Yesterday, following the conviction of Senator Ted Stevens, CREW's Melanie Sloan said the Senator from Alaska should resign.

Today, John McCain echoed that call:

Republican presidential candidate John McCain is calling for Alaska Sen. Ted Stevens to step down.

Stevens was convicted Monday on seven felony counts in connection with a corruption case.

In a statement issued Tuesday morning by his campaign, McCain says Stevens has broken his trust with the people and that the long-serving Republican should step down.

The McCain campaign claims Sen. McCain had no obligation to report gambling winnings on his personal financial disclosure reports.  That’s wrong; gambling winnings are earned income that must be disclosed.  It’s not even a close call.

Pages 33-34 of the Senate Ethics Manual (pdf available here) state “the staffer who appears on Jeopardy and becomes a grand champion may keep her prize money and other winnings as may the Senator who purchases the winning Powerball ticket.”  The manual continues, “Such winnings must be reported by disclosing individuals as earned income.”  What possible distinction can there be between lottery and game show winnings and money won at a craps table?

Second, some have suggested that because the IRS allows a person to net out his winnings and losses and report only the gain, the same rule must apply to personal financial disclosure forms.  Wrong again. The IRS rules are designed to determine a person's total income, but the Ethics in Government Act's disclosure requirements are designed to identify all of a Member's sources of income.  So under IRS rules, if Sen. McCain won $2,000 at the MGM Grand on Saturday and then lost it all at the Venetian on Sunday, he wouldn't have to report any net income from gambling.  Under the Ethics in Government Act, however, he would still have to report the $2,000 he won at the MGM Grand as income of more than $200 from a specific source.  Other members of Congress, including Sen. Judd Gregg (R-NH), House Minority Leader John Boehner (R-OH), and Rep. Paul Kanjorski (D-PA), all understand this rule and reported such winnings.  Former Rep. Bob Ney (R-OH), on the other hand, went to prison, in part, for failing to properly disclose gambling winnings on his personal financial disclosure form.

Yesterday, CREW filed an ethics complaint against Senator John McCain (R-AZ) for failing to disclose his gambling winnings.  That move has generated a good deal of media coverage.

The Hill:

The Senate Ethics Committee should look into whether John McCain violated federal laws by failing to list gambling winnings on his Senate financial disclosure forms, according to a watchdog group. 

The request by the left-leaning Citizens for Responsibility and Ethics in Washington (CREW) cites several media reports describing McCain as an avid, high-stakes gambler. The group questions why the Arizona senator has not included any gambling winnings on his disclosure forms.

"The Crypt" at Politico.com:

It's no secret that McCain likes to shoot craps, but his campaign told Politico Thursday afternoon that McCain had no gambling winnings in 2006 or 2007. The CREW complaint cites a 2007 weekend in Las Vegas gambling at MGM among the reported incidents in which McCain walked away a winner.

"He had no gambling winnings in 2006 or 2007," McCain spokesman Brian Rogers said in an e-mail. "If he had, they would have been disclosed on his tax returns."

CREW also points to a New York Times report about a McCain visit to Foxwoods Casino in 2000 in which he won money but did not report it on his 2001 disclosure forms.

The Washington Post:

The CREW complaint, however, provides a window into McCain's gambling nature; assuming he abides by all Senate and federal tax laws, McCain's not much of a winner at the craps table.

Under Senate rules, all gambling winnings would be treated the same way as pension plans, book royalties, or other winnings from competitions such as lotteries that are open to the public. They are considered "earned income."

So, under Senate rules, at the end of each year, McCain was required to tally up those gambling trips and determine if he netted at least $200. If he had, he was required to report such winnings on his disclosure forms.

Federal tax law is even more strict: "All gambling winnings must be reported irrespective as to whether any portion thereof is subject to withholding. In addition, you may be required to pay an estimated tax on your gambling winnings."

(For anyone who's ever spent a weekend in Las Vegas, this would appear to be one of the most loosely enforced tax rules ever. However, there are plenty of online guides to explain how McCain, or even once-a-year gamblers, are supposed to report wins and losses while legally gambling.)

