June 1, 2002
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Brokers' donations were steered, Deters says
Saturday, June 1, 2002
Dispatch Senior Editor

State Treasurer Joseph T. Deters denies his office traded contracts for campaign cash.

State Treasurer Joseph T. Deters, battling allegations of money laundering, conceded for the first time yesterday that brokers were directed to give money to the Hamilton County Republican Party as a way to help his re-election campaign.

Deters also said that he personally solicited contributions from bankers who do business with his office, but called "patently false'' any notion that he traded contracts for contributions.

After declining to comment for more than two months, the beleaguered Republican treasurer held a series of one-on-one interviews with reporters to discuss Democratic allegations that he used the Hamilton County GOP to launder campaign contributions from brokers.

Appearing tanned and relaxed in his Rhodes Tower office, Deters, 45, said he had delayed commenting until he had "all the answers'' about circumstances involving the money-laundering allegations.

Although spokesmen for Deters continually had denied that his campaign directed brokers to give money to the Hamilton County GOP, Deters said he learned otherwise from Eric Sagun, a fund-raiser for both Deters' campaign and the Hamilton County party.

Five Columbus brokers whose companies do millions of dollars worth of business with Deters' office likely were told by Sagun that they could help re-elect Deters by donating to the Hamilton County GOP, he said. Three of the brokers gave at least $25,000 to the Cincinnati-based party; two gave at least $12,500.

"I am certain that Eric would have directed them to do that as an option for them to help me,'' Deters said.

Sagun also solicited a $50,000 contribution to the Hamilton County GOP from Frank Gruttadauria, a Cleveland broker now in jail on charges that he bilked clients of millions.

Deters said he met with Gruttadauria in Cleveland but never asked him for campaign money. He said Sagun asked Gruttadauria to give $50,000 to the county party "maybe a year after'' Deters and Gruttadauria had met.

Deters insisted that none of the contributions to the Hamilton County GOP from brokers doing business with his office were illegally earmarked for his campaign.

Carlo LoParo, spokesman for Secretary of State J. Kenneth Blackwell, said such contributions are not illegal if the county party did not make a commitment to transfer the donations, dollar-for-dollar, to the Deters campaign.

"The fact that the contributor wants the money to go to a particular candidate does not force the party to abide by those wishes,'' LoParo said.

Over 13 months through this past January, the Hamilton County GOP donated more than $300,000 to Deters' campaign -- more than Ohio's other 87 county parties combined. While serving as state treasurer, Deters also was chairman of the county party from December 1999 to March 2001.

Deters said Mike Barrett, the current Hamilton County GOP chairman, "solely and entirely'' made the decision to underwrite Deters' campaign, including paying partial salaries of three consultants shared by the campaign and county party.

The treasurer said the fact that Sagun raised money both for his campaign and for the Hamilton County GOP created "an appearance problem,'' and he has told Sagun to stop soliciting money for the county party from people who do business with the treasurer's office.

Deters said he personally has solicited campaign contributions from bankers who do business with his office, including two longtime and powerful Cincinnati friends -- Carl Lindner, owner of Provident Bank; and George A. Schaefer Jr., president and chief executive of Fifth Third Bancorp and Fifth Third Bank.

Neither of those men, nor any other investment banker, has been led in any way to think that he must give campaign money in order to get business, Deters said.

Beginning this month, he added, he will begin posting each contribution on his campaign Web site within two business days of receiving it.


 
     
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