News: CJ Exclusives

Easley Testimony Contradicts Campbell, Undercuts Own Party

Former governor testifies five hours in board of elections probe

RALEIGH – Political observers knew he would show up, but few could have guessed that he would hang around so long.

Former Gov. Mike Easley, the subject of a North Carolina Board of Elections’ investigation, testified nearly five hours Wednesday during a third day of hearings into alleged fundraising fraud by his campaign. His testimony often contradicted past witnesses’ accounts — and at times, the former governor said things that seemed to be at odds with statements he had made earlier in the day.

Easley strolled into the hearing shortly before 9:30 a.m., flanked by his attorney and lawyers for the state Democratic Party. A moment later, elections board chairman Larry Leake swore the former governor in.

“I’ve always wanted to pick on a governor. It’s a rare opportunity,” Leake said before launching into a series of questions that ranged from home repairs and free flights to possible pay-to-play schemes, political kickbacks, and secret funds meant to skirt campaign donation limits.

Easley said he took a hands-off approach to internal campaign affairs and fundraising. That claim was punctuated by Easley’s admission that he didn’t know the location of his campaign headquarters in 2000 and 2004.

Easley did keep a tight rein on the campaign’s pocketbook, however, even though he admitted to never reviewing a campaign report.

“The people in campaigns, Mr. Chairman, will use money like Monopoly money. They’ll spend all you got,” he said.

Easley denied knowing about memos circulated by his former campaign manager, Jay Reiff, describing a loophole that allowed funds to be funneled to the campaign through the state Democratic Party, potentially circumventing a $4,000 limit on donations from individual contributors.

“I wasn’t in the loop on these kinds of things,” Easley said.

Easley later said that he raised money for the party in 2006 and 2008 to help legislative candidates. Jim Cooney, a lawyer for the Democrats, argued that Easley had no say in how those funds would be spent.

But in apparent contradiction to Cooney’s premise, Easley said he didn’t want to raise money for nonviable candidates, suggesting that he had some influence over how the party would spend the funds.

And though Easley served two terms as attorney general before becoming governor, and as AG headed a bipartisan commission to study campaign finance reform, at one point he testified he did not understand some key aspects of campaign law.

The former governor’s testimony also contradicted statements McQueen Campbell, a Raleigh real-estate broker and long-time Easley friend and donor, made under oath two days earlier.

For years, Campbell gave Easley free flights on aircraft owned by his company, none of which Easley reported on his 2000 and 2004 campaign disclosure forms. At one point in the testimony, Easley said Campbell had asked the governor for advice on finding an attorney so Campbell could file a lawsuit about a “newspaper article” published in 2008 on the governor’s travel.

That article, published in Carolina Journal and written by Executive Editor Don Carrington, said a source reported “McQueen boasted of flying the governor as frequently as once a week, and that the value of the flights totaled as much as $200,000 per year. Some of the trips were to Florida and New York for recreational purposes, the source said.”

In testimony this week, Campbell estimated the value of unreported political flights he provided Easley from 2000 to 2006 at nearly $88,000. In addition, Campbell testified he flew Easley on personal trips, including one to a Carolina Panthers game.

Easley said he eventually dissuaded Campbell from filing the lawsuit, noting that Campbell would have to disclose records of the flights during pretrial discovery.

Campbell also twice arranged for repairs to Easley’s home in Raleigh.

During his testimony Monday, Campbell said that Easley wanted to pay for the repairs using fabricated invoices.

The former governor denied the conversation occurred. “It never, ever happened,” he said. “There was never any conversation with him or with me where he could imply, read my mind, or anything else, that I wanted him to submit any bogus invoices.”

“I don’t know where he got that idea, but he did not get it from me,” Easley added.

Easley claimed the invoice was advance payment for air travel that would be booked later.

The former governor also said he was “surprised” that Campbell testified that he hadn’t been paid for all of the flights. “The important thing is that we get it sorted out, and if we owe it, we pay it,” he said.

In another instance of conflicting accounts, Easley indicated that, against his wishes, Campbell submitted a request for insurance reimbursement for water damage to Easley’s home.

Easley said he didn’t want to file insurance on the damage because he owned coastal property and had filed claims in 1996 for hurricane damage. He was concerned that the insurance company would drop his policy.

At another point during his testimony, Easley flatly denied granting Charlotte developer Gary Allen a state permit to operate a boat dock after Allen gave donations to the Democratic Party. He said that Allen “is not the type who would ever bring” up permits to him.

“If he ever did discuss something like that with me,” Easley said, “it wouldn’t be at the same time he was giving me checks, I can promise you that.”

Former Easley aides Beverly Walker and Cari Boyce testified for 10 minutes apiece after the elections board excused Easley. Both said they weren’t involved with arranging travel for the governor, but Boyce recalled two occasions where she flew with Easley and Campbell.

Boyce said she never heard discussions between Campbell and Easley about payment for the flights, nor was she aware of vehicles provided by Fayetteville-area auto dealership owner Robert Bleecker to the Easley family.

David N. Bass is an associate editor of Carolina Journal.