The complete Sigler filings can be found here and here in PDF format. Sorry, you’ll have to use the rotate button. I would suggest reading both before continuing onto this post.
The following was submitted by a local Attorney, who for obvious professional reasons wishes to remain anonymous.
How could we all be so dense? For the last six months or so, hundreds of minutes of air time, thousands of pages of newsprint, and countless hours of live and internet discussion have been devoted to the legal (including criminal) consequences of Matt Kelty treating loans from campaign supporters Fred Rost and Glenna and Steve Jehl as “personal” rather than as “contributions” to his Campaign Committee, even though the loan proceeds were quickly and indisputably transferred to the Committee as loans from Kelty. Much scrutiny was given to a previously obscure and judicially unnoticed statute defining “contribution”. Experts from near and far opined as to the interplay between “loan”, “contribution” and “donation”, the inexpert but enthusiastic (including many local bloggers) engaged in exhaustive if sometimes tortured statutory analysis, and unfavorable conclusions were dismissed as the result of partisan bias, even if doing so meant tarnishing previously untarnished reputations (e.g., Election Board members Wright and Brown).
I remember fondly the firm certitude of nationally famous barrister Jim Bopp as he declared loans to be something other than a donation, and thus necessarily not a contribution. Leo Morris and Tracy Warner found rare agreement in declaring the “Kelty interpretation” of the law a “loophole” that swallows the rule. The post-indictment chest puffing at Fort Wayne Left was extreme, with the authors asserting: “The facts of this case really had not been in doubt for some time though; really the arguments boiled down to interpretation of the law.” They claimed with seemingly justifiable pride that Dan Sigler agreed with FWL’s “loan equals donation” analysis rather than the Bopp/Election Board conclusion to the contrary.
And for those not interested in delving into statutory minutae, it was often sufficient to assert that the loans must violate our “full disclosure” election laws, without any apparent concern for whether we actually have such laws.
I’ll admit I’m also guilty of gross stupidity these last several months. I wasted a lot of time examining the statute and reading the arguments, both from the professionals and from the amateurs. And when the Grand Jury issued indictments against Kelty but not against the other purported targets (Rost and the Jehls), I reconciled that possible contradiction by acknowledging that they merely made loans; it was up to Kelty to report them in accordance with the law (or at least Dan Sigler’s view of the law).
But better men (and women) than me also spent the last several months on mental hiatus. Only last week, Mr. Morris of the News-Sentinel took Kelty to task for singing the blues in a fundraising letter, writing: “The facts of this case are not in dispute. There is merely a difference of opinion about what those facts mean, which hardly constitutes a vast conspiracy. Loans made to the candidate were reported as loans made by the candidate to his campaign. Does that or does that not violate
Indiana’s requirement for full disclosure of campaign contributions?”
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Oh Leo, how did we (and every single one of your editors and reporters) get it so wrong for so long? And where do you go to have inappropriately italicized text removed from your backside?
But what of renowned attorney Larry Mackey who, unlike me and Leo, had the benefit of the Grand Jury transcript? He might have been on his game when he argued for the United States in the Oklahoma bombing case, but he wasted twenty or more pages and thousands of Kelty’s legal defense dollars arguing about the definition of “contribution”. If it makes you feel any better Mr. Mackey, many disinterested but knowledgeable observers thought your arguments “air tight.” What a pity that you, like the rest of us, failed to understand Mr. Sigler’s charges, and that your arguments, while correct, are irrelevant.
But with the help of Mr. Sigler, the scales have fallen from my eyes. His recent filing exposes our inexplicable community-wide confusion, much to our collective embarrassment. It seems, you see, that the Kelty prosecution has nothing to do with how you report loans because, well, according to Mr. Sigler, there never were any loans… at all. He-who-must-not-be-criticized claims Fred Rost gave Kelty $150,000- no strings attached, and then entered into a conspiracy to make the gift look like a loan, complete with a bogus promissory note prepared by a duped (or co-conspiring?) attorney charging high fees.
And the Jehls? Same thing, according to Mr. Sigler. They gave Kelty $10,000 and either agreed or insisted (it’s not clear to me, but I haven’t been thinking clearly for months) that a scheme be implemented to make the gift appear to be a loan, again with a bogus promissory note.
Kelty didn’t make any loans either, says Sigler. Why not? Because there was no promissory note. (I’m going out on a limb here, but I’m betting if there was one Mr. Sigler would declare it bogus.)
And Mr. Sigler tells us why (the motive!!!) all this took place: the Kelty Campaign was in “dire” need of money.
This is all so simple now. The fog has lifted. How did we waste our time worrying about whether loans (real ones, not the bogus type) are contributions if made to a candidate by one who seeks to influence the outcome of an election? An interesting issue, perhaps, but completely irrelevant to Sigler’s charges and completely uncommented upon in the Sigler brief. The Kelty/Bopp/Mackey side of the argument wins over the Downs/FWL/Warner/Morris side by default. Sigler never showed up for the fight.
