Jurors Indict Mecham Over Campaign Loan

Gov. Evan Mecham was indicted by a state grand jury on fraud and perjury charges Friday for allegedly concealing a $350,000 campaign loan made by a developer, the state attorney general’s office announced.

The governor’s brother, Willard, 67, who served as Mecham’s campaign treasurer, also was indicted in the alleged scheme. Mecham took office one year ago this week as the state’s first Republican governor in 12 years.

Two state grand juries and a special counsel to the state House of Representatives have been investigating the governor’s failure to report the loan from Tempe developer Barry Wolfson and other financial arrangements.

Mecham, 63, who did not report the loan to the state until November, after it was disclosed by the news media, has called the failure “an honest mistake.”

Atty. Gen. Bob Corbin, also a Republican, said conviction would result in the governor’s removal from office. The charges against Mecham carry a maximum sentence of nearly 23 years in prison.

Mecham left the Capitol by car an hour after the indictments were announced and did not speak to reporters. His brother was not available for comment, according to a relative who answered the phone at Willard Mecham’s home.

Press Secretary Ken Smith said that after the indictments were announced, the governor expressed a “sense of relief because at least this formalizes some of this. . . . There’s no longer jousting at windmills.

“It was no surprise. He did not seem surprised,” Smith said.

Mecham, the first sitting governor in Arizona history to be indicted, will be arraigned Jan. 22.

The governor and his brother were charged with perjury, fraud and false filing for omitting the loan from a campaign-finance disclosure report. Signing a false financial-disclosure statement constitutes perjury, officials said.

Mecham also was charged with fraud and two counts of perjury for omitting the loan from two personal-finance disclosure statements.

One lawmaker, Republican state Rep. Jim Hartdegen, called on the governor to resign. Another, state Rep. Bobby Raymond, a Democrat, said it would be the “statesman-like thing to do” for Mecham to consider resigning.

In Line to Succeed

If Mecham resigned or were removed from office, he would be replaced by Secretary of State Rose Mofford, a Democrat.

The Arizona House already had been considering whether to impeach the governor over the loan, but House Speaker Joe Lane, a Republican, said the indictment will have “no direct impact” on the House investigation.

“Our investigation has always been and will remain on a separate track,” Lane added. The House plans next Friday to hear a report by special counsel Willaim French on his probe of the governor’s finances.

The governor, a former auto dealer, already faces a recall campaign. He had come under fire for such actions as rescinding a state holiday honoring Dr. Martin Luther King Jr. and defending use of the word pickaninny for blacks.

“It’s a sad day for the state of Arizona to have a governor indicted,” said House Minority Whip Debbie McCune, who is a Democrat.

“When we convene on Monday, we’ll have to get about the business of dealing with issues important to the state. But this indictment will cast a shadow over our proceedings.”

U.S. Rep. Morris K. Udall (D-Ariz.) also called it a “sad day for Arizona.”

“Guilty or innocent, to have a governor indicted is a serious and regrettable matter,” Udall said. “We’ll leave it to the courts to see that his rights are protected.”

U.S. Rep. John Jay Rhodes III (R-Ariz.) called the indictments a “matter of considerable concern.” He said he would meet with Mecham next week to discuss the governor’s future.

The Mecham brothers had spent 3 1/2 hours in the grand jury area of the Maricopa County courthouse Thursday, and the governor spent all of Wednesday there.

Neither would comment Thursday after leaving the grand jury area.

Wolfson said Friday, “I think certainly the governor is guilty--guilty of bad judgment and having incompetent people around him. But being guilty of perjury, willful concealment and filing false reports, I would say it’s highly unlikely.”

‘Misadvised’ by Staff

Wolfson said that he believed the governor had been “misadvised” by his former chief of staff, Jim Colter, regarding the loan, and that he knew of no evidence of intent to evade the law.

When Mecham amended his personal and campaign financial disclosure forms in November, he said the omission was an “honest mistake” and blamed his brother for it.

A grand jury had been looking into the loan as well as an alleged death threat by a state official against a former top Mecham aide. That panel expired in early December without handing up any indictments. The new grand jury convened in late December.

A Mecham recall committee last year submitted for verification more than 387,000 signatures in favor of a recall election.

A total of 216,746 valid signatures are required to force a recall election, and authorities have said Mecham is virtually certain to face recall when the verification is complete, probably by mid-month.

Mecham, who was rejected by voters four times before winning a divisive three-way race in 1986, pledged at his inauguration to launch Arizona on a “new beginning,” a vision that included clean air and water, no drugs, less crime and lower taxes.

His troubles began one week after he took office when he abolished the state holiday for King. Mecham said it had been declared illegally by his predecessor, Democrat Bruce Babbitt.

In the next few months came several allegedly racist and sexist remarks that offended blacks, women and homosexuals. Many complained when Mecham said he believed the word pickaninny was a term of affection, or when he said working women contributed to the divorce rate.

Most recently, he angered Jews when he said he believed the United States was a “great Christian nation.”