Wilmington Lawmaker Lied About Contributions and Diverted Campaign Funds for Personal Uses
RALEIGH – After completing the hundred-mile journey from Burgaw, Claude and Bonnie Ward took seats in the second row in the Clarion Hotel’s Clambake Room, which on May 15 was arranged as an ad hoc tribunal by the state Board of Elections. The man whose fall from grace they’d come to witness – Wilmington Democratic Rep. Thomas Wright – briefly took a seat in front of them, and then moved with his lawyer to the defense table.
“He told my wife at the Blueberry Festival in Burgaw – we asked him point-blank if he’d taken any money from Hugo Neu,” said Claude Ward, a former state corrections employee who went on to head the eastern North Carolina office of the Blue Ridge Environmental Defense League before fully retiring. “It was on June 24, 2006. He said no, the only money he took was from Progress Energy. We found out that he took a contribution from John Neu.”
The 71-year-old environmentalist was indignant about the fact that his representative in Raleigh had lied about receiving campaign contributions from Sims Hugo Neu, an out-of-state company planning to site a massive landfill in Pender County. Wright’s evasion had kept the landfill from becoming a campaign issue in the months leading up to the primary and general elections. Later, the New York solid waste company would withdraw its plans as Wright’s troubles with election officials mounted.
“We don’t need to be a waste state,” Ward said. “That landfill up in New York, Fresh Kills, they’ve got all kinds of waste ready to go. They’ve got the debris from 9-11 there. It’s toxic as all get out.”In a relatively swift display of justice the elections board decided after less than six hours of testimony to hand over its case files on Wright to the Wake County District Attorney for review and possible criminal prosecution. The board’s itemization of offenses included possible perjury for signing false campaign finance reports, failure to report campaign contributions and commingling political money with personal funds.
In addition to those transgressions, the board found that Wright failed to register a non-profit foundation with the Internal Revenue Service – a potential federal tax violation. The nonprofit known as the Community’s Health Foundation solicited and received contributions from AT&T, AstraZeneca and Anheuser-Busch.
Once an ally of disgraced former House Speaker Jim Black, Wright recently stepped aside as chairman of the House Health Committee and is a former chairman of the NC Black Legislative Caucus.
He wore a slight smile on his face during the hearing, at which he declined to testify, invoking his Fifth Amendment right to avoid self-incrimination. Testimony from a Wilmington political activist, two former campaign workers, a radio host and a state elections investigator suggested that Wright not only deceived his constituents about his role in the proposed landfill, but used undisclosed campaign contributions for personal purposes and caused a Wilmington family to lose more than thousands of dollars in a land deal designed to set up a museum to commemorate the 1898 Wilmington Massacre.
The hearings began with a review of a land deal in which Helyn Rogers Lofton agreed to transfer a building thought to have historical significance in the 1898 massacre to the Community’s Health Foundation, a nonprofit chaired by Wright. Bank records produced by the elections board showed that the Loftons transferred the property to the Community’s Health Foundation on April, 5, 2002.
The Community’s Health Foundation borrowed $150,000 from Myrtle Beach-based Coastal Federal Bank, which was paid to the Loftons to retire the debt on the property.
Wayne Lofton, who runs a Boys and Girls Club in Wilmington, said the building his parents agreed to hand over to Wright’s nonprofit “was to be used as a museum and community health center.” He said the family negotiated a total price of $315,000 for the property and had accepted $15,000 in earnest money prior to the transfer. Lofton testified and a deed of trust presented as evidence confirmed that the Community’s Health Foundation committed to pay the family the remainder of $150,000 over the next six months.Lofton said he had concerns about the deal, but he was assured by Wright that the money would be forthcoming. A letter written by Torlen Wade, a state official who headed the Department of Health and Human Services’ Office of Research, Demonstrations and Rural Health Development also helped to create that impression, although it is unclear whether it was shown to the Loftons or loan officials at Coastal Federal Bank.
“I am writing to enthusiastically endorse the Community Health Foundation’s effort to convert the building located on the 900 block of 4th St. into Foundation offices, New Hanover Community Health Center offices and into a History Museum,” Wade wrote on March 15, 2002. “With this endorsement, the office is committing $150,000 in funding toward the completion off this conversion project. The funding will be awarded by June 30, 2002.”
