The State Board of Elections wants to know if Phipps paid off the $75,000 campaign debt of former opponent Bobby McLamb. It is not illegal to pay another candidate's debt, but it has to be done by the book.
Phipps said she gave control of her finances to her treasurer Linda Sanders. Phipps said she never questioned Sanders' decisions.
Phipps said she learned at the hearing Wednesday that Sanders may have used campaign funds to pay McLamb's debt.
"I did not know checks were coming from the campaign. I would have been terribly upset, had I known," Phipps said.
Phipps said during the hearing that she should have used professionals instead of volunteers to handle her campaign.
"If I had known it was wrong, we would have corrected it. I don't want you to think that I don't take this very seriously. I'm just saying that a lot of this, I am hearing today for the first time," Phipps said during the hearing. "My intent from the beginning of this investigation is to learn what the problems were and to make whatever corrections we need to make."
Florida businessman Robin Turner testified under guarantee of legal immunity in ahearing that aims to determine whether Phipps or a formerDemocratic Party rival broke campaign finance laws.
Turner testified he gave $8,000 in cash at aHickory fundraiser last year for Phipps.
The Florida carnival company operator said he was approached byagriculture department officials about helping Phipps while beingtold of a business opportunity at the North Carolina State Fair.Turner says raising money for Phipps was not a condition for hiscompany joining the competition for the State Fair contract.
The contract to run the state fair's midway went to a New Jerseycompany.
The hearing is expected to last through Friday.
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