John Swallow accusations prompt call for ethics, campaign finance reform

Published: Wednesday, Jan. 16 2013 9:10 a.m. MST

Utah Attorney General John Swallow speaks out Monday in his office at the state Capitol about allegations that he brokered a deal to stifle a federal probe into a St. George businessman.

Scott G Winterton, Deseret News

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SALT LAKE CITY — Utah Attorney General John Swallow's business relationships have prompted a state senator to propose legislation that would prohibit appointed and elected officials from doing work on the side that might conflict with their jobs.

"My bill and hopefully my law will make it very, very clear that if you're on the state payroll, you may not do business in a way that would have any relationship whatsoever with your official duties," said Sen. Jim Dabakis, D-Salt Lake City.

Dabakis said he doesn't know if recent allegations that Swallow helped broker a deal to get an embattled St. George businessman out from under a federal investigation are true.

But, he said, it appears undisputed that Swallow was paid as a consultant in at least one instance while serving as chief deputy attorney general. Swallow, a Republican, won the top job in the November election.

Dabakis, the Utah Democratic Party chairman, isn't alone in wanting to see the Utah Legislature tackle government ethics reform on the heels of the allegations against Swallow.

Former Utah Republican Party leader Enid Greene Mickelsen said it shows Utah has lax ethics laws and needs a cap on campaign contributions.

"We here in Utah always convinced ourselves that we don't need it because we're better than that, and we keep having these types of questions come up," she said. "Right now, the laws are just too porous, and we need to make some changes."

Dabakis, too, supports campaign finance reform.

One-time multimillionaire Jeremy Johnson accused Swallow of helping set up a $600,000 payment intended to enlist Senate Majority Leader Harry Reid in an effort to derail a Federal Trade Commission investigation into Johnson's Internet marketing company, iWorks.

Federal prosecutors indicted Johnson in June 2011 for mail fraud in connection with his company. The FTC alleges he scammed consumers out of millions of dollars by billing them for products and services they never ordered.

Swallow has adamantly denied Johnson's allegations, saying he only put Johnson in touch with Richard M. Rawle, who had experience working with FTC lobbyists. Swallow worked for Rawle's company, Check City, as a lobbyist and in-house attorney before being appointed chief deputy attorney general in 2009.

While chief deputy, Swallow was a paid consultant on a cement project Rawle, who died of cancer last month, had in Nevada.

In an affidavit Swallow released after Johnson's allegations came to light, Rawle states that he did not pay Swallow for introducing him to Johnson. But he said he paid Swallow's company, P-Solutions, a total of $23,500 for consulting work on the cement project in fall 2010 and spring 2011.

On March 15, 2012, Swallow removed himself as manager of P-Solutions, the same day he filed his candidate financial disclosure report in the attorney general's race.

Mickelsen questions such political maneuvers.

"That's legal, I think. I'm not a campaign finance lawyer. Does it make us feel all warm and fuzzy inside? Absolutely not," she said.

In his state conflict-of-interest form filed last Thursday, Swallow listed himself as the owner of one company, Swallow & Associates. On the line asking for a description of the business or activity, he wrote "none at present."

Before former Attorney General Mark Shurtleff hired Swallow as chief deputy, Swallow worked as the lead fundraiser for his 2008 re-election campaign. Swallow came to know Johnson at that time. Johnson and his associates donated $200,000 to Shurtleff. Johnson did not contribute to Swallow's campaign.

Though those donations were legal, Dabakis said, it's bad for politics.

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