Ethics slams Oxendine over campaign spending

State commission finds $200k in improper spending.

Longtime Georgia Insurance Commissioner John Oxendine accepted more than the legal limit from about 20 donors and improperly spent more than $200,000 in contributions during his unsuccessful bid for governor in 2010, according to an amended complaint released by the state ethics commission.

The complaint, obtained by The Atlanta Journal-Constitution Friday, came about a month after the AJC reported that Oxendine’s campaign failed to return about $750,000 in contributions he received for the 2010 Republican gubernatorial runoff and general election — races the former commissioner never got a chance to run because he finished fourth in the GOP primary.

After questions were raised by the AJC, Oxendine filed an amended disclosure report showing the campaign had $500,000 left in the bank five years after he lost the 2010 primary. The ethics commission complaint says Oxendine improperly spent more than $208,000 raised for the runoff and primary even though he never actually ran those races.

The amended complaint also said Oxendine accepted contributions above the legal limits — $6,100 per election for most of that period — from about 20 donors. Most of the donations were made for the primary election, during which Oxendine greatly out-raised his opponents. While Oxendine led in most polls until shortly before the 2010 primary, he eventually faded and the election was won by Nathan Deal.

According to the complaint, Oxendine collected $12,500 from a bank executive for the primary — despite the $6,100 limit at the time — and $12,200 from another businessman for the primary.

The amended complaint said the former commissioner also improperly used about $2,000 in campaign money for membership dues and expenses at the Commerce Club in Atlanta and the Delta Crown Room VIP lounge.

Oxendine was unavailable for comment late Friday after the AJC obtained the amended complaint.

The new allegations were tacked onto an existing complaint against the former commissioner and two insurance companies that accused Oxendine of accepting $120,000 in illegal contributions from the insurers. The case against the insurers, filed in 2009, was dismissed in 2014, largely because previous commission staffers had made so little progress on it. But more recent staffers have continued to work on the case against Oxendine for receiving the excess money.

In a letter to Oxendine’s lawyer, Stefan Ritter, executive secretary of the ethics commission, said staffers took a new look at the former commissioner’s case after the AJC reported on the campaign discrepancies.

Ritter said Friday, “We did a full audit of Mr. Oxendine’s accounts and paperwork and we determined there were additional violations.”

As insurance commissioner, Oxendine set new standards for political fundraising. He was often accused of strong-arming those working in the industries he regulated for contributions, a charge he denied.

As a gubernatorial candidate in 2010, he reported taking in about $3.9 million in contributions. He reported spending close to $3.4 million. About 20 percent of what the candidate raised was designated for the Republican runoff and general elections.

State law dictates that candidates who raise money for races they don’t run must refund it to contributors or, if refunding it isn’t possible, donate it to charity. But commission officials say state law doesn’t specifically say how long candidates have to give the money back.

While many other candidates — such as those who ran unsuccessfully for governor in 2010 — also raise runoff and general election money for races they didn’t run — they generally return it to donors after the election.

Oxendine told the AJC last month that he was holding onto the leftover campaign money until his ethics commission case was settled, and pointedly noted that state law set no time frame for him to return donations. He has spent some of the leftover money on legal bills and contributions to other politicians, such as failed presidential hopeful and former Texas Gov. Rick Perry.

However, ethics experts say Oxendine can’t pay his legal expenses with funds he raised for the races he never ran. Oxendine, a lawyer, argues that he can.

Oxendine has reported having left over money for years, but his 2015 campaign disclosure showed the money had disappeared. When the AJC pointed out the discrepancy, the former commissioner said that it was a reporting error and he amended his report in August to show the money was still in his campaign account. He declined, however, to provide the AJC with his bank statements.

Ethics commission officials said they received the bank statements this week in response to a subpoena but had not yet examined them.

Cases like the one involving Oxendine may become more common in the next few years because Gov. Deal and the General Assembly beefed up the commission’s budget, giving it the staff to perform more thorough audits of campaign filings.

An initial hearing on Oxendine’s case is expected to be held at the commission’s next meeting in December.

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