Friday, October 11, 2013

Gov. Nikki Haley describes ethics fine as ‘business expense’ in campaign report

‘Just the cost of doing business’

Posted by Corey Hutchins on Fri, Oct 11, 2013 at 11:09 AM

click to enlarge Haley speaks at a recent Georgia/South Carolina water caucus meeting - COURTESY U.S. ARMY CORPS OF ENGINEERS
  • Courtesy U.S. Army Corps of Engineers
  • Haley speaks at a recent Georgia/South Carolina water caucus meeting
According to public filings by Nikki Haley, the governor's re-election campaign listed nearly $10,000 for an ethics fine and related costs as a “business expense.” 

The Lexington Republican, who is running for re-election in 2014, was fined $3,500 in July after regulators concluded a probe of her campaign finances and found she hadn’t kept the proper addresses of some campaign contributors as the law requires. A Democratic Party staffer had filed a complaint about the missing information. 

The State Ethics Commission’s deputy director and lawyer, Cathy Hazelwood, said candidates are usually more specific about describing ethics fines on their public reports. Some, for instance, note if they had to pay the agency for filing a disclosure late. Haley didn't mention a fine or why campaign money was going to the agency. 

“She needs to look at this again,” Hazelwood says about how the Haley campaign described the fine and other costs related to it. “They’re not descriptive enough.”

Haley’s campaign did not immediately return phone messages.

In South Carolina, public officeholders and candidates are allowed to pay ethics fines with campaign money. In 2010, then-Republican Gov. Mark Sanford paid $74,000 — the largest ethics fine in state history — from his campaign account. It’s a practice that’s come under fire in recent years, and in response, lawmakers are currently debating what public officials and candidates can and can’t do with campaign funds.

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“This is the clearest evidence that, to the offenders, ethics violations are just the cost of doing business,” says Chris Kenney, a Columbia attorney who represented the Democratic staffer who filed the original ethics complaint against Haley. “You break the rules and then you pay for it with other people’s money. That ain’t right.”

In August, Haley’s gubernatorial campaign reported paying more than $9,600 to the State Ethics Commission. Her lawyers had been able to negotiate the fine and costs. The agency eventually fined her campaign $3,500 for not keeping proper records, and an additional $2,000 went to pay the cost of investigating her campaign.

Haley’s campaign gave the money from contributors whose addresses the campaign couldn’t verify, a total of $4,176.78, to the Children’s Trust Fund of South Carolina. That's a charity that accepts campaign donations that politicians can't keep because they can't verify where the money came from to send it back. Negotiations took roughly 14 months for Haley to settle on the fine, costs, and charity donation. Her lawyers had tried to have the complaint dropped and the fines waived.

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