In a formal, 30-page letter to former state Rep. Jeremy Durham, the Registry of Election Finance staff lists around 690 alleged violations of state campaign finance laws that were found in an audit. Since each could lead to a maximum civil penalty of $10,000, the total theoretically could be $6.9 million – more than the total collected from all fines in the Registry’s history.
The letter is a step toward deciding what, if any, penalty will be imposed. Durham has until May 1 to respond to the letter, offering any explanation or defense he wishes to the allegations – most involving use of campaign money for personal expenses and investments, but multiple cases of failure to disclose contributions and other infractions.
A Registry hearing is scheduled for June 14. The FBI is also reportedly investigating Durham, apparently with an eye toward tax evasion or fraud charges.
A copy of the letter is available by clicking on this link: durhamletter
The Tennessean has an overview story on the letter’s allegations. An excerpt:
The information… also provides for the first time the names of prominent campaign donors and business owners who gave Durham thousands of dollars that the former Franklin lawmaker never reported on his campaign disclosures… Additionally, the report details nearly $76,000 in improperly disclosed campaign expenditures — on everything from Florida restaurants and airplane tickets to flowers and a Yankee Candle purchase.
The donors and reportedly undisclosed contributions listed in the show cause notice include:
Lee Beaman, a well-known Republican fundraiser and prominent Nashville car dealer, gave Durham $3,000. Durham reported receiving only $1,500;
Cathy and John Simmonds gave Durham $6,000, but he reported receiving only $1,000. John Simmonds, the former CEO of Southeast Financial Credit Union, wrote a letter to a federal judge seeking leniency for a former youth pastor who admitted to statutory rape and child pornography charges. Durham also wrote a letter on the man’s behalf, although there is no discernible personal connection between Durham and the man;
Tracy and Cynthia Miller, who are the brother and sister-in-law of prominent Republican donor and businessman Andy Miller, donated $6,000 to Durham. He reported only $4,500.
A complaint filed with the House Ethics Committee against House Democratic Caucus Chairman Mike Stewart has been withdrawn, reports Nashville Post Politics. Rep. John Ragan (R-Oak Ridge) withdrew the complaint in an email to Ethics Committee Chairman Steve McDaniel (R-Parkers Crossroads).
Ragan had alleged that Stewart used questioning of the Tennessee Emergency Management Agency during a House Government Operations Committee meeting to benefit his law firm, Branstetter Stranch & Jennings, which has a pending lawsuit related to the fires that swept through Gatlinburg last year.
However, when asked for comment, Ragan implied that he could refile the complaint.
“I do not comment on potentially ongoing investigations,” Ragan emailed.
But Stewart says the fact that the complaint was pulled when he asked for a hearing shows that there never was any evidence to move forward with it.
“As far as I’m concerned, he’s withdrawn his compliant, and that means it’s over,” Stewart said.
State Rep. John Ragan, R-Oak Ridge, has filed an ethics complaint against House Democratic Caucus Chairman Mike Stewart because of questions the Nashville lawyer-legislator asked the director of the Tennessee Emergency Management Agency during a legislative hearing on Gatlinburg fires.
The statements from Stewart occurred during a House Government Operations Committee meeting on Feb. 16.
Before asking TEMA director Patrick Sheehan questions, Stewart said, “Full disclosure, I’m a lawyer and I can’t remember, but it’s always possible that my firm would have some involvement in lawsuits related to those fires. So just be aware of that.”
Stewart is a partner at the Nashville-based law firm Branstetter, Stranch and Jennings, which was hired to represent someone affected by the fire.
…During the committee meeting, Stewart asked Sheehan to explain what happened with the communications systems that resulted in text notifications not being sent out to nearby residents before the fire reached the city.
…In Ragan’s complaint, he points to a Feb. 6 letter from Stewart’s law firm to TEMA in which they request various information regarding the area’s communications system.
In the letter, the law firm asked for records of statements made by TEMA, communication between federal, state and city employees and any contracts with third party groups that provided emergency warning services.
