Elections board to begin its hearing on Easley

RALEIGH

Former Gov. Mike Easley's campaign finances will go under the microscope Monday when state election officials begin to scrutinize his election efforts and money from the state Democratic Party.

The investigative hearing, which could last up to a week, could provide new details about more than 25 questioned plane flights and other activities surrounding the two-term governor while Easley was in office.

The five-member board -- three Democrats and two Republicans -- could issue fines or reprimands, refer the case to a district attorney for criminal charges, or exonerate the party and The Mike Easley Committee.

The elections board said yesterday that it had subpoenaed Easley and at least 27 other people, including former members of the Easley administration, the trooper once in charge of his security detail and McQueen Campbell, the ex-N.C. State University trustee chairman who has acknowledged providing flights for the governor.

It's not clear how many people subpoenaed will be asked to testify.

"I can tell you unequivocally that Governor Easley will be a witness," board Chairman Larry Leake said in an interview.

Easley is the latest high-profile Democrat before the board this decade, after House Speaker Jim Black and state Agriculture Commissioner Meg Scott Phipps, both of whom ultimately went to prison. Easley is certainly the best known.

Easley hasn't been formally accused of wrongdoing, but political observers expect Democrats to take some hits because of the hearings on the conduct of the former prosecutor-turned-governor.

"It's never happened before. It's not exactly a pleasant spectacle," said Gary Pearce, a longtime Democratic consultant whose clients included Gov. Jim Hunt and John Edwards.

Easley and his election victories were once one of the few bright spots for the Democratic Party in the South. He was someone who "had a reputation of being a tough, courageous, crime-busting DA and attorney general before he was governor," Pearce added. "And this is like Jekyll and Hyde."

Easley joined a high-powered law firm in Raleigh after 16 years in office -- eight each as governor and attorney general.

He essentially has been close-mouthed since May as these and other allegations surfaced. A spokesman, political consultant Ace Smith, declined comment yesterday out of what he called "respect for this process." Smith said in July that he didn't believe a board hearing was warranted. Spokesmen for the committee and the Democratic Party have said they were cooperating with the board.

"We are confident that what we have done was permissible under the rules and laws of the State Board of Elections related to campaign finance," Andrew Whalen, the party's executive director, said.

By holding the hearing, board Chairman Larry Leake -- one of two Democratic board members previously appointed by Easley -- apparently believes it's important enough to examine publicly Easley's activities while he was in office. It's a reflection of the board's increased role as a watchdog and its interest in examining noncash contributions to campaigns.

"Campaign finance has been the central feature of our political landscape, and the state board is right in the middle of that issue," said Michael Crowell, a lawyer who represented Phipps in her 2002 board hearing. "Until the last 10 years, there just weren't investigation like this."

The hearing stems from allegations that Easley's campaign reported improperly or not at all private airplane flights offered to him by supporters while governor and a car loaner being used by his son.

The Democratic Party got pulled in when it announced in July that it was forfeiting more than $24,000 in "in-kind" donations, most of which originated from donors who also have acknowledged flying Easley around while he was governor.

Leake said in July that there were concerns about whether the donations actually were used by the party -- leading to questions of whether the flights were earmarked to the party so Easley donors could avoid the $4,000 donation limit per election.

The board plays the role of a public investigative grand jury, issuing subpoenas and taking testimony and is even permitted to offer legal immunity. Witnesses can decline to give testimony on the right against self-incrimination.

The board also subpoenaed some Democratic Party donors, as well as Lanny Wilson, a member of the N.C. Board of Transportation, and developer Gary Allen. Allen, Wilson and Campbell were involved in a coastal development where Easley and his wife bought land. Several former Democratic Party officials also have been asked to appear.

The campaign irregularities are scattered around a broader probe by federal prosecutors interested in how former first lady Mary Easley landed a job at N.C. State University while her husband was governor and the lot the Easleys bought in the Cannonsgate coastal development.

Leake acknowledged giving a fundraiser for Easley during his 2000 governor campaign and considers him a friend but said he believes he and other board members can act objectively, pointing to their handling of such previous cases as Black and Phipps.

Leaders in North Carolina's political circles are anxiously watching the results of the board probe, the latest with the potential to damage further the reputation of politicians in the eyes of the public.

"For anybody that calls North Carolina home, it's not a happy occasion," Senate Minority Leader Phil Berger, R-Rockingham. "It does paint us all with a brush that we prefer not be painted with. It's all the more reason for us to get to the bottom of it and find out what happened and deal with it."