Sen. Fletcher Hartsell accused of money laundering, mail fraud and wire fraud

A federal grand jury handed up a 14-count indictment against state Sen. Fletcher Hartsell on Tuesday, charging the longtime Republican lawmaker with misusing campaign money over an eight-year period – charges that could lead to prison time or a heavy fine.

The charges in federal court escalate the legal woes for the 69-year-old Concord lawyer nearly three months after a Wake County grand jury indicted him in state court on allegations that he certified three campaign-finance documents as correct, while knowing they were not.

In federal court, Hartsell faces five counts of mail fraud, three counts of wire fraud and six counts of money laundering. The indictment alleges that Hartsell engaged in a scheme to solicit and obtain campaign money from 2007 through 2015 that he spent on personal items and services and then concealed his actions by filing knowingly false campaign finance reports.

The indictment alleges he spent campaign money on a trip to Charleston, S.C., with his wife’s handbell choir, on haircuts, tickets to the musical “Jersey Boys,” a vacation with his wife in Edenton, his granddaughter’s birthday party and getting his driver’s license renewed.

Additionally, according to the indictment, Hartsell spent campaign money on car expenses and repairs, lawn care and “memberships in certain clubs.”

The state charges are low-level felonies, but each of the federal charges carries a maximum sentence of 20 years and a $500,000 fine.

Hartsell is the longest-serving current member of the Senate, having served during the administrations of five governors. Though he plans to finish his 13th term this year, Hartsell is not seeking re-election. He had filed to seek a 14th term, but abruptly withdrew his candidacy, saying in a statement that he wanted to spend more time with his grandchildren.

The State Board of Elections voted about a year ago to forward results of its lengthy examination of Hartsell’s campaign-finance expenditures to state and federal prosecutors on the belief that he had used campaign money to pay personal expenses.

A News & Observer investigation of Hartsell’s campaign spending triggered the state’s extensive review.

The state investigation found that Hartsell spent more than $109,000 from his campaign account to pay personal expenses from 2009 to 2012. In a statement last year on the board’s action, Hartsell said he believed he fully complied with the law.

The elections board’s investigation discovered Hartsell spent campaign donations on dinners with his family, haircuts, shoe repairs, speeding tickets, part of his driver’s license renewal fee, and more.

The board looked into campaign payments of nearly $2,500 to Hartsell’s company that owned a former church building in downtown Concord.

A federal court hearing on the allegations is set for Sept. 29.

Efforts to reach Wade Smith, the Raleigh attorney representing Hartsell, were not immediately successful.

Therapy and ‘hippie’ hair

The federal indictment alleges that Hartsell told a state Board of Elections investigator that he thought “expenditures related to a trip to Charleston, South Carolina, with his wife’s handbell choir were proper because constituents were present.”

Hartsell, according to the indictment, said expenditures related to haircuts were “proper because he was a ‘hippie’ and would not get his hair cut were he not a legislator.” The “Jersey Boys” show “constituted ‘therapy’ for him.” Hartsell told the elections board investigator, the indictment alleges, that his campaign paid for his granddaughter’s birthday “were proper because he mingled there with constituents.”

Before October 2006, candidates could use their campaign funds on virtually anything. They bought cars, laptops and tickets to sporting events, and they paid for trips and monthly expenses.

The state legislature adopted more restrictive laws as part of campaign and lobbying reforms after high-profile criminal cases involving lawmakers.

Candidates are now prohibited from using campaign money for personal items unless the expense is connected to the lawmaker’s legislative duties.

The elections board’s investigation found Hartsell’s campaign had more expenditures the day before the law changed than on any other day reviewed.

“Our campaign finance laws must be enforced in order to protect the integrity of the American democratic process. If you abuse the power granted to you as an elected official, the FBI will work tirelessly to ensure you are held accountable for your actions,” said John Strong, FBI’s special agent in charge. “Confidence in the integrity of our elected officials is essential and is at the heart of our democracy. To be elected to serve in public office is an unmistakable privilege, not an opportunity to fraudulently enrich oneself using a position of trust.”

This story was originally published September 27, 2016 at 5:18 PM with the headline "Sen. Fletcher Hartsell accused of money laundering, mail fraud and wire fraud."