State Election Official Says It's Not Criminal For Candidates To Spend Campaign Money On Personal Expenses

The Fort Wayne Journal-Gazette's Niki Kelly has a story today asking where the money candidates raise for their campaign committees goes. She examined some of the expenditures made by statewide candidates and legislative leaders. Among the expenses were non-itemized credit card expenses. Surprisingly, a top official with the state's election division tells Kelly it is not criminal for candidates to spend campaign money on personal expenses.

Attorney General Greg Zoeller spent $13,740 on credit card bills the first six months of the year. Senate President Pro Tempore David Long spent $27,691 on credit card bills last year, while House Minority Leader Scott Pelath spent $13,380. She found Gov. Mike Pence's campaign spent $8,400 on food during a six-month period, including $1,400 at Panera Bread and $1,200 at Potbelly sandwich shop. Pelath said he spent most of the money on food and travel, including $3,200 at an Indianapolis steakhouse for a political fundraiser and travel expenses, including repair work on his car for blown tires and a thrown rod. 

Indiana Elections Division co-director Brad King tells Kelly that his office instructs candidates to list the purpose of an expenditure, not just list an itemized expense as a payment to a credit card company. King says the office has never received a complaint against a candidate for spending campaign money for personal expenses because Indiana's law is so vague. The law only says campaign expenses should be "reasonably related" to campaigns and may not be used primarily for personal expenses. Those provisions of the current law were added after it was learned former Supt. of Education Harold Negley had spent campaign money for personal expenses like tennis club fees, lawn mowing services and haircuts. Negley later resigned after he faced felony charges of ghost employment and official misconduct, the same charges Marion Co. Prosecutor Terry Curry allowed Tony Bennett to walk on.

King told Kelly, though, it was not a criminal offense to spend campaign money on personal expenses. "King said using campaign dollars for personal purposes is generally not a criminal issue, noting that a person could be charged with an infraction that includes a fine up to $10,000," Kelly said. "Or the election commission can fine a committee up to $1,000."

I'm not sure federal prosecutors would view the issue the same way. Former U.S. Rep. Jesse Jackson, Jr. went to prison for spending about $750,000 of his federal campaign money on personal expenses. Jackson spent campaign money to buy a Rolex watch, a fedora once worn by Michael Jackson and furs, among other personal expenses. More than $582,000 of those expenses were paid with credit cards. Jackson was charged with fraud and conspiracy charges, while his wife faced income tax evasion charges. Another former Illinois congressman, Aaron Schock, was forced to resign and is now under federal investigation for misusing his campaign committee's money on lavish travel and other personal expenses.

My experience tells me that a politician is hiding something when he doesn't itemize credit card expenses on his campaign finance report. I parted ways with the first politician I worked for back in Illinois many years ago over a similar issue. I became concerned when he used campaign funds to pay tens of thousands of dollars in credit card bills. He served as his own treasurer, and his campaign finance reports did not itemize the purpose of those credit card expenses. He had used a credit card to pay off a bank loan on a Corvette he had bought and trips he and his wife had taken to place like to Puerto Vallarta, Mexico and then paid the credit card bills with campaign money.

That state senator believed it was okay to pay off the car loan with campaign money because he used the car for campaign purposes like riding in parades. I'll never forget Phyllis Schlafly placing a call herself to the office to complain that a $5,000 campaign contribution she had made to the state senator's campaign committee from her Eagle Forum PAC was not reported on his report. The senator said he had "mistakenly" deposited the check into his personal bank account. That senator never got prosecuted for using campaign money for personal expenses, but he later had to file bankruptcy and was asked to resign when he became embroiled in a sex scandal involving a 17-year old State House tour guide.