Easley campaign hearing off to fast start
A series of witnesses piled up testimony against former Gov. Mike Easley on Monday as a historic hearing into his campaign finances opened before the State Board of Elections.
Easley is the first sitting or former governor in North Carolina to face a campaign finance inquiry – he wasn't at the hearing Monday – and it didn't take long for witnesses to begin leveling allegations against him and his campaign. From Raleigh real estate broker McQueen Campbell to Wilmington developer Nick Garrett, practically every witness had a story to tell Monday that many observers found stunning.
Campbell testified that he flew Easley on his private plane dozens of times between 1999 and 2004, including many trips to and from campaign-related events. None of the flights was ever noted on Easley's campaign finance reports, and Campbell said he never billed the campaign for the flights, which he said amounted to more than $87,800.
State law limits political contributions from individuals to $4,000 per candidate in an election cycle. Corporate donations are banned.
Tommy Hicks, the Wilmington attorney representing Easley at the hearing, was incredulous that Campbell never sent an invoice to the campaign for the flights.
"At the time, I don't remember thinking much about it," Campbell said, noting he had been fascinated with politics for years and just wanted to help the campaign. "I just assumed someone with the campaign would be handling the reporting."
Campbell said he did send two invoices to the Easley campaign in 2005 for about $11,000 total, but he said neither was for the flights. Instead, he said, he had paid for some repairs to Easley's private home in home – Easley was living in the Governor's Mansion at the time – and wanted to be reimbursed.
He said Easley asked him whether there were any unbilled flights that needed to be paid off, and he said he understood that to mean that Easley wanted the home repairs paid off as campaign flights.
Hicks angrily dismissed that claim during a break in the hearing.
"The governor did not authorize or advise him in any way whatsoever to file any kind of false or fraudulent invoices to the campaign," Hicks said. "He did not do that. That did not happen."
Rebecca McGhee, a former assistant to Easley campaign treasurer David Horne, bolstered Campbell's story by noting that Easley ordered her to pay the invoices from Campbell, even though they didn't include any documentation about the flights.
Campbell said Easley never specifically asked him to file a false invoice to the campaign, "but I understood what he meant" when Easley brought up unbilled flights amid a conversation about paying for the home repairs.
In 2004, state election law allowed politicians to use campaign money for such personal expenses, as long as they properly reported it. The law has since been changed to forbid such spending.
Jane Pinsky, director of the North Carolina Coalition for Lobbying and Government Reform, said Campbell's testimony was damaging to Easley.
"I think particularly the revelations from McQueen Campbell that the governor tried to get the campaign to pay for home repairs was bad news," Pinsky said.
Campbell's ties to Easley also have been a focus of a federal grand jury's investigation into the former governor's dealings with friends and contributors while in office. Campbell served on the North Carolina State University Board of Trustees when Easley's wife was given a high-paying university job, and he brokered the sale of a waterfront lot in Carteret County to the Easleys at a below-market rate.
In other testimony, Fayetteville car dealer Bobby Bleecker said that he supplied the Easleys with three vehicles since the 1990s and didn't accept payment until the family was finished using them. He said he considered the deals to be leases on the cars, but he never had the former governor or his relatives sign any lease documents.
After Bleecker called the Easleys in March to collect payment on a used GMC Yukon that he gave to Easley's son in 2003, Mary Easley sent a check for $6,900 and the Easley campaign paid $16,000 to cover back taxes and other costs of its use of the vehicle, Bleecker said.
Wilmington developer Nick Garrett and Lanny Wilson, a former state Department of Transportation board member, both testified that they gave money to the North Carolina Democratic Party after they had "maxed out" on their donations to Easley's campaign by reaching the $4,000 limit. Both men said they intended their money to the party to be funneled to the Easley campaign, and Wilson said campaign staffers told him that was the best way to get money to them.
"We all got together, and we thought it was a way to get money to the campaign," Garrett said.
State law prohibits giving money to a political party with the intent of benefiting a particular candidate.
Jim Cooney, the lawyer representing the Democratic Party in the hearing, suggested to both men that the donations were for "coordinated campaign" expenses, where campaigns would pool money to benefit all Democratic candidates. Neither Garrett not Wilson said he knew how the money sent to the party had been spent.
Democracy North Carolina, a campaign watchdog group, filed a complaint against the Democratic Party, alleging officials were using tacit agreements with donors to redirect contributions to specific candidates.
"This is a system that went on for years of taking advantage or trying to abuse the system (and) get around the campaign contribution limits," said Bob Hall, executive director of Democracy North Carolina.
The only witness who didn't have anything damaging to say Monday about Easley was one who didn't testify.
Ruffin Poole, who was an attorney for Easley while he was governor, convinced a Superior Court judge to block the subpoena the State Board of Elections issued for him. He argued that his testimony could violate the privacy privilege between attorney and client.
Board of Elections Chairman Larry Leake said the board immediately appealed the ruling.