Lowcountry S.C. House Rep. Jim Merrill was indicted Wednesday on 30 charges that accuse him of misconduct in office as far back as 2002 as well as a series of ethics violations.
Altogether, the 30-page indictment accuses Merrill of illegally using his office to pocket at least $1.3 million, either directly or through his business, Geechie Communications.
He also failed to disclose receiving payments of more $673,000 from trade, advocacy and political groups in violation of state ethics law, according to the indictment.
Speaker of the House Jay Lucas, R-Darlington, suspended Merrill late Wednesday afternoon. “This suspension is pursuant to state law and will remain in place until the matter is resolved or the seat is declared vacant,” Lucas said in a statement.
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The long-awaited indictment by a Richland County grand jury said Merrill, who has represented Berkeley County in the House since 2001, violated the ethics law 28 times and committed official misconduct twice.
Prosecutor David Pascoe, who was assigned to oversee the investigation, announced the charges in a news release that also states the probe is ongoing. Pascoe said he will have no public comment because the investigation is not over.
A bond hearing for the 49-year-old Merrill, once the House Republican Caucus leader, had not been set by late Wednesday.
Merrill’s attorneys, Matthew Hubbell and Leon Stavrinakis, issued a statement late Wednesday afternoon.
“Representative Jim Merrill adamantly denies the charges brought against him by Solicitor David Pascoe,” they said. “He has served honorably and in good faith.”
“Contrary to the flawed allegations made today, the work performed by Jim Merrill’s private company was completely legal and legitimate,” the attorneys said. “In fact, the charges include conduct that has been declared legal in written opinions by the South Carolina Attorney General, the bipartisan House Ethics Committee and the State Ethics Commission.”
Ethics watchdog John Crangle has followed the investigation closely. Crangle, head of S.C. Common Cause, said he suspects that as many as three or four more people are facing indictments.
Merrill is accused of accepting money to influence government decisions and sponsor legislation for private interests. For example, Merrill is charged with taking $172,485 from New Jersey-based bus contractor, Student Transportation of America, in exchange for sponsoring a failed 2012 bill “regarding legislation to privatize school buses” in the Palmetto State.
“The defendant intentionally violated the law for the purpose of making money for himself personally,” one count of the indictment states.
The GOP Caucus, Harrell connections
Prosecutors also say Merrill, through his public relations company, illegally received payments totaling at least $276,561 from the S.C. House Republican Caucus. His involvement with the caucus is tied to several of the accusations of ethics violations.
The indictment also links Merrill to former House Speaker Bobby Harrell, R-Charleston. Harrell pleaded guilty and resigned in October 2014 to charges of misusing campaign funds for personal gain after an investigation by Pascoe, who is the state’s 1st Circuit solicitor.
Merrill was charged with directing tens of thousands of dollars from the Palmetto Leadership Council, which is Harrell’s political action committee, to Geechie Communications, in excess of the fair market value for his services.
The indictment also states that Merrill “colluded with the Republican Caucus and the Palmetto Leadership Council to give candidate contributions to members of the Republican Caucus in excess of $5,000 and accept contributions in excess of $3,500” that are the maximums under state law.
Among a number of counts, Merrill is accused of failing to disclose contributions and expenditures made on behalf of the House GOP Caucus and of improperly using the caucus’ operating account for campaign purposes. That failure allowed Merrill to collect $164,564 from the caucus without accountability between Jan. 1, 2005, and Dec. 31, 2008, according to prosecutors.
Merrill is charged with using his office for financial gain for receiving $108,169 through Geechie Communications from the GOP caucus just from Jan. 1, 2010 through Dec. 31, 2011.
He is accused in another count of using his position from 2005-2008 while serving as House GOP leader to direct $82,515 from the caucus to his PR firm.
In addition, the indictment alleges Merrill directed $186,332 from the caucus to Geechie Communications, in excess of the fair market value for services it rendered between 2008 and 2010.