“Given the timing and nearly identical way in which the questions Representative Stewart asked in committee mirror the questions made by his law firm, I believe that Representative Stewart knowingly asked questions…to aid himself and Branstetter, Stranch & Jennings,” Ragan wrote in his complaint.
…Stewart said he thought he asked very generic questions that he didn’t think were improper… Stewart said until Thursday he was not aware that the Feb. 6 letter was sent by the law firm to TEMA.
Stewart, who previously served as a member of the 10-member House Ethics Committee, said he would be happy to explain his actions in the event that the complaint is taken up by the committee.
The Tennessean has a lengthy review of Mark Lovell’s activities leading up to his resignation from the legislature amind allegations that he sexually harassed at least one woman on the night of Feb. 7. The “fondling” episode came after Lovell made the rounds on the legislative reception circuit and, by several accounts, became intoxicated. An excerpt:
On the night in question, there were at least five formal receptions. Lovell, who has longer, more coiffed hair than most lawmakers and sports a salt and pepper goatee, attended them all. The first event began before the end of the business day.
Lawmakers were invited to The Standard. It costs thousands of dollars a year to join the private club, established in 1843, and although there is a public restaurant at The Standard, a keycode is required to get into the more exclusive rooms.The soiree started at 4:30 p.m. with drinks and food paid for by AT&T and Delta Dental.
…The Tennessee Malt Beverage Association hosted lawmakers at their 14th annual “Brew Ha-Ha.” The invitation for the event, at the German-themed Gerst House near Nissan Stadium, shows a clipart image of a buxom woman holding a beer-laden tray as two figures toast in the background.
…While the food at these events tends to be mediocre, receptions at Puckett’s Grocery and Restaurant stand out. The Tennessee Cable Telecommunications Association spent more than $17,000 at the downtown restaurant that evening, offering heavy hors d’oeuvres like barbecue and cheese plates as live music filled the air at the southern-style eatery. The bacon-wrapped asparagus was particularly delicious.
Anyone attending a different reception hosted by the Tennessee Disability Coalition had the opportunity to meet with people served by organizations including AARP Tennessee, Disability Rights Tennessee and the Mid-Tennessee Council of the Blind. It was at one of the swankier hotels in town, The Sheraton.
…The Tennessee Organization of School Superintendents sponsored an event at the Hermitage Hotel. It’s a posh, century-old building with terracotta tiles, Tennessee marble and a painted glass skylight in the lobby that’s hosted countless lawmakers and dignitaries over the years, including serving as a headquarters for John F. Kennedy’s 1960 presidential campaign. The hotel is across the street from Legislative Plaza.
Only the Gerst House is outside walking distance from the statehouse.
Lovell said he only had three cocktails between 4 and 9 p.m. at the receptions and afterward. “I’m less than a social drinker,” he said on the day he resigned. Others say Lovell, who is partial to Crown Royal and Coca-Cola, had many more. By 8 p.m., they say he was visibly drunk.
What happens next is disputed. The 5-foot 8-inch West Tennessean said he didn’t recall doing anything wrong at any events he attended that evening. He called the accusations of sexual impropriety “100 percent false.”
All other sources say after the legislative events that evening, the then-lawmaker grabbed a woman inappropriately while at a local establishment. He is accused of grabbing one woman’s breasts and buttocks, in addition to trying to prevent her from walking away. Several sources say he engaged in additional inappropriate touching with another woman.
News release U.S. Rep. Steve Cohen
[WASHINGTON, D.C.] – Congressman Steve Cohen (TN-09) today was appointed by House Democratic Leader Nancy Pelosi and approved by the House Democratic Caucus to serve on the House Committee on Ethics. In 2008, then-Speaker of the House of Representatives Nancy Pelosi referred to Congressman Cohen as the “conscience of the freshman class.”
Democrats at the state Capitol on Tuesday blasted their Republican colleagues for not doing enough to prevent sexual harassment on the hill, after a freshman Republican lawmaker resigned surrounding allegations of sexual misconduct.
Rep. Mark Lovell, a fair and carnival operator from suburban Shelby County submitted his resignation letter on Tuesday. Lovell said in the letter that the elected position ended up being more demanding than he expected and that he needed more time to devote to his business interests and family.
