Frederic V. Malek
- 1 Nixon Administration
- 2 Other Political Activities
- 3 Business Activities
- 4 SEC Administrative Penalties
- 5 Related Sourcewatch articles
- 6 References
Fred Malek was President Richard Nixon's White House personnel chief during the Watergate scandal, "and helped dispense patronage for major Nixon donors as well as serving as deputy director of CREEP" (the Committee to Re-Elect the President).  CREEP employed money laundering in its political activities, and was directly and actively involved in the Watergate scandal.
- "Malek is perhaps most famous for his central role in responding to Nixon's request for a count of Jews employed in the Bureau of Labor Statistics."
- In 1971, the Washington Post reported that Malek had ordered the FBI to conduct an investigation of then-veteran CBS correspondent and Nixon critic Daniel Schorr. 
- Malek was known as "the hatchet" in the Nixon administration "because of his alleged ruthlessness in paring the workforce and ousting those deemed disloyal to the Nixon administration."
CREEP's Responsiveness Program and Backlash
Malek engineered Nixon's "Responsiveness Program," which aimed to politicize the executive branch and take advantage of the power of the incumbency to direct federal resources towards ensuring Nixon's re-election.  This included replacing civil servants and nonpolitical government workers who refused to participate in the Nixon reelection campaign, and directing federal grants and loan money towards Nixon supporters. The "Responsiveness Program" was censured by the Senate Watergate Committee. The committee found that the program was aimed at influencing decisions concerning government "grants, contracts, loans, subsidies, procurement and construction projects," decisions regarding "legal and regulatory actions," and even personnel decisions that affected protected "career positions" -- all to advance Nixon's reelection.
Malek took great care to keep the program secret so the White House would be protected in case of a leak. In a 1972 memo, Malek wrote "No written communications from the White House to the Departments -- all information about the program would be transmitted verbally . . . documents prepared would not indicate White House involvement in any way."
Failed 1982 Post Office Appointment
In 1982, President Ronald Reagan nominated Malek to be a governor of the U.S. Postal Service. The Republican-led Senate Governmental Affairs Committee refused to pass Malek's nomination after reviewing his role in CREEP and the Watergate scandal. Colbert I. King of the Washington Post has reported on the committee hearings about Malek's nomination:
- Sen. John Danforth (R-Mo.):"My understanding of the responsiveness program, whether it was legal or illegal . . . is that it was wrong, just plain wrong.
- "We know what we mean by responsiveness programs, by misuse of a public trust, by using a government office in order to win a political campaign: That was true of the Nixon administration, it was true of the Watergate era, it was true of the responsiveness program, you admit that it was true, you admit that it was wrong . . . you regret it and you will never do it again. . . . Am I wrong or right?"
- Fred Malek: "You are absolutely right, senator."
- Sen. David Pryor (D-Ark.): "Did resigning ever occur to you in the period of time when you were running the responsiveness program? Did it ever occur to you that what you were doing was wrong or immoral?"
- Mr. Malek: "Yes, sir, it did."
- Sen. Pryor. "But you did nothing about it?"
- Mr. Malek: "Well, we did something about it. We simply refrained from pursuing with vigor aspects of the program that had been laid out in prior memos."
Under questioning by Sen. Carl Levin (D-Mich.) during the second day of hearings, Malek admitted that a memo written by him did suggest that people who were not Nixon's supporters be punished in some way. "Unethical, immoral and improper" was the way Levin described Malek's role, adding that Malek had "spearheaded a calculated, systematic effort to sell government favors to the highest bidder in the Nixon reelection campaign and to punish low bidders or the nonbidders."
"Jew-counting" at the Bureau of Labor Statistics
According to Talking Points Memo, "Malek is perhaps most famous for his central role in responding to Nixon's request for a count of Jews employed in the Bureau of Labor Statistics" (BLS). 
In 1971, Richard Nixon became convinced the BLS had come under the control of Democratic rivals and what Nixon termed a "Jewish cabal." Malek compiled a list of 13 of 35 top BLS employees who he believed to be Jewish based on their names. "Less than two months later, two senior BLS officials who were Jewish were moved out of their jobs to less visible posts.
Disgraced RNC Resignation
George H.W. Bush appointed Malek to head the Republican National Committee in 1988, but he was forced to resign after Bob Woodward followed up on his Watergate reporting and reminded America about Malek's BLS "jew-count." 
Other Political Activities
Malek was John McCain's National Finance Committee co-chair in the 2008 election, and George H.W. Bush's campaign manager for his 1992 reelection bid.
