Evidence Shows SCA Funds Were Illegally Earmarked Campaign Contributions, Investigation Revealed; Feds Still Working Case

hendershott dave hearing 1.jpg
Image: Court video
Dave Hendershott, seen hear testifying in the disciplinary hearing for former County Attorney Andrew Thomas, was very evasive when interviewed by investigators about the SCA scandal.
​The evidence shows that Sheriff Joe Arpaio's top men ran an illegal campaign-finance scheme to benefit their boss' 2008 race, say newly released investigation documents.

The internal affairs probe of the so-called SCA scandal concluded earlier this year and resulted in the termination of two of Arpaio's closest aides, Chief Deputy Dave Hendershott and Deputy Chief Larry Black. The scheme's frontman, former Captain Joel Fox, was fired in October.

As we've mentioned previously, that probe -- ordered by Arpaio and turned over to his political ally, Pinal County Sheriff Paul Babeu -- whitewashed the sheriff's involvement. But Arpaio's role in the SCA could still be explored by the feds, who took over the case after state Attorney General Tom Horne gave it up.

One tantalizing piece of evidence that Arpaio knew something about the SCA (a.k.a. Sheriff's Command Association) is that he didn't order an investigation into the scheme, which helped him keep his seat in 2008, until mid-2010, when a whistleblowing deputy chief made public his suspicions about that and other serious ethical problems in the office. At that point, Arpaio could no longer safely ignore the scandal.

New Times has been harping about this case since it broke in late 2008 due to the apparent law-breaking by high-ranking lawmen. State law prohibits raising corporate funds for a political action committee, which the lawmen did, and it prohibits making donations to a political party that are earmarked to help a specific candidate.

Critics may want to dismiss the stories by New Times or the state investigation conducted under former Democratic Attorney General Terry Goddard.

But this time, it was the sheriff's own investigators who found that his top men probably broke the law.

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The so-called "toughest sheriff" didn't call for internal investigation of a potentially illegal campaign-finance scheme run by his top men -- and which benefited him in the 2008 election -- until a whistleblower forced his hand.

​From 2006 to 2008, Hendershott, Black and Fox set up a secret fund and quietly raised $111,500 from a few wealthy buddies, plus another $12,150 from themselves and other deputies. Just before the 2008 election, $105,000 of the pool of dough was handed to the Republic Party in two big checks from the SCA's bank account.

The party, in apparent coordination with the sheriff's men, used the bulk of it to create a sleazy TV ad targeting Arpaio's opponent, Dan Saban.

For months, Fox was the only known member of the SCA. He refused to divulge the names of the people who'd contributed until threatened with a $315,000 fine.

Many of the findings of the Babeu-run investigation were made public in May -- but the SCA stuff, which made up about a third of the massive report, remained under wraps until a judge's order two weeks ago. The sheriff's office made the entire 29,000-page document available this week, and we had a chance to thumb through it.

Prior to its release, New Times fought with the Sheriff's Office and County Attorney's Office to have the document released in its native format -- that is, electronically. We lost the argument.

The sheriff's office insisted on printing the whole thing out, which means you can't see it all unless you buy copies at 50 cents a page or view it at the sheriff's downtown Phoenix office. While thousands of pages are dry as desert dust -- overtime sheets, policy manuals, the entire 800-page report by the AG's office, personnel files, etc. -- there are also dozens of transcripts from interviews of sheriff's personnel that contain rich detail and provide a fascinating glimpse into Arpaio's dysfunctional regime.

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Larry Black

The most damning portion of the newly released part of the Babeu report explains how the key players were involved in potential crimes.

On one hand, Babeu and the private investigator he hired, Keith Sobraske, say in the report that they aren't "positing a finding" that Fox, in particular, broke the law. They note that the question is now before criminal investigators.

However, the report also states that "the preponderance of evidence" shows that the SCA funds were transferred to the state Republican Party for the purpose of creating and airing the Dan Saban ad.

In other words, the law was broken.

Karen Osborne, director of county elections, even told investigators that she warned Hendershott -- who's called her to a clandestine restaurant meeting in 2009 to discuss the action she'd taken against the SCA to get Fox to divulge the names -- that if the SCA funds contained corporate money, then Fox "was taking a trip" to prison.

It's "inconceivable" that the donation wasn't earmarked, she related.

Both Hendershott and Fox were singled out by investigators as liars.

The description of Hendershott's general caginess makes him sound no better than a street criminal under questioning. Investigators noted that, "Hendershott's evasiveness during the interviews on the SCA matter was prominent and obvious, and added nothing to his credibility or the believability of the information he did provide."

When asked whether he discussed the SCA donations during a trip to Alaska he took with Black, developer Steve Ellman and businessman James Wikert, Hendershott denied it flatly, then started talking about how he "almost got eaten by a bear" and had to ask to borrow Ellman's .50-caliber handgun.

