Attorney General Ken Cuccinelli (R) believes a public scolding of the IRS and the Treasury Department directly led to the federal government finally releasing hundreds of millions of dollars in settlement money from a Medicaid fraud settlement.
Cuccinelli held a press conference Wednesday morning demanding action from the agencies to give Virginia the $125 million due for their part in a settlement with Abbot Laboratories. The company advertised the drug Depakote for a use not approved by the federal government. A few hours after the press conference, the Attorney General announced they had received a letter from the Treasury Department resolving the matter.
On CNBC's Kudlow Report Cuccinelli said the money would not be on the way without the press conference.
"They've known about this for almost two years now," Cuccinelli said. "But it took until today, until we went public, for them to get back to Virginians and say we are releasing the money."
But another official involved in the process say press conference or not, the Treasury Department was poised to release the funds sometime this week.
Senator Tim Kaine's office was cc'd on a May 24 e-mail to the Treasury Department from Cuccinelli's office asking for a status update on the funds disbursement. After reaching out to the Treasury Department shortly after Memorial Day, they were informed that a response was in the works. Last Friday they were told a letter would be sent this week to the Attorney General that would resolve the issue. That was the letter arrived Wednesday.
Kaine never connected with Cuccinelli after receiving the news about a pending resolution and Cuccinelli's office reiterated that before Wednesday's letter, which came after the press conference, their last contact with Treasury was in April.
Senator Mark Warner's office was also not informed about a pending resolution to the situation.
John Sullivan, a spokesman for the Treasury Department's Under Secretary for Terrorism and Financial Intelligence, would not specifically pinpoint the last time the department communicated with Cuccinelli's or Kaine's office. He could not confirm if they office contacted Senator Kaine last Friday. Sullivan pointed to back to that same letter sent to John Childrey, a Deputy Attorney General, which states the department was responding to the May 24 e-mail.
The letter informing the Attorney General's office of the resolution was dated June 5 and takes great pains to outline the complexity of this particular settlement agreement.
"As you noted, our offices have maintained open dialogue and communication about the status of this record-high and potentially precedent-setting sharing request." wrote Eric E. Hampl, the Director of the Executive Office of Asset Forfeiture. He goes on to point out the "policy challenges presented with an equitable sharing payment of this size."
In a statement to NBC12, Cuccinelli says he was disappointed Kaine's office never informed him of a possible resolution.
"If Senator Tim Kaine or his office were doing anything to be helpful in this matter, they never communicated to me or my office," said Cuccinelli. "If they knew a potential resolution was forthcoming, I would be astonished that they would withhold such information on such a non-partisan matter as protecting and advancing Virginia's law enforcement.”
The specificty of this timeline is irrelevant in terms of its impact on Virginia getting its share of the settlement money. It has a much bigger role in the race for Governor. Shortly after the announcement that the Treasury Department was releasing the funds, Cuccinelli's gubernatorial campaign sent out an e-mail to supporters making note of the accomplishment. The use of the IRS as a buzz word is also helpful to Cuccinelli because of the agency recent controversial troubles.
Just how big of an impact the press conference had it the funds actually making their way to Virginia we may never know. It is clear though that the issue will be something the Cuccinelli camp will seek to point out moving forward.