Opinion ID: 2029434
Heading Depth: 1
Heading Rank: 7

Heading: NADC Complaints and Investigation

Text: Shortly after Hergert was elected, three separate complaints were filed with the NADC regarding Hergert's conduct during the campaign. These complaints became cases Nos. 04-35, 04-36, and 04-43. An additional complaint was filed in May 2005 but is not relevant to our analysis. Case No. 04-35 involved Hergert's failure to report the late contribution of $44,000 within 2 days of his committee's receipt of the loan proceeds on October 26, 2004. Case No. 04-43 involved Hergert's unlawful receipt of $49,000 in loans on October 26 and 29. This amount was greater than 50 percent of the committee's receipts from sources other than loans at the time the loans were accepted. See § 49-1446.04(1) (prohibiting candidate committees from accepting, after 30 days of formation, loans greater than 50 percent of committee's receipts, excluding loan proceeds). The complaint filed in case No. 04-36 ultimately resulted in the Legislature's charges in articles III and V. On November 4, 2004, Daley received a letter from Blank, alleging facts that, according to Blank, showed (1) Hergert's committee had made expenditures which should have triggered the filing of Hergert's forty-percent affidavit and (2) the committee should have reported those expenditures on Hergert's second campaign report filed on October 25. On Daley's recommendation, the NADC commenced an investigation, which became case No. 04-36, looking into Hergert's alleged violation of § 32-1604(5)(b) because he failed to file a forty-percent affidavit until after the general election. Daley sent the notification of this investigation to Hergert on November 12. On November 22, 2004, Hergert's attorney, Kermit Brashear, wrote Daley to request more time to respond to the allegations because of the upcoming holidays. In the letter. Brashear stated: Hergert prepared the 40 Percent Affidavit on behalf of the Committee, and believes in good faith that he placed same with the United States Postal Service on October 29, 2004, addressed to the [NADC]. On November 30, 2004, pursuant to these three complaints, the NADC commenced an audit of the committee's records, covering the period from June 1 through December 31, 2004. The audit required the committee to provide its records of receipts and expenditures, including: bank statements, contribution records, deposit slips, canceled checks, invoices, billing statements, contracts, and any other records relevant to receipts and expenditures. On December 9, 2004, William Howland, general counsel for the NADC, wrote to Brashear and specifically responded to Brashear's contention that Hergert believed in good faith he had mailed his forty-percent affidavit on October 29: The facts and circumstances surrounding his belief is an area that I am interested in pursuing by way of a deposition of ... Hergert. I believe that's probably the quickest way to get to the resolution of this matter. .... ... I would also like to have you check your calendar and ... Hergert's for possible dates for a deposition. On December 21, 2004, Brashear sent to the NADC the committee's records from June 1 through December 8, 2004, including its bank statements, a summary of the committee's banking transactions (i.e., a check register), deposit slips, and copies of invoices through December 8. The NADC investigations were ongoing when Hergert took office on January 6, 2005, and when Hergert filed his postelection campaign statement on January 11.