules, nominees are permitted to keep clients secret if the identity is protected by court order or under seal. In addition, nominees can decline to disclose the identity of a client who has been the subject of a grand jury or nonpublic investigation, or if a written confidentiality agreement was in place when the lawyer was hired.
The lack of disclosure puts nominees on an honor system, recusing themselves from matters that involve former clients.
Justice Department spokeswoman Tracy Schmaler said that Mr. Horowitz will tell ethics officials about his legal work and that officials will have an accurate recusal list.
“He’ll follow DOJ policy on that just like anyone else,” she said.
While 11 of Mr. Horowitz’s clients remain confidential on ethics forms, he did disclose 11 other clients for whom he has provided legal services. The disclosure document doesn’t describe the specific matters on which Mr. Horowitz worked, but states that he provided “legal services.”
Several of the clients listed on Mr. Horowitz’s ethics forms have faced recent scrutiny from the Justice Department:
c Roger Schaerer is one of four Swiss bankers charged this year with helping U.S. taxpayers use secret accounts to help avoid paying federal taxes.
c The Stryker Corp. last year received a subpoena from the Justice Department in an ongoing investigation involving “sales, marketing and regulatory matters,” according to Securities and Exchange Commission filings.
c Dow Chemical in July agreed to pay $2.5 million to settle a Justice Department probe into air, water and waste violations at a Michigan complex.
c Pfizer in 2009 agreed to pay $2.3 billion to settle a Justice Department probe into fraudulent marketing of its anti-inflammatory drug Bextra.
Under Mr. Obama’s ethics rules, Mr. Horowitz must recuse himself for two years on specific matters involving former clients unless he receives a waiver.
An administration official familiar with the nomination, who asked not to be named because the matter involved personal disclosure issues, said Mr. Horowitz would not require a waiver. The official also said that when a nominee has confidential clients, “the agency counsels the nominee on applicable ethics rules and helps them to set up a screening process to ensure that they are recused from matters involving those clients.
“In this case, [the Justice Department] reviewed his disclosed client list and determined that Mr. Horowitz would be able to implement a screening and recusal process to ensure compliance with the Ethics Pledge, as well as the other applicable ethics regulations, for all of his clients,” the official said.
A former federal prosecutor, Mr. Horowitz served on the U.S. Sentencing Commission and held top Justice Department posts in the George W. Bush and Clinton administrations, including deputy assistant attorney general and chief of staff to the head of the criminal division.
Through a spokesman for the Cadwalader, Wickersham & Taft law firm, where Mr. Horowitz is a partner, he declined to comment. The law firm provided several names of references, including two officials who served during the Bush administration.
Michael Chertoff, former Homeland Security secretary and former judge on the U.S. Court of Appeals for the 3rd Circuit in New Jersey, said Mr. Horowitz is “a good choice.”
“He’s fair, even-tempered and not a guy who is going to buckle under pressure … a model of integrity,” Mr. Chertoff said.
Larry Thompson, a deputy attorney general at the Justice Department from 2001 to 2003, said he, too, had a handful of clients from private practice whose identities he was bound not to disclose when he went to the department.
“I think certainly a nominee with the respect and demonstrated integrity as Michael would recuse himself from those matters,” Mr. Thompson said.
Mr. Horowitz isn’t the only nominee who has declined to divulge some of his clients.
Paul J. Fishman, U.S. attorney for New Jersey, provided the names of 29 clients on disclosure forms he submitted to the U.S. Office of Government Ethics in 2009, but withheld the names of “approximately 37 confidential clients” involved in grand jury or other secret investigations.
Frank Kendall III, principal deputy undersecretary for acquisition, technology and logistics at the Defense Department, declined to name six consulting clients. In the cases of Mr. Fishman and Mr. Kendall, White House officials said they were confident that the appointees would recuse themselves in cases involving former clients.
Mr. Horowitz was nominated for the inspector general’s job to replace Glenn A. Fine, who resigned this year after nearly a decade in the prominent watchdog position. Under Mr. Fine, the office headed high-profile investigations into the firings of U.S. attorneys and raised questions about the FBI’s use of national security letters.
In 2008, Mr. Fine’s office found that as U.S. attorney general, Alberto Gonzales failed to properly secure 18 top-secret documents related to National Security Agency surveillance and detainee interrogation programs.
More recently, Mr. Fine’s office was investigating the Justice Department’s civil rights division to determine whether voting section employees were harassed for participating in specific investigations or prosecutions. The move was made amid concerns within and outside the Justice Department about the dismissal of a complaint brought against the New Black Panther Party after its members disrupted a Philadelphia polling place.