He claimed to incredulous investigators that he didn't really meet Black, Fox and Republican Party consultant Chris Baker at a restaurant in 2008 to discuss the planned donation of the SCA funds to the party.

True, he related, he was at the restaurant while they were there -- but he sat far away from them, by himself, and drank an iced tea.

(Fox, meanwhile, claimed he never saw Hendershott at the restaurant.)

Investigators concluded that Hendershott was the primary solicitor of SCA funds and was heavily involved in the formation and operation of the scheme. (We pegged him as the "brainchild" of the SCA scandal in our April feature article.)

Hendershott knew in advance that the Saban ad would come out, the report reveals.

Lisa Allen, Arpaio's spokeswoman, told investigators that Hendershott was "like a kid in a candy shop" in the days before the ad aired. He told her and several top deputies that something "big" was about to happen in the race. After the ad ran, Allen and the others were certain he'd been talking about the ad.

When state investigators launched a criminal probe and began talking to deputies about the SCA, Hendershott "coached" his men to lie, the Babeu report concludes. Babeu and Sobraske decided that Hendershott's denial of the coaching wasn't credible when stacked up against the statements by witnesses.

Black's denials weren't seen as much better by Babeu. However, the investigating team left unresolved the issue of whether Black -- who had helped run the SCA, solicit donors and take checks to the Republican Party -- had broken the law. At the same time, the report mentions that Black was "intimately involved" in the SCA scheme and that "the contributions were earmarked."

The federal criminal investigators can't help but take note of statements like that.

Black admitted to investigators that he'd discussed Saban's videotaped deposition during a 2006 defamation lawsuit with Baker, the Republican Party consultant. Allen was convinced that when she'd witnessed Black in his office working with the Saban video material, he'd been helping to create the Saban ad.

Some of Fox's "faulty logic" and apparent bald-faced lies were "remarkable," the report states. For instance, Fox denied publicly that the SCA fund contained corporate money. Yet he collected and deposited three checks, totalling $36,500, that were clearly marked as being from corporations.

Investigators pointed out that Fox had a motive to lie in order to avoid potential criminal prosecution. He'd lied to the public and to the state AG's office investigators. His convoluted, illogical account of why he gave the money to the Republican Party is "not credible."

Egregiously, the investigators didn't probe Hendershott about Arpaio's knowledge of the SCA.

A five-hour, unrecorded interview of Arpaio was conducted by Sobraske, but the private investigator and Sheriff Babeu refused to turn over any notes or transcripts of that interview.

Inquiring minds want to know: Who, if anyone, is going to end up taking the "trip" that Osborn mentioned -- and when?


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47 comments
keepintabsonthepussyman
keepintabsonthepussyman

I always love the term "The Feds" as it applies to Arizona. Once upon a time the fact that the "Feds" as in "Oh my Fucking God" it's the Feds brought fear into a public officials heart. Now the only thing the "Feds" care about is some food stamp scam. Here's what your government officials now spend their time doing....and I voted for Obama and Bush is a criminal...They make sure that the middle class and poor are kept in check and peruse their computers for that wife swapping weekend...if only their wives would agree....the whole fucking lot of this government ought to be citizen arrested, incarcerat6ed and tried.

Preciado909
Preciado909

Ojala lo vistan de rosita tambiem y le den muchas carisias en la carcel, bueno eso quisieramos mucjos de nosotros desgraciadamente existe mucha gen racista comk el en este pais y tal ves termine corriendo para gobernador o peor aun para presidente jajajaja

Jason
Jason

OF COURSE the SCA funds were illegal. Hendy, Black and Fox were too stupid and clueless to see it or believe it. Then again, why am I not surprised by this latest round of MCSO shurf/MCSO BS/corruption/malfeasance in office?  

What this means is that the MCSO shurf should've lost his 2008 election. I wonder if now a judge will declare the 2008 election invalid?  

mikefrombisbee
mikefrombisbee

It's like Watergate without Archibald Cox or Maximum John Sirica. That's the only reason America's Self-Proclaimed Toughest Sheriff has walked. The investigating and prosecuting agencies are either corrupted and incompetent (state A.G) or cowardly (Montgomery, the late great Dennis Burke and Holder).

Gerry_C
Gerry_C

When is Joel going to pop in to remind us that he never lied?

Rob
Rob

Any time I read or hear the story about Fox claiming to have not seen Henderschott waddling into the restaurant I can't help but laugh out loud.

How the hell does anyone miss that guy waddling around anywhere?He must have been on shitty cop.

NorthAdamsRemembers
NorthAdamsRemembers

Do not forget the spinmeister in the report, Paul Babeu. He has been "fast and furious" in avoiding sharing anything about the Arpaio interview. The interview was paid for with public money and Babeu keeps it secret? 