Today, CREW filed a complaint against Senator John McCain (R-AZ) with the Senate Ethics Committee.  CREW wants that committee to investigate whether Senator McCain violated federal law and Senate rules by failing to disclose gambling winnings on his Senate financial disclosure reports.   In contrast to House rules, Senate rules allow outsiders to file ethics complaints. Senate rules also require the Ethics Committee to conduct a preliminary inquiry of the complaint.  A copy of our complaint can be found here.

According to a recent article in The New York Times , Sen. McCain is an avid gambler, who frequents casinos as often as once a month. The article states that in the winter of 2000, at the Foxwoods Casino in Connecticut, “[Sen. McCain] and his entourage emerged with thousands of dollars in winnings.” Sen. McCain also reportedly spent a weekend at the MGM Grand in Las Vegas, Nevada in 2007, playing craps while there.

In July, Time reported that over the past decade, Sen. McCain has gambled on Mississippi riverboats, on Indian land, in Caribbean craps pits and on the Las Vegas strip, allegedly playing “for a few thousand dollars at a time.” In 2005, The New Yorker reported that while in New Orleans in the spring of that year, Sen. McCain gambled at Harrah’s Casino.

Federal law and Senate rules require all income to be reported on annual financial disclosure reports. The Senate Ethics Manual states that winnings, such as those derived from a lottery or a game show, are gifts that must be reported as income. Knowingly filing a false report is a crime punishable by up to five years in jail.

Nevertheless, Sen. McCain reported no income derived from gambling on the personal financial disclosure reports he filed with the Senate between 2000 and 2007.

In contrast, other members of Congress, including Sen. Judd Gregg (R-NH), House Minority Leader John Boehner (R-OH) and Rep. Paul Kanjorski (D-PA) all reported winnings on their financial disclosure reports.

CREW’s executive director Melanie Sloan issued this statement when we filed the complaint:

Given Sen. McCain’s long history of gambling, the fact that he never included gambling income on his financial disclosure forms suggests he is either the unluckiest gambler ever or, more likely, he failed to report the income.

The Senate Ethics Committee should investigate whether Sen. McCain deliberately failed to report gambling winnings, and if so, the matter should be turned over to the Department of Justice for a criminal investigation.

Jack Abramoff's associate, Ralph Reed, didn't bother showing up at the fundraiser for John McCain last night.  But, Reed sure created a firestorm by "humping" the event:

Reed was a no-show at a fund-raiser for John McCain Monday evening, following nearly a week of considerable drama surrounding his involvement in the senator’s campaign.

The Republican candidate had come under fire for associating with Reed, the former head of the Christian Coalition who fell from grace after his involvement with lobbyist Jack Abramoff. McCain was one of the leaders of the investigation of Abramoff’s lobbying activities that led to his imprisonment. Reed was never charged.

By many accounts, Reed injected himself into the recent debate. He sent an email to friends announcing his participation in the fund raiser, which he says was a call for more support. Others took it as an assertion of his involvement with the campaign, going so far as to insinuate he was hosting the event.

From NBC's First Read:

Will Ralph Reed actually show up at today’s McCain fundraiser in Atlanta? We said it last week and we’ll say it again: Given the fact that McCain’s Senate Indian Affairs Committee helped uncover the Abramoff scandal and given that McCain has railed against Abramoff on the campaign trail, it’s striking 1) that Reed -- Abramoff’s former business partner -- has helped to raise money for today’s event and 2) that the McCain camp didn’t disassociate themselves from Reed’s participation. 

Last night, the Mouth of the Potomac, the blogs of the Washington Bureau of the NY Daily News, published yet another piece on the growing controversy over Ralph Reed's fundraiser for John McCain.  Something about this event doesn't add up without a big dose of hypocrisy thrown in:

John McCain, a champion of lobbying reform, is drawing fire today for allowing ex-Christian Coalition executive director Ralph Reed help organize a campaign fundraiser for him in Atlanta next Monday.

Democrats and watchdog groups are calling on McCain to pull the plug on the event because Reed is a lobbyist closely tied to convicted felon Jack Abramoff.

