BY SANDY THEIS
The Cincinnati Enquirer
George Voinovich
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COLUMBUS - In a statement that raises more questions than it answers, Gov. George Voinovich denied Wednesday that he "knowingly approved or authorized" an alleged scheme to disguise a payment from his 1994 re-election committee to his brother, Paul, and a statehouse lobbyist.
The governor's comments break his nine days of silence over charges pending before the Ohio Elections Commission. The bipartisan panel quietly launched a probe of the governor, his brother, his campaign treasurer and other related parties last month. Democrats made the charges public Nov. 2 - the day before voters elected the Republican governor to the U.S. Senate.
The case is based on information provided by Franklin County Prosecutor Ron O'Brien and federal officials. The most serious allegations about the governor are outlined in a sworn statement to a federal grand jury by Vince Panichi, the governor's longtime friend and campaign treasurer.
On Sept. 3, 1997, Mr. Panichi told a grand jury in Cincinnati that he attended a meeting during which the governor and Paul Voinovich discussed a proposal to have the governor's campaign reimburse Paul Voinovich for payments he made to a campaign worker. Instead of having the campaign pay Paul Voinovich directly, Paul Voinovich suggested the reimbursement be made through a third party, according to a transcript of the testimony.
"And the governor OK'd this?" Mr. Panichi is asked by a federal prosecutor.
"Correct," Mr. Panichi replies.
On Wednesday, however, Mr. Panichi appeared to be changing his story.
"Vince Panichi agrees with the governor's statement," Mr. Panichi said through his attorney, Donald Brey.
He contends that Mr. Panichi's sworn testimony is contradictory in parts, and contends his client might have been led astray by an aggressive federal prosecutor.
Under Ohio election law, it is illegal to misrepresent the nature of an expenditure made by a campaign committee. Violations carry a maximum penalty of $10,000 and removal from office.
While initially greeting the charges with silence, Mr. Voinovich issued a one-page statement Wednesday that said:
"Since the matter has been assigned for preliminary hearing on Dec. 10, it would be inappropriate for me to pre-empt the jurisdiction of the commission by discussing the matter in detail."
Still, he said, "I deny that I knowingly approved or authorized any misrepresentation as to expenditure of campaign funds." Ohio Democratic Party Chairman David Leland, who made the allegations public last week, wondered aloud why it took the governor so long to issue his denial.
"He was either at the meeting or he wasn't," Mr. Leland said. "He either approved it or he didn't. Why did he wait nine days, and wait until he found out what everybody else was going to say, to come out and deny it?"
The governor's lawyer, David Young of Columbus, "is arranging to present a fuller explanation of this entire matter to the elections commission," Mr. Voinovich said in the statement.
Both Mr. Young and Mr. Brey said Mr. Panichi's sworn statment is somewhat contradictory.
They noted that at one point in the testimony, Mr. Panichi said Gov. Voinovich approved the plan to use a middleman to reimburse his brother, because a direct payment from the campaign "doesn't look good" politically. Paul Voinovich was being reimbursed for paying Anthony "Ray" Gallagher, a union leader who worked on the governor's campaigns.
At another point, however, Mr. Panichi testified that the governor approved payments to the third party - Mamias & Associates - and "Mamias & Associates would employ Ray Gallagher."
What is not clear from either the sworn statments or interviews is why the Voinovich campaign simply did not pay Mr. Gallagher directly. Also unclear is why Paul Voinovich apparently helped pay Mr. Gallagher's campaign salary.
Mr. Young and Mr. Brey said they hope to straighten out the confusion during proceedings before the elections commission.
Phil Richter, executive director of the panel, said he expects all parties to file written briefs by the end of the month.
Also unclear is who - if anyone - will act as prosecutor in the case.
"Usually, nobody appears and the complaint kind of stands on its own," Mr. Richter said. But, usually, complaints do not come before the commission via federal and county prosecutors.
More commonly, one campaign files a complaint against another. The party that files the complaint makes its case, acting much like a prosecutor would. The other side defends itself, acting much like defense counsel.
As Ohio's chief elections official, the secretary of state could act as prosecutor, Mr. Richter said.
That post is now held by Republican Bob Taft, whom voters elected to succeed Mr. Voinovich as governor.
"I'm not certain whether the Secretary of State's office will be coming to argue this complaint or not," Mr. Richter said.
At the Dec. 10 hearing, he expects the panel will determine whether the complaint should proceed to a full hearing. The commission can dismiss the complaint, issue sanctions or refer the matter to the local prosecutor.