Paul Babeu now sits well-taught about shifting funds and shady donations. He is in a high-stakes decision on whether to be sheriff again or to try for being a congressman. He forgets there is the third option which his bogus Arpaio-assist will hopefully help him obtain: unemployment, at least in the public sector.

Babeu's personal and agency finances need to be looked at next. Arpaio has been at the corruption years longer, but his little shaved head tag-along is learning fast and well on his way to personal gain at the public trough. Secrets and fear are what keeps Babeu afloat in his current job as sheriff.

A little help from his friends.

Trommy Themulus
Trommy Themulus

A real man would step down so the entire organization is not brought down with him.

Gerry_C
Gerry_C

"Egregiously, the investigators didn't probe Hendershott about Arpaio's knowledge of the SCA.

A five-hour, unrecorded interview of Arpaio was conducted by Sobraske, but the private investigator and Sheriff Babeu refused to turn over any notes or transcripts of that interview."

I have felt all along that Ole Saggy Balls ordered the investigation from Babeu to look at Fox, Black, and Blimpy.  The scope of the investigation was not comprehensive or systemic to MCSO and may have missed assessing culpability.  We have known this, but now there is more evidence that it was whitewashed.

Gerry_C
Gerry_C

"Hendershott denied it flatly, then started talking about how he "almost got eaten by a bear" and had to ask to borrow Ellman's .50-caliber handgun."

WTF???  Is that bear blind and without a sense of smell?

OnlyinArizona
OnlyinArizona

Say it isn't so.  Hendershott a liar?  How will that fare out for him when he is confronted with all the lawsuits charging him with abuse of power?  How much will his "integrity" cost the county in payouts?  He lied through his entire tenure with Maricopa County.  His testimony won't be worth two cents.  If his lips are moving, he is lying.  Maricopa County taxpayers should just get the pens out and start writing the checks.

Royalphoenix2
Royalphoenix2

Why is Hendershott walking around a free man? His name is all over every crooked deal at the sheriffs office. He probably knows where all the bodies are buried. peace

DPSnAZ
DPSnAZ

In a tantalizing way, this clearly shows how wrong the concept of elected officials in Law Enforcement and the Judiciary really is.

Ross
Ross

This is all part of the U.S. Attorney's Fast and Furious operation.  You let a crooked sheriff and a few of his men get away with major crimes, just so you can see how many other politicians help them cover it up.  Then when it turns out that kids were being raped while your target was on the loose, you pretend nothing happened.

Anthony Wesley
Anthony Wesley

I honestly believe that Arpaio will end up committing suicide or going to prison when all of these investigations finalize.  In all honesty he deserves everything that happens to him.  He is the perfect example of the "Good ole boy" way of law enforcement where the law is more corrupt than the criminals they put behind bars.  He deserves to be behind bars in tent city for the rest of his miserable life for everyone's life that has been destroyed by his incompetence and using his office for his own corrupt wants.

Jason
Jason

Tom Horne is just too mentally sick to do his job.

Monty is owned by the Flaccid Fool. Monty knows for fact that he can't get re-elected next year without the help of the Old Fool.

Burke was forced out by Congressional R's who are playing politics with this investigation. Holder was under oath and supposedly lied about the DOJ's involvement in the investigation.

Tommy Collins
Tommy Collins

I think his days as posting as himself are over. I think he's had too many of his prior comments come back to bite him and if he is still posting, which I believe is true, it is under a pseudonym.

teknik1200
teknik1200

it's funny how these people attempting to be career politicians go yapping about "small government" when they are actually trying to cram their agenda down our throats.

some people are easily sold.

DNichols
DNichols

Do Real Men yell at Women on public Television like Arpaio has?

Boy he is "Tough".

Jason
Jason

I heard that Sobraske's interview with Ole Saggy Balls was indeed recorded, but that the MCSO shurf lost the recording and can't recall where it is...

Marcy
Marcy

I have a complete transcript of Joe's 5 hr interview, he made the following statements 1,534 times in total.  In one instance Joe was asked if he'd like a break for lunch and he forgot to get off the script and replied "I don't remember".

I don't knowI don't rememberI have no idea

Bnbk
Bnbk

Yes there is,and all involved should be held accountable,including Babeu for his whitewashing of this crime.

Tommy Collins
Tommy Collins

The bear was only being defensive, Gerry. Imagine how frightening it must be for a bear to see a human who is actually bigger than the bear...

teknik1200
teknik1200

not only that, but why is he collecting two pensions from the same job?  

do-as-i-say-not-as-i-do

Jason
Jason

Hendy probably received a cushy deal from the feds in exchange for his help in bringing the MCSO shurf to his knees.

After all, if anyone were to roll on the Old Fool, Hendy would be best because he aided the shurf in much of the corruption percolating from MCSO currently.

