TALLAHASSEE -- Gov. Charlie Crist said Friday that the criminal investigation into the fundraising scandal surrounding his own hand-picked former Republican Party chairman should be transferred to the U.S. Attorney's Office in Tallahassee, suggesting that tax violations could have occurred..
Crist made the request Friday in a one-paragraph letter that cited "the potential IRS implications" of the probe, which was ordered earlier this week by fellow Republican Attorney General Bill McCollum when he forwarded the findings of a party audit to the Florida Department of Law Enforcement.
Ex-chairman Jim Greer is being investigated over personal expenses and a secret contract he signed last year that funneled nearly $200,000 in fundraising commissions and consulting fees to a private company called Victory Strategies in which Greer had a 60-percent ownership stake.
An independent audit of Republican Party of Florida finances filed with the state this week also concluded the party lacked the paperwork to justify tens of thousands of dollars in other party expenses claimed by Greer and his appointed party director, Delmar Johnson, who was also his partner in Victory Strategies.
If investigators determine such expenses were not for valid business purposes, they could be treated as personal income under federal law and – if not reported on income-tax forms – subject individuals to possible tax-evasion charges.
Greer's lawyers did not return calls seeking comment.
The mention of "IRS implications" may chill those who had RPOF American Express cards and used them freely over the past several years.
The list includes Greer and Johnson, who ran up more than $1 million in AmEx charges for everything from chartered planes and four-figure dinner bills to flowers sent to the wives of Greer and Crist. Grass-roots and leadership anger over Greer's spending, even as party fundraising plummeted, forced his ouster in early January.
But party credit cards were also given to former House Speaker Marco Rubio, Crist's U.S. Senate primary foe who's been challenged for using his card for thousands of dollars of personal expenditures; House Speaker-designate Dean Cannon of Winter Park, who the Orlando Sentinel reported spent $190,000 over two years on charter planes, expensive dinners and other items he says were all related to "party business;" and Senate President Jeff Atwater, the North Palm Beach Republican who's running for CFO.
Crist — who hand-picked Greer as party chairman in 2007 — has said he never had a party AmEx card. And he's recently tried to make a major issue of Rubio's spending.
The ex-speaker ran up $100,000 in charges on his party AmEx between 2006 and 2008, including $16,000 in personal expenses he said he repaid the party. Crist has been demanding that Rubio make public his tax returns for the period.
That may explain why Crist was quick to join with a Democrat in calling for a federal investigation of his own party.
Crist's one-paragraph memo was released half an hour after Democratic Chief Financial Officer Alex Sink asked for the investigation to be turned over either to the Leon County state attorney or the U.S. Attorney, citing the potential for a conflict of interest if it remains under FDLE.
The agency is overseen by the governor and Cabinet: three Republicans — Crist, McCollum and Agriculture Commissioner Charles Bronson — and Sink.
"This investigation should have been referred at the outset to an independent prosecutor who does not report to the Cabinet … It is not appropriate to refer this investigation to a law enforcement agency that works under the direction of the four of us," Sink wrote.
Sink's letter was directed to McCollum, her likely gubernatorial rival this fall, who made the FDLE referral Wednesday after new party chairman John Thrasher said RPOF auditors had discovered Greer's secret interest in the fundraising contract.
"While I have tremendous confidence in the Florida Department of Law Enforcement, I can certainly understand and appreciate your very reasonable request for referral," Crist wrote to Sink in response. "I do believe it should be referred to the United States Attorney's Office due to the potential IRS implications."
However, it was unclear if any broader federal inquiry was imminent.
McCollum said he thought state authorities were doing fine by themselves, but he didn't object to requesting other agencies' involvement.
"I think it's been investigated rather well to date by FDLE … but it doesn't matter to me where else it gets investigated," McCollum told reporters in Orlando, adding, "We need to make sure that justice is done, and whatever mess is there is cleaned up."
A spokeswoman for the U.S. Attorney in Tallahassee said the office was not yet involved.
"We anticipate something, but we have no referrals as of yet," said spokeswoman Kelli Dougherty. An FDLE spokeswoman also said there was no change in the agency's investigation.
A federal probe would ratchet up already-high election-year tension in Tallahassee. And Greer has also shown a willingness to generate headlines critical of high-ranking state Republicans.
On Thursday, Greer filed a lawsuit in Seminole County circuit court alleging state GOP leaders cheated him out of $123,000 in severance money and broke a written pledge to keep secret the circumstances of his ouster as chair in January.
Damon Chase, the Lake Mary lawyer who's representing Greer in the lawsuit, said Thursday that "everyone knew" about Victory Strategies and that Greer's spending as party chair was appropriate and common for political leaders courting major donors.
Greer has also hired a former U.S. Attorney, Gregory Miller, who was the lead prosecutor and chief federal law enforcement officer in the North Florida district and now specializes in white-collar criminal defense.
Anika Myers Palm contributed to this story. Aaron Deslatte can be reached at 850-222-5564, or at firstname.lastname@example.org.Copyright © 2015, Los Angeles Times