Local Politics

Feds investigate Edwards campaign funds

Posted May 3, 2009 11:29 a.m. EDT
Updated May 4, 2009 5:59 a.m. EDT

— A federal investigation is under way into whether funds from John Edwards' presidential campaign were used inappropriately, according to Wade Smith, an attorney for the former U.S. senator.

Edwards said in a written statement that his campaign is innocent of such behavior and that he has cooperated in the investigation.

"I am confident that no funds from my campaign were used improperly," Edwards said.

"However, I know that it is the role of government to ensure that this is true," he continued. "We have made available to the United States both the people and the information necessary to help them get the issue resolved efficiently and in a timely manner. We appreciate the diligence and professionalism of those involved and look forward to a conclusion."

As recently as an April 13 interview with WRAL News, U.S. Attorney George Holding, the top prosecutor for eastern North Carolina, said he could not confirm or deny reports that a federal grand jury was hearing evidence that Edwards used campaign money to pay off his mistress.

In August 2008, Edwards admitted to conducting an affair with Rielle Hunter, a videographer with his campaign, in 2006. He has denied paternity for Hunter's child Frances who was born in February 2008, saying the affair ended before the child was conceived.

Edwards offered to have a paternity test, but Hunter refused, and no father is listed on the girl's birth certificate. A campaign worker, Andrew Young, has claimed to be the baby's father.

Former Democratic political consultant Joe Sinsheimer said he believes Edwards' statement is not enough and that he needs to end speculation about money and paternity once and for all.

“He needs to stand up and answer the questions. He may have to do that in a federal courtroom, but he needs to do this with the public. Until he does that, his reputation will continue to be tarnished,” Sinsheimer said.

While Edwards focused his comment on campaign funds, he also had a range of other fundraising organizations – including two nonprofits and a poverty center at his alma mater – that have come under scrutiny.

Edwards' political action committee paid Hunter's firm $100,000 for video production in a four-month span in 2006 and then paid an additional $14,086.50 on April 1, 2007. At the time, the PAC only had $7,932.95 in cash on hand, according to records filed with the Federal Election Commission.

That same day, according to the records, Edwards' presidential campaign paid the PAC $14,034.61 for what is listed as a "furniture purchase."

Willfully converting money from a political action committee for personal is a federal crime.

The furniture money was one of just five contributions to the political action committee between April 1 to June 30, 2007. The other four occurred on June 30, the last day of the reporting period, including a $3,000 contribution from the wife of Edwards' finance chairman, Fred Baron.

“They must have some belief that money was transferred from someone other than Fred Baron. I can't believe they (investigators) would waste their time on this investigation unless they felt the possibility of a campaign finance violation or abuse of a non-profit,” Sinsheimer said.

Baron, Edwards' national finance chairman and a wealthy Dallas-based trial attorney, said last year that he quietly began sending money to Hunter and Young to resettle in California from Chapel Hill. He said no campaign funds were used and that Hunter was not working for the campaign when he started giving her money.

Edwards has said he was unaware of the payments. Baron died of cancer in October.

Hunter's videos documented Edwards' travels and advocacy in the months leading up to his 2008 presidential campaign.

Edwards, 55, powered onto the national scene in 1998, when he won a seat for the U.S. Senate in his first political campaign. With smooth speech and good looks, the former trial lawyer ran for the White House in 2004 and was tapped as Sen. John Kerry's running mate. He returned to the campaign trail in a 2008 presidential bid but was largely overshadowed by a duel between Hillary Clinton, vying to be the first female president, and Barack Obama, vying to be the first black president.

Since announcing the affair, Edwards has remained largely secluded. His wife, Elizabeth, will soon be releasing a book talking about the affair.