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In the late 1980s, Robb was considered a possible future presidential candidate until stories began surfacing about his weekends at Virginia Beach, where people said that he routinely caroused at wild parties attended by drug dealers, cocaine users, prostitutes and businessmen with organized crime connections.
Watson investigated the stories himself and brought back leads indicating that Robb had attended more than 100 parties and engaged in sex with at least a dozen women, including underage girls, hookers and married women. One woman, Tai Collins, was a former Miss Virginia and was threatening to blow the story sky-high. Worse, the Republicans had gotten wind of the story and hired Billy Franklin, a private investigator to dig up dirt on Robb.
McCloud fought off the stories at first with threats and countercharges against Republicans. On one occasion, which was tape-recorded, he threatened to have the IRS harass Franklin if he continued his inquiries. Collins would later say that she had received several death threats designed to keep her from going public with stories about Robb.
In a final effort at damage control, McCloud and Watson attempted to argue that the stories were being engineered by Doug Wilder, Robb's main rival in the Virginia Democratic Party. In a move both cynical and stupid, they attempted to prove their point by releasing a transcript to reporters of a conversation on Wilder's cellular phone in which Wilder joked about Robb's political troubles.
The fact that Robb's team possessed an illegally-obtained tape recording of Wilder's phone conversation quickly became the center of the scandal. The widening investigation showed that the Robb for Senate Committee had also secretly purchased Franklin's private phone records for $2,375, disguising the transaction by billing it as a "legal fee" for "research services."
McCloud and Watson eventually both copped guilty pleas to lesser charges and were punished with fines and community service. Robb narrowly escaped a grand jury indictment thanks to political string-pulling by the Bush administration and a well-connected attorney at Covington & Burling, the same law firm that would later help McCloud and Philip Morris to oversee Contributions Watch.
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