Draft documents drawn up by Colorado Independent Ethics Commission suggest members will allow Secretary of State Scott Gessler to establish a private defense fund he hopes to draw on in the event that an investigation launched into his alleged misuse of public funds leads to criminal charges. The apparent nod from the ethics board comes despite harsh dissent of its chairman, Dan Grossman.
“The Secretary of State’s contention that contributions to his legal defense fund should be excepted from the gift ban because being charged with a crime constitutes a special occasion is far-fetched,” wrote Grossman, a Democratic.
If greenlighted by the ethics board in the final decision scheduled to be released next week, Gessler’s fund would be subject to narrow guidelines aimed at limiting donations and ensuring public transparency, according to the documents. (Read them here (pdf).)
Gessler’s spending is being examined by the Ethics Commission and by Denver District Attorney Mitch Morrissey. Complaints based on reports first published by The Fort Collins Coloradoan allege Gessler charged taxpayers $1,500 to travel to Florida in August for a Republican National Lawyers Association meeting and then to the Republican National Convention held last year in Miami. The complaints allege Gessler charged another $1,500 to his office’s tax-based discretionary funds without submitting receipts.
The amount of money at the center of the investigation is relatively small as expenses go for many top state officials. Yet the fact that $3,000 in expenditures has given rise to a criminal probe, a government investigation and wide media coverage highlights how fraught Gessler’s two-year tenure as Secretary of State has been. The longtime hard-driving conservative politics lawyer and unabashedly partisan Republican has become the subject of near-constant monitoring by the left. His critics say he uses rule-making authority to reshape election and campaign laws in ways that bolster conservative voting blocs and raise up conservative priorities. Gessler routinely dismisses the criticism as partisan mudslinging and has admitted publicly that he feels the need to battle what he views as liberal attempts to undermine conservative political representation in the state.
Earlier this month, Gessler hired three lawyers paid with state funds to argue his case before the Ethics Commission — high-profile attorneys Robert Bruce, Michael Davis and David Lane. The three failed to convince the Commission to dismiss the allegations against the Secretary. But now, based on the draft decision papers made public Tuesday, it seems clear that they succeeded in persuading the Commission to approve a fund that would raise private donations for Gessler’s use but that would be tightly structured to avoid violating the state’s anti-corruption laws banning gifts to public office-holders.
The Commission documents show the bipartisan members — two Republicans, two Democrats and one unaffiliated — comparing Gessler’s request to a request made in 2011 by the Office of Legislative Legal Services at the Capitol in Denver. The Office was seeking to establish a medical fund for state Senator Mike Kopp, R-Littleton, whose wife was terminally ill with cancer. That request, which the Commission granted, was made without the Kopp’s knowledge.
Gessler’s request is significantly different, the members argue, and must be subject to stricter guidelines.
“In the present situation,” the draft decision reads, “according to the information provided, it is the Secretary not the agency, who is currently under investigation for alleged criminal activities. The Secretary has broad jurisdiction relating to lobbyists, nonprofits and charities, elections, campaign finance, bingos and raffles, business organizations, notaries public, and many other areas. Thus… there could be a variety of reasons for a donation to his legal defense fund, only one of which, a pre-existing friendship, would be permissible.”
Although the decision comes with a letter attached from Commission Director Jane Feldman cautioning that it may be revised significantly, the draft decision suggests the Commission will allow Gessler to set up a fund for individual donors excluding lobbyists, people who have business before and/or are regulated by the Secretary and his employees. The donors’ names and the amounts they give to the fund would be made public and individual donation would be capped at $1000.
In the working dissent to the decision included with the documents released by the Commission, Grossman slams Gessler’s request.
[The law] provides an exception to the prohibition for gifts or things of value “[g]iven by an individual who is a relative or personal friend of the recipient on a special occasion.” The term “special occasion” is not defined… and it is doubtful the people of Colorado… intended that term to include criminal indictments.
Moreover, even if a criminal prosecution can be shoe-horned into the special occasion exception, the section specifically limits the exception to gifts from relatives and personal friends of the recipient…
The [argument] posed by the Secretary in support of his request is that… a legal defense fund would help protect the personal assets of officials from frivolous claims. However, counsel for the Secretary conceded… that his request is limited to a legal defense fund to assist in compensating him for defense of a potential criminal action. Criminal actions are initiated by public prosecutors based upon law, evidence and the pursuit of justice… Should the Secretary find himself charged with a committing a crime, the costs of his defense are appropriately his to bear.
The final version of the Commission’s decision is set to appear next week, but Deputy Secretary of State Suzanne Staiert requested the draft version on Gessler’s behalf last week, citing Colorado Open Records law and, in effect, threatening legal action if the request was refused.
Ethics Commission Director Jane Feldman made clear in her response to Staiert that she was reluctantly releasing the working papers, mainly because the Commission has no attorney on staff to file an effective refusal.
“The Commission continues to believe that these matters are privileged,” Feldman wrote to Staiert in the email cover letter that accompanied the decision and Grossman’s dissent.
As The Colorado Independent has reported, the state’s underfunded Ethics Commission typically leans on the Attorney General’s office for legal counsel. But Attorney General John Suthers’ staff on January 8 sent a letter to the Commission officially recommending that its members approve Gessler’s request for the defense fund. A spokesperson for the Attorney General said Suthers decided to weigh in on the matter because he believed the decision would have significant effect on government employees in departments across the state.
Citing Suthers’ position, Assistant Attorney General Lisa Brenner-Freeman, reportedly informed the Ethics Commission, which she typically serves as counsel, that she could not provide advice on the matter of the Gessler defense fund.
Government watchdog group Colorado Ethics Watch– the left-leaning group that filed the misuse of public funds complaint against Gessler in the fall– accused Suthers, a Republican, of putting the interests of Gessler before the interests of the state.
“Whose hat is [Suthers] wearing?” Ethics Watch Director Luis Toro asked. “Is he counsel for the Ethics Commission or for Scott Gessler?”
Now Ethics Watch is asking the same kind of question about Staiert, Gessler’s top aide.
“[Gessler] has misused staff time of state employees to attempt to bully the Ethics Commission to keep it from doing its job,” Toro said in a release posted yesterday.
Staiert told the Independent that the questions surrounding the fund pose admittedly thorny questions for department staff. She said she consulted with the attorney general’s office before sending the request for the Commission documents.
“I asked ‘Should I being making the request or should the Secretary send the request himself or should he ask private counsel to send it?’”
She said she was assured by the attorney general’s office that it was well within her responsibilities to send the request and that precedent supported that position.
Although Gessler’s three attorneys are being paid with taxpayer money to represent him before the Ethics Commission, Gessler will have to pay them, or other attorneys, to defend him against any potential criminal charges, which is why he is seeking to set up the defense fund.
According to sources familiar with the kind of fees Gessler’s three private-sector attorneys usually charge, the public cost attached to the Ethics Commission investigation already is likely many times higher than the amount of public money Gessler is alleged have misused in the first place.