It’s been well known for the better part of a year that Baltimore State’s Attorney Marilyn Mosby and Council President Nick Mosby were the subject of a federal investigation into their finances. Late Wednesday it was revealed the power couple spent thousands of dollars of campaign funds on high-powered law firms.
In reports filed with the state, both Mosbys reported legal expenses paid out to multiple law firms over the course of the most recent reporting period, which encompassed most of 2021.
It matters because legal bills can be considered acceptable campaign expenses, but only through a narrow window of allowable circumstances under state law.
Marilyn Mosby’s report shows her campaign spent nearly $48,000 on legal expenses — $37,500 to Reed Smith LLP in Washington, D.C. where her criminal defense attorney A. Scott Bolden practices, and $10,200 to Templeton Law Firm, owned by Granville Templeton, in downtown Baltimore.
Nick Mosby, council president since late 2020, spent $52,500 in campaign funds on attorneys — $12,500 to Reed Smith and $40,000 to Kostelanetz & Fink, a Washington, D.C.-based firm.
Only Marilyn Mosby, Baltimore’s state’s attorney since 2015, has been charged with a crime. She was indicted last week on federal charges of perjury and making false statements.
She is accused of lying to avoid penalties for prematurely withdrawing thousands of dollars from her city retirement account, then using the funds to purchase two vacation homes in Florida. Federal prosecutors argue she said she had faced financial hardship from the COVID-19 pandemic to complete the withdrawal, when in fact she had received a raise during that time period. Prosecutors also allege she lied on a mortgage loan application about having an outstanding federal tax debt.
What does Maryland law say about campaign funds being used for legal expenses?
Jared DeMarinis, director of the candidacy and campaign finance division of the Maryland State Board of Elections, said it is prohibited for any candidate or political committee to use campaign funds for legal expenses related to investigations or court proceedings that “do not have a direct connection with the candidacy.”
An opinion from the state Office of the Attorney General issued in 1993 found that an elected official is allowed to use campaign funds to pay debts stemming from “the defense of a criminal prosecution directly related to alleged campaign improprieties.”
While the state attorney general’s opinion states legal fees must be related to a campaign-related criminal prosecution, charges don’t have to be filed for a candidate to expense legal fees to their campaign, said Bruce L. Marcus, a Greenbelt defense attorney who in 2012 chaired a panel established by the legislature to recommend changes to Maryland’s campaign finance laws.
”Legal fees incurred in connection with criminal investigations may arise prior to the inception of charges and, if the allegations relate to campaign activities, they may well be legal fees properly attributable to the campaign,” he said.
Do the Mosbys’ legal expenses have a “direct connection” to their candidacies?
It’s not clear.
Federal investigators subpoenaed Marilyn Mosby’s campaign treasurer Sharif Small in March seeking campaign accounting records and tax documents dating back to 2014. But, the charges lodged against Mosby thus far are unrelated to her campaign or her work in office.
Attorney Warren Brown represented Nick Mosby’s campaign treasurer Carlton Saunders in relationship to the probe. He said Saunders received subpoenas related to both Marilyn Mosby and Nick Mosby’s campaigns.
Marcus said expensing legal fees to a campaign is typically OK, so long as the legal services were campaign-related.
“Legal fees incurred by a candidate have to be judged in the light of whether they are personal or related to campaign activities,” Marcus said.
“Personal expenses of a political candidate are generally not appropriate campaign expenditures.”
Maryland Policy & Politics
While the Mosbys both hold elected office, they campaign on different cycles. Marilyn Mosby’s current term expires early next year, and she has two Democratic opponents vying to replace her. She has not formally announced plans to run for re-election, but has been fundraising for the effort. Nick Mosby was sworn in in December 2020 and is in the midst of a four-year term.
What have the Mosbys said about this?
Very little. Both Mosbys have not answered inquiries, nor have campaign officials related to them, to explain how the expenses are related to the campaign. Marilyn Mosby’s attorney also did not respond to a request for comment.
The state’s attorney’s campaign, however, has addressed a similar issue in the recent past. Early last year, a complaint was filed with the state prosecutor asking for an investigation into a $3,250 payment made by Marilyn Mosby’s campaign fund to her personal attorneys. Baltimore law firm Kramon & Graham represented the state’s attorney during a seven-month investigation by the Baltimore inspector general into her travel, gifts and businesses.
The Friends of Marilyn Mosby campaign issued a statement in February saying it initially considered the inspector general’s investigation a campaign matter because it dealt with her “electoral viability.”
“Once the scope of the investigation evolved and expanded, it became increasingly clear that it was a legal matter that encompassed more than her electoral viability, which is why she ceased using campaign funds,” according to the statement. “There was never an intent to mislead, which is why she reported the initial expense of $3,250 in her routine campaign finance disclosures.”
In a statement Thursday, the campaign said, “Following advisement from the State Board of Elections, it was determined that campaign funds could be used for legal services related to campaign finance activity.
But the campaign did not explain how the services were related to the campaign.