John Swallow brought to the attorney general’s office a culture of special favors for big donors and a secret network of entities designed to hide his supporters from public scrutiny, investigators reported in their second day of damning revelations about Utah’s former top cop.
"We have uncovered facts that suggest that state law may have been skirted or broken," said Steve Ross, a special counsel for the House Special Investigative Committee.
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Swallow and his predecessor, fellow Republican Mark Shurtleff, gave big donors — such as Jeremy Johnson, the St. George businessman now facing federal fraud charges — extraordinary access in exchange for campaign contributions and special favors.
Swallow allegedly promised payday lenders that, as attorney general, he would be "ready and willing to help lead out" on staving off potential federal regulations.
Perhaps the most egregious finding: Days before he left office, Shurtleff unilaterally agreed to dismiss a lawsuit that could have helped thousands of Utahns facing foreclosure. The reason he settled, investigators said, was to spare Swallow political embarrassment.
"You see the danger of an official in essence hanging up a ‘for sale’ sign on the state’s attorney general’s office," said Steve Reich, another special counsel for the bipartisan House panel.
The two days of jaw-dropping revelations disgusted committee members and several said they now want to reverse course and continue the five-month probe that was shut down after Swallow announced his resignation Nov. 21.
Lead investigatorJames Mintz walked lawmakers through examples of special treatment and access given to well-connected friends and donors of Shurtleff and Swallow.
With payday lenders, it was the late Richard Rawle, owner of the Provo-based Check City payday-loan chain and a former employer of Swallow. For the online-poker industry, it was Jeremy Johnson, whom Swallow met when he was the finance chairman for Shurtleff’s campaign.
Mintz told of a long-standing relationship, which included Swallow serving as counsel and lobbyist for Rawle’s companies. Swallow had an attitude of "reverence" toward Rawle, Mintz said, and Rawle was generous to the Swallow campaign.
Mintz said Rawle gave Swallow $23,500 in consulting money, promised an ownership stake in a cement project, made $20,000 in contributions to otherentities to help Swallow’s campaign.
Rawle also provided the campaign with free, unreported office space — likely a violation of state law.
Swallow courted the payday-lending industry, seeking to raise hundreds of thousands of dollars from it. But his campaign was sensitive to the public fallout of such heavy backing from a controversial industry, investigators said, so his political consultant Jason Powers set up political-action committees and nonprofits to hide the funds from voters.
"I do not want this to be a payday race," wrote Swallow, then a chief deputy attorney general.
He directed the loan companies to either steer their contributions to the nonprofits that did not have to disclose their donors or give their money through entities not tied to the payday industry.
"This is our No. 2 cop from the state of Utah, who’s here to protect citizens of the state of Utah and he’s cutting a deal in his election with a group of predatorial lenders," said Rep. Mike McKell, R-Spanish Fork. "I think it’s very, very problematic and he tried to hide it."
Said Mintz: "That kind of flow of benefits, back and forth with elected officials, is pay to play. If it isn’t dirty, why is it kept so secret?"
He said Swallow and Powers raised more than $452,000 through Powers’ nonprofit, the Proper Role of Government Education Association, with Rawle, the largest donor, giving $100,000. It funneled the money through other nonprofits and used it in scathing TV and radio attack ads against Swallow’s GOP primary opponent, Sean Reyes, then publicly denied any connection to the spots.
Powers also targeted former state Rep. Brad Daw, R-Orem, hammering him with damaging mailers and phone calls to voters disparagingthe then-lawmaker, who had sponsored legislation opposed by the payday industry.
"The payday [loan] industry provided a huge benefit to John Swallow by helping to defeat his opponent," Mintz said, "and Swallow, through his campaign, provided a huge benefit to Richard Rawle and the payday industry by helping defeat their opponent."
McKell bluntly stated that "there are some people who need to go to jail."Next Page >
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