Abramoff and Reed both worked on behalf of the gambling lobby, a clientele that eventually led to Abramoff’s demise and conviction. Abramoff paid Reed millions of dollars to press Christian conservatives to oppose casinos that would compete with casinos owned by Abramoff’s gaming industry clients.

But here is the rub: McCain led a Senate investigation that helped bring down Abramoff and helped expose Reed’s role in the shady lobbying deals. Reed, who also worked closely with ex-Bush political boss Karl Rove, was angry over McCain’s proceedings and the two were all but enemies. McCain has even boasted that he helped take down Abramoff.

“Sen. McCain should not go to that fundraiser. McCain was a reformer who went after Abramoff. He says “I am an anti-lobbyist reformer,” but then he agrees to let Reed throw him a fundraiser. That is just so hypocritical,” said Melanie Sloan, executive director of the left-leaning legal watchdog group Citizens for Responsibility and Ethics in Washington.

Before Jack Abramoff's ally, Ralph Reed, hosts the fundraiser for John McCain next week, McCain should probably review the emails between those two, which were collected by his Senate Committee.  We'd suggest starting with this one:

As we reported Monday, Jack Abramoff's ally, Ralph Reed, is hosting a fundraiser for presidential candidate John McCain next week.   We stand by our suggestion that John McCain should review the 66 pages of correspondence between Mr. Reed and convicted felon, Jack Abramoff, which were obtained by his committee.   Those emails between Reed and Abramoff are posted at governmentdocs.org.

In addition, we think McCain should cancel the fundraiser:

Republican presidential candidate John McCain so far is ignoring calls from several watchdog groups to cancel an Atlanta fundraiser promoted by Ralph Reed, a longtime friend and business partner of imprisoned lobbyist Jack Abramoff.

Public Citizen, Citizens for Responsibility and Ethics in Washington (CREW), and Campaign Money Watch are urging the Arizona senator to cancel plans for the Aug. 18 fundraiser at the Marriott Marquis in downtown Atlanta and remove Reed from McCain’s Victory 2008 Team.

Reed lost his 2006 campaign for Georgia lieutenant governor in large part because of details about his relationship with Abramoff — much of the information uncovered by McCain’s Indian Affairs Committee investigation into the wide-ranging lobbying corruption scandal.

The Senate probe discovered $4 million in payments Reed accepted to run a bogus anti-casino campaign aimed at reducing gambling competition. An Indian tribe with a competing casino made payments to Reed, which according to the Senate investigation’s final report, were “passed through” Abramoff’s firm, Preston, Gates, Ellis & Rouvelas Meeds, and another organization, Grover Norquist’s Americans for Tax Reform.

On the campaign trail, McCain often touts his work tackling Abramoff’s corrupt lobbying practices as evidence of his commitment to cleaning up Washington and a straight-shooting style that transcends politics.

Considering all that, CREW's Melanie Sloan put this controversy into perspective :

Watchdog groups are floored that McCain, who has worked with them for years to reform campaign finance law, has called on Reed to help bundle contributions.

“[Reed’s] hypocrisy is legion — now matched only by John McCain’s attending a fundraiser he’s helping host,” said Melanie Sloan, CREW’s executive director. “You just have to wonder who’s the bigger hypocrite.”

Next week, John McCain will attend the fundraiser for his campaign, which is being hosted by a close ally of Jack Abramoff, Ralph Reed:

On Thursday afternoon, Republicans around Georgia received an invitation from Reed, who will serve as a host of a “special event” for McCain at the downtown Marriot Marquis on Aug. 18.

“John McCain believes in a strong national defense, a smaller, more accountable government, steady economic growth and opportunity, the dignity of life and traditional values,” wrote Reed, whose 2006 campaign for lieutenant governor sank under the weight of evidence detailing his relationship with Washington lobbyist Jack Abramoff — much of it uncovered by McCain’s Indian Affairs Committee.

John McCain may want to review the 66 pages of correspondence between Mr. Reed and convicted felon, Jack Abramoff, which were obtained by his committee.   Those emails between Reed and Abramoff are posted at governmentdocs.org.