Department spokeswoman Laura Keehner confirmed to United Press International that Stephen Payne was asked to resign after being surreptitiously videotaped by a British newspaper apparently offering to arrange meetings with senior administration officials in return for a six-figure fee, including a quarter-million-dollar donation to the library.
"The department asked him to step down" from his post on the Secure Borders and Open Doors Subcommittee of the Homeland Security Advisory Council, Keehner said, declining to comment on the reasons.
The news comes as questions began to emerge about whether Payne properly disclosed his work on behalf of a number of foreign entities as required by federal law.
Also Tuesday, congressional investigators began to probe the charges, first made in the London Sunday Times last weekend, that Payne offered to arrange meetings with Vice President Richard Cheney, national security adviser Stephen Hadley and Secretary of State Condoleezza Rice in exchange for the donation.
Payne believed he was meeting with an intermediary for the exiled former President of Kyrgyzstan Askar Akayev, ousted in a people power-type revolution three years ago, but in fact, he had been set up by the middleman, Yerzhan Dosmukhamedov, known as Eric Dos, a Kazakh politician with whom he had worked before, and was secretly taped by an undercover reporter.
"If true, this report raises serious concerns about the ways in which foreign interests might be secretly influencing our government through large donations to the library," House Oversight Committee Chairman Henry Waxman, D-Calif., wrote to Payne. Current law places little restriction on the solicitation of funds for presidential libraries and imposes no disclosure requirements. "As a result," wrote Waxman, "a presidential library can solicit secret donations from companies and foreign interests that seek to surreptitiously influence government action."
A spokesman for the Bush Library Foundation told the Dallas Morning News that no donations would be accepted from foreign sources until after the president had left office.
"It's safe to say the things that are alleged in this story would never be encouraged or allowed," the paper quoted spokesman Dan Bartlett as saying.
Payne told UPI in an e-mailed statement that the Sunday Times had entrapped him, that there was no quid pro quo for the donation he suggested, and that he had done nothing wrong.
He said he had resigned from the advisory council because "under the current circumstances there will be too many distractions for me to successfully focus on (its) important work."
But the story has also raised questions about Payne's apparent failure to register much of his work on behalf of foreign entities with the Justice Department, as required by the Foreign Agent Registration Act.
In a promotional brochure Payne provided to Dos, which he later said was a draft, and on a page of his Web site that was removed after the story broke, the lobbyist touted his work for several foreign entities, including the governments of Azerbaijan, Afghanistan and Turkmenistan; and an Uzbek opposition leader called Muhammad Salih.
Payne said he did not have to register, since he was working on behalf of commercial entities, not governments.
"I believe that we are in compliance with FARA regulations," Payne wrote in his e-mail to UPI. "We did not need to FARA register as the basis for our work was commercial projects in these countries. We checked with the Department of Justice's FARA division and were informed that we did not need to register for these commercial projects."
But the brochure states that his company, Houston-based Worldwide Strategic Partners Inc., "arranged for the president of Azerbaijan to visit the United States and meet with President Bush ... (and) arranged a private phone call between the vice president of the United States and the president of Azerbaijan." It also states that he "developed" and placed a series of op-ed pieces "written by influential U.S. officials to boost positive U.S. public perception about Azerbaijan."
"I cannot envisage a set of circumstances where those activities would not be covered" by FARA, campaign finance lawyer and lobbying disclosure expert Brett Kappel told UPI, adding that failing to register as required was a felony punishable by up to five years in jail.
Kappel, a lawyer with the Washington firm of Vorys, Sater, Seymour and Pease, called FARA "the most far-reaching lobbying disclosure law in the United States, requiring the most extensive and detailed disclosures."
He said the commercial exemption, which the law says covers "private and non-political activities in furtherance of the bona fide trade or commerce" of a foreign entity, was "a narrow exemption originally intended to cover foreign corporations doing business in the United States."
"What is 'private and non-political' about a phone call with the vice president?" he asked. "Lobbying on foreign policy issues is not exempt merely because a foreign commercial interest is involved."