US socialite's climb halted by unfolding generals scandal; 'very close to Gen. Petraeus'

Associated Press

TAMPA, Fla. - Jill Kelley's climb up the social ladder may be as spectacular as her fall.

Accounts of lavish parties at her Florida mansion with politicians and military generals have been replaced by reports of financial woes and claims she used her close friendship with Gen. David Petraeus to try to further business dealings. Even her "Friends of MacDill" Air Force base access pass has been unceremoniously revoked.

The tangled web around the daughter of Lebanese refugees, her twin sister, former CIA chief Petraeus and Gen. John Allen, who succeeded Petraeus as the top U.S. commander in Afghanistan, has spread to include questions about a cancer charity Kelley and her doctor husband, Scott, founded.

Although Petraeus' affair with his biographer, Paula Broadwell, was the immediate cause of his downfall, Kelley and her relations with the U.S. Central Command have surfaced as a sort of connective tissue for the growing scandal.

On Wednesday, a New York businessman said Kelley was introduced to him at the Republican National Convention in August as someone whose friendship with Petraeus would help facilitate a no-bid deal with South Korea on a coal-gasification project. She would supposedly be in a position to help broker the billion-dollar deal directly with the South Korean president, said Adam Victor, president and chief executive officer of TransGas Development Systems.

Victor called Kelley "a very vivacious woman. She seemed eager to assist us in our project and she confirmed that she was very close to Gen. Petraeus ..."

Kelley is an honorary consul for South Korea, a ceremonial position, and got diplomatic plates for her car. But Victor says he concluded she had little to offer in the way of deal-making expertise or connections with Korean leaders.

The Associated Press also learned Wednesday that Kelley attended an FBI "Citizens' Academy" last year. It was Kelley's complaints to an FBI agent about alleged threats from Broadwell that led to Petraeus' resignation last week and has sidelined Allen's nomination to become the next commander of U.S. European Command and the commander of NATO forces in Europe.

The agent was Frederick W. Humphries, 47, a veteran counterterrorism investigator in the Tampa office, and he was among the FBI employees Kelley met during the academy, the AP learned.

Both Petreaus and Allen have been guests at the Kelleys' home, which records show they purchased in 2004 for about $1.5 million. Jill Kelley's twin sister, Natalie Khawam, also lives there.

Jill Kelley, 37, and her husband soon gained a reputation for their sumptuous and well-attended affairs.

The relationship between the Kelleys and Petraeus began in late 2008, when he came to MacDill to assume command of CENTCOM. The couple threw a welcome party for him.

Such overtures to the military brass are nothing extraordinary. But Petraeus aides say Jill Kelley took it to another level, winning the title of "honorary ambassador" for her extensive entertaining on behalf of the command, throwing parties that raised her social status through the reflected glow of the four-star general in attendance.

Petraeus honoured the couple with an award, given to them in a special ceremony at the Pentagon just before he departed the military for his post at the CIA, an aide said, speaking on condition of anonymity because he was not authorized to comment on the matter publicly.

Aaron Fodiman, who's been publisher of Tampa Bay Magazine for 27 years, said people like Petraeus and Allen usually don't know anyone when they arrive, and that people like Kelley act as "the welcome wagon."

But behind the scenes, the veneer of upward mobility was showing signs of cracking.

Hundreds of pages of court files in numerous cases portray the Kelleys as both litigious and financially strained. And Khawam, Kelley's twin, has had legal troubles of her own. Khawam, who earned $270,822 in 2010, according to a court filing, has filed for bankruptcy.

In 2005, the Kelleys established Doctor Kelley Cancer Foundation Inc., with themselves and Khawam as its sole directors, according to the Florida Department of State. Its mission statement says the organization, which was based out of the Kelley home, was created to "conduct research studies into efforts to discover ways to improve the quality of life of terminally-ill adult cancer patients."

In 2007, the last year for which it filed paperwork, the foundation reported revenues of $157,284 to the Internal Revenue Service, all from direct donations, according to its tax filing. The document lists expenses totalling precisely the same amount, including $43,317 for meals and entertainment, $38,610 for travel, $25,013 in legal fees, $8,067 for supplies and $5,082 in phone bills.

The filing claims $58,417 of its expenses went toward program services, but it's unclear what those services entailed.

Christopher Pietruszkiewicz, dean of the Stetson University Law School and expert on nonprofits and taxation, said the foundation's filing "raises a lot more questions than it does provide answers."

As the Pentagon looked into up to 30,000 pages of emails and other documents — some characterized as "inappropriate communications" — between Jill Kelley and Allen, MacDill's commander on Tuesday revoked her access pass.

Kelley was issued the pass, one of about 800 handed out under a program to promote interaction with the civilian population, in November 2010, according to a military source, who spoke on condition of anonymity because the person was not authorized to comment on the situation. It was renewed this past February.

Several months ago, Jill Kelley was appointed an honorary local consul for South Korea, said Kristen Smith, executive assistant at the South Korean consulate in Atlanta, which also covers Florida. The license plate on Kelley's silver Mercedes-Benz reads, "Honorary Consul 1JK."

Smith was not authorized to say anything more about Kelley's activities on that country's behalf, although she confirmed that Kelley still maintained her position.

When Kelley called police Tuesday to complain of reporters staking out her home, she cited her honorary position and requested "diplomatic protection."

Frodiman, the magazine publisher, said there's a sense that Kelley's many efforts to rise socially have been undercut by the scandal.

"I think she has now been tainted," he said. "Just too much has come out, that even if it's not true, people will remember. I would imagine that they will ultimately leave the community."

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Cassata reported from Washington. Also contributing to this report were Associated Press writers Matt Sedensky and Tony Winton in Tampa, and Adam Goldman in Washington.

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