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Haley cleared by ethics panel

Governor calls accuser John Rainey 'a racist, a sexist bigot'



Five Republicans and one Democrat cleared Republican Gov. Nikki Haley of wrongdoing June 29 after investigating whether she had illegally lobbied as a lawmaker. It was the first time the House Ethics Committee investigated a sitting governor.

The setting resembled a trial as the six-lawmaker panel heard nearly 12 hours of testimony in a case to determine whether Haley had benefited financially from her job as a public servant.

"The ethics committee serves in a role similar to a jury," said the panel's chairman, Aiken County GOP Rep. Roland Smith, a 79-year-old retired postal worker and minister. That day, Haley's defense attorneys, Butch Bowers and Kevin Hall, controlled much of the process and trotted out roughly a dozen executives, officials, and lobbyists who claimed to have knowledge of Haley's business dealings. All said Haley had done nothing wrong.

In a surprise move, Haley herself appeared as the final witness. Taking the stand, her voice shaking, Haley said she wanted the truth to be known about what she'd done for two businesses that paid her during the time she helped make laws. "I did not lobby in any way whatsoever for anyone at any time," she said. She also had harsh words for her accuser, Republican activist John Rainey, calling him "a racist, a sexist bigot" who has done what he can to hurt her and her family.


The case revolved around whether Haley had broken any laws as a legislator either by lobbying a state agency on behalf of the Lexington Medical Center hospital where she earned $110,000 as a fundraiser or by doing secret consulting work for Wilbur Smith and failing to properly abstain from legislation benefiting the engineering firm. Both occurred during the time she represented Lexington County as a Republican in the S.C. House prior to becoming governor in 2010.

Presenting evidence in the case was attorney Ben Mustian, a former S.C. House Judiciary Committee lawyer now in private practice. As a non-advocate, it was Mustian's job to relay the allegations made by Rainey and direct the lawmakers who make up the committee to portions of the applicable law.

Rainey, who brought the complaint, is a longtime Republican fundraiser who formerly chaired the state's revenue-projecting Board of Economic Advisers and recruited Mark Sanford to run for governor. To represent him in the case, he hired the law firm of state Democratic Party Chairman Dick Harpootlian.

Haley's lawyers had subpoenaed Rainey as a witness. But in a masterful play, they never called him to testify, and thus he was kept for 12 hours under sequester in a brightly lit holding room in a first-floor office building at the Statehouse, unable to hear or view the proceedings.

Those proceedings included testimony from 11 people. Robert Ferrell said he hired Haley at Wilbur Smith and paid her $48,000 to keep her eyes open for mostly private work the firm might be able to get in on. He said Haley never won them any new contracts, and she was eventually let go. He said she did not lobby.

Lexington Medical Center president and CEO Mike Biediger said he created a $110,000 job for Haley as a hospital foundation fundraiser. "That was her only responsibility," he said, adding that she did not lobby or otherwise help the hospital in ways other than anyone else in the Lexington delegation would in its effort to eventually get a new heart center.

When asked about specific meetings he had with Haley that dealt with the heart center and that were mentioned in e-mails the ethics panel had obtained, Biediger said he couldn't recall them. The hospital's lobbyist Billy Boan also said he couldn't recall similar meetings.

All in all, no one the committee heard from had anything negative to say about the current governor.

With the hearing over, Rainey stepped from the witness room. Because he hadn't heard or seen the proceedings, he declined to comment, other than to say the art on the walls of the room where he'd spent the past 12 hours wasn't very good.

The next day, the committee voted to dismiss all charges against Haley.

In response, Rainey said the hearing was a "shameful farce" and accused the panel of "harboring a culture of corruption enshrouded in a conspiracy of silence."

As for Haley's personal attacks, Rainey pointed to a hand-written letter Haley had sent him days after the only time they'd ever met, which was during her gubernatorial campaign. In her testimony, Haley said that after the meeting with Rainey in which she characterized him as racist and sexist, she told her staff she did not want his money or support.

"I will work hard to earn your support and make you proud," her thank-you note to Rainey reads at the end.

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