Carolina Journal News Reports
RALEIGH — Former 1st District Congressman Frank Ballance made a total of $53,500 in political contributions from his federal campaign fund in a nine-week period surrounding the signing of a plea agreement on Aug. 30 that required him to make $61,917 in restitution payments.
The agreement, prepared by the U.S. Attorney, required Ballance to plead guilty to conspiracy to commit mail fraud and money laundering. It also required to make restitution to the State of North Carolina, and to forfeit all assets of the John A. Hyman Memorial Youth Foundation.
The political contributions went to the 1st District Democrat Party, the Democratic Congressional Campaign Committee, the Democratic National Committee, and the Warren County Political Action Committee.
He gave a total of $10,000 before Aug. 30 and he kept on giving after signing the agreement. On Sept. 6 he gave $25,000 to the Democratic Congressional Campaign Committee. On Oct. 6, he gave $6,500 to the North Carolina Democratic Party.
On Oct. 21, he gave $2500 to Concerned Citizens of Bertie County, $2000 to the Henderson/Vance County Black Leadership Caucus, $1500 to the Northampton County Black Caucus, $4000 to the Warren County Political Action Committee, and $2000 to the Robert Holloman Senate Committee.
Sen. Holloman, a Hertford County Democrat, had cooperated with Ballance in questionable financial transactions involving public funds, according to the federal government’s case against Ballance. The federal indictment documented a total of $393,000 that Holloman’s church and affiliated programs received through the efforts of Ballance. Holloman has not been charged with any crimes.
In March 2005 Ballance sent $1,000 to the Warren Family Institute, an organization that had also cooperated with Ballance in the movement of public funds. According to the federal charges, Ballance secured a $75,000 state grant for the institute and then directed the organization to forward $58,500 of it to his nonprofit Hyman Foundation.
CJ asked one of the recipients why it accepted money from Ballance. N. C. Democratic Party spokesman Schorr Johnson said, “The contribution from his federal campaign account was legally made and legally reported.”
The U.S. Attorney’s Office signed the plea agreement on Sept. 15, and Judge Terrence Boyle approved it on Nov. 9 when Ballance appeared before him in court.
When he resigned from Congress in June Balance had $72,000 in his political campaign fund. At the time of his resignation Ballance said a neuromuscular disorder had affected his ability to carry out his duties, but federal and state investigations may have contributed to his decision.
George Smaragdis, a spokesman for the Federal Election Commission, told Carolina Journal that if a candidate is no longer running for office he may use the unspent campaign funds for any lawful purpose. “Charitable, membership, and political organizations are acceptable uses, but Ballance can not make personal use of the money. He can also return the money to contributors,” he said. According to his campaign reports, Ballance did not return any campaign contributions after he resigned.
CJ was unable to determine the status of Ballance’s restitution requirement. Gloria Dupree, spokeswoman for the U.S. Attorney’s Office, said efforts to recover funds are not public record. Cooper’s spokeswoman Noelle Talley said, “At this point we're monitoring the process through the US Attorney's Office. We still hope to have the funds that were seized by the US Attorney returned to the State of North Carolina.”
On Sept. 2, 2004, a Federal Grand Jury indicted Ballance and his son, District Court Judge Garey Ballance. Frank Ballance was charged with diverting more than $100,000 in state funds meant for the John A. Hyman Memorial Foundation to his son, daughter, mother, church and law firm while he was a state senator. Judge Garey Ballance was charged with willful failure to file a federal income tax return for 2000. Neither has been sentenced.
The day he was indicted Joseph Cheshire V, a lawyer for Frank Ballance, said he expects Ballance to reach a plea agreement with the federal government. But, as noted above, Ballance had already signed an agreement. As of April 15, 2005, he still had $10,940 on hand in his campaign fund.
A sentencing hearing for Frank Ballance is expected sometime in May.
Carrington is executive editor of Carolina Journal.