Gov. Mike Easley: Using His Position to Line His Pockets

Updated October 2, 2009

Establishment Clueless
Reflecting the opinions of the insiders running state government, columnist Scott Mooneyham calls the Easley scandal shocking. “Plenty of political observers saw Easley, a longtime criminal prosecutor, as a bit lazy and unmotivated," he explained. "They didn't see him as easily succumbing to the trappings of power, or as in office to try to enrich himself.”

Observers with a more skeptical eye find that view dubious. One long-term political watcher recalls how the former governor's image never fit the reality. 

 

In 1990, Easley burst on the statewide stage as a crime fighting, drug cartel busting District Attorney from Southeastern North Carolina who was to be the Democratic establishment’s great white hope to run against Jesse Helms and save the party from black former Charlotte Mayor Harvey Gantt. However, another opponent, a tough old mountain state senator named Bo Thomas, labeled Easley the “plea bargain king” for his habit of cutting deals with drug traffickers. And though an overly-compliant media didn’t dwell on it, Easley's wife, Mary, was a prominent lawyer defending drug offenders and other criminals in Easley’s own district – an activity that appeared to create a conflict of interest, but which the drug fighter Mike dismissed as sexist.

Gantt won the Democratic nomination for the US Senate race against Helms, but the question remained. Would a truly honest prosecutor allow people to wonder if a payment to his wife could buy a plea bargain during pillow talk?

Bald Head Island Deal
Apparently, the establishment which is now expressing such surprise by Easley’s corruption didn’t look very hard. Shortly after being elected as State Attorney General in 1992, Easley settled beach erosion claims against a ritzy Bald Head Island development, giving them exemptions from environmental laws. The developers then sold Easley and his brother a $250,000 beach house, a price that was $70,000 less than a similar house on the same street. Today, that property is worth over $1.1 million.

TV Ads on the Public Dime
As Attorney General, Easley used his office as a high profile launching pad for his race for Governor, fueling his name ID with over $1 million in "public service" TV ads, in which he starred as the state's consumer-fraud fighting AG.

Money alone could not buy better name recognition for the ambitious gubernatorial contender. Even so, the ads were paid for with public dollars, primarily money from legal settlements in consumer fraud cases – and they focused on predatory lending in an effort to target black voters, a key Democratic constituency. While the Justice Department claimed that it had produced the ads as a public service, a later investigation by the Carolina Journal found that they were actually produced by Easley’s political consultants.

Under the law, fines & forfeitures collected by government are supposed to go to the state’s public schools. But as North Carolina’s chief law enforcement officer, then-Attorney General Easley evaded the law by calling the money “settlements,” then reallocating it for his own political purposes. And although his ethical lapse was showing, Easley won the gubernatorial election.

Nepotism
Entering the Governor’s office during a budget crisis, Governor Easley foreshadowed coming attractions by immediately handing his sister-in-law a state job in the Department of Cultural Resources, a position which she held until the dying days of his administration, when she burrowed deeper into the bureaucracy via a promotion into a new position in order to survive Easley’s departure. Whether Judy Easley will keep her $70,000 political patronage job despite all the ensuing scandal remains to be seen.

The scandal surrounding Easley's wife, Mary, would come later.

And a Late Bill?
Hiring relatives didn’t take up all of the newly elected Governor’s time. The first couple also began remodeling their Southport home, opening another financial tangle. According to the Carolina Journal, builder Nick Garrett did a quarter million dollar renovation, apparently allowing Easley to avoid paying for eight months. Garrett, who eventually went bankrupt, was rewarded with both gubernatorial appointments and a license tag office from Easley – along with the governor’s support for Garrett’s controversial purchase of a state marina in Southport.

Sweetheart Deals
Apparently the governor was just warming up. As any public official knows, elected office can net lots of perks for a corrupt politician willing to take them. For eight years, Easley didn’t pay a penny for his membership in an exclusive golf club, a gift worth $50,000 that was never reported as required by state law.  Never one to forget his friends, Easley appointed some fellow club members to prestigious positions on state boards.

But it was Cannonsgate, a land deal that made Bill & Hillary’s Whitewater look like a beacon of integrity, that really put Easley on the map. In 2006, the Carolina Journal reported that the Easley’s paid a mere 3-percent over tax value for choice property at the Cannonsgate development near Emerald Isle. They purchased their upscale waterfront lot for $549,000 – substantially less than others paid for less-prime lots. The Cannonsgate project was being developed by Easley appointees who certainly had a wealth of reasons to keep the governor happy. Subsequent investigations exposed the fact that the deal was even sweeter than first thought, when Easley was later found to have been given an additional 25-percent discount (or $137,000 off of the $549,000 sale recorded).

That the discount was never reported to the register of deeds made it even worse, since the developers may have used the maneuver to defraud other buyers by tricking them with inflated appraisals.

In fact, by purchasing the Cannonsgate property, Easley walked away with $135,000 in cash by borrowing more on the land than he paid for it. Among the governor’s Cannonsgate angels was Realtor McQueen Campbell, who bragged about how his political influence greased the skids for the necessary environmental permits. Campbell was later rewarded by Easley with a choice appointment to the NCSU Board of Trustees – an appointment he was later forced to resign as a result of the Easley scandals.

