- Associated Press - Tuesday, July 28, 2015

WINSTON-SALEM, N.C. (AP) - A month before he won election, Gov. Pat McCrory attended a fundraiser hosted by an appointee to the state Board of Elections who resigned amid questions about his ties to an Internet sweepstakes magnate targeted by a campaign finance investigation.

Disclosure reports filed by McCrory show his campaign paid $1,606 to Paul J. Foley to reimburse him for costs associated with the Oct. 6, 2012, event.

McCrory has said he didn’t know Foley personally before appointing him to the elections board in April 2013, yet records show Foley hosted the fundraiser just six months earlier. Though it is unclear how much money was raised at the event, the date coincides closely with nearly $40,000 in donations to McCrory’s campaign from lawyers in Foley’s firm, as well as donors connected to the Internet sweepstakes industry.

Receipts obtained by The Associated Press show Foley used his credit card to settle a $1,577 bar tab at the District Roof Top Bar & Grille, a restaurant about a mile from Foley’s law office. Foley’s credit card was also used for about $29 at a nearby party supply store.

The restaurant went out of business earlier this year, but former co-owner Mason McDowell told the AP he remembered the 2012 event, which was held in a large private dining room. McDowell said about 80 people were in attendance, with many of them posing for photographs with McCrory in front of U.S. and North Carolina flags.

McCrory, a Republican, has tried to distance himself from Foley since he resigned July 16. The governor has said he had no idea Foley’s firm represented the company of Chase E. Burns, whose sweepstakes software company gleaned millions from Internet cafes in North Carolina.

The day before the fundraiser, McCrory’s campaign reported receiving a pair of checks from Burns and his wife, written for the maximum $4,000 contribution then allowed by state law.

Burns, of Anadarko, Okla., was behind more than $270,000 in checks to North Carolina politicians, making the out-of-state couple among the largest contributors during the 2012 elections cycle. At the time, Burns and his affiliated operators were seeking to reverse a statewide ban on the games through court challenges and an intensive lobbying effort.

Foley’s law firm, Kilpatrick Townsend & Stockton, represented Burns’ company before the state Supreme Court in 2012. Many of Burns’ campaign contributions were either mailed or hand-delivered by lobbyists from Moore & Van Allen, a Charlotte firm where McCrory was employed while running for governor.

McCrory’s campaign spokesman, Billy Constangy, has not responded to multiple calls and emails from AP over the last two weeks seeking comment about the fundraiser hosted by Foley.

Democrats said Tuesday there are too many unanswered questions.

“This looks bad and it’s time for Governor McCrory to provide more insight into his relationship with Paul Foley and indicted donor Chase Burns,” said Ford Porter, a spokesman for the North Carolina Democratic Party

Foley’s firm stopped representing Burns in the spring of 2013, after he was charged with multiple felonies in Florida as part of an investigation into a scam charity prosecutors said served as a front for laundering hundreds of millions collected from sweepstakes cafes. Burns later pleaded guilty to reduced charges as part of a plea deal where he forfeited millions but avoided prison time.

Reached by phone in Oklahoma, Burns declined to comment about his political giving in North Carolina. A two-year investigation by the North Carolina Board of Elections concluded earlier this month Burns’ donations were legal, even though the checks were drawn from an account prosecutors described as containing the proceeds of a criminal enterprise.

Foley’s July 16 resignation came after AP reported that for nearly a year and a half he had demanded regular updates on the agency’s investigation into the 2012 donations from Burns and other sweepstakes operators.

Foley has denied any role in representing Burns, or knowledge of the payments to his firm. But records obtained by AP show Foley is close to lawyers who represented Burns’ sweepstakes company in court. Two of the lawyers who represented Burns gave donations to McCrory processed in the days after the Winston-Salem fundraiser.

It is not unusual for political campaigns to report receiving donations in the days immediately before and after a fundraiser connected to particular donors, as checks and credit card charges are collected and processed by staff. McCrory’s campaign reported raising more than $10.7 million in individual contributions during 2012.

Foley was the general counsel for the North Carolina Republican Party when the governor appointed him to the elections board, just as the agency’s investigation into Burns was getting underway. He has not responded to recent phone messages or emails from AP.

When a reporter knocked at his Winston-Salem home last week, Foley could be seen retreating into the kitchen as his wife slammed the door shut.


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