Record $465,000 fine issued against Jeremy Durham for hundreds of campaign violations

State officials imposed more than $465,000 in fines Wednesday on former lawmaker Jeremy Durham, a record fine levied in response to the Williamson County Republican violating Tennessee’s campaign finance law hundreds of times.

The six-figure fine Durham now faces is the largest the Tennessee Registry of Election Finance has ever imposed in its 26-year history. 

"It puts people on notice that the board takes the campaign finance law very seriously and if it's violated they have no problem assessing civil penalties," said Drew Rawlins, executive director of the Bureau of Ethics and Campaign Finance.

Officials imposed the fine after a marathon discussion that lasted nearly five hours, in which Durham's attorney Peter Strianse occasionally objected to the findings of a six-month audit performed by the registry.

"We are here today to ask the board not to assess any civil penalties," Strianse said while representing Durham, who was not present at the meeting. 

After the hearing, Strianse said he plans to appeal the registry's action in front of an administrative law judge. 

As the fines started piling up, Strianse became less combative. After the meeting he said he had "definitely" decided to appeal any fines before Wednesday's meeting. 

"I just think it was clearly excessive. This is the first step in the proceeding," Strianse said, referring to the amount of the fines. 

Allegations against Jeremy Durham

Among the findings in the registry's audit were allegations Durham used campaign funds to improperly buy sunglasses, suits, and spa products to inappropriately loaning thousands of dollars to his wife, a prominent GOP fundraiser and a professional gambler.

More:Jeremy Durham spent campaign funds on suits, sunglasses and spa products

Last month, Durham, Strianse and unidentified campaign aides pushed back on the registry’s findings with a 235-page response, saying many of the expenses in question were for legitimate purposes.

They also cited a USA TODAY NETWORK-Tennessee investigation to point fingers at other legislators, overly broad state laws and human error.

More:Jeremy Durham dismisses campaign finance audit, points finger in fiery letter

During Wednesday's meeting, registry members, over the objection of Strianse, rejected to use Durham's response to their audit in their official record, given that it was unclear who helped create the document. 

Durham's response was not signed, sworn testimony. 

While objecting to the board's move Strianse said his client did his best to respond "under very difficult circumstances," noting Durham is the subject of both state and federal investigations. 

As the registry slowly discussed the 12 findings in its audit, Strianse argued the agency should not have been able to even initiate their investigation. The probe began after the state attorney general received a sworn statement from a former employee of Durham related to the expelled lawmaker's financial activities.

Strianse said because the initial finding identified by the attorney general was different than what the registry found in its investigation the entire audit should not have begun. 

“You’ve given us another reason to discredit almost every statement that comes from (Durham),” said board member Patricia Heim while discussing Durham's own financial discrepancies related to his former employee. "Gosh, golly, whiz, can’t the candidate even take responsibility for the one thing that started this investigation?"

The breadth of the penalties against Durham 

The registry findings showed leniency for Durham rarely, but did so on findings Durham may have used $7,700 in campaign funds for purchases already covered by legislative per diems. 

Board member Hank Fincher, who was a state lawmaker in the late 2000s, said possibly all 132 legislators could be in violation of similar acts as Durham.

Fincher cited the hectic pace of the legislative session and poor math skills as reasons lawmakers may occasionally use campaign funds while also receiving per diems for the same purchases.

Strianse had raised similar concerns in his letter from Durham and others to the registry.

"If the registry is serious about policing the legislature, then it should follow up on this paper's reporting and pursue audits of the legislative abuses identified in recent stories," the response said.

"The failure of the registry to take such action speaks loudly to its real intent which, unfortunately, is to harm Mr. Durham rather than protect the public interest."

There was no sign of leniency when the registry got to the 208 purchases Durham made with campaign funds for everything from meals to clothing. 

Fincher said while some might have been legitimate, as Durham contends, not accurately reporting the expenses showed nefarious motives.

"It is clear proof of an intentional attempt to hide expenses," Fincher said. "It's as bad as I have seen in my time of service on this registry."

The board issued a $1,000 fine for each of these transactions, resulting in a $208,000 penalty, the largest single fine for any one finding in the audit. 

After more than two and a half hours of going through the findings of the audit, the registry began imposing fines for individual violations of state law. 

Board members occasionally haggled over the individual amounts for each fine, trying to persuade each other how egregious Durham's actions were while also expressing a desire to use the penalties to prevent future wrongdoing.

At several other points, the board opted against fining Durham, saying his reporting was simply sloppy or may not have amounted to willful violation of state laws. 

In total, the registry fined Durham $465,500 for more than 300 violations. 

The largest fine in state history was in 2007, when then-state Sen. Jerry Cooper, D-McMinnville, was forced to pay $120,000 after investigation determined use used $95,0000 in campaign money for personal use.

No collecting fines until after appeals

Rawlins, the executive director of the Bureau of Ethics and Campaign Finance, said in the event that Durham and his attorney make an appeal to an administrative law judge, the state's attorney general could represent the state. 

Rawlins said he was aware of less than a half-dozen cases that have been brought before an administrative law judge. 

Any effort to begin collecting the fines against Durham are not able to begin until a potential appeal is ruled on by a judge. 

The registry and the state Ethics Commission have historically had difficulty collecting fines, despite the help of the attorney genera. When fines are collected, they go to the state General Fund. 

Reach Dave Boucher at dboucher@tennessean.com or 615-259-8892 and on Twitter @Dave_Boucher1. Reach Joel Ebert at jebert@tennessean.com or 615-772-1681 and on Twitter @joelebert29.