The state's top job came with other perks. The governor and his family frequent exploited their access to state resources for their own personal convenience, including repeated use of the state helicopter to fly the family to and from their beach house in Southport, rather than making the drive in personal vehicles.

Ethics Crash
Whether real or illusionary, Easley effectively played the role of a good old boy, hobnobbing with NASCAR teams while enriching himself behind the scenes. In one notable incident, Easley crashed a racecar belonging to Rick Hendrick, a NASCAR impresario. All was forgiven, however, because the two apparently had their hands in each other’s pockets. While Hendrick was providing Easley with flights on corporate jets, free vacations and even a free car for Mary (none if which were reported as required), Easley provided classic political payback, pushing through lavish tax breaks for NASCAR, including a tax exemption on fuel that NASCAR owners burn in their corporate jets. Easley’s ally, Senate Rules Chairman Tony Rand, assisted the governor in ushering the targeted tax advantages through the legislature.

Hendrick wasn't alone.  At least one other car dealer, Bleecker Olds Buick GMC in Red Springs, a frequent seeker of state contracts, appears to have given both Senator Rand and Easley’s son Bleecker company vehicles.

Mary Easley: The Connoisseur
One mustn’t forget the sacrifices the first lady was forced to make on behalf of North Carolina’s citizens and taxpayers. In 2007 and 2008, under the guise of “economic development,” the Department of Cultural Resources allegedly asked Mrs. Easley to visit France, Estonia and Russia to promote the state. The junkets cost taxpayers well over $100,000, triggering a state audit which concluded that some of the First Lady’s expenses were “unreasonable.” According to a WRAL report, some of the excessive expenses included:

• An average per-room lodging expense of $955.40 at a five-star hotel in St. Petersburg
• Excessive meal reimbursements that included a lunchtime caviar cocktail costing $332.12 and hundreds of dollars in alcohol purchases in violation of state policy
• Entertainment expenses, including ballet tickets costing $1,169.56
• 24-hour availability of private transportation in a Mercedes SUV for $27,012.61

Governor Easley defended his wife's spending. “It cost what it costs,” he said.

McQueen Fetches a Job for the Queen
Easley’s whole house of cards finally collapsed when McQueen Campbell, who readers will recall as the governor’s own personal Sir Lancelot of Cannonsgate, secured a high paying job for Queen Mary at NCSU. As WRAL reported, “E-mails turned over to the grand jury showed that McQueen Campbell, a former member of the Board of Trustees, discussed a potential NC State job for [Mrs.] Easley with former Gov. Mike Easley and that Campbell worked with [NCSU Chancellor] Oblinger and former Provost Larry Nielsen to make it happen.” 

While a typical Professor earned $110,000, Mary Easley stunned the campus last year when she gained an 88-percent raise – from $90,000 to $170,000 annually – for running a speakers series and law-related program. When public pressure forced the college to ask the former first lady to step down, she fought back – first by refusing to resign, and when that failed, by filing a lawsuit against NCSU and its leaders.

Damage Control
State government tried its best to contain the damage. While former State Auditor, Republican Les Merritt had investigated Mary Easley’s salary while the Easley’s still resided in the governor’s mansion, his Democratic successor Beth Wood suppressed the audit when Mary Easley’s lawyer, Sen. Tony Rand objected to its release. But after an embarrassing trip to the federal grand jury, she relented.

No one was surprised by the audit's conclusions. “According to the preliminary findings of the audit, investigators determined that [Mary Easley] should have been paid $79,000 for the various programs she ran. Her presence, for example, saved the Millennium Speakers program only $4,500 a year.” The audit report went on to state that “The salary paid to Ms. Easley is excessive when compared to the responsibilities assigned and others in similar positions."

Even the Highway Patrol tried to hide the truth. During the investigations of Easley’s affairs in 2009, Easley’s security chief was seen delivering a computer hard drive to the former governor’s Raleigh home. The loyal trooper denied it, claiming that he was simply making a personal visit to his old boss. But along with that hard drive, a year's worth of Easley’s travel records went missing. Subsequent news reports indicate that Easley took at least twenty-five rides on corporate aircraft which were not reported, and the Democratic Party ended up forking over $24,000 to the State Board of Elections to atone for possibly receiving illegal contributions from members of Easley’s flying circus.

Crybaby Mikey
One would think that after being caught red-handed in so many ways, a man of Easley’s position might step up to the plate to accept responsibility for at least some of his actions. Easley, however, blames the press. In an exit interview with Mark Binker of the Greensboro News-Record, Easley claimed that the increased demand for online news had led to "gotcha" journalism. “There's a 24/7 press cycle now," he said. "People calling all night long. They want access to the governor all the time ... So that's created a lot of competition." Easley feels that increased competition in the media has led to more pressure for original stories, stating that “original content [means] gotcha stories.”

And the establishment that never saw it coming? Clearly, they just weren’t paying attention.