Democrats though quickly sensed blood in the water and took the opportunity to strike.
“This is unacceptable behavior from people who are elected to the general assembly,” said Sherry Jones, a Democrat from Nashville.
Jones and two other top Democratic lawmakers addressed reporters Tuesday afternoon and called on lawmakers to repeal what’s known as Jeremy’s Law.
The bill, which passed last year, was unofficially named after former Rep. Jeremy Durham, who was expelled from his seat surrounding allegations he sexually harassed more than two dozen women at the Capitol.
That bill mandates any victim of sexual harassment who sues the state and loses must then pay for the legal fees of the defense.
“I would say nobody up here is safe anymore. If we can go through all of the sexual harassment issues that happened last year, and you still have somebody…who would do something like that again, what does that say about this place?” Jones added.
State Rep. Mark Lovell, a freshman Shelby County Republican who defeated veteran Rep. Curry Todd in last year’s Republican primary, has submitted a letter of resignation from his House District 95 seat.
The Tennessean reports that the resignation comes with Lovell accused of inappropriate sexual contact with a woman last week, though he contends the accusation is “100 percent false.”
“I’m taking away from my family, I’m taking away my business and now I’ve got accusations of improperness and it’s like you know what, I just need to focus on my family and my business and I don’t need people throwing stones at me when it’s not necessary,” Lovell said in the phone call.
Lovell, R-Eads, engaged in “inappropriate touching” with one woman, (a) source said. Another person with knowledge of the situation also confirmed Lovell is under investigation for acting inappropriately toward a woman.
That statement, more or less, comports with Lovell saying in his resignation letter to House Speaker Beth Harwell, dated Tuesday, that “the time requirements to represent my constituents are more demanding than anticipated” and he doesn’t “have the time necessary to devote to my business interests and to my family.”
Further, from the Associated Press:
Lovell told WHBQ-TV in Memphis that a woman had accused him of inappropriate touching at a legislative event last week.
“The accusations are taking away from my family and my business,” he added. “It doesn’t matter if you’re guilty or not in politics.”
…The Shelby County Commission will name a temporary replacement for Lovell until a permanent successor is voted into office within 107 days of Gov. Bill Haslam issuing a writ of election.
Note: Copy of the resignation letter is available by clicking on this link: lovell
Following up on the Registry of Election Finance audit of Jeremy Durham’s campaign finances, The Tennessean quotes a former federal prosecutor as sayiing the report is “packed with problematic stuff” for the former legislator that will keep him “in the crosshairs” of an ongoing federal investigation. The article goes on to give a couple of comparisons between federal prosecutions in other states and matters raised in the Durham audit.
Before federal investigators indicted North Carolina state Sen. Fletcher Hartsell Jr. on more than a dozen counts of money laundering, mail fraud, wire fraud and tax evasion, they asked him why he spent campaign money on haircuts.
Hartsell said he is a “hippie” and only trims his locks because he’s a lawmaker, according to federal court documents. Investigators called this rationalization an attempt to “perpetuate his scheme to defraud.”
In comparison, when a state auditor asked ex-Tennessee lawmaker Jeremy Durham why he spent more than $1,400 of campaign funds on lawn care, he reportedly told the investigators he needed the lawn mowed at his house in case he hosted fundraisers there.
In pleading guilty to a federal wire fraud charge this month, a former mayor in New York admitted to using campaign contributions for his own purposes. The wire fraud charge stemmed from the former mayor moving fraudulent funds between bank accounts, court documents state.
In the Durham audit, Tennessee campaign finance officials found Durham spent more than $10,000 of donor money on personal items, including alcohol and a plane ticket for his wife. He also routinely moved funds between his campaign, political action committee and personal and professional bank accounts.
Both the North Carolina and New York cases demonstrate strategies the FBI and U.S. attorney for Middle Tennessee could use if they indict Durham.
In releasing an audit indicating hundreds of campaign finance law violations by former state Rep. Jeremy Durham, the Registry of Election Finance board ignored a threatened lawsuit by Durham’s lawyer, Peter Strianse, according to The Tennessean. Now Strianse says he and Durham have not decided whether to follow through on the threat.
