LaRoque lawyers up
Posted November 17, 2011
Kinston Republican Stephen LaRoque has been saying for months there's nothing wrong in his non-profit's handling of federal economic development grants. But it appears he's not taking any chances.
A letter to House Speaker Thom Tillis revealed today that LaRoque has retained high-profile criminal defense attorney Joe Cheshire.
Cheshire's letter, dated Wednesday, urges Tillis not to acquiesce to a request by House Minority Leader Joe Hackney for a legislative investigation into LaRoque's dealings.
Hackney's letter to Tillis, dated Wednesday, refers to "media reports" that "appear to point to a pattern of violating several guidelines for nonprofits as well as the rules for the U.S. Department of Agriculture loan program that provides the capital for Rep. LaRoque’s business."
"I am asking that you appoint a bipartisan commission to independently review the matter and make recommendations about the best course of action in this case. The leadership of this commission should also be bipartisan -- as is the leadership of our Ethics Committee -- to assure the public that political gamesmanship is not a factor in this review," Hackney wrote.
Tillis replied to Hackney that "The appropriate body for review of these matters is the bipartisan Legislative Ethics Committee." The Speaker said he would refer Hackney's letter to that committee, requesting that Hackney "provide the LEC with more specificity regarding the allegation, including without limitation any matters of which you have personal or actual knowledge."
"Doubtless, if more specific or actual knowledge exists," Tillis added, "it will prove critical to the LEC's work."
The controversy over LaRoque's loans dates back to the summer, when the left-leaning advocacy group NC Policy Watch published a report on his financial dealings. According to that investigation, LaRoque paid himself six-figure salaries for his work managing a non-profit that administered USDA loan funds. The report also claimed he stacked the boards of those non-profits with friends and family members, made sweetheart loans to friends and political allies (including two other GOP lawmakers), and used the funds to loan one his for-profit businesses $200,000 at zero interest without reporting that to the IRS.
In audio posted at Policy Watch from an August townhall in Kinston, Tillis says, "I have my staff looking at" the LaRoque story.
"What I'm trying to do is get my facts straight, beginning with confirming your information, talking with the federal agencies that are involved, and we'll continue that process," he told NCPW's Sarah Ovaska.
"If you're talking about legislative ethics, it's not clear to me that's it's even within the purview," he went on. "That's a question I've asked everybody to look at. You know, I'm a partner for PriceWaterhouseCooper, so I'm familiar with audit compliance issues. So we're just going through this process as we would with anybody."
Tillis said he needed to independently confirm the facts in Ovaska's report. Ovaska asked for a timeframe. "I know it took you a month and half, two months. I hope to do it in far less than that," Tillis said.
Almost three months to the day later, Tillis spokesman Jordan Shaw couldn't say any conclusions had been arrived at.
"[Tillis] said that he was gathering information and would handle the matter appropriately. Our office has gathered information (which, for the most part, has been press reports or blog reports from Policy Watch)," Shaw said in an email today.
Tillis' Chief of Staff Charles Thomas told the Associated Press Wednesday the Speaker wants more details about the allegations against LaRoque.
Cheshire weighs in
In his letter today, LaRoque's attorney Joe Cheshire urges the Speaker not to appoint a special commission to look into the issue, saying it "could certainly be thought of as partisan political bait."
"If we as a society begin to appoint 'independent commissions' to investigate 'media' accounts of politicians, there will be no end to commission hearings," Cheshire says in the letter.
"Such a hearing would set a precedent for further politicizing the government ethics process, would waste taxpayer money that should go to more important state endeavors, and will run rough shod over the presumption of innocence."
"We can have no comfort that such a political investigation will not create a destructive media circus with no checks on the truth," Cheshire concluded.
It's fair to note that Cheshire knows something about media circuses, having defended both the Duke Lacrosse players and former Gov. Mike Easley.
Shaw confirmed tonight that "The Speaker’s office has referred Rep. Hackney’s letter to the Legislative Ethics Committee, which is the existing body to review such matters."
LaRoque has not responded to repeated requests for comment.