GAB dings ethics, campaign finance violators

Never-before-published list includes notable names

About this story

This story was produced with support from the State Integrity Investigation, a ranking of all 50 states’ corruption risk by the Center for Public Integrity, Global Integrity and Public Radio International. The Wisconsin Center for Investigative Journalism assessed Wisconsin for the project, which gave the state a C-, ranking 22nd among the states: www.stateintegrity.org/wisconsin.

View a summary of Wisconsin’s report card: Capitol chaos shines spotlight on secretive state institutions

By Kate Golden
Wisconsin Center for Investigative Journalism

Gary Goyke probably should have known better.

A former lawmaker turned career lobbyist, Goyke was convicted in 1990 on four felony counts of illegal campaign contributions. But in 2009 he ran afoul of campaign finance rules once again, paying a $6,449 fine for exceeding the $10,000 annual individual limit on contributions to all Wisconsin campaigns.

“He’s been around for like 30 years. How could he have not known there was a limit?” asked Mike Buelow, research director of the Wisconsin Democracy Campaign, a nonpartisan campaign finance advocacy group.

Goyke is one of 110 people or groups that paid fines for violating Wisconsin’s campaign finance and ethics laws in the past three years. The Wisconsin Center for Investigative Journalism procured the list from the Government Accountability Board through an open records request.

View the list of the 110 violators

Gary Goyke, lawmaker turned career lobbyist, paid a $6,449 fine for exceeding the $10,000 annual limit on individual contributions in 2009. He said he didn't know the rule applied to all campaigns. Photo: Wisconsin Government Accountability Board website.

The violator list reads like a Who’s Who of Wisconsin politicians, and includes some noteworthy outsiders as well.

The fines totaled $273,390. They ranged from $20 for an improper corporate contribution all the way up to the biggest ethics fine in Wisconsin history — the $166,900 paid by Wisconsin & Southern Railroad Co. owner and president William Gardner for laundering campaign contributions to Gov. Scott Walker through associates, employees and a relative.

Many of these offenses have made news already, but the full list of violators from 2009 to 2011 has not been compiled before.

The board’s investigations are secret by law, though complainants sometimes publicize their complaints. And the board rarely announces its enforcement actions. Goyke explained that he didn’t realize the limit applied to local and judicial races as well as state campaigns.

“We didn’t try to sneak one in. It’s just not worth it,” he said.

A total of 28 people, including Goyke, were fined for donating over the limit.

Not everyone claimed to be ignorant of the law. Robert Habush, a prominent trial attorney, explained in a succinct email: “Bad arithmetic.”

Gardner leads the pack

Nobody’s violations come anywhere close to those of William Gardner, the subject of a joint investigation by the GAB and the Milwaukee County District Attorney’s Office resulting from an ongoing John Doe investigation. Seven Wisconsin & Southern employees also paid $250 fines for laundering contributions.

SIDEBAR:

State cracks down on excessive contributions

The Wisconsin Democracy Campaign has long made a practice of poring through campaign
reports to name and shame individuals who violated the $10,000 annual limit.

Now it has an ally: The state Government Accountability Board.

In years past, according to Democracy Campaign research director Mike Buelow, the old Elections Board rarely acted on these complaints.

The GAB, operating since 2008, has been more vigilant.

“After about a year of its existence, we found out that the GAB was pretty serious about acting on violators and did hand out fines,” Buelow said. Last year, the Democracy Campaign didn’t even need to file complaints; the board negotiated settlements on its own.

But Buelow said things aren’t perfect. The board doesn’t appear to have done anything with complaints filed months ago about candidates who failed to report required employer and occupation data for people who contributed over $100.

“Our purpose is not to get forfeitures. Our purpose is to get disclosure,” said GAB spokesman Reid Magney. He said the agency does follow up on these complaints with candidates.

And while it’s clear that GAB is doing much more than its predecessor agencies, it’s hard to assess its effectiveness. The agency doesn’t regularly publish a list of its enforcement actions or even how many complaints it’s received.

Magney said that in the past year of political turmoil, the number of complaints skyrocketed — but many were informal or outside the scope of the board’s jurisdiction, making them hard to count.

During that time, the board has been faced with the implementation and defense of Wisconsin’s voter identification law, a contentious Supreme Court election, nine state Senate recall elections, redistricting, unprecedented campaign finance donations and this year’s even bigger recall elections for the governor and lieutenant governor.

