Addressing Ethics, Corruption Focus of Commission Hearing

December 12, 2012

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PaymentIn 1990, Operation Lost Trust exposed shocking degrees of criminal corruption in South Carolina’s state government that gathered national headlines, garnered 27 convictions and substantially weakened the public’s faith in government.

Twenty-two years later, things haven’t improved by much.

In a state still sporting two black eyes in the executive branch alone thanks to recent ethics investigations of the governor and lieutenant governor that resulted in one being cleared under what critics described as secretive circumstances (Gov. Nikki Haley) and the other resigning in disgrace (former Lt. Gov. Ken Ard), it’s no wonder a Winthrop University opinion poll this week showed a majority of South Carolinians believe state ethics laws need a strong shot in the arm.

So too, ironically enough, does Haley, who in October created the 11-member S.C. Ethics Reform Commission, co-chaired by former state attorneys general Henry McMaster and Travis Medlock, to generate recommendations on how to reform and strengthen ethics laws and enforcement in South Carolina.

Tuesday on the second floor of the Brown building on the State House grounds, the commission held its third public hearing and first featuring testimony from experts from various organizations and agencies about how to address the state’s most pressing ethical issues. The session began with an address from Haley to the commissioners.

“What I hope comes out of this is real ethics reform, ethics reform that is not biased toward anybody, ethics reform that is fair to everybody in the state, and ethics reform that helps people trust their government better,” Haley said. “What I plan to do is what you come out with, you’re going to see me push, whether I like it or not, because that’s what matters. I trust you.”

As it stands, “weak” and “vague” (Haley’s words) ethics laws mean South Carolina lawmakers enjoy privileges of secrecy and power few of their colleagues across the nation do, a fact that allows for cases of nepotism, secrecy and egregious abuses of campaign finance-law loopholes.

Such was the nature of testimony on Tuesday from state Attorney General Alan Wilson; Cathy Hazelwood, the State Ethics Commission’s deputy director and general counsel; Ashley Landess, president of the South Carolina Policy Council, the parent organization of The Nerve; John Crangle, executive director of Common Cause of South Carolina; and representatives from the League of Women Voters of South Carolina and the South Carolina Association of Counties.

Wilson addressed the commission with a proposal to form an inter-agency “Public Integrity Unit” that would be comprised of members from the Attorney General’s Office, Inspector General’s Office, State Law Enforcement Division, the S.C. Department of Revenue and the State Ethics Commission. Rather than create a new agency with staff, budget and office requirements, Wilson’s idea is to have individuals in those existing agencies designated to coordinate information between each other with the chief benefit of avoiding duplication of investigations as happened, Wilson pointed out, in the case of former Lt. Gov. Ard.

“This past year we had a situation where we investigated a constitutional officer (Ard), and subsequently that constitutional officer was convicted,” Wilson said. “The Ethics Commission had it for five months. The state grand jury had it for eight months. Imagine if these agencies were working together from Day One rather than waiting – it would have been more timely, more efficient and allowed these agencies to resolve the matter before them more quickly.

“What you have right now, whether it’s true or not, is you have ethics laws being enforced by different entities depending on what position you hold. If you are a member of the General Assembly, then ethics laws are enforced by ethics committees in the House and Senate. If you’re any other elected official, they’re enforced by the South Carolina Ethics Commission.

“I believe, for purposes of investigation, that all public officials should be investigated by the same entity. That entity should not be used as a hatchet machine or for any type of political gain by either party.”

Wilson, however, has not yet provided specifics about the taxpayer cost of creating a Public Integrity Unit, The Nerve recently pointed out.

More Funding Needed

Hazelwood, who deals with campaign finance ethics on a daily basis for statewide offices with the State Ethics Commission, characterized her office as severely underfunded and understaffed when questioned by Medlock about those who have suggested it take over jurisdiction of House and Senate ethics investigations.

