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Everyone listed in PACs was notified, Baker says

By Debra Hale-Shelton

This article was published July 31, 2014 at 5:26 a.m.

Former state Sen. Gilbert Baker said under oath that despite reports to the contrary, he believes he contacted everyone he was supposed to notify before listing their names on several political action committees that have since become mired in contention surrounding campaign contributions to Circuit Judge Michael Maggio.

Chris Stewart, the Little Rock attorney who created the PACs in 2013, said he sent all of the officers letters about the committees, but not until January of this year, after the PACs had begun making contributions. He also questioned whether at least one of the former officers who became upset about his name being on one of the PACs was being truthful.

Baker, a Conway Republican, and Stewart were among witnesses interviewed as part of an Arkansas Ethics Commission investigation of contributions to Maggio.

"Mr. Baker said he believes he contacted everyone he was responsible for and got the affirmative. He said these people were [friends] of his and no matter what is in the paper, he thinks he contacted all and got the okay to include them as officers," Baker told the commission staff, according to a summary of testimony released earlier this week.

Baker said Stewart also was responsible for contacting some of the officers.

Nursing-home owner Michael Morton of Fort Smith largely financed the eight PACs, seven of which donated thousands of dollars to Maggio's campaign.

Morton's PAC checks were dated July 8, 2013, the day Maggio held a hearing on whether to reduce a Faulkner County jury's $5.2 million judgment on May 16, 2013, against a Morton-owned nursing home involving a lawsuit filed over the 2008 death of patient Martha Bull, 76. Three days after the hearing, Maggio cut the judgment amount to $1 million.

Maggio withdrew from the campaign on March 6, and the Arkansas Supreme Court has stripped him of all of his cases in the 20th Judicial Circuit.

The Ethics Commission recently fined Maggio $750 for accepting donations above state limits.

The FBI and the Arkansas Judicial Discipline and Disability Commission also have been investigating the PAC-financed contributions. Additionally, the state judicial commission is investigating online comments that Maggio made anonymously about women, sex, race and a confidential adoption involving actress Charlize Theron.

In April, Stewart said his client, which he has since identified as Baker's LRM Consulting Inc., had indicated "that he [Baker] had the approval of all those persons to be listed as officers."

But Stewart said he learned that three of those officers "were unaware of their names being involved." He said he was "shocked" and amended the PAC forms to remove the names of the two who complained to him by fax -- Ancil Lea III of Conway and Cheryl Loetscher. The third officer was former Baker campaign aide Don Thomas of Conway, who has said he didn't know anything about the PACs.

Lea and Thomas did not return phone messages seeking comment Wednesday. Loetscher, whose number was unavailable, did not return a phone message left with her father.

During a May 14 interview with the Ethics Commission staff, Stewart said he "was provided with a sheet of legal paper in his client's handwriting with the names of the PACs and the officers who would be on those PACs as well as their addresses."

"He [Stewart] did not feel the need to question who was listed as the officers of the PACs," the commission summary adds. "He did, however, send those officers letters making them aware that they are members of those PACs, any donations that had been made from the PACs" and other information.

"These letters would have been dated sometime in January, after the first contribution was made. No one responded to the letters Mr. Stewart sent except for Linda Leigh Flanagin, who said she had received the letter."

After Lea's letter was returned in the mail, Stewart said he called Lea and asked Lea if he wanted to be a PAC officer. Stewart told the commission that Lea told him "he would go ahead and stay on as a PAC officer."

That changed in April, after Stewart speculated that the news media might have contacted Lea. Stewart said Lea sent a fax asking Stewart how the media got his [Lea's] name and asking why he was a member of these PACs," the summary says.

That same month, Lea issued a statement saying, "Someone took great liberties with my name without any kind of consent of my own.

"I am furious that my name has been associated with these actions," Lea added.

Stewart told the commission staff members that he "does not know what kind of communication" Baker and Lea had, the summary states.

It adds: "Mr. Stewart does not know if Mr. Lea was playing both sides, or once his name was mentioned he no longer wanted to be affiliated. Mr. Stewart was not sure if Mr. Lea was being truthful or not."

Baker, interviewed June 5, told the commission's staff that "Ancil Lea is a friend and talked to him."

Baker also reportedly said Thomas and Faulkner County Justice of the Peace Steve Goode, also an officer, were friends, that Loetscher worked for Thomas and that Flanagin worked for Baker's company.

Flanagin, LRM's sole employee at that time, did not return a phone message Wednesday but has previously declined to comment. Goode declined to comment.

Stewart and Sarah Drye, who Stewart said works for his law firm, also were PAC officers. Drye was out of the office Wednesday and was not reached by phone.

The report also reflects that Baker blamed Stewart for the contention that has arisen over the PAC contributions to Maggio's campaign.

Referring to donations that exceeded state limits from three of the PACs to Maggio's campaign, Baker said he "was trusting Mr. Stewart to keep up with the records."

According to the summary, Baker said he "pointed out to Mr. Stewart that the 'screw-up' was the genesis of this entire problem because it makes it look horrible and salacious that he got a check on the same [day] as all this stuff happened with Maggio. It looks horrible just because Mr. Stewart messed up on the PAC report. Mr. Baker said he would never have intentionally authorized anything that was excessive."

Stewart had originally put on the PAC forms that Morton's donations came in July 8.

Stewart later amended the forms to change the date to July 19 on seven of the forms and to Aug. 2 on an eighth form. Stewart explained in an email that he had inadvertently listed the date that appeared on the checks as the date the PACs received the checks and, therefore, changed them. The acceptance date is the key date, Ethics Commission Director Graham Sloan has said previously.

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