Ex-Reagan Campaign Aide Pleads Guilty : Admits to Giving Kickbacks to Influence Awarding of Postal Pacts

WASHINGTON —  John R. Gnau, a prominent Detroit businessman and former Michigan campaign director for Ronald Reagan, pleaded guilty here Friday to charges of conspiracy to defraud the U.S. government and payment of illegal kickbacks in a scheme to steer lucrative Postal Service contracts to a client of his public relations firm.

Gnau, 56, who managed Reagan’s Michigan campaigns in 1976 and 1980, is the latest target of a government probe that led to the conviction last May of Peter E. Voss, former vice chairman of the Postal Service’s Board of Governors, for embezzlement and accepting kickbacks.

Voss admitted accepting $20,000 to $25,000 from Gnau in exchange for influencing the Postal Service to award contracts worth $250 million to Recognition Equipment Inc., a Dallas-based company that employed Gnau’s public relations firm.

Company Not Charged

REI has not been charged with any wrongdoing in the case, U.S. Atty. Joseph E. DiGenova said.

U.S. District Judge George H. Revercomb will sentence Gnau Dec. 19. He faces up to seven years in prison and a fine of $20,000. Voss, who also faces a seven-year prison term, will be sentenced Oct. 24.

The probe has exposed a widening scandal that has led to the dismissal and demotion of top Postal Service officials.

During the course of the investigation, Paul N. Carlin, then postmaster general, was replaced by Albert V. Casey. But Casey, stressing that he accepted the position only on an interim basis, resigned his position Aug. 15 to join the faculty of Southern Methodist University. He was replaced by New York businessman Preston R. Tisch.

According to documents of the U.S. attorney, the scheme began in December, 1983, when Voss agreed to direct firms seeking postal contracts to Gnau’s public relations firm. Gnau agreed to give Voss a percentage of the consulting fees he charged the vendors. In September, 1984, Voss persuaded REI officials to hire Gnau’s firm in their effort to obtain Postal Service contracts.

Recommends Contract

Six months later, the documents show, Voss asked an unnamed senior postal official to award a $162-million contract to REI for the production of “multiline optical character reading machines” used in mail sorting.

Carlin, who was then postmaster general, and Senior Assistant Postmaster General James V. Jellison opposed the contract. In a meeting during the summer of 1985, Voss and Gnau “concluded it would be necessary to have both (Carlin and Jellison) removed from their positions,” the documents said.

Carlin was fired by the postal board of governors last January, after board members accused him of indecisiveness and unresponsiveness. Carlin charged at a congressional hearing last June that he was fired for interfering with the kickback scheme involving Voss and Gnau.

Demotion Charge Denied

Jellison resigned from the Postal Service after Carlin’s replacement, Casey, demoted him. Jellison cited his opposition to the REI contract as a reason for his demotion, a charge that a spokesman for the board of governors denied.

Government attorneys argued Friday that Voss and Gnau discussed replacing Carlin in December, 1985, and that Gnau later asked REI officials to recommend a candidate for postmaster general. REI officials suggested Casey, who was chosen for the position Jan. 6. Government attorneys characterized Casey as a “friend” of REI officials.

A spokesman for the U.S. attorney’s office declined to say whether Casey’s appointment is part of the investigation. Casey was traveling and could not be reached for comment.