Larry Leake, chairman of the election board, said he found the letter troubling.
“Speaking as a citizen, when you have a situation where a legislator can obtain a letter from a state official to advance a personal interest, that’s a scary thought,” he said.
Wade appeared before the election board but, like Wright, declined to testify.
“He never explained why he wrote the letter,” said Chuck Winfree, a Republican board member from Greensboro, “other than to say he did it, and retrospectively it was a display of poor judgment and the money was never forthcoming.”
Before the Community Health Foundation made good on its debt to the Loftons, the property went into foreclosure. Wayne Lofton said he made several attempts at the prodding of the bank to find out what Wright was doing to straighten out the matter.”There was a period of years where we didn’t have any conversations,” he said. “I made several attempts to reach Wright, but was not able to do that.”
He said his parents received “not one dime” for the property, adding, “When the foreclosure went through I was shocked to read in the paper that there had never been a bill introduced to get the funds to finish the building.”
Wright chaired the 1898 Race Riot Commission, which released an official report in May 2006 that brought new attention to a statewide effort more than a century ago by white supremacist Democrats to violently force legitimately elected black elected officials and their progressive white allies from power in Wilmington. In what might be considered a historical irony, the tragedy Wright helped highlight featured a racist slander campaign to discredit black leaders, who had only recently been allowed to vote and hold elected office, as corrupt and incompetent.Kim Strach, the board investigator, testified that the
Wright campaign took in a total of about $472,000 between 2000 and 2006 that was deposited into four different bank accounts and commingled with personal funds. After reviewing bank statements and subtracting expenditures that were obviously politically related, Strach said it appears that about $240,000 was diverted to personal uses, based on a review of activity in the four accounts.
Two past treasurers for the Wright campaign, Daryle Parker and Karen Davis, said that they were only nominally in control of Wright’s campaign finances; they left the chore of reconciling bank statements to their boss, and generally wrote checks from the account at Wright’s direction without questioning him. At one point in her testimony, Davis indicated that it appeared that her signature had been forged on three Wright campaign checks totaling $2,800 that were made out to the candidate. The memo line on one check dated Nov. 27, 2002 in the amount of $1,050 indicates: “Reimbursement for fine.”
“We could not determine what account constituted the campaign account because contributions were deposited in multiple accounts,” Strach said, “Campaign contributions were deposited in accounts that were commingled with personal receipts.”
Strach testified that that the bulk of Wright’s personal income appeared to be from his legislative salary, and his expenditures appeared to outstrip his means.
The election investigator presented evidence that Wright used Community’s Health Foundation letterhead to solicit contributions from Anheuser-Busch, AstraZeneca and AT&T as late as February 2004.
A letter written by Wright to Anheuser-Busch’s Lewis McKinney requests “support in the acquisition and development of a building in Wilmington, North Carolina that will serve as a historical relic and museum about the 1898 Race Riot,” and suggests that the prospective donor make the check out to the Community’s Health Foundation in care of Wright.Strach testified that the three checks from the corporate donors – including one for $5,000 from the beer company – were deposited in one of Wright’s accounts in August 2004. Soon afterwards, expenditures were made to a variety of entities that had no evident connection to either the museum or the candidate’s reelection campaign, including to Quality Suites, Circuit City, Cingular, the Hilton Wilmington, Progress Energy, State Farm, CVS, Food Lion, Autozone, the US Postal Service, the New Hanover County NAACP and Wright’s wife.
The hearings wrapped up with the testimony of Curtis Wright, a Wilmington securities broker and investment consultant who moonlights as a radio talk host. Galvanized by the loudly expressed concerns of listeners who live near the proposed site of the Sims Hugo Neu landfill, Curtis Wright said he invited the state lawmaker to appear on his program to answer a set of questions shortly before the 2006 general election.
“Because of the controversy that had been taking place in our area for several months I had a specific question crafted to get a specific answer, because I know how you can get an answer sometimes and go back to find out that it’s no answer at all,” Curtis Wright said. “I asked him, ‘Have you received or accepted any contributions from anyone employed by or associated with Sims Hugo Neu?'” His response was ‘no.'”
At that, Leake asked Thomas Wright if wished to respond to the allegations.The rejoinder from the lawmaker’s hired counsel was terse and to the point.
“Rep. Wright doesn’t have any evidence or testimony,” he said.
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