Coleman will use campaign funds to pay legal fees

  • Article by: TONY KENNEDY and PAUL McENROE
  • Star Tribune staff writers
  • December 17, 2008 - 8:49 PM

Sen. Norm Coleman said Wednesday he will use campaign funds to pay any legal bills stemming from two lawsuits and an FBI probe related to allegations that a wealthy friend tried to funnel unreported money to the senator.

"We intend to have any legal fees related to what we believe to be a politically inspired legal action to be covered by the senator's campaign,'' said Luke Friedrich, campaign spokesman. "We will be seeking the necessary approvals at the proper time to ensure that this is done in strict accordance with all appropriate laws and rules."

Coleman is not being sued. But allegations were made in the lawsuits that multimillionaire Nasser Kazeminy steered $75,000 to Coleman last year from an underwater services company in Texas that Kazeminy controls. The Republican senator has retained former Assistant U.S. Attorney Doug Kelley to represent him as the FBI investigates the allegations.

If Kazeminy maneuvered money to Coleman, the senator would be in violation of federal law for not disclosing it.

The lawsuits allege that Kazeminy misused corporate funds by directing executives at Deep Marine Technology Inc. to send the cash in three quarterly payments to Minneapolis-based Hays Companies Inc., an insurance agency that employs Coleman's wife, Laurie.

Kazeminy has denied the allegations and Hays has said that its business arrangement with Deep Marine is legitimate and that the lawsuits contain factual errors. Laurie Coleman has declined to comment. Norm Coleman has said that the lawsuits' allegations are false and that he welcomes an investigation.

Friedrich said campaign funds will not be used for legal fees incurred by Laurie Coleman, who has hired St. Paul's Earl Gray, another former assistant U.S. attorney, to represent her.

FEC precedents

Federal Election Commission (FEC) rules forbid using campaign funds for "personal use,'' said Mary Brandenberger, an agency spokeswoman.

In determining if legal fees are "personal use,'' the FEC considers on a case-by-case basis whether the expense would have existed irrespective of the candidate's campaign or duties, according to the FEC website.

Past advisory opinions by the FEC show there is precedent to pay criminal defense lawyers from campaign funds.

In the 2005 case of former Republican U.S. Rep. Randall (Duke) Cunningham, the FEC allowed him to spend campaign funds on legal fees related to a grand jury investigation and federal prosecution of corruption allegations.

Cunningham collected $2.4 million in homes, yachts, antique furnishings and other bribes, including a Rolls Royce, in one of the biggest congressional scandals in history. He resigned and was sentenced in March 2006 to eight years and four months in prison.

The FEC's advisory opinion said the legal expenses would not have existed if it weren't for Cunningham's duties as a federal officeholder.

"Senator Coleman is now forcing his contributors to bail him out for his questionable ethical behavior," said DFL communications director John Stiles, when asked to comment on Coleman's plans. "But he has no one but himself to blame for the legal trouble he's gotten himself into.''

Tony Kennedy • 612-673-4213 Paul McEnroe • 612-673-1745

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