Malek is founder and chairman of the American Action Network, a 501(c)(4) outside interest group created in February 2010 after the U.S. Supreme Court's Citizens United decision permitted corporations to spend unlimited money influencing elections. Malek also plays a major role in the Republican Governors Association, an organization supporting the election of Republican governors.
He is also a George W. Bush crony who was part of the syndicate that bought the Texas Rangers, one of Bush's failed businesses.
Malek served as a director of Fannie Mae during the period in which CEO Franklin Raines was forced out by regulators and when Raines left the federal mortgage guarantor with a pension worth over $100,000 a month and over $5 million in stock options.
Malek made his initial fortune as CEO of Marriott Hotels and is part of the Carlyle Group. Malek joined Marriot Hotels in 1975 as a senior vice president; he served as president from 1981 to 1988. He participated in the buyout of Northwest Airlines and was its president and chairman from 1989 to 1991. After contributing to the acquisition of CB Richard Ellis in 1989, Malek became co-chairman of the global real estate company until 1996. He also had important roles in the buyouts of the Ritz-Carlton Hotel Company, and of the Texas Rangers baseball team, which he co-owned with other Republican financiers and George W. Bush. Malek founded two private equity firms, Thayer Capital Partners and Thayer Lodging Group, in 1991
SEC Administrative Penalties
Malek paid a $100,000 fine to the Securities and Exchange Commission in a case involving a fraudulent pension fund scheme.
On August 12, 2003, the SEC filed a civil fraud lawsuit against former Connecticut state Senate Majority Leader William DiBella for participating in a fraudulent scheme to invest $75 million of the state pension funds with Malek's firm, Thayer Capital Partners. The SEC said that Thayer failed to disclose payments to DiBella who performed "no meaningful work" and was hired by Thayer at the request of the state treasurer. On May 18, 2007, DiBella and North Cove were found liable for aiding and abetting Silvester's intentional violations of the Securities Exchange Act of 1934, and Thayer was found in negligence of Investment Advisers Act of 1940. Thayer paid a civil penalty of $150,000, and Malek personally paid a fine of $100,000.
Colbert King of the Washington Post describes the incident:
The SEC instituted administrative and cease-and-desist proceedings against Malek, his company, Thayer Capital Partners, and two Thayer affiliates, TS Equity Partners IV L.L.C, and TC Management Partners IV L.L.C. The SEC charged that in 1998 the Connecticut treasurer, Paul J. Silvester, used state pension investments in Malek's company to reward a friend and political supporter, William DiBella, former majority leader of the Connecticut Senate.
The SEC charged that Malek, who was seeking state money for investment in one of Thayer's funds, hired DiBella and paid him a percentage of the state pension fund's total investment with Malek's company, "even though DiBella had no prior involvement with the transaction and ultimately performed no meaningful work related to the investment." DiBella understood from Silvester that he didn't have to do any work for Malek or his company and that Silvester even increased the amount of the pension fund's investment with Malek "by at least $25 million (to a total of $75 million) solely to secure a larger fee for DiBella," according to the SEC News Digest.
Silvester was later sentenced to four years in jail after pleading guilty to federal charges that included racketeering and conspiracy to launder money, according to the Hartford Courant. Silvester was also working on deals with other investment companies. ad_icon
Fred Malek and his company, for their failure to disclose to the pension fund (and pensioners) the side deal to retain and pay DiBella nearly $375,000 -- and without admitting or denying the SEC's findings -- consented to the issuance of a cease-and-desist order censuring him and his company. Malek's company was ordered to pay a civil penalty of $150,000, and he was personally made to pay a civil penalty of $100,000.
Related Sourcewatch articles
- Return of the Secret Donors, New York Times, Oct. 16, 2010.
- Committee for the Re-Election of the President Collection: Frederic Malek Papers, Nixon Presidential Library and Collection, accessed October 18, 2010.
- American Action Network: Who's Putting Up the Money?, Talking Points Memo, Feb. 8, 2010.
- Fred Malek, Then and Now, Colbert I. King, Washington Post, Feb. 4, 2006, accessed October 18, 2010.
- Senate Watergate Report, "The Responsiveness Program" - The Administration's Basic Plan to Employ Federal Resources to Affect the 1972 Presidential Election, 1974.
- American Action Network: Who's Putting Up the Money?, Talking Points Memo, Feb. 8, 2010.
- Fred Malek's Anti-Semitic Past Makes Him Unfit to Chair a State Government Panel, Timothy Noah, SLATE, May 21, 2010.
- Colbert I. King, "Fred Malek, a Dog and the SEC", Washington Post March 11, 2006.
- Colbert I. King, Fred Malek, a Dog and the SEC, Washington Post, March 11, 2006.