“I think it’s the transparency part that’s been on the back burner, not the investigations themselves,” Magney said.

— Kate Golden

After Gardner, the next highest fines went to those who, like Goyke, donated more than $10,000 in a year. Most fines were one and a half times the overage.

Among these violators:

• Grant Abert, a philanthropist who has donated to clean-government groups. He paid $7,500 in 2010 for exceeding contribution limits in both 2008 and 2009.

• Jerry Frautschi, who funded Madison’s Overture Center with a $205 million grant. Frautschi drew a $3,375 fine in 2009 for a $1,500 overage.

• Two payday lenders. Kevin Dabney of Waukesha, president of Speedy Loan Corp., and Robert Reich of Deerfield Beach, Fla., owner of Wisconsin Auto Title Loans. Dabney paid a $6,000 fine in 2010, and Reich paid $4,500 in 2011. The payday loan industry has donated tens of thousands of dollars to Wisconsin politics in recent years and has successfully beat back efforts to regulate it.

Robert Fettig, president and CEO of metal fabricator Tankcraft Corp. in Darien, paid his $9,225 fine without disputing it. But he complained about it in a letter to the GAB. Fettig said he donated his first dollar to a Wisconsin campaign more than 30 years ago and had never heard of the $10,000 annual limit on his donations.

Asked whether he thought the cap was reasonable, Fettig said, “No, I think it’s stupid — but more importantly, it’s one that no one knows about.”

But Buelow argued that the $10,000 cap limits undue influence by individuals. He noted that less than 1 percent of the adults in Wisconsin donate to campaigns, and the average small donor gives about $20.

“Everybody else is pretty much already drowned out,” Buelow said.

The other most frequent forfeitures were for late filing of lobbying or campaign reports, and for making improper corporate or lobbyist contributions. Corporations are banned from directly donating to political committees, which also may not take such contributions. Lobbyists may only give to elected officials during a short window each election cycle.

The largest fines for improper corporate contributions, all in 2010, went to the Oneida Nation of Wisconsin (paying a $6,050 fine); payday lending chain Check Into Cash ($750); and the Democratic Party of Columbia County ($690).

View the list of the 110 violators

And remember that decade-old caucus scandal, in which politicians and aides were campaigning on the taxpayer dime? A handful of politicians have been caught recently for using state resources for political purposes — in one case by broadcasting a political email from a state address. Longtime Democratic state Rep. Fred Kessler of Madison paid $200 and Republican Rep. Don Pridemore of Hartford paid $300 for such violations.

Cain’s ‘cigarette guy’ busted

Before Mark Block became a YouTube sensation by smoking on Republican presidential candidate Herman Cain’s campaign ad, he had “a history of being a bad boy in Wisconsin,” according to Jay Heck, executive director of Common Cause in Wisconsin, a nonpartisan good-government advocacy group.

Block is infamous for managing former Supreme Court Justice Jon Wilcox’s 1997 campaign, found to be illegally coordinating with a pro-school-choice group that spent $200,500 on postcards and calls. For that, Block agreed he’d pay a $15,000 fine, and he couldn’t work in Wisconsin politics for three years. (Wilcox also paid a $10,000 fine.)

Block paid a $450 fine for improper lobbyist contributions in 2009 to Republicans, including Walker. Such settlements require candidates to return the illegal contributions. That year, he was state director of the Wisconsin chapter of Americans for Prosperity, the Koch Industries-backed
conservative advocacy group.

The Milwaukee Journal Sentinel reported last year that Prosperity USA, a nonprofit co-founded by Block, may have violated state or federal campaign laws by paying for thousands of dollars in expenses for the Cain campaign. It also quoted “several conservatives” in saying Block left Americans for Prosperity with tens of thousands of dollars in unpaid invoices.

Block didn’t respond to a phone message, and Americans for Prosperity state director Luke Hilgemann didn’t respond to multiple contacts.

Heck was surprised that a player with Block’s experience would draw a GAB fine.

“He was too busy smoking, I guess,” Heck said.

The nonprofit, nonpartisan Wisconsin Center for Investigative Journalism (www.WisconsinWatch.org) produced this story as part of the State Integrity Project, assessing corruption risk in all 50 states: www.stateintegrity.org/wisconsin. The Center collaborates with news media and the UW-Madison School of Journalism and Mass Communication.

All works created, published, posted or disseminated by the Center do not necessarily reflect the views or opinions of UW-Madison or any of its affiliates.

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