ethics

Registry votes to fine Durham $465K for campaign finance violations

The Registry of Election Finance board voted today to levy $465,000 in civil penalties against former state Rep. Jeremy Durham for multiple violations of state campaign finance laws. That’s the biggest such fine ever imposed by the watchdog agency in its 26-year history.

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On fines for violations of TN campaign finance, lobbying laws going unpaid

The Registry of Election Finance and the Tennessee Ethics Commission have levied $730,000 in civil penalties since 2010, but collected just 21 percent of that total, reports The Tennessean.

The Registry, which oversees enforcement of campaign finance laws, has $356,125 in unpaid fines during the period while the Ethics Commission, which oversees enforcement of lobbying laws and the filing of conflict-of-interest disclosures, has $218,380 in unpaid penalties. (Note: A big chunk of the unpaid Registry penalties are from 2016, when the agency assessed $215,300 in fines with $172,275 unpaid as of last month, according to Registry figures.) If other unpaid penalties going back up to  26 years are added, the unpaid total reaches more than $1 million.

These findings underline what many Tennessee politicos already know: The public entities tasked with holding officials accountable have little, if any, teeth.

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Deal providing tax-exempt bonds to Nashville charter schools brings criticism

Working with a politically-connected law firm, two Nashville charter schools used an obscure Metro Nashville board to receive tax-exempt bonds for their projects that are drawing intense scrutiny after going unnoticed by other city officials for months, according to the Tennessean.

The deals approved by the Metro Health and Educational Facilities Board for Rocketship and Purpose Prep charter schools do not use local taxpayer money and contain no provisions that would put taxpayers on the hook. But critics on the Metro Council and the Nashville school board say the charters should go to banks for private financing and not use the facilities board, which can issue tax-free bonds for nonprofit groups.

They directed particularly sharp criticism at a $7.74 million in bonds for Rocketship, which is part of a national charter school network.

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Politico lists Corker, Fleischmann as having potential conflicts in stock trades

Sen. Bob Corker and Rep. Chuck Fleischmann, both Chattanooga Republicans, are highlighted by Politico in a listing congressmen whose stock trading raises a question of conflicting interests with their lawmaking activity.

The article, bearing the headline “Reckless stock trading leaves Congress rife with conflicts,” reports that Political found “28 House members and six senators each traded more than 100 stocks in the past two years, placing them in the potential cross hairs of a conflict of interest on a regular basis. And a handful of lawmakers, some of them frequent traders and some not, disproportionately trade in companies that also have an interest in their work on Capitol Hill.”

Here are excerpts from the report on Corker and Fleischmann:

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House rejects honoring resolution for writer with Penthouse background

The House has spurned a resolution honoring Kay West, longtime Nashville journalist perhaps best known as a restaurant food critic – apparently because she once worked for Penthouse magazine. The resolution (HR127) was sponsored by Rep. John Ray Clemmons, D-Nashville.

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Durham disputes campaign finance violations, criticizes state law

In a formal response to a Registry of Election Finance audit that found 690 potential violations of state campaign finance laws by former Rep. Jeremy Durham, the ex-legislator’s lawyer, Peter Strianse, and unnamed advisors offer explanations for some matters, generally deny any wrongdoing and criticize the laws involved.

WSMV has text of the document HERE. The Tennessean has a more lengthy narrative report on the 235-page response. An excerpt:

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Kevin Teets gets his lawyer license back

The state Supreme Court has reinstated the license to practice law for Kevin Teets, a veteran Democratic political operative after a 19-day suspension following accusations that he took about $8,000 from  nonprofit association created to help the homeless, reports The Tennessean.

But that comes with conditions. Teets must meet with another lawyer biweekly who will monitor Teets’ work and has to continue weekly mental health sessions. He has to allow his therapist to provide monthly reports to the Board of Professional Responsibility, which recommended his discipline. And he has to pay the board’s costs of nearly $800 (he has already paid restitution), disciplinary documents say.

“Practicing law in Tennessee is a privilege and it’s a privilege that I am glad to have reinstated by the Tennessee Supreme Court,” Teets said Thursday. “I’m passionate about advocating for my clients and I’m ready to get back to work.”

Teets is a former executive with the Tennessee Democratic Party and led the political campaigns of District Attorney General Glenn Funk and former mayoral candidate Bill Freeman.

Note: Previous post HERE.

More details on Durham’s alleged campaign money misdeeds

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.

Ethics complaint against Stewart withdrawn

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.

 

Stewart faces ethics complaint over questioning TEMA director

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.

From The Tennessean:

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.