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CNN fails to retract ‘exclusive’ on second Christie scandal after their story implodes

On Monday, CNN flooded the airwaves with reports of a second scandal threatening to engulf New Jersey’s Chris Christie, claiming the Republican governor is under federal investigation after evidence surfaced that Hurricane Sandy relief funds were used to purchase a self-promoting advertisement campaign. But according to the federal government, that’s simply not true — and CNN has yet to issue a meaningful correction or retraction.

The story first broke early Monday morning. “CNN has learned exclusively that a federal investigation will be launched into why money meant for Hurricane Sandy relief was used in a marketing campaign involving Christie’s family,” anchor Kate Bolduan began, before punting it off to CNN’s new investigative reporter, Chris Frates.

Frates alleged that the Christie administration improperly spent $25 million in federal Hurricane Sandy relief funds on a 2013 advertisement campaign to promote tourism in the wake of the storm — even going so far as to spend $2.2 million more on one ad because the agency agreed to feature Christie and his family.

New Jersey Democratic Rep. Frank Pallone, a longtime rival of Christie, was apparently the network’s big tipster. “After an initial review of the Sandy relief spending,” Frates said, “the office of inspector general at the Department of Housing and Urban Development [HUD] has concluded that there is enough evidence to launch a full-scale investigation, according to Congressman Pallone.”

The network pushed the story hard, revisiting the report in at least fourteen separate segments on Monday alone. But on Tuesday, HUD’s inspector general issued a rare press release directly contradicting CNN’s story.

“The Department granted a waiver to allow the State to use $25 million of its award on a marketing campaign to promote the Jersey Shore and encourage tourism,” the release read. “An audit was initiated in September 2013 to examine whether the State administered its Tourism Marketing Program in accordance with applicable departmental and Federal requirements. This is an audit and not an investigation of the procurement process.” The statement adds that audits of federal expenditures “are something that this office does routinely.”

That means there was never any “initial review of Sandy relief spending,” no “evidence” yet dug up suggesting wrongdoing, and certainly no “full-scale investigation” — a word the federal government uses only to define a probe by law enforcement. Instead, the inspector general’s release suggests a routine accounting review, the likes of which are pursued dozens of times each year by any agency doling out large grants.

So how did CNN respond to these new revelations? The television reports mostly dried up, while a few sentences added to Chris Frates’ written report Tuesday noted that the inspector general released a statement calling the probe an audit, not an investigation.

But the “update” failed to note that the audit is part of a routine inspector general process, that the $25 million diversion for advertising was approved by HUD or that CNN was wrong in its initial claim that the federal government was pursuing a law enforcement investigation against Christie. And on Wednesday Frates pushed boldly onward, writing that the ad agency rejected by Christie was asked if they would feel “comfortable” featuring the governor in their ads and that — unsurprisingly for a New Jersey state initiative– the committee evaluating the ad proposals was made up entirely of Christie officials.

It’s unclear whether Rep. Pallone misrepresented the audit to CNN or if the network misrepresented the congressman’s explanation of the audit. Both CNN officials and Pallone failed to respond to a request for comment.

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