Fox is about as bright as Aubuchon, and maybe Candy Andy Thomas on his best day, especially when it comes to law-enforcement.

Black is equally as clueless and ranks up there with Alexander... 

DNichols
DNichols

Arpaio is the "Poster Child" for Term Limints for the Old Fashioned Position of Sheriff.

It is far to easy for them to become Corrupt, and with the vast power Sheriffs have,to start acting as if they are some type of God.

Even abusing this vast power against rivals in Elections, like Arpaio has.

Lets hope True Justice will finally prevail.

Coz
Coz

Yes, it does. Elected officials and their Goons can break all the laws they want while anyone else is sent to prison.

DNichols
DNichols

Excellent Comment, however Arpaio is far to Cowardly to committ suicide, he does on the otherhand like to yell at Women on Public T.V.

teknik1200
teknik1200

unfortunately anyone in this state with the real power to do anything about it is also in the "Good ol' Boy" club.   They see this as no big deal, it's just a part of life when you are part of the group working to control the state by any means.  they only care about retaining power.  anything they do to maintain that power is fine, because they know what is best for us.

Tommy Collins
Tommy Collins

I disagree, Jason. I don't perceive Horne as being mentally ill. I think he is married to the party and doesn't have the intestinal fortitude to do what is right, especially with someone like the mentally ill MCSO shurf involved.

Gerry_C
Gerry_C

Oh, maybe we will get a post from "I'm Not Joel"  stating that "Joel never lied."

Jason
Jason

Buffoon will more than likely be an unemployed, washed-up has-been by the time the 2012 elections come around.

My sources in North Adams tell me that Buffoon is not very good at keeping political jobs for more than one term. Plus, Buffoon's considering a Congressional run.

sancl
sancl

Babeu said, he just would make an administrative investigation, when he knew some criminal charges could have been persued. Why babeu is not calling for Arpaio resignation also, the same as he speaks out about Erik Holder.

Also babeu didnt run a clean campaign. He still ownes money to his former webmaster at sheriffpaul.com and ex-boyfriend. Some payments were made by paul's ex-boyfriend and paul never reinbursed him. even when paul babeu didn't pay a dime to him, babeu is bullying his es-boyfriend throu his close friend Chris DeRose to not speak out or embarras babeu. Sheriff paul babeu was caugh with a profile on adam4adam.com, a gay website, on june 2010. there is evidence of this comment. however there are more ethical and personal problems rounding the real paul babeu. Paul babeu is more probable to protect any GOP friend even when they are guilty, all for his benefit and get votes and money.

Jason
Jason

There are multiple retirement accounts for law-enforcement officers. Hendy contributed to multiple retirement accounts and as a result, is able to draw multiple retirement pensions.

Tommy Collins
Tommy Collins

You make an interesting point. If you're watching Pinal County it's interesting to see that the Bald Bunion, who will running for Congress, is grooming his understudy to take over for him. Assuming his understudy has no further political interest he could be there for the next twenty years, just reciting the immigration song four times a year to keep the money and votes rolling in.

Term limits would be a good thing, and appointed sheriffs (with P.O.S.T. certification and experience mandatory) would be even better, in my less than humble opinion.

Tina
Tina

That might be true here in Arizonam but the Illinois criminal justice system just handed down a 14 year prison sentence to forment governor Rod Blagojevich,  And Blagojevic is the  FOURTH illinois governor in my lifetime that has been charged and convicted of crimes while in office.  Besides RB, there was Otto Kerner, Ryan...and can't remember the fourth one's name.  

Jason
Jason

I agree with you Tommy. Horne lacks the intestinal fortitude to actually go after the mentally ill old man we call a shurf. That's why I voted for Rotellini.

Jason
Jason

It is delicious. I can enjoy it straight, on the rocks, or mixed.

Bnbk
Bnbk

BTW, I finally tried some Captain Morgan this past weekend at a friend's birthday party. I tried it straight on the rocks at first,but although had somewhat of a sweet taste,still found it too strong to drink without mixing it.Mixed with a little bit of coca-cola & enjoyed it. The stuffs not bad.

Bnbk
Bnbk

I hope he does run for congress, his chances of winning are not very good. I have a feeling that alot of these corrupt criminal politicians & their lackeys are starting to get very nervous. I can't wait till the hammer drops on them.

Gamor
Gamor

Reporters are working on it. corrupt politicians are coming down.

Jason
Jason

Buffoon is a political ally of the Flaccid Fool and wouldn't dare cross the Old Fool if his life depended on it.

Then again, Buffoon is known to serve one term in political office and then not be re-elected...

Bnbk
Bnbk

All known wrongdoings & lawbreaking by any of these so call "law enforcement officers" should be brought to light. The time is now for all who have inside information to come foward & finally rid our state of these corrupt politicians.

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