scandals

Durham lawsuit contends his ouster was unconstitutional

Former state Rep. Jeremy Durham filed a federal lawsuit Monday contending his ouster from the state House was unconstitutional and the state should still provide him his pension and health insurance, reports The Tennessean.

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Witness tampering added to charges in Monroe County vote buying cases

Witness tampering has been added to the list of  federal charges against Brian “Wormy” Hodge, who is accused of buying votes to help Randy White get elected Monroe County sheriff in 2014, reports the News Sentinel.

 Hodge was initially indicted in February on charges he recruited now-confessed chronic vote buyer Betty Jane Best to funnel money he supplied to voters willing to cast their ballots for White and help those voters use the absentee ballot process to do so.

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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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Bill restricting campaign money investment goes to governor

The House gave unanimous approval Monday evening to a bill to put new restrictions on investments of money held in state political campaign accounts. It was inspired by a number of questionable investments found in an audit of former state Rep. Jeremy Durham’s  funds.

The measure (SB377) had passed the Senate earlier (previous post HERE, including a press release) and it now goes to the governor for his signature.

Sponsors are Sen. Doug Overbey, R-Maryville, and Rep. Gerald McCormick, R-Chattanooga. The bill declares campaign funds must be deposited in a financial institution insured by the FDIC or the national credit union administration that is authorized to do business in the state.

The Durham audit found the Franklin Republican, expelled from his seat last year, had invested more than $100,000 of campaign money in a company operated by a major political donor and also used the funds to make substantial loans to a professional gambler and his wife. That’s not illegal under current law, though Durham is under investigation for multiple other allegations of activity that would be illegal.

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.

Democrats call for repeal of ‘Jeremy’s law’

From the Associated Press

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.

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Rep. Lovell resigns House seat; accused of ‘inappropriate sexual contact’

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

Audit helps keep Durham ‘in the crosshairs’ of fed prosecutors?

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.

Durham’s lawyer threatened to sue Registry over audit release

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.”

More on Durham audit — up to 500 violations, June hearing set

From The Tennessean’s overview story:

Former state Rep. Jeremy Durham violated state campaign finance law possibly as many as 500 times, including spending more than $10,000 of campaign funds illegally to buy an airplane ticket for his wife, custom suits, spa products and sunglasses, according to a state campaign finance audit released Wednesday.

He also used campaign money for more mundane bills, including lawn care and paint for his home office, the audit shows.

Durham made at least 55 illegal purchases using money given by donors; the state report outlines 39 expenses, but some include multiple purchases. The former Franklin lawmaker also used campaign funds to invest more than $100,000 in the company of a wealthy GOP donor, loan nearly $30,000 to a professional gambler who has a criminal past and loan $25,000 to his wife, auditors found.

Durham paid himself $7,702 from his campaign account for expenses he’d already been reimbursed for by the state, according to the audit. The practice is more commonly known as double-dipping.

…In addition to the illegal use of campaign finances, the audit details how Durham invested more than $100,000 in Life Watch Pharmacy, a company owned by Andrew Miller, a prominent Republican donor who has advocated for anti-Islam policy in the state.

…The report also states David Whitis, a professional gambler who has a criminal record, received three checks totaling $29,800 from Durham’s campaign account…Two of the checks to Whitis indicate the funds are a “loan to friend.” Additional information provided to the auditors by Durham states the money was “capital for a startup venture.”

From WPLN’s report:

Durham’s attorney has a “laundry list” of objections to the findings. Peter Strianse also says he thought the report was a draft that would not yet be distributed widely.

“I understand if that’s they’re procedure and those are the steps we have to go through,” says the lawyer. “But why in the world would you make public a report that you know is going to be subject to significant challenge?”

But a Registry official says the office followed standard protocol.  

Durham’s attorney has until May to respond to the findings, before a hearing slated for June.

The Franklin Republican was expelled from the legislature last year following nearly two dozen anonymous claims of sexual harassment.

A federal investigation into potential campaign finance violations is ongoing. 

 

ABOUT THIS BLOG

Former Knoxville News Sentinel capitol bureau chief Tom Humphrey writes about Tennessee politics, government, and legislative news.

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