Lundergan spent $25,000 on Grimes campaign event but billed only $3,706, feds allege

Jerry Lundergan left the federal courthouse on in Lexington after his first appearance on campaign finance charges in 2018.
Jerry Lundergan left the federal courthouse on in Lexington after his first appearance on campaign finance charges in 2018.

Federal prosecutors continued building their case Wednesday that Lexington businessman Jerry Lundergan made illegal corporate contributions to the campaign of his daughter, Kentucky Secretary of State Alison Lundergan Grimes, while the defense worked to discredit a key prosecution witness.

Lundergan and prominent political consultant Dale Emmons, of Richmond, went on trial in federal court in Frankfort this week for allegedly scheming to support Grimes’ 2014 U.S. Senate campaign with illegal contributions from Lundergan’s companies, which the two have denied.

Grimes, a Democrat, lost a bid to unseat U.S. Senate Majority Leader Mitch McConnell, a Louisville Republican.

Lundergan allegedly made more than $200,000 in illegal contributions to Grimes’ campaign for the 2014 race, sometimes by paying for campaign services directly and not seeking reimbursement and sometimes by paying costs through Emmons.

Erin Tibe, who served as compliance director for Grimes’ campaign, testified Wednesday. Her job was to make sure the campaign followed federal rules on accounting for receipts and spending.

Tibe testified she made a presentation to campaign staffers in February 2014 on the rules governing contributions, including the ban on contributions from corporations.

Lundergan was closely involved in Grimes’ campaign, but Tibe said she could not confirm he or Emmons attended the training.

An email that Assistant U.S. Attorney Andrew T. Boone introduced through Tibe’s testimony indicated there was talk inside the Grimes campaign about making sure to reimburse Lundergan for services his companies provided to the campaign.

“We need to be very strict with Jerry,” Grimes’ campaign manager, Jonathan Hurst, said in one email in 2014.

Prosecutors introduced evidence that Lundergan billed Grimes’ campaign only $3,706 for work to stage her July 30, 2013 kick-off rally.

The prosecution said earlier that Lundergan actually spent nearly $25,000 on the event and didn’t bill Grimes’ campaign for the rest.

Tibe also testified Emmons joined the campaign as a paid consultant in January 2014, and couldn’t recall paying him for services earlier.

Prosecutors said earlier that Lundergan began paying Emmons for campaign work months earlier, though defense attorneys said those payments were for services that were not related to Grimes’ campaign.

The defense has not yet started presenting witnesses.

In cross-examining Tibe, however, defense attorney Marc. E. Elias indicated one effort will be to attack Hurst’s credibility.

Prosecutors made a deal not to prosecute Hurst in return for his testimony against Lundergan and Emmons.

Elias introduced emails through Tibe indicating that Hurst was slow to respond to her efforts to pay vendors and staffers at times.

Hurst, who had sole authority to approve payments from the campaign, sometimes told her not to pay bills even though the campaign clearly owed the money, Tibe said.

Tibe also testified she had concerns that Hurst was using a campaign debit card for some of his personal expenses. If he did that, it was a violation of campaign law, she said.

Lundergan twice headed the state Democratic Party, and Emmons has been involved in hundreds of political campaigns.