In a Feb. 6 letter sent to a staff attorney for the registry… Strianse said releasing the audit to the public would be “premature and unfairly prejudicial” to the Franklin Republican, reflecting an argument he used prior to the audit’s release on Wednesday.
“Obviously this matter is of great public importance and personal importance to Mr. Durham. Respectfully, it is our belief that many of the findings contained in the Draft Report are clearly erroneous, contrary to law, and require significant correction and amplification,” Strianse wrote in his three-page letter, obtained by The Tennessean through an open records request.
Registry Treasurer Tom Lawless, who is also an attorney and served as chairman when the audit began, waved off the threat.
“It’s a knee-jerk reaction, almost as if the registry would be intimidated by that. Which couldn’t be further from the truth. There’s a complete immunity,” Lawless said in a phone interview Friday.
“The truth, generally, is an absolute defense in law.”
…“Libel and slander remain actionable torts when the individual in question is a public figure,” Strianse said (in the letter). “The release of the Draft Report over Mr. Durham’s timely objection may demonstrate that the challenged material was published with actual malice if it is prematurely released on 2/8/17 before Mr. Durham has had an opportunity to respond and proper findings have been made by the Board.”
House Speaker Beth Harwell and Lt. Gov. Randy McNally, through spokespersons, tell The Tennessean that it’s not the responsibility of legislative leaders to police “double dipping” by legislators – the practice of billing taxpayers for daily expense payments while also being reimbursed for their expenses from their campaign finance accounts.
That illegal action was highlighted in an audit released Wednesday that found rampant wrongdoing by former lawmaker Jeremy Durham.
Among the possible 500 violations of campaign finance law found by the Tennessee Registry of Election Finance, Durham is accused of receiving $7,700 in payments from the legislature for personal expenses he’d already reimbursed himself for using campaign funds. That would be illegal, but Lt. Gov. Randy McNally and House Speaker Beth Harwell said that’s up to the registry to monitor.
“Violations in a campaign account are governed by the Registry of Election Finance, which is permitted to turn any criminal finding over to the district attorney,” said Kara Owen, a spokeswoman for Harwell.
McNally spokesman Adam Kleinheider also noted the legal process in place if lawmakers receive improper reimbursements.
“If there are further possible remedies, Lt. Governor McNally would certainly be open to discussing them but clearly there are already laws on the books that cover this kind of illegal and unethical behavior,” Kleinheider said.
..No legislative leaders are recommending tougher penalties for campaign violations in the wake of the Durham audit.
House Majority Leader Glen Casada, R-Franklin, said the registry is best equipped to ensure reimbursement issues are addressed. But he and House Ethics Committee Chairman Steve McDaniel, R-Parkers Crossroads, who chaired the special committee that investigated Durham’s sexual impropriety last year, agreed that the Durham findings necessitate a formal review of House practices.
… Despite the tepid response to any legislative action from Harwell and McNally, lawmakers could increase the number of random audits election finance officials perform each year.
Under state law, only 2 percent of candidates — including judges, lawmakers and the governor — are subject to a random audit in an election year. That means during the 2014 election cycle, just 10 candidates, five of whom were legislative candidates, received full audits, according to the registry’s website.
“Other than random audits, I don’t know of anything that we have. I mean, how do you know if somebody’s telling you the truth unless you audit them? And that’s how they found all of these things, was through an audit,” McDaniel said.
Note: The referenced WTVF report (short version in previous post HERE) was based on what reporter Phil Williams called “old fashioned accounting” – simply matching what legislators reported spending in their campaign finance disclosures with the dates they were reimbursed for travel/per diem and noting when the two overlapped. It would seem a fairly simple matter to legislatively mandate that Registry staff do the same – except, of course, that would add to the workload of folks of an already-understaffed agency. But maybe simply enacting such a review requirement would deter – if not eliminate – the intentional practice of double dipping. In the cases cited by WTVF, the legislators reimbursed the state for what they said was an unintentional oversight.