Indicted State Auditor Troy Kelley ()

Indicted State Auditor Troy Kelley ()

Gov. Inslee repeats call for embattled state auditor to resign post; will Kelley be paid during ‘leave of absence’?

  • By Rachel La Corte The Associated Press
  • Sunday, April 19, 2015 12:01am
  • News

By Rachel La Corte

The Associated Press

OLYMPIA — Gov. Jay Inslee continues to urge embattled state Auditor Troy Kelley to resign following his indictment by a federal grand jury.

A letter from the governor was emailed Thursday night and then hand-delivered to the Auditor’s Office on Friday, Inslee spokesman David Postman said.

Kelley pleaded not guilty to 10 felony counts Thursday.

The indictment charged him with filing false tax returns, attempting to obstruct a lawsuit and possessing more than $1 million in stolen property related to his former business.

Trial was set for June 8.

Inslee wrote that the indictment “makes it clear that you can no longer serve the citizens of Washington as state auditor.”

“You have now been indicted for the very type of conduct that your office is tasked with regulating; in turn, you have lost the public’s trust,” Inslee wrote.

Inslee said Kelley’s plan to take a leave of absence would be insufficient because the criminal proceedings will cloud the image of the office along with its reputation and ability to properly function.

Inslee is among several state leaders who have called for Kelley’s resignation.

Kelley has said he’ll take a temporary leave of absence beginning May 1 but is determined to fight back and keep his position.

Postman said the governor believes Kelley’s leave should be unpaid, and ways to accomplish that are being explored.

Kelley’s current salary is $116,950 a year.

“We don’t believe he should be in the job at all. If he stops coming to the job May 1, he should stop drawing a state salary,” Postman said.

Mark Firmani, a personal spokesman for Kelley, said he had not seen the letter from Inslee and did not yet have a response from the auditor to share.

At a news conference Thursday, Kelley insisted he did not break the law.

“And I want to be extremely clear here: I never, ever thought I was breaking the law, and I still do not to this day,” he said.

The 41-page indictment alleged various misdeeds by Kelley, a Democrat elected in 2012, in connection with mortgage title services companies that he previously ran.

Federal prosecutors said he kept more than $1 million that should have been refunded to customers and that he unlawfully avoided paying taxes by claiming personal or campaign expenses were business-related.

The most serious charge carries a possible sentence of up to 20 years in prison.

A felony conviction would automatically force Kelley from office, and some lawmakers spoke about the possibility of impeaching him in light of the charges alone.

“Every single person in the Capitol thinks he needs to resign, other than himself,” said Rep. Drew Stokesbary, a Republican from Auburn.

“He’s putting his own personal and financial interests above the interests of the people of this state.”

Kelley’s company, Post Closing Department, worked with escrow and mortgage title companies to track certain real estate transactions.

According to the indictment, it was supposed to collect up to $150 in advance as a fee for each transaction, keep $15 to $20 for its services, pay any government fees required and then refund whatever portion remained.

Instead, Kelley kept the money, the indictment said — an amount that totaled at least $3 million from 2006 to 2008.

More in News

Immigration fears hit Olympic Peninsula

Law enforcement agencies won’t deport individuals

Local immigrants worry about federal orders

As President Donald Trump steps into office and reports… Continue reading

Jefferson commissioners to discuss sheriff appointment

Three candidates named by Jefferson County Democrats

Eric Spencer, a landscaping and janitorial worker for New Life Open Bible Church, clears snow from a sidewalk next to the church at Sixth and Peabody streets in Port Angeles on Thursday morning. (Keith Thorpe/Peninsula Daily News)
After snowfall, cold temperatures expected today

Morning commutes could continue to be icy, weather service says

Public opposes rezone of Port Townsend park

City has funded housing site layout study

Port Townsend Food Co-op sets date for union election

Simple majority needed to approve ballot

OMC board seeking candidates to fill spot

Commissioners also make all seven positions at-large

Port Angeles brothers Finley Bornsworth, 3, left, and Oliver Bornsworth, 6, take a snowy sled ride on the campus of Port Angeles High School on Tuesday. Overnight snowfall left a mantle of white over much of the North Olympic Peninsula with an additional chance of snow showers forecast through the weekend. (Keith Thorpe/Peninsula Daily News)
Snow day

Port Angeles brothers Finley Bornsworth, 3, left, and Oliver Bornsworth, 6, take… Continue reading

Funding freeze may affect Port Angeles grants

Judge extends block of Trump action

City of Port Angeles updates mobile and itinerant vendor code

Effective March 1, process expands definitions, establishes criteria

Port Angeles school board approves criteria for new leader

Directors looking for visionary innovator with extensive experience

Madison Canterbury, 7, of Shelton looks at a Valentine’s gift she created with the assistance of volunteers Chandra McGuff, left, and Nicole Lemon at a craft table set up outside the Silver Lining Cafe at The Wharf on Saturday on the Port Angeles waterfront. Youngsters were given the opportunity to create gifts and Valentine’s cookies during the event. (Keith Thorpe/Peninsula Daily News)
Valentine’s gift

Madison Canterbury, 7, of Shelton looks at a Valentine’s gift she created… Continue reading