Robert Gehrke: Attorney General Sean Reyes didn’t tell the truth about what he did with a donation tied to a crime

Even in what has been derisively referred to as the “fraud capital of America,” the case against Washakie Renewable Energy is a doozy.

It kind of has it all — a lavish house, a $1.75 million sports car, international banks and, because it wouldn’t be uniquely Utah without it, a little polygamy for good measure.

Four people with ties to the Kingston polygamist sect have already pleaded guilty and cooperated with prosecutors in connection with the scam. The fifth defendant, Lev Dermen, will go on trial this week, claiming the Kingstons duped him.

Prosecutors will argue that Dermen and the Kingstons conspired to defraud American taxpayers out of $511 million of renewable energy tax credits, pretending to manufacture fuels from plant waste and instead purchasing it from other manufacturers and claiming the credit.

[Read more: Trial for the last Washakie fraud defendant begins this week: Here’s what you need to know]

For a period of time about five years ago, Washakie was living large, including being one of the biggest sponsors of the Utah Jazz and funding scholarships and research at the University of Utah.

They also were politically active, donating more than $100,000 to state candidates in a two-year span, the lion’s share — $50,985 — given to Attorney General Sean Reyes.

Robert Gehrke

I first highlighted the donations back in 2015. On the heels of a scandal that drove John Swallow from office, Reyes, came in vowing to clean things up, but at that time had accepted more than $30,000 in contributions from the company, which had been fined $3 million for collecting bogus biofuel credits.

Reyes went on to collect nearly $20,000 more while Washakie, it is alleged, kept scooping up fraudulent credits.

Back in February 2016, after federal agents raided Washakie’s offices, Reyes’ campaign manager, Alan Crooks, said the campaign would put the money in an escrow account, setting it aside so it wouldn’t be spent until the investigation had run its course.

After charges were filed against Washakie executives in 2018, Crooks reiterated that the money was still in escrow where it would stay for safekeeping pending the outcome of the case.

“Everything’s locked down now,” Crooks said back then, calling questions about the money “stupid.”

“I’m giving you zero comment, nothing, not even a ‘no comment,’” Crooks said. “It’s a ridiculous question.”

He was defiant. And his statement — ”Everything’s locked down now” — was utterly false.

Right before last Thanksgiving, without any fanfare, the Reyes campaign posted a “clarification” about the Washakie donations on the campaign website saying that, by the time the campaign was contacted about the Washakie donation in 2016 the money had already been spent.

"The donation had been depleted,” Crooks said in the statement. “Due to the fact that the funds were no longer available, the campaign was not able to put the donation in escrow.”

It is an absurd claim on its face. As if the issue is tracking the exact dollar bill that Washakie executives handed over, instead of the dollar amount. It implies that the Reyes campaign divvied up the more than $1 million it has raised since the last election or the $350,000 it has in the bank by the donor source.

Crooks also suggested when I spoke with him Monday that parting with the Washakie money would be unfair to other donors. In their minds, Crooks said, donors were thinking, “We’ll give money to the campaign, but we don’t want to pay back Washakie for their dollars.”

That assumes campaigns have to answer to donors when it comes to spending money, whether it’s returning illicit funds or renting an office or paying Crooks’ company $130,000 in consulting fees. It doesn’t work that way. Or at the very least, it shouldn’t work that way. It would give credence to anyone who complains that a politician is bought by a donation.

Reyes certainly could get rid of the money and he should have done so already. Last year, Reyes’ campaign returned $5,000 to the Walmart Political Action Committee. In 2017, they returned $10,000 to a donor.

Campaigns do this all the time. Democrats couldn’t get rid of Harvey Weinstein money fast enough when allegations of his serial sexual abuse surfaced, many donating the funds to groups working to combat sexual violence. Republicans gave away tens of thousands of dollars in donations from indicted Rudy Giuliani associates Lev Parnas and Igor Fruman.

Reyes could do the same (as could — and should — Gov. Gary Herbert, who received $15,000 from Washakie and also spent it). He could donate it to charity or gift it to the U.S. Treasury, which would, in essence, return it to the victims of the crime — American taxpayers.

Or, as it appears Reyes has done, he can keep it and benefit directly from one of the largest criminal conspiracies in our state’s history.

If he doesn’t correct his error, however, he should at least update his campaign website to remove the part about his priorities being to protect Utahns from “frauds and scams and … restoring public trust” in the office, because his actions make his words ring hollow.