The principal actors in the timeline below:
|Paul J. Foley|
A Key Document in the Investigation
Memo from Kim Strach to Josh Howard in October 2014
State Board of Elections (SBOE) member Paul J. Foley was fishing for information about a confidential SBOE investigation of a man who had paid Foley's law firm at least $1.3 million. In an Oct. 10, 2014, memo to Josh Howard (Chair of the SBOE), Executive Director Kim Strach detailed inappropriate behavior by SBOE member Paul Foley regarding an on-going investigation into large campaign contributions given to Pat McCrory, Paul Tillis, Phil Berger, and other NC politicians in 2012 by Chase Burns, an Oklahoma Internet sweepstakes software magnate who was lobbying NC officials to make internet gambling legal in the state. SBOE Director Strach had learned belatedly that Foley's law firm represented Burns and that Foley's law firm had been paid a large sum by Burns. Foley never disclosed his conflict of interest to Strach or to anyone else at the SBOE. When Strach learned of the conflict, she insisted that Foley recuse himself from the SBOE investigation of Burns, but Foley continued to press for detailed information (particularly about which witnesses were being interviewed). “Mr. Foley stated that he wanted a copy of the findings report sent to him immediately,” Strach recounted in her Oct. 10 memo. Strach said she again advised Foley that would be improper, based on his recusal. “Mr. Foley was not satisfied with my answer …. I was alarmed by Mr. Foley’s behavior today, and I have again cautioned staff not to address any questions from Mr. Foley regarding this ongoing investigation.”
Timeline for Understanding What's Up With Paul Foley
2012 election cycle: Chase Burns, the internet sweepstakes magnate, gives at least $520,000 to dozens of NC politicians including Pat McCrory, who is running for governor. The money is disbursed to those politicians by lobbyists for the Charlotte law firm of Moore & Van Allen, which also happens to be Pat McCrory's former employer. Checks are written on an Oklahoma bank account which is subsequently seized for containing illegal sweepstakes money. The handwriting on the checks draws scrutiny: the politicians' names filled in as payees appear to be in a different handwriting from the amounts on the checks.
March 2013: Chase Burns is arrested in Florida on felony racketeering and conspiracy charges related to a fake veterans’ charity prosecutors say was used to launder $300 million from sweepstakes cafes there. Court filings from the Florida case show that Burns’ company made another $98 million from Internet cafes in North Carolina, though the games were illegal here.
April 19, 2013: Democracy North Carolina files a formal complaint about the Burns contributions with the SBOE, which at that time still has three Democrats and two Republicans sitting on the board. Democracy North Carolina wants to know if the contributions were made using corporate, rather than personal, funds, and was someone other than the contributor directing who received the money?
April 25, 2013: A majority on the SBOE agree that an investigation of Burns is warranted and is therefore set in motion.
April 26, 2013: Newly elected Gov. Pat McCrory replaces every board member on the SBOE to reflect the results of the 2012 elections: three new Republican members and two new Democratic members. Paul Foley is one of the Republicans appointed. The Burns investigation is already underway.
September 2014: SBOE staffers, looking through documents from the Florida investigation, discover that Burns has paid Foley’s law firm nearly $1.3 million between 2009 and March 2013, when Burns was arrested and his accounts frozen (including the account used to send the half-million to the North Carolina politicians).
September 29, 2014: Foley recuses himself from the Burns investigation (but not actually). He continues to press Strach and SBOE investigative staffers for details and updates.
October 10, 2014: Strach spills the beans about Foley's conflict of interest and his behavior to SBOE Chair Josh Howard. Howard quickly requests the Attorney General's office to investigate whether Foley’s conflict of interest tainted the Burns investigation.
June 23, 2015: Senior Deputy Attorney General Alexander Peters concludes in a letter to SBOE Chair Howard that it was proper for Foley to recuse himself from issues involving Burns but that Foley has not compromised the investigation (because SBOE investigators have mainly ignored his fishing). SBOE employees told the Attorney General's office that Foley’s behavior had been “unusual” and “unprecedented.” (SBOE officials hadn’t known about the connection between Foley’s firm and Burns.) The Attorney General's office did not investigate whether Foley had leaked information to lawyers in his firm who were actively representing Burns and said that the ethics commission or the Bar Association would be responsible for addressing whether Foley had acted ethically. Foley meanwhile chooses to interpret this opinion from the Attorney General's office as "exoneration."