Money woes for family in scandal

Thursday, November 15, 2012
Jill Kelley leaves her home Tuesday in Tampa, Fla. Kelley is identified as the woman who allegedly received harassing emails from Gen. David Petraeus’ paramour, Paula Broadwell. (Chris O’Meara ~ Associated Press)

TAMPA, Fla. -- When news vans camped outside her stately home, a Florida socialite tied to the Gen. David Petraeus scandal fell back on her informal credentials as a social ambassador for Tampa society and top military brass: She asked police for diplomatic protection.

In a phone call to authorities, Jill Kelley, a party hostess and unofficial social liaison for leaders of the U.S. military's Central Command in Tampa, cited her status as an honorary consul general while complaining about news media that had descended on her two-story, five-bedroom brick home overlooking Tampa Bay, which was purchased in 2004 for $1.5 million.

"You know, I don't know if by any chance, because I'm an honorary consul general, so I have inviolability, so they should not be able to cross my property. I don't know if you want to get diplomatic protection involved as well," she told a 911 dispatcher Monday.

Nearly all lines in the tangled scandal involving Petraeus lead back to Kelley, whose complaint about anonymous, threatening emails triggered the FBI investigation that led to the general's downfall as director of the CIA. And now Kelley is in the middle of an investigation of Gen. John Allen, the top U.S. commander in Afghanistan, over alleged "inappropriate communications" between the two.

Details emerged Wednesday about how the investigation began. Out of concern, Kelley reached out to an FBI agent in June she met about a year ago when she attended the bureau's Citizens' Academy in Tampa, according to a person close to Kelley who spoke on condition of anonymity because of the ongoing investigation.

CIA Director David Petraeus testifying on Capitol Hill in Washington. (Cliff Owen ~ Associated Press File)

The FBI program shows members of the public at least some of what the FBI does and how it works. Kelley was not asking the agent, whom she had kept in touch with since the academy, to conduct an investigation into the emails, the person said.

But the FBI agent said the emails raised serious concerns because the anonymous author knew the comings and goings of two of the nation's most senior generals; one now the CIA director.

Around the end of July or beginning of August, the agent told Kelley he had been taken off the case and he was concerned the FBI was not aggressively pursuing it, the person said.

In August, a second FBI agent contacted Kelley to make sure he had all the relevant materials, the person said. That agent told Kelley that Paula Broadwell was the author of the emails. Kelley did not know who Broadwell was -- Petraeus never told Kelley about his affair with the biographer, the person said.

Kelley's friendship with Petraeus and his wife, Holly, began when the general arrived in Tampa around 2008. Kelley and her husband, Scott, a cancer surgeon, had moved to the area a few years earlier. At their home, a short distance from MacDill Air Force Base, where Central Command is headquartered, they hosted a wecome party for the Patraeuses.

Marine Gen. John Allen, the top U.S. commander in Afghanistan listens during a news conference at the Pentagon. (Haraz N. Ghanbari ~ Associated Press file)

Kelley's pass to MacDill Air Force Base was suspended indefinitely in the past couple of days, Pentagon spokesman Lt. Col. Steven Warren said Wednesday. Kelley can still enter the base but she now must report to the visitor center and sign in.

Hundreds of pages of court documents in several lawsuits detail financial troubles for the Kelleys and Kelley's twin sister, Natalie Khawam, who lived with the couple.

Chase Bank sued Scott Kelley in 2010 over a $25,880 unpaid credit card bill, and an investment by the Kelleys in a Tampa office building turned into a dispute with the tenant over $28,000-a-month rent. The couple didn't pay the mortgage and entered into foreclosure.

Attorney Barry Cohen represented the Kelleys in the case, but they turned around and sued him over legal fees, claiming he overcharged them by $5,000. The suit was dismissed, but court documents did not say what happened.

Khawam, a graduate of Georgetown Law School, worked for Cohen's firm. She filed a lawsuit against the firm's chief financial officer, claiming she was sexually harassed after she asked about reimbursement for expenses, according to the court documents.

Cohen said Wednesday that one of his employees did speak to Khawam inappropriately and was fired.

Cohen said he thought Khawam's appearance, in part, might help her attract lucrative cases to his firm. In the end, though, he said she was a "terrible employee."

"I expected more out of her than I got," he said. "It made me feel much better about not getting into Georgetown."

Khawam, who earned $270,822 in 2010, quit the firm and filed for bankruptcy in April, listing almost $350,000 in assets against $3.6 million in liabilities, including an $800,000 personal loan from her sister and brother-in-law, according to court documents. It was not clear whether the loan was made over time.

Her assets were a $344,000 residential property in Washington, D.C., a 2000 Volvo, jewelry, clothes and $694 in cash. Her liabilities included two mortgages totaling $367,000 on the D.C. property, more than $100,000 in student loans and three other personal loans totaling $1.1 million.

For her part, Kelley has taken a low profile since Petraeus' affair with his biographer became public. The Kelleys have retained a high-powered Washington lawyer Abbe Lowell, who did not immediately return a call.

Kelley was appointed honorary consul for South Korea for the city of Tampa in August after she met with that nation's ambassador when he and other embassy staff visited Florida to promote a free-trade agreement subsequently approved by Congress.

South Korean Embassy officials said the position doesn't give her diplomatic immunity or powers, and she hadn't really done anything in her role. Kelley was one of 10 honorary consuls in the U.S. and one of two in Florida.

Soong Yoon, consul general at the South Korean Embassy in Washington, said South Korea is reviewing Kelley's appointment.

"We are keeping an eye on what's happening in this case and we will review the whole process," Yoon said. "Any decision will depend on our official assessment."

In 2005, the Kelleys established the Doctor Kelley Cancer Foundation Inc., according to the Florida Department of State.

In 2007, the last year they filed paperwork, the foundation reported revenue of $157,284 to the IRS, all from direct donations, but the charity's expenses totaled the same amount. The group spent $43,317 in meals and entertainment; $38,610 in travel and $25,013 in legal fees, among other things.

The filing also said $58,417 went toward the charity's mission to "research studies into efforts to discover ways to improve the quality of life of terminally-ill adult cancer patients," but it's not clear what specifically the money was spent on.

The only three listed officers for the organization were the Kelleys and Kwaham, who all shared the title of director, according to the IRS filing. The foundation was run out of the Kelleys home.

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