Tuesday, May 19, 2009

KING AND THE KREF EXPLANATION




I feel compelled to clarify some of the allegations against the King's I have initiated through the KREF. Why you may ask? Simply, in my opinion they are now doing nothing more than using delay tactics to stall the conclusion of this case.

Below are some highlights from the official complaint I filed with the KREF in February. Hopefully for some of you it will give you some idea of why this has become so important to the integrity of elections.

After filing an initial complaint with the Judicial Conduct Commission (JCC), and receiving a non response in this regard from them
Louisville News and Politics: KING UPDATES AND MORE! , I was ready to let it go and figured they would have the power to keep a real investigation from being done. After being bombarded with email from loyal readers asking me to continue, and some giving me basic information I could start with, I decided to do a bit more research on the King's.

Once I started researching it became more and more obvious to me that there was probable cause to believe that the election violations went beyond simple unethical behavior and into the possibility of criminal intent.

In a Judge's race, if in no other, I would expect candidates to be above illegality since we empower them to enforce the law against those who commit illegal acts. I therefore expect the standards to be higher for candidates in this office than any other. I also believe in the biblical saying of "judge not lest ye be judged."

While it may not mean much to many people in the case of our legal system it means everything.

With that in mind here is a short sample of some of the original allegations in the complaint. Since all can be obtained through normal open records request laying them out is not a problem I am worried about.

The Katie King Campaign for District Judge was operated entirely by financially interested family members and business associates. Each loan submitted by Respondent Katie King to her Campaign Committee was addressed to and from King Southern Bank, the depository bank of the Committee, which is owned and operated by her father and campaign treasurer, Jim King.

Furthermore, the dubious mortgage instrument dated October 27, 2008 was prepared by Raymond J. Naber Jr., a member of Gold-King Title Services LLC., of which Katie King is a founding member.

The Campaign Committee also employed the King family operated CPA firm for campaign bookkeeping and financial recording purposes.

Multiple treasurers resigned from Katie King’s campaign, all within two weeks prior and one day subsequent to this financing, including Matthew Conway and Jim King. The $209,000 in financing was made available by King Southern Bank nearly one week before the election on November 4, 2008. Five weeks thereafter, Respondents refused to disclose this and other information through retained legal counsel. This public lack of comments, if you will, coupled with the unavailability of bank records and other financial documents, made a formal inquiry necessary.

Although the note and mortgage were signed and secured by Katie King personally, the loan proceeds were deposited into the campaign account directly to and from the location of King Southern Bank at 3400 Dutchmans Lane.

The consistent policy behind conditionally excluding bank loans from contribution limits has been summarized best by the New Jersey Election Law Enforcement Commission. In an advisory opinion, that state’s commission affirmed that a “mortgage loan,” when made in the ordinary course of business “is not a contribution because it is an arm’s length commercial transaction with no intent or opportunity that any portion of the loan proceeds will become a contribution or exert undue influence” Advisory Opinion No 01-2003.

In other words, a bank loan made in the ordinary course of business has the sole purpose of making profit for the lending institution.

In this particular case though Jim King’s position as father to judicial candidate Katie King, treasurer of her campaign, chairman, president and CEO of King Southern Bank, and president and CEO of the campaign’s accounting firm, King & Company, PSC, establishes that this loan was not conducted by two unrelated parties bargaining at arm’s length.

In short the King family operated lending institution purposely extended financing with the knowledge that the funds would be deposited in an account for the payment of campaign expenses.

As a partisan elected official, past Louisville Metro Council President, 2004 Chairman of the Kentucky Bankers Association and member of its Board of Directors, Jim King is uniquely positioned to understand the specter of undue influence. The decision of Jim and Katie to ignore campaign finance law in this regard shows their collective disrespect for the integrity of public office.

The nature and timing of this financing arrangement suggests that Katie King would not have qualified for the terms without her relational ties, both family and employment, acting as registered agent of process for both the lending institution and its parent holding company.

Because of the close family and financial relationship each shares with the other, their conduct in this matter establishes a pattern of knowing, blatant disregard for campaign finance regulation promulgated under 32 KAR 2:180(2)(c). Because of this the October 27, 2008 loan fails to be classified as such under KRS 121.015(7)(b), and should be considered an illegal corporate contribution under KRS 121.025 and 121.150(21).

Furthermore, this illegal contribution subjects all parties to civil and criminal penalties under KRS 121.990(1-2), and the possible revocation of King Southern Bank’s corporate charter and forfeiture of its authority to conduct business in Kentucky under KRS 121.990(2).
The obfuscatory remarks of Respondent Kathryn King on December 12, 2008 also call into question the method by which the October 27, 2008 second mortgage or refinancing agreement was obtained. When provided the opportunity to explain how she obtained the $194,000, Katie King, in her public refusal to comment, did not reveal this mortgage existed.

Katie King’s statement that the campaign funds originated from her “personal accounts” does not comport with documentary evidence. KRS 121.150(12) would prohibit the transfer of funds into Katie King’s campaign account by a person acting as a disguised intermediary for another, including her father. If the prior unreleased mortgage was paid down substantially to allow later financing, where did the money come from to pay it down and when was it accomplished? This question is very relevant to the process.

We also still do not know whether the similarly reported loans totaling $50,700 that Katie King made to her campaign during the primary election were obtained through secured financing as well.

If Katie King knowingly accepted funds from her dad Jim King for the purpose of augmenting her campaign’s account balance and facilitating financing, then each would have acted in contravention of KRS 121.150(12).

Furthermore, these contributions would have exceeded the $1,000 limit stated in KRS 121.150(6). IF Katie King is found guilty of knowingly accepting such an illicit distribution of funds from her Dad Metro Councilman Jim King as passed through his lending institution, her judicial office would be declared vacant pursuant to KRS 121.999(7) and both individuals would be subject to criminal prosecution.

This is just a sample of some of the things in the complaint I have asked to investigate.

Jim King and his legal team have even alluded to an email they received from the KREF last summer saying that he could indeed gift money to his daughter legally. After receiving the emails through the Kentucky Open Records Act I have included them with this article for your review.

No where does the KREF give permission for King to do so. This is a blatant mischaracterization by King to try to make people believe he had justification for going forward with his plans to get Katie a Judgeship. In my opinion anyway.

A couple other quotes for you.

On November 5, 2008 when interviewed by Ben Jackey of WLKY news Katie King stated, “[w]ho’s to say, you know, what, how far he went, you know, I think it just depends on somebody’s opinion, I mean, I think that, um, I think he’s just an overzealous father” [WLKY-TV 32 Broadcast].

On December 12, 2008 even Joe Terry, a former chairman of the Kentucky Registry of Election Finance stated that if a parent gave a large gift to a child after he or she filed for office, “that would stink to me” and might be considered an illegal contribution.”

He now is employed by King as part of his legal staff.

Sarah Jackson, executive director of the Kentucky Registry of Election Finance, said that the agency would consider the “timing and the intent of a personal donation from a family member” in deciding whether it should be subject of an inquiry.
Bottom line? Simply this. Whether Katie King and Jim King robbed the judiciary blind, there is sufficient evidence in the mountain of misgivings stated in the complaint to subject this to further investigation.

And We The People are entitled to know if our Judges are above the law.
Your thoughts?

1 comment:

  1. Can you make a personal loan to your campaign in that amount? KRS 121.150(13). If you can not make such a loan: How can you unknowingly violate the plain language of a statute?

    ReplyDelete

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