What was the source of our mass confusion? As I recall, somewhere in the Constitution there is a right in the defendant to be reasonably informed of the charges against him. I noticed that Indiana Code Section 35-34-1-2(a)(3) says that an indictment must include “the nature and elements of the offense charged in plain and concise language.” And just last night I saw Mr. Sigler on television assuring us that his conduct is at all times above reproach and beyond criticism. So the fault must be mine…and Leo’s…and Mackey’s.
Now I hesitate to write any more, as I’ve been so horribly confused for so long. And I certainly don’t want to suggest anything critical of our Special Prosecutor, because he seeks penalties if you criticize him. So forgive me, and consider me to still be operating under the fog that has clouded the collective intellect of Fort Wayne for the last several months, if I ask a few more questions about Mr. Sigler’s charges.
If I accept that the Kelty Campaign was in “dire” need of money, then I can accept that fact as a good motivation for Kelty to try to get money. But why would that be a motivation for Rost or the Jehls to give money rather than loan money? And if I accept Sigler’s claim that Rost and the Jehls intended to and did donate money (of which the Campaign was in dire need), what is their motivation to hide it as a loan to Kelty. If I were Rost, and I’d just offered to give the Kelty Campaign $150,000 (a “free contribution” according to Sigler) and Kelty said something like “Great, but I want to disguise it as a loan to me, make up a bogus note using your expensive lawyer, and get your assurance you will lie about it under oath if need be”, I’d hit him.
I mean doesn’t most every political campaign have a dire need for money?
And if these loans were really gifts hidden as loans, then doesn’t that necessarily mean that Rost and the Jehls are not relatively innocent players in Kelty’s debacle, but nasty people consciously involved in a felonious scheme to defraud? Didn’t they have to agree to “hide” their gifts as loans? Doesn’t this mean that Rost had to lie to his attorney, Mike O’Hara, who prepared the loan document? And to Dan Stockman from the JG who did a story about the loans? And doesn’t it follow that even after Rost was purportedly named as a target of the Grand Jury, he either lied to his very fine criminal defense attorney or, if he told him what Sigler claims to be the truth, his fine attorney permitted him to lie to the Grand Jury. And didn’t Rost lie/obstruct justice when he gave an affidavit in support of Kelty’s motion to dismiss swearing he loaned money to Kelty?
And aren’t most of these same questions applicable to the Jehls? Aren’t the Jehls and Fred Rost widely recognized as productive, responsible, upstanding members of our community with no record of nefarious or criminal conduct? Aren’t Sigler’s claims wholly inconsistent with the reputations we know them to have? How does the Campaign’s “dire need for money” give these people a motivation to enter into a conspiracy to defraud and to risk their reputations, their professions and their freedom- particularly if, as Sigler claims, they were willing to just give the money to the Campaign?
Don’t we have to conclude that Rost and Steve Jehl perjured themselves if, as appears to be the case, they told the Grand Jury they loaned money to Kelty? And rather than (or in addition to) pursuing Kelty on perjury charges using the two awkward lines of questioning already advanced, why not prosecute him for lying under oath in claiming Rost and the Jehls loaned him money?
Doesn’t it follow that Kelty must have lied to Jim Bopp or, if he told Bopp Sigler’s version of the truth, that Bopp knowingly presented false factual arguments to the Election Board? If Mr. Sigler’s claims are correct, don’t we have to conclude that even after Kelty knew he was ass-deep in trouble, he lied to attorney Frank Gray or, if he told him Sigler’s version of the truth, Gray ignored his ethical obligations and sat silent while his client lied about loans to the Grand Jury? And don’t we have to conclude that even with felony charges hanging over his head, Kelty either lied to Mackey or, if he told Mackey Sigler’s version of the truth, Mackey consciously presented arguments to the Allen Circuit Court based upon facts he knows to be false?
No, things are certainly not what they seemed to be, or at least what they seemed to be to me. Like Leo Morris and the guys at FWL, for months I thought the facts were relatively undisputed and the law hotly contested and arguably unclear. And like every single News Sentinel, Journal Gazette, WANE TV, 21ALIVE and WOWO report since May, I thought the issue and the charges were about how loans should be reported.
A favorite author of mine, and one who died long before the great Fort Wayne brain freeze of ’07, once wrote: “Contradictions do not exist. Whenever you think you are facing a contradiction, check your premises. You will find one of them is wrong.”
If our prosecutor has been clear, consistent and solely focused on the pursuit of justice with complete respect for the rights of the defendant, how did so many normally astute lawyers, reporters, editors and public servants fail to understand the charges against Kelty? But as Ayn Rand suggests, I should check my premises. Clearly, the Bopp, Mackey, Gray, Morris, Warner, Pruitt, Lanka, Quilligan, Wright, Brown crowd (and many others) are not as astute as I once thought, and are instead readily confused. Otherwise, I might have to consider the possibility that our prosecutor has quietly substituted an untenable legal theory (which is subject to dismissal by a judge) for an even weaker factual theory (which generally has to be rejected by a jury following a trial).
