UPDATED AT 4:50 P.M.
By Jack Brammer
FRANKFORT – The Kentucky Democratic Party filed a complaint Monday with the Legislative Ethics Commission, alleging that Republican gubernatorial candidate David Williams violated an ethics law by intentionally failing to report gambling as a source of income in his 2002 financial disclosure statement with the state.
The five-page complaint filed by state Democratic Party Chairman Daniel Logson said Williams listed $5,313 in miscellaneous income from gambling on his 2002 individual federal income tax returns, made public earlier this year in records about his 2002 divorce proceedings.
The gambling income was about 12 percent of his adjusted gross income, which was $44,228.
But Williams’ 2002 statement of financial disclosure, filed Feb. 12, 2003, with the Legislative Ethics Commission, did not list gambling as a source of income, the complaint said.
Lourdes Baez-Schrader, a spokeswoman for Williams’ legislative office, said, “President Williams has not an opportunity to review this politically motivated complaint. He looks forward to answering the inquiry.”
Williams, a Burkesville attorney, told the Lexington Herald-Leader in June that he did not list gambling as a source of income on his legislative disclosure form because he thought that was not required.
“Sources of income for legislative ethics reporting purposes refer to regular streams of income from business or profession,” he said.
John Schaaf, general counsel for the ethics commission, told the newspaper in June that the question of whether a legislator should report income from gambling has never come up.
Kentucky Revised Statutes 6.787, which requires sources of income to be listed on ethics forms, does not mention gambling.
Schaff said legislators are given a sample form to guide them on what information they should include on their financial disclosure forms filed each year.
The guide’s section dealing with “Sources and form of gross income of the filer,” lists salary from profession, salary from the state, income from any business, dividends, capital gains from IRA and profit on sale of real estate.
There is no language in the commission’s guide that disclosures should only be about recurring income. The example from the agency suggests that even one-time sources of income – such as sale of land – should be listed.
Legislators often call to ask about listing other sources of income but no call has ever been received about gambling as a source of income on any financial disclosure form with the Legislative Ethics Commission, Schaff said.
If Logsdon’s complaint stands up, Williams could be subject to a Class A misdemeanor, punishable up to 12 months in jail and a $500 fine.
“We have known for some time that Senator Williams thinks the rules that apply to regular people don’t apply to him,” Logsdon said in a news release.
“These ethical guidelines are easy to follow and are in place for one important reason: so that Kentuckians can trust their government. I urge the Legislative Ethics Commission to take swift action on this complaint.”
Williams, who has refused to release his income tax filings beyond the year 2002, should make the documents public, Logsdon said.
Williams’ divorce records provided details about Williams’ gambling winnings and losses from 1999 to 2002. He has long acknowledged he used to gamble at casinos.
Documents in the divorce showed Williams claimed gambling losses of $36,147 from 1999 to 2002.
Logsdon also noted in his complaint that financial disclosures also require legislators to disclose sources of gifts with a retail value of more than $200.
Logsdon said the ethics commission should investigate whether Williams intentionally failed to list any gifts from casinos.
Also, Williams’ 2002 tax returns reported his wife’s occupation as a teacher.
In her deposition filed in 2003 divorce records, she stated she earned $63,000 as an assistant superintendent with the Cumberland County School District and had worked with the district for 21 years.
But Williams did not list her source of income as a teacher in his financial disclosure with the ethics commission. Williams said he did not because his wife and he separated in 2001.
“I derived no benefit from her income during this disclosure period,” he said.
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