Without an influx of significant additional resources and investigators, Hazelwood said, it simply would not be possible for the Ethics Commission to undertake, especially when it relies on those very entities for its budget.

“It is a huge concern that needs to be looked at long and hard when you say, ‘Let’s have the Ethics Commission also investigate the House and Senate,’ and then also have their budget tied to them,” Hazelwood said. “In Georgia, that’s the case and (its ethics commission’s budget) just got cut in half. As it is, we’re in a horrible state budget cycle; and we’ve been through many horrible state budget cycles here in the last 13 years I’ve been with the commission, so that’s an absolute concern.

“I am certainly not here begging for the House and Senate to come under the jurisdiction of the State Ethics Commission.”

Even so, it’s an idea Haley herself has entertained. As pointed out by commission legal expert John Simpkins, South Carolina is one of only four states out of 40 that have state ethics commissions but which have no authority over their respective legislatures.

When Medlock asked Haley whether she would be in favor of appropriating sufficient funds to allow the state commission to also oversee House and Senate ethics investigations, the governor was succinct.

“I think it’s something that you would see me support,” Haley said. “There’s no price on trust. I think we can do it efficiently. I think we can do it effectively; and I always say if you’re going to do something right, let’s do it right the first time.”

For Common Cause’s Crangle, the issue at the heart of most every ethics issue is money. Among other things, he cited the huge amounts of money being raised by candidates, the way in which campaign money is used and misused by officials, the troubling amount of public embezzlement cases across the state, the lack of legal protection for whistle blowers, and the underfunding and understaffing of the State Ethics Commission.

He also had a novel idea that elicited a few chuckles.

“I think public officials who have jurisdiction over large amounts of public funds at local and state levels should be required to take polygraph tests each year where they can be asked about embezzling or stealing funds,” Crangle said. “It’s something to consider.”

‘Recipe for Corruption’

Landess, the Policy Council’s president, focused on eight key areas: restoring judicial independence, increasing accountability for the Governor’s Office, shortening legislative sessions, opening to scrutiny the state’s economic incentives programs, ending lawmakers’ ability to police themselves, mandating full financial disclosures for elected officials, strengthening open-records laws, and enforcing open budget-writing processes.

“The recipe for corruption is concentration of power and secrecy,” Landess said. “That’s true always, and we have more of both than any other state in the country.”

“There’s a difference when you talk about ethics and corruption,” Landess continued, “and I would contend that we’re past ethics and all the way into systemic corruption in our state government.

“Ethics governs professional standards of behavior. When we talk about corruption, in our state I’m talking about legal corruption – many of the practices are legal … and what we have today is a system in which the public has very little trust.”

Up next: The Ethics Reform Commission will meet Jan. 8 to consolidate comments and testimony, and draft recommendations. On Jan. 22, the commission will discuss its final recommendations and written report; and on Jan. 28 it will provide that report to Haley, the Legislature and the public.

The full Ethics Reform Commission is comprised of:

  • Co-chairman Henry McMaster, S.C. attorney general (2003-2011);
  • Co-chairman Travis Medlock, S.C. attorney general (1983-1995);
  • Bill Rogers, executive director of the South Carolina Press Association;
  • John Simmons, former U.S. attorney for South Carolina (1992-1993);
  • Susi McWilliams, State Ethics Commission chairwoman (2009-2010);
  • Ben Hagood, former S.C. representative 2002-2008;
  • Charles Bierbauer, dean of the University of South Carolina’s College of Mass Communications and Information Studies;
  • F. Xavier Starkes, former assistant U.S. attorney for South Carolina (1992-1993);
  • Kelly Jackson, Third Circuit solicitor 1999-2010;
  • Monica Key, community relations manager, Bridgestone Americas Tire Operations; and
  • Flynn Harrell, former employee of the S.C. Attorney General’s Office under Medlock and former member of the State Ethics Commission.

Reach Aiken at (803) 200-8809 or ron@thenerve.org.