And yes it seems contradictory that people of the caliber, character and reputation of Fred Rost, Steve and Glenna Jehl and, yes, Matt Kelty, would concoct and continue an elaborate scheme to defraud, involving bogus loan agreements and multiple lies under oath, when the sole suggested motivation for doing so- the claimed dire need for cash of the Kelty Campaign- could have been satisfied by giving the money without the needless conspiracy to hide it as a loan. But checking my premises, I suppose I have to conclude that Rost, the Jehls and Kelty are not the people they have appeared to be for the last twenty or thirty years and are instead the bumbling, lying criminals that Mr. Sigler claims them to be. Otherwise, I might have to consider the possibility that the loans are actually what they have been considered to be since this dispute arose- loans, and the prosecutor’s claims have no merit.
But who really knows? I haven’t been thinking clearly for months.
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If the Rost loan was a “personal” loan, why did Kelty pay the bill from Rost’s attorney for drawing up the “loan” document from campaign funds?
You cannot use CAMPAIGN funds for PERSONAL use.
That is clearly ILLEGAL.
The author based his position on the fact that Rost had no motive to lie about the gift-loan to Kelty, and Kelty had no motive to try to hide the gift-loan. There was a very good reason to hide the source of the money. Rost is the head of the Allen County Right to Life (ACRL). That org/PAC had a hard call to make. Were they going to endorse Peters, a long time Right to Lifer or their man Kelty. They gave it to their man Kelty, which was very important to the right wing conservation candidate. If word got out that the head of the ACRL was backing Kelty with $150,000 of his own money, the organization’s endorsement would look like what it really was, a personal favor to a friend. At the time the endorsement meant votes for Kelty, and the $150,000 would garner even more votes- only if the source of the gift/loan was kept secret. That’s why the Good Old Boys at the GOP exposed the ruse. By exposing the true source of the money, the ACRL endorsement would have less importance, and it would hurt Kelty’s fund raising, both of which would help Peters. It was really never was about the money, Kelty needed the ACRL badge as a base for his campaign. He needed the money too, but exposure that both coming from the same forbidden tree made tainted fruit of both.
Loans=Gifts!?
Who pays tens of thousands of dollars in annual interest on a “gift”?
Who makes a $25,000 principal payment on a “gift”?
Haven’t the Jehl’s and the Rost’s made campaign contributions that have been reported as well as loans to Kelty? It seems they know the difference between the two.
I don’t think the Prosecutor is, “politically motivated”, I think he is playing the hand dealt to him and trying to win. What was “politically motivated” in my estimation was the original complaint and its subsequent handling by the Allen County Prosecutor in light of the election board ruling, and cheered on by a few Republican regulars on the so called Executive Committee.
Using the prosecutors logic in this reponse and applying it to the current sub-prime mortgage crisis, it apprears that all those lenders didn’t provide mortgages to borrowers, but gifts! (Good for them). The difference is of course the Government is going to bail them out, and no one is bailing out the Kelty’s.
If nothing else, given the apparent change in approach by the prosecutor, it appears the Kelty legal team’s motion to dismiss was effective in pushing him off his central premise, and he is now hunting for another. His request for the release of sealed Grand Jury testimony represents, “everything and the kitchen sink” to throw at Kelty to provide fodder for his accomplices in the media to help him make his case in the public domain, and potentially influence the jury pool in advance of a trial, in my opinion. But it is Kelty who is destroying the public trust (riiiight!).
I hate to say it, but given the luke warm support of Matt Kelty by many Republicans in Allen County, I think they are happy to watch him from the sidelines be squashed like a bug, to send a message to the rest of us, “Don’t buck us, and shut up and color!” A fractured Party is an opportunity to many, not a cause for action. This of course is all reversable with strong, principled leadership, something County Republicans are starving for.
There is simply too much at stake for Kelty to prevail at trial, and if he does (heaven forbid), let him be so diminished as to be a characture of himself, and no longer a threat to anyone as a potential candidate for any office. Many have much invested, it would appear, in his destruction. Lord knows we can’t have situation where he is exonerated, and the voters of Fort Wayne begin reflecting on how they would have voted knowing he was innocent. Safe to say many would feel manipulated, and bilked out of their vote. And what recourse? There is none. Oops! Too bad.
Then again, I too could be confused.
Knuth=Stretching
Kevin’s changing course now…Keep it up…
This is what is known as the “floating prosecution.” Keep moving your basic premise until something sticks. Nifong was pretty good at this as well. Of course, they were all confused as well. Gift, loan, sham loan, I want respect….All too familiar cover for incompetence. As a taxpayer I want a competent Special Prosecutor. What is Dan getting paid for this?
Kevin …
I admit that I have not read the special prosecutors legal respnse, but where in the wrangle over Kelty’s “illegal acts” was he accused of misusing campaign finance funds? Hell’s Bells, candidates are even permitted to give their excessive funds to candidates for whom the political donations were never intended to benefit.
Then there is Harry Reid who finds nothing wrong with spending campaign funds as he pleases: http://tinyurl.com/392tq8
Again without knowing the law, the concept of a deal that could transpire involving a logical arms-length transaction which begins: “If the Kelty for Mayor Fund will pay for the incidental legal fees involved, Matt Kelty will personally pledge $150,000 …”