North Carolina GOP Chair, Donor Charged in Bribery Scheme

April 2, 2019 by Dan McCue
Gavel and scales

A federal grand jury has indicted the chairman of the North Carolina Republican Party and a major Republican campaign donor on conspiracy and bribery charges related to a bid to curry favor with the state’s insurance commissioner.

Robert Cannon “Robin” Hayes represented North Carolina’s 8th congressional district from 1999 to 2009, and was the Republican nominee for Governor of North Carolina in 1996.

He served as chairman of the North Carolina Republican Party from 2011 to 2013, and again starting on April 30, 2016.

On Tuesday, Hayes was charged with one count of conspiracy to commit honest services wire fraud, one count of bribery concerning programs receiving federal funds and aiding and abetting and three counts of false statements to the FBI.

Only 24 hours earlier he announced he won’t seek re-election as the state Republican Party’s chairman in June, a decision he attributed to ill health.

According to federal prosecutors, Hayes, insurance magnate Greg Lindberg, and two of his associates planned to give state Insurance Commissioner Mike Causey hefty donations “in exchange for specific official action favorable to” Lindberg’s business.

The contributions were to be funneled through the state GOP and an independent committee the conspirators allegedly created just for that purpose.

Among the things Lindberg wanted were the removal of a deputy insurance commissioner responsible for examining one of Lindberg’s Durham-based businesses, Global Bankers Insurance Group.

Lindberg is quoted in the indictment as complaining to Causey that the unnamed deputy insurance commissioner had been “deliberately and intentionally and maliciously hurting my reputation with other regulators.”

Lindberg has given more than $5 million to North Carolina candidates, party committees and independent expenditure groups since 2017.

According to the indictment and a press release from the Justice Department, between April 2017 and August 2018, Lindberg sought to shower Republican state Insurance Commissioner Mike Causey with donations.

Lindberg, political consultant John Gray, and John Palermo, an executive for another Lindberg company, Eli Global LLC, and a former Chatham County Republican Party chairman, met with Causey at least five times in the winter and spring of 2018 to discuss favors and money, prosecutors said.

Lindberg’s team urged Causey to hire Palermo to replace the investigating deputy commissioner, prosecutors said.

Causey eventually refused, fearing Palermo’s ties to Lindberg’s company would be exposed by journalists, the indictment said.

Lindberg then proposed “we recruit someone brand new to the Department with the same skill set,” the indictment said.

Palermo then created an independent expenditure committee able to spend unlimited amounts on political campaigns with limited public disclosure that was funded with $1.5 million of Lindberg’s money, prosecutors said. In all, Lindberg and his associates promised Causey $2 million in donations.

Hayes, prosecutors said, directed that $250,000 previously contributed to the state GOP by Lindberg be transferred to Causey’s re-election campaign. In October, as the federal investigation was building steam, Causey turned over $250,000 in campaign donations from the state GOP to U.S. Marshals.

Lindberg also had donated $5,000 directly to Causey’s campaign, but the commissioner returned the money.

Causey, who was first elected to a four-year term in 2016, was not charged in the indictment, apparently because he voluntarily reported the scheme.

“Thanks to the voluntary reporting of the North Carolina Commissioner of Insurance, we have uncovered an alleged scheme to violate our federal public corruption laws,” said U.S. Attorney Murray in a written statement.  

All four of the accused men appeared before a federal magistrate on Tuesday.

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