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A McCain donor turns into an embarrassment

July 22, 2008 | 10:20 pm

There’s an old saying that the only thing wrong with tainted money is that there “taint” enough of it.

That might work for universities and other institutions that grace their halls with the names of robber barons, but it’s trouble for political campaigns.

The McCain camp recognized that fact of life anew this week. The Washington Post reports that the campaign was stung by its ties to Oregon venture capitalist and political donor Craig Berkman, who was sued by former investors in a fraud case and ordered to pay $28 million in civil damages.

Berkman and his wife, the Post reports, donated $50,000 to Republican candidates and party committees this election cycle. That included a $28,500 check to the Republican National Committee’s Victory Fund on May 29 to support McCain’s presidential bid.

The McCain campaign has given its donations from Berkman to charity and will ask the Republican National Committee to do the same.

Berkman’s political generosity -- even as his financial empire was collapsing -- has angered his former investors. They have prevailed in court against Berkman but haven't received any of the $28 million in damages.

"Someone should ask John McCain: 'With all these folks in your campaign, you couldn't put his name into Google?' " Jordan Schnitzer, the head of an Oregon investment firm who says Berkman duped him, told the Post.

It’s hardly the first time in this presidential race that a candidate has been put on the defensive by a big benefactor with an unsavory past.

Barack Obama gave $160,000 to charity to distance himself from a onetime major fundraiser,  Chicago businessman Tony Rezko. Last month, Rezko was convicted of 16 counts in an influence-peddling scheme involving top Illinois state officials. Not to mention Hillary Rodham Clinton and her friend Norman Hsu.

-- Stuart Silverstein

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