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Kane spends over $310K in campaign cash on legal fees, PR in perjury case

| Tuesday, Feb. 2, 2016, 11:05 p.m.
Kathleen Kane announces her victory for the Democratic nomination for attorney general on Tuesday, April 24, 2012, at The Radisson Lackawanna Station Hotel in Scranton.

Donors to Kathleen Kane's campaign unwittingly paid for more than $310,000 in legal and public relations fees related to criminal charges against the attorney general, according to campaign finance documents released Tuesday.

Kane has said she is running for re-election this year even though she faces charges of perjury, obstruction and official oppression, as well as potential removal by the state Senate and impeachment by the state House, and has had her law license suspended by the Supreme Court.

Thomas Ostrowski, a certified public accountant at Scranton-based Eckersley & Ostrowski, signed Kane's annual report as her campaign's treasurer but did not return calls for comment. .

Chuck Ardo, Kane's state office spokesman, said she is not using any tax money for her criminal defense. Kane is using state money for legal costs associated with her office, such as defending against wrongful termination lawsuits. Two former employees filed such lawsuits against Kane late last year.

Her campaign account expenditures could be legitimate under the state's election law, which allows spending for anything that could influence an election.

“The Pennsylvania election code and expense reporting is just one loophole after another,” said Larry Otter, a Bucks County attorney specializing in elections law. “Nobody seems to have ever objected to a politician who has some problems with the law using campaign funds to pay their lawyers.”

Former state Sen. Vincent Fumo of Philadelphia spent $1.1 million from his campaign account on legal fees. Former state Sen. Robert Mellow from Lackawanna County spent $738,000. Former state Sen. Jane Orie used more than $110,000 from her campaign account on legal fees in 2011. All three were convicted of corruption-related offenses, lost their elected offices and served time in prison.

That Kane has said she is running for re-election, despite no presence of a formal campaign and multiple legal hurdles, could be enough to justify the expenses, said G. Terry Madonna, director of Franklin & Marshall's Center for Politics and Public Affairs. He called the limits on campaign fund spending in the state's law fuzzy at best.

“It's so loose — influence an election — I have no clue what that means,” Madonna said. “You can give any amount of money, at any time, and they can use it for anything.”

Kane raised no money in 2015, according to her report, which was filed Jan. 11. She raised more than $75,000 in 2014 and nearly $600,000 in 2013. In 2012, when she became the first woman and Democrat to be elected attorney general, she raised $3.5 million.

She spent $94,266 in 2014, the year her legal troubles began. None of it was spent on legal fees or public relations.

Kane is one of four Democrats running in April's primary election. Allegheny County District Attorney Stephen A. Zappala Jr., Montgomery County Commissioner Josh Shapiro and Northampton District Attorney John Morganelli are also running for the nomination. State Sen. John Rafferty is the lone Republican in the race.

In 2015, Kane paid Washington-based Lanny Davis and Associates $130,060 between February and May for “strategic communications advice,” according to the report. She hired Lanny Davis, a crisis communications specialist who once helped President Bill Clinton, in 2014. He defended her as her spokesman and accompanied her to a Montgomery County grand jury investigating whether she leaked grand jury information to a Philadelphia newspaper.

The grand jury recommended criminal charges against Kane.

Levick Strategic Communications, a Washington firm associated with Davis that sent out news releases defending Kane, received $11,000 from her campaign account.

Davis no longer works with Kane and declined comment. Levick Strategic Communications also declined comment.

New York attorney George Shargel represented Kane at the grand jury proceedings and in legal proceedings related to the criminal contempt case against her. His firm, Winston & Strawn in Chicago, received $150,000 in June from Kane's campaign account. Shargel could not be reached.

Kane paid Scranton law firm Minora, Minora, Colbassani, Krowiak, Mattioli & Munley $19,228 in October, according to the report. Attorney Amil Minora represented Kane in the criminal contempt proceedings and before the state Supreme Court on issues related to a special prosecutor investigating Kane.

Minora did not return a call seeking comment.

Kane also reported $1.65 million owed to her husband, Christopher Kane, whom she said in 2014 she is divorcing.

According to the report, Kane still has $246,330 cash on hand.

Staff writer Brad Bumsted contributed to this report. Aaron Aupperlee is a Tribune-Review staff writer. Reach him at 412-320-7986 or aaupperlee@tribweb.com.

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