Kenneth "Buddy" Barfield, an Austin-based consultant, directed Dewhurst's re-election campaign for lieutenant governor in 2010, as well as the Republican's unsuccessful run for Senate in 2012. Dewhurst quietly took the allegations to the state ethics commission last week. But Barfield has not been charged with a crime, and local prosecutors did not immediately respond to TPM's request for comment.
According to a bombshell story published late Thursday by The Dallas Morning News, Dewhurst's associates discovered the missing money this month, and Dewhurst and his top aides confronted Barfield with the allegations. According to an anonymous campaign official cited by the newspaper, Barfield offered to repay the money but could not. On Dec. 20, Dewhurst's aides alerted the Travis County District Attorney's Office, and asked for an investigation. The following day, the campaign committee filed 11 amended finance reports, going back to 2008, with the Texas Ethics Commission.
The amended reports included a statement that read:
It was recently discovered, unknown to the officeholder and the treasurer of the committee, that the contribution balance shown on the original report was false. The correct contribution balance is stated herein. The incorrect balance was the result of Mr. Kenneth A. Barfield, an official of the campaign, supplying false information. Unknown to the officeholder and treasurer, this person, who was responsible for compiling the information used for the report, intentionally submitted false and incorrect amounts and documentation. This misrepresentation of contribution balances was directly related to the misappropriation of committee funds to his own account, and for his own personal benefit. Appropriate actions are being taken to obtain full restitution to restore to the committee the misappropriated funds.
The amended reports gave an indication of the sums potentially involved. One of the original filings, a semiannual report filed July 16, showed cash on hand of $777,245. The amended report filed this month lists cash on hand of $7,226.
Anonymous campaign officials told the Morning News that Barfield might have made off with more than $1 million, and was able to escape detection for so long because he had access to the committee's bank accounts and had little oversight:
They said Barfield concealed illicit transactions by submitting false financial reports to the Dewhurst campaign, including fake bank deposit slips and fraudulent invoices to the campaign for services that were never rendered by him or one of his consulting companies.
For example, one of his companies handled media buys for the campaign, which spent millions of dollars on TV commercials for the lieutenant governor's race.
So far, discrepancies have apparently only been found in Dewhurst's state campaign accounts. Texas state law requires that corrected reports be submitted within 14 business days of a discrepancy being discovered. But the Morning News reported Dewhurst's lawyers and accountants are currently going over finance reports from the Senate campaign that were filed to the Federal Election Commission.
According to the FEC's best practices for political committee management, "[a]s soon as a misappropriation is discovered, the political committee must notify law enforcement. The committee also must notify the FEC and file amended reports to correct any reporting errors due to the misappropriation."
TPM could not locate Barfield for comment, and the Dallas Morning News reported he did not return the newspaper's calls to his cell phone.