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“Penny Tax” Probe: An Update

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DETAILS OF ILLEGAL ACTIVITY UNEARTHED … MULTIPLE INVESTIGATIONS FORTHCOMING

Chalk another one up for our network of sources …

As we reported exclusively last week, there’s been significant motion in the S.C. Department of Revenue (SCDOR) investigation of the Richland County “penny tax” – a new sales tax levy “approved” via a rigged election in 2012.

In fact we’ve now obtained the letter (.pdf here) from SCDOR director Rick Reames alerting county officials to the state’s initial findings in the probe – which was announced back in April.

Specifically, Reames’ letter said his investigators have discovered “questions of potential public corruption and fraud” as well as “multiple instances of illegal activity by individuals and/ or companies associated” with the tax hike program.

While SCDOR does not investigate corruption and fraud, Reames’ letter makes clear his agency is proceeding with cases against the local government related to the illegal activity it has uncovered.

For example, two specific expenses – a politically correct “small business enterprise program” and a so-called “public information” campaign – are alleged to fall outside the scope of permissible expenses.

RICK REAMES

RICK REAMES

“It is unclear exactly what work has been actually performed as no documentation detailing the work has been provided,” Reames wrote of the latter initiative.

Reames’ letter concluded that Richland County council “has misappropriated a significant amount of (penny tax) revenue and is scheduled to spend millions of additional dollars over the next several years for expenditures falling outside the parameters of the transportation tax laws.”

County leaders “should take action to correct these expenses both prospectively and by reimbursement for previously paid amounts,” Reames advises.

Sources close to the investigation tell us Reames’ letter is just the beginning of his agency’s work on the matter.  In addition to SCDOR’s probe, we’re told the matter has been referred to the S.C. State Law Enforcement Division (SLED) for criminal investigation and to the office of S.C. attorney general Alan Wilson for prosecution.

What have they been asked to investigate?

According to our sources, there is concern not only regarding the extra-legal appropriation of penny tax revenue (which is what the SCDOR investigation is focused on) but also the manner in which those appropriations were made.  Specifically, we’re told there are links between firms receiving proceeds from the tax and individuals who approved the disbursements.

And while SCDOR has issued a blanket refusal to comment on “ongoing criminal investigations,” we’re told the agency uncovered “multiple examples” of such favor-trading in its forensic audit of the penny tax.

Hopefully SLED and the attorney general will do their job and prosecute these shady deals … although we’re not holding our breath on that.

More to the point: As pleased as we are to see at least one government agency attempting to hold Richland County leaders accountable, the real scandal here remains totally unexplored.

This was a theft, people – a $1.2 billion robbery in which there was clear and unambiguous evidence of voter suppression.

“In all our years of exposing corruption in the Palmetto State, we’ve never seen anything quite like what happened in the run-up to that vote,” we wrote earlier this year.  “Or in the miscarriage of justice which followed it.”

After county residents narrowly rejected this tax hike in 2010, Republican and Democratic leaders of the local legislative delegation took matters into their own hands.  With the approval of S.C. governor Nikki Haley, they  passed a law seizing control of the local election commission and installed their hand-picked puppet as its leader.  This puppet proceeded to rig the election – targeting excessive shortages of voting machines in county precincts that voted against the tax hike two years earlier (possibly working in direct coordination with her intimate relations in the pro-tax movement).

Astoundingly, the U.S. Department of Justice (USDOJ) has refused to launch an investigation.  Not only that, the S.C. Supreme Court (without comment) upheld this rigged election and the puppet who pulled it off got rewarded with a new job and a lifetime pension.

Again, we’re glad to see someone is following the money from the proceeds of this tax increase (an effort we support) … but the real scandal remains the “passage” of the tax in the first place (and the failure of multiple government entities to do anything about it).

Finally, while we’re glad to see reporter John Monk of The (Columbia, S.C.) State newspaper digging into these latest findings, we’d like to remind readers of how far his publication went in terms of cheerleading for this tax hike prior to its “passage.”

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