Ethics Investigation Can|Continue in South Carolina

COLUMBIA, S.C. (CN) - The South Carolina Supreme Court ruled Wednesday that the state's attorney general may continue his grand jury investigation of ethics charges against longtime House Speaker Bobby Harrell.

The unanimous decision reversed a ruling by Richland County Circuit Court Judge L. Casey Manning, who shut down the investigation in May. Manning held that any investigation would be more appropriately handled by the state House Ethics Committee.

Under state law, the House Ethics Committee is empowered to investigate timely filed civil ethics complaints. In the event it finds the violations rise to the level of criminal conduct, it is to forward those charges to the attorney general.

But the state Supreme Court ruled Wednesday: "The House Ethics Committee's concurrent civil regulatory authority does not affect the Attorney General's authority to initiate a criminal investigation in any way, whether or not there is a referral, or even a pending House investigation."

Harrell, a Charleston Republican who has been House Speaker since 2005, has been accused of improperly using campaign funds, using his influence to obtain a state permit for his pharmaceutical business, and of inappropriately appointing his brother to a judicial candidate screening committee.

The South Carolina Policy Council, a nonprofit, Libertarian think tank, brought these charges to State Attorney General Alan Wilson in early 2013, but the attorney general initially said any investigation of the allegations must be handled by the Ethics Committee.

However, after the Policy Council said such an investigation was fraught with hurdles it could not overcome, Wilson, also a Republican, asked the State Law Enforcement Division to look into the allegations.

After an eight-month investigation, Wilson and State Law Enforcement Division chief Mark Keel asked the circuit court to empanel a state grand jury.

Judge Manning initially granted this request, but later reversed himself, saying from the bench that after several weeks, he had received no evidence from Wilson of a criminal violation.

In a May 12 order, Manning concluded that because the complaint was civil in nature, the state grand jury lacked criminal jurisdiction to investigate the charges, and likewise, that the attorney general lacked the authority to investigate the matter without a referral from the House Ethics Committee.

In appealing to the state Supreme Court, Wilson argued that Manning's decision was erroneous in light of the state constitution and court precedents. The justices on the state's highest court agreed.

In State v. Thrift, a 1994 case, the state Supreme Court held that legislative jurisdiction over violations of the Ethics Act is civil in nature.

"There, the State appealed a pre-trial order of the circuit court dismissing the indictments against multiple defendants charged with public corruption ... The State in Thrift submitted that if the Court interpreted a prior version of the Ethics Act to require the State Ethics Commission to refer criminal allegations to the Attorney General as a precondition to the institution of a criminal investigation in every prosecution, then the referral scheme was unconstitutional," the court ruled.

It continued: "Noting that the State possesses 'wide latitude in selecting what cases to prosecute and what cases to plea bargain,' the Court observed that the Attorney General's authority to prosecute derives from our state constitution and thus 'cannot be impaired by legislation' ... Therefore, the Court deemed any requirement placing the power 'to supervise the prosecution of a criminal case in the hands of the Ethics Commission' unconstitutional."

The state Supreme Court concluded: "The absence of a complaint to the Ethics Commission will never operate as a limitation upon the State's independent right to initiate a criminal prosecution."

Rather than look to Thrift, however, Manning relied on a more recent case, Rainey v. Haley, deciding that gave the House Ethics Committee exclusive jurisdiction over the matter at hand.

In Rainey, the appellant sought a civil declaratory judgment that Governor Nikki Haley was criminally culpable for ethical violations allegedly committed while was a state representative. The Circuit Court dismissed for lack of jurisdiction, and the Supreme Court affirmed.

The justices allow that in doing so they again affirmed the Ethics Commission's jurisdiction over civil ethics complaints filed against House members, but as applied to the current case, "the circuit court placed great significance on the 'exclusivity' language in Rainey, but failed to consider that case in context: a civil declaratory judgment action."

"Rainey does not affect the clear and unambiguous holding of Thrift, as Rainey address the civil regulatory function of the House Ethics Committee and not a criminal prosecution. Consequently, Rainey is distinguishable, and the circuit court erred in relying on it for the proposition that the House Ethics Committee has exclusive jurisdiction over this matter," the Supreme Court said.

"Furthermore, the circuit court's finding that a referral from the House Ethics Committee was required before the Attorney General could initiate a criminal investigation into this matter not only contravenes Thrift, but more importantly, runs afoul of Article V, section 24 of our constitution."

Having decided that Judge Manning erred in finding the grand jury was without jurisdiction, the Supreme Court said that while his rationale was "misplaced," the court acted well within its statutory authority in assessing the jurisdiction of the state grand jury beyond the empanelment stage.

The justices remanded, directing the circuit court to decide whether the attorney general should be disqualified from participating in the state grand jury proceedings, as Harrell's legal team has argued.

In the wake of the decision, Harrell issued a statement in which he said: "We are disappointed with the court's ruling but in no way did the court take exception to our original contention that another prosecutor should take over this case because of the Attorney General's inappropriate conduct.

"It was Judge Manning, not my attorneys, who brought up the jurisdictional issue in this case," the statement continued. "The only thing we originally asked the court was for a fair and impartial prosecutor to be put in charge of this matter. As Supreme Court Justices clearly pointed out at the hearing, the Attorney General has improperly handled this case from the beginning.

"As the Circuit Court ruling stated, after more than a year of investigations the Attorney General was still pursuing this case even though he could not point to a single shred of evidence of criminal wrongdoing. Clearly the Attorney General's motivations have been corrupted by political motives and that is why he needs to be replaced with a fair and impartial prosecutor."

A spokesman for the attorney general's office declined to comment.

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