Black got $500,000, prosecutors say

RALEIGH -- Former House Speaker Jim Black accepted a $500,000 check from a lobbyist in 2000, deposited the check into his campaign account and then misrepresented the transaction as a personal loan, federal prosecutors say.

The revelation was disclosed for the first time in court papers filed this week.

Prosecutors argue that Black's actions broke North Carolina campaign finance laws, though they don't specify which ones. The laws limit contributions to candidates to $4,000 per election and require strict reporting of contributions and loans, including loan sources.

Black could face more charges, prosecutors appear to imply, noting that they learned of the transactions from state investigators independently of the plea agreement Black signed in February that granted him limited immunity. Or he could face more prison time for the one federal charge to which he has pleaded guilty.

"As a matter of law, each of these transactions should have been disclosed in his filings," prosecutors write in their 19-page memorandum.

Black, a Matthews Democrat, is to be sentenced at 9 a.m. today on a federal corruption charge related to thousands of dollars in payments from chiropractors.

One prosecutor, Assistant U.S. Attorney John Bruce, declined to comment further on the $500,000 check. Black's lead attorney, Ken Bell of Charlotte, could not be reached.

According to reports that Black's campaign filed with the state, Black personally loaned his campaign $500,000 on July 18, 2000, and then repaid himself the same amount on Aug. 4, 2000. He did not indicate the money came from a lobbyist. He also reported the transactions more than a week late, waiting until the day after Election Day 2000.

Prosecutors write that the second transaction actually involved Black's writing a check from his campaign account back to the lobbyist.

Shortly afterward, prosecutors write, came a third transaction -- Black's again depositing $500,000 into his campaign account. Prosecutors do not say where the money came from, and state records do not appear to reflect the deposit.

The revelation by prosecutors is "eye-popping," said Joe Sinsheimer, a former Democratic campaign consultant who once ran a Web site calling for Black's resignation.

"It's more shocking evidence of the pay-to-play empire that Jim Black built while House speaker, and it's a powerful argument that Jim Black deserves prison time," Sinsheimer said. "Just think about what he would owe that lobbyist."

The lobbyist involved has not been named, and prosecutors gave no hints about either the person's identity or whether the money was tied to a specific interest. Several lobbyists have testified before the federal grand jury hearing evidence related to Black.

Among the biggest developments in North Carolina politics in summer 2000 was the decision of South Carolina to ban video poker machines, effective July 1 that year. With operators poised to move north across the state line, the decision set off a seven-year debate over a similar ban in North Carolina.

Black was among the industry's most ardent defenders.

Any large campaign contribution would have helped Black retain and expand his power. In 2000, he was in just his second year as speaker.

In that role, Black was head of the Democratic House caucus and the lead fundraiser for their election efforts. He reported raising just over $1 million during the 2000 election cycle -- not including either of the $500,000 deposits described by prosecutors -- and he passed on most of that money to Democrats campaigning in tight races.

Later, Democrats continued to support him for speaker.