The board is looking at flights Easley took on the private planes of supporters, a vehicle he received from a North Carolina car dealer, and how money given to the North Carolina Democratic Party may have been used for the Easley campaign.
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The hearing resumed on Tuesday with testimony from Dave Horne - a lawyer who served as campaign treasurer and oversaw campaign finance reports for the Easley campaign.
Board members closely questioned Horne about money that was given to the Democratic Party. Parties can receive unlimited contributions while individual candidates are limited to $4,000 per donor. There is no limit on how much the parties then turn around and give to specific campaigns. However, it is against campaign law for parties to solicit funds for specific candidates.
In testimony Monday, two contributors spoke about checks they wrote to a special fund at the North Carolina Democratic Party that was specially set up to funnel money through the party for the Easley campaign.
But questioning Horne Tuesday, Democratic Party attorney Jim Cooney pointed out that Easley raised more money for the Democratic Party than they did for him - trying to discredit the idea of a plan to funnel money to the Governor.
"It would be fair to characterize it as a miserable failure," Cooney said.
Finance director testifies
Tuesday afternoon, Michael Hayden - finance director for the Easley campaign - was called to testify.
Hayden told the board that he didn't remember discussing fundraising strategy with Governor Easley other that when he was first hired. He also said that Easley disliked fundraising activities.
Hayden testified that he never told donors that money they gave to the North Carolina Democratic Party would go directly to the Easley campaign.
Under questioning, Hayden responded that he wasn't the compliance director responsible for making sure the campaign followed election law.
"Who did have that title?" asked a board member.
"No one had that title," Hayden responded.
In-kind contributions
The board also asked witnesses about "in-kind" contributions made to the Easley campaign. In-kind contributions are goods or services, and they have to be reported just like cash contributions are.
Flights the Governor took on private planes would legally be considered in-kind contributions that should have been reported to state elections officials.
The board's questioning Tuesday followed up on explosive testimony from campaign supporter McQueen Campbell on Monday.
In his testimony, Campbell, a former North Carolina State University trustee, acknowledged providing private flights to Easley that may have exceeded donation limit rules.
Campbell testified there were 61 flights he provided to the governor, but he said not all were campaign related. When asked about reporting the flights to elections officials, Campbell said he expected that the Easley campaign was taking care of that.
Campbell also testified about repairs made to an Easley home. He said he arranged for two repairs - one for around $4,000 and another for around $6,000.
When asked who paid for the repairs, Campbell responded "I did."
Campbell said when he called Easley to be reimbursed for the repairs, Easley asked him about unbilled flights taken on his plane.
Campbell said he understood that to mean "for me to bill the campaign for unbilled flights to cover those amounts."
"So did the Easley campaign indirectly pay for repairs to the Easley home?" asked Chairman Larry Leake.
"That's correct" said Campbell.
Under cross examination from an Easley attorney, Campbell was asked if Easley told him directly to file a false invoice.
"I understood what he meant," McQueen responded.
Later in the day, Rebecca McGhee, an assistant to the Easley campaign treasurer, testified that Governor Easley instructed her to pay the invoice from Campbell - even though it was not accompanied by supporting documents that were usual with travel bills.
In his testimony Tuesday, Horne said he remembered a discussion with McGhee about paying the invoice from Campbell. He testified she sent him a memo saying she had had a conversion with the Governor about paying the invoice even though it did not have attached documentation, and Horne said the bill was paid.
Horne testified he did not know about the repairs to the Easley home at the time.
Thomas Hicks, an attorney for former Governor Easley, made it clear in his questioning of Horne that using campaign funds for repairs to the Easley home at the time was legal.
Horne wouldn't speculate on why - if it was legal - that Easley would tell Campbell to invoice the campaign for air travel instead of home repairs.
More witnesses expected
Dozens of witnesses are expected to testify this week.
Ruffin Pool, Easley's general counsel while he was governor was called to testify Monday afternoon. But, Pool is claiming attorney client privilege and filed a lawsuit to quash the subpoena. A judge agreed Monday and he won't be forced to appear. Leake asked the board's attorney to appeal the ruling.
The witness also list includes top state Democratic Party officials, former aids, other campaign contributors and Highway Patrol Captain Alan Melvin, who headed Easley's security detail from 2003 to 2007, and kept records of Easley's travel.
Easley also under federal investigation
The BOE hearing is not likely to be the end of Easley's problems. He's under federal investigation not only for his campaign financing, but for a real estate deal and the way in which his wife Mary got a job at NC State University. He has not been charged with any crime, and has told ABC11 in past interviews that any suggestion of wrongdoing is "ridiculous."
It's not clear what day Easley will testify or if he will speak at all. He can claim his Fifth Amendment right not to incriminate himself in possible future criminal proceedings.
BOE hearings have been the starting point for criminal cases in the past.
Former agriculture commissioner Meg Scott Phipps and legislators Jim Black and Thomas Wright all went before the NC Board of Elections and ended up behind bars.
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