Profiting through Geechie Communications, brother
Besides the caucus and the school bus group, Merrill used his position to profit illegally from four other organizations, according to the indictment. Merrill is accused of accepting:
▪ $391,174 from the South Carolina Association of Realtors to serve as a lobbyist for the organization, according to the indictment. Those offenses happened between May 14, 2008, and April 25, 2012, the prosecution contends. Merrill received the money to influence legislation that benefited the association, the indictment states.
▪ $35,000 from Infilaw Management Solutions, which was trying to buy the Charleston School of Law in 2014. He used his office “to influence a governmental decision” of economic interest to him, a relative, someone with whom he was associated or a business to which Merrill had ties.
▪ $43,000 from Thomas & Hutton Engineering from March 2008 to February 2010 in exchange for using his position to help the Savannah, Ga.-based firm, prosecutors contend.
▪ $148,693 through Geechie Communications from the Charleston Area Convention and Visitors Bureau while serving on the S.C. House’s budget-writing committee from April 2012 through August 2014. Merrill chaired a House subcommittee that oversaw the budget for the S.C. Department of Parks and Tourism, which provides money to the Charleston visitors bureau. Merrill also was accused of accepting $135,000 from the visitors bureau from October 2014 to October 2016. The money was laundered through Pluff Mud Public Affairs, a company owned by Merrill’s brother, John Denver Merrill, prosecutors said.
In addition, Merrill is accused of charging the caucus and Palmetto Leadership Council roughly $275,522 for candidate mailings and advertisement placements during elections and failing to disclose those “expenditures in an effort to conceal the contributions.”
Specifics of the misconduct charges are not spelled out in the indictment. Those counts, which carry sentences of up to 10 years in prison, state that the offenses happened between Jan. 1, 2002, and July 1, 2016. One count says Merrill used his office for personal gain. The other charge says he violated the ethics and campaign reform law “to obtain a personal profit and benefit.”
The lawmaker also, according to the indictment, failed to disclose Geechie Communications’ receipt of:
▪ $56,306 from the S.C. Manufacturers Alliance in 2008-10.
▪ $24,000 from the state Trial Lawyers Association in 2008.
▪ $37,000 from the S.C. Association of Convenience Stores in 2010.
Pascoe fought to keep the investigation
The indictment alleges violations for conduct that is common in the Legislature, said Ashley Landess, head of the S.C. Policy Council.
“Like all lawmakers with a consulting firm or a company, he was paid for performing a service,” she said. “And don’t think I’m defending Jim Merrill, because this shouldn’t be happening at all.”
Ashley Landess, head of the S.C. Policy Council, noted that Gov. Nikki Haley was brought before the House Ethics Committee during her time as a Lexington County legislator for her connections to Lexington Medical Center and a Columbia engineering firm. She eventually was cleared of any wrongdoing.
“So what’s different here?” Landess asked. “There’s not enough in the indictment to tell.”
York County Republican lawmaker Rep. Ralph Norman said, “It’s sad. I know Jimmy, and I’ve served with him a long time. But the law is the law, and it has to have consequences.”
“We’ve heard for a while that they had substantial evidence,” Norman said, “and almost wonder why it’s taken this long. I expect you will see others that will follow.”
Pascoe, appointed as a special prosecutor by S.C. Attorney General Alan Wilson, had to fight to retain control of the investigation when Wilson attempted to assign the case to another state prosecutor. Wilson’s attempt came just as Pascoe was about to activate the State Grand Jury, which has broad investigative powers.
Pascoe sued Wilson and in July won decisively in the S.C. Supreme Court. The justices ruled that Wilson – who had removed himself earlier from the case because of an unspecified conflict of interest – could not fire Pascoe.
Pascoe, a Democrat, argued in court that Wilson was trying to scuttle the case just as the investigation was reaching a crucial phase.
Staff Writer Bristow Marchant contributed.