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SALT LAKE CITY — A new federal complaint accuses embattled Utah businessman Jeremy Johnson of violating campaign finance laws in donations made to U.S. Sens. Harry Reid, D-Nev., and Mike Lee, R-Utah, as well as former Utah Attorney General Mark Shurtleff.
The Federal Election Commission filed the complaint Friday in U.S. District Court, alleging Johnson illicitly used “straw donors” to exceed the limits of allowable campaign contributions in efforts to support U.S. Senate runs by Reid, Lee and Shurtleff in 2009 and 2010.
“Contributors … gave funds ostensibly in their own names to the candidates but with the understanding that Johnson would either advance them the funds or reimburse them after the contributions were made. Johnson advanced or reimbursed approximately $170,000 to the straw donors he recruited,” the civil complaint states.
In all, federal authorities say Johnson donated by proxy about $100,000 toward Shurtleff’s campaign, $50,000 to Lee and $20,000 to Reid. The legal limit for individual donations to federal campaigns is $2,400.
The complaint states Johnson conspired with former Utah Attorney General John Swallow in 2009 about “the possibility of illicitly contributing additional amounts” to Shurtleff, who was a candidate in Utah's Republican primary election for U.S. Senate in June 2010.
Shurtleff gave a statement to the Deseret News on Friday saying he knew nothing about the unlawful campaign donations.
“Mr. Shurtleff relied on his professional campaign finance staff to accept only legal contributions, and he had no knowledge of prohibited donations, if any, to his Senate campaign,” the statement reads.
The FEC says Johnson and Swallow switched their attention to Lee after Shurtleff dropped out of the primary in November 2009 and endorsed him for the office of U.S. Senator.
“In particular, Swallow told Johnson that if (he) contributed to Lee, and if Lee won election to the Senate, Lee could then play a key role in the appointment of a United States attorney in Utah who could protect Johnson’s business interest from prosecution by other United States attorneys.”
Johnson allegedly agreed and forwarded funds to others, including family members, friends and employees, with an understanding they would donate to Lee’s campaign. In some instances, the alleged straw donor would make the payment and then Johnson would reimburse that person, according to the federal complaint.
A spokeswoman for Lee’s office, Emily Long, was adamant that his campaign was not privy to information about any illicit contributions.
"At no time during or since the 2010 campaign was Sen. Lee or anyone associated with the Lee campaign aware of any unlawful contributions to the Lee campaign. The documents obtained by investigators confirm that the scheme was known only to the two individuals who may have been involved,” Long said in a prepared statement. "This FEC filing demonstrates clearly that the Lee campaign had no knowledge of any of the activities in which Jeremy Johnson and others may have engaged. If there is further action required by the campaign, the FEC will inform us and we will follow their instructions.”
Johnson was also attempting to influence election politics using spurious methods in Nevada, the civil complaint against him alleges. He allegedly used straw donors to funnel $20,000 into Reid’s campaign using the same methods he employed for donations to Lee and Shurtleff.
The Federal Trade Commission filed a lawsuit against Johnson in December 2010 based on allegations against his internet marketing company, iWorks, based in Nevada. This was despite Johnson seeking Reid’s protection against the investigation, according to the federal complaint.
Shurtleff is charged with five felonies from his time in public office: three counts of accepting gifts, and one count each of bribery to dismiss a criminal proceeding and obstruction of justice. He allegedly accepted lavish gifts from Johnson.
Swallow faces 13 felonies stemming from his time campaigning for Utah attorney general. These include accepting gifts, making false statements, misuse of public money, bribery, tampering with evidence and obstruction of justice.
Johnson faces 86 criminal counts for alleged conspiracy, bank fraud, wire fraud and money laundering.
An attempt to reach Reid’s office Friday was unsuccessful.