Tulsa World: Financial loopholes for lawmakers remain

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Financial loopholes for lawmakers remain

By OMER GILLHAM World Staff Writer
Published: 6/14/2009 2:24 AM
Last Modified: 6/14/2009 4:00 AM

More than two years after Oklahoma received a failing grade for how it tracks the finances and income of state officials, the state still appears to have loopholes for reporting gifts, real property and other financial holdings by lawmakers, records show.

Meanwhile, an apparent loophole that allowed former Gov. Frank Keating to accept thousands of dollars from a wealthy New Yorker while serving as governor is still in place, a Tulsa World analysis shows.

The Tulsa World examined the financial disclosure statements of 149 state lawmakers, which includes 48 senators and 101 representatives. The records were obtained from the Oklahoma Ethics Commission.

Known as the F-1R statement, the filings were due May 15. The reports show sources of income and assets that include salaries, investments, honoraria, retirement benefits and other similar holdings or income by lawmakers, said Ethics Commission Executive Director Marilyn Hughes. The reports are designed to show possible conflicts of interest rather than total income figures, Hughes said.

In 2006, Oklahoma received an "F" from the Center for Public Integrity for lacking financial details on lawmaker income, gifts and holdings.

Among the 50 states, Oklahoma was ranked 34th for its level of financial disclosure and potential conflicts of interests by lawmakers. Scoring a 55.5 out of a possible 100 points, Oklahoma was among 23 states receiving a failing grade.

"The rankings show how the states compare to each other on the level

of reporting income and other financial information," said Steve Carpinelli, a spokesman for the nonprofit organization. "The comparisons help Oklahoma understand what it needs to do to improve its score compared to other states."

Based in Washington, D.C., the Center for Public Integrity is an investigative journalism group that ranked the states on the level of financial openness by lawmakers, judges and governors, Carpinelli said.

In 2009, Oklahoma still does not require lawmakers to report the income of spouses working outside of government, real property holdings or large gifts from individuals outside the definition of lobbyist or doing business with the state, records show. Additionally, lawmakers are only required to report income above $5,000, which leaves in question how much the lawmaker received from a given service or job.

Meanwhile, eight years after it was discovered that Keating accepted large sums of money from Jack Dreyfus, the apparent loophole of accepting such gifts remains acceptable under Oklahoma's ethic rules, the World analysis shows.

Ethics rules say an elected official can only accept up to $100 in gifts for a calendar year from lobbyists or similar groups, Hughes said.

In 2001, published reports show that Keating received about $250,000 from Dreyfus over a period of several years, including some of the years that Keating served as Oklahoma's governor. As governor, Keating did not disclose the money because reporting rules do not require the disclosure of gifts from individuals with no economic interest or lobbying interest, Hughes said.

Addressing the issue in 2001, Keating contended that he had done nothing wrong by accepting the money because Dreyfus was not a lobbyist or businessman hoping to benefit from Keating's office or his influence. Facing public scrutiny, Keating returned the money.

Elected officials are restricted from accepting large gifts from people or individuals in three main categories:

A lobbyist or lobbyist principal.

Someone doing business with or seeking to do business with an entity of government that the public official or a state employee is part of.

Someone who has an economic interest in actions or matters pending before the public official's or state employee's governmental entity.

Hughes said elected officials can accept gifts from anyone in any amount as long as they do not fit into the categories that prohibit gifts greater than $100 in a calendar year.

Keating was accused of no wrongdoing, and his gift was deemed acceptable under the Ethics Commission rules, records show.

Hughes said Oklahoma's failing grade by the Center for Public Integrity is a fair assessment of what Oklahoma is lacking in its financial disclosure statements for lawmakers.

"This grading is fair, considering the things we don't have disclosed," Hughes said.

Hughes said she was not aware of the 2006 report by the Center for Public Integrity. She said she would submit it to the Ethics Commission's governing board, an oversight committee that has the power to submit rule changes to the Legislature.

Placing the lawmakers' files online for greater public access would be one way to improve Oklahoma's failing score, Carpinelli said.

However, the Legislature has turned down Ethics Commission requests for increased funding to place the reports online in a searchable format, Hughes said.

Additionally, Hughes said an estimated 4,800 disclosure statements are filed with her office. The statements include income and asset data for agency heads, deputy directors and certain state employees in addition to lawmakers and other elected officials. Members of the public serving on certain boards fill out a similar form. Placing all the filings online would require hiring additional staff, Hughes said.

Hughes said her office attempted to add more stringent reporting requirements for financial disclosure, but such rule changes have been turned down by the Legislature. The current level of financial disclosure essentially remains the same as it was when the law was enacted about 1978 by the Legislature, she said.

Penalties for making an error in reporting financial information can involve a fine up to $1,000 for an unintentional mistake and up to $2,000 for an intentional error, Hughes said.

Omer Gillham 581-8301
omer.gillham@tulsaworld.com By OMER GILLHAM World Staff Writer

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	Report Comment Ron Ballew, Lawton (6/14/2009 6:42:04 AM) All income should be taxed without exception and fully disclosed to the IRS; however, only lawmakers, judges, and elected officials, should be required to disclose their income to the public. These are the only people that should face possible fines or punishment for making a mistake on their financial disclosure statement. The objective of financial disclosure is to prevent conflicts of interest in people that have the power to regulate the people.
	Report Comment KJNOKIE, TULSA (6/14/2009 8:32:25 AM) Honest officials should have no problem with full disclosure.
	Report Comment ttr1975, Sand Springs (6/14/2009 8:55:46 AM) I think you would be hard pressed to find an "honest official" in any form of government. Money money money...
	Report Comment oldrustytulsa, Tulsa (6/14/2009 12:57:31 PM) Oh, but you folks just keep right on re-electing them to the same offices, Got to support the Party.
	Report Comment ajohnb, Jenks (6/15/2009 7:27:33 AM) And someone thinks the Legislators are going to fix this? And they won't let the Ethics commission put the violations online for the people of Oklahoma. What a joke.
	Report Comment 52favoriteteacher, Washburn--used to be Broken Arrow (6/16/2009 6:30:47 AM) Thanks Omer good story you get a 15 percent raise and congrats... will also throw in free coffee, hot cocoa, and a ticket to see the Drillers.

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