Former Board of Regents Chairman Timothy Shelnut's pattern of illegal campaign contributions probably would have gone undetected if one of the recipients of his largess, Linda Schrenko, hadn't gotten into trouble, state officials say.

But she did, he 'fessed up with some prodding from the federal government, and his case led last month to the largest State Ethics Commission fine ever levied against an individual — $40,000.

John Spink/AJC (ENLARGE)

Former state school Superintendent Linda Schrenko, shown in 2004, is serving time in a federal prison.

Andy Sharp/AJC (ENLARGE)

Former Gov. Roy Barnes said his campaign tried to screen contributions and there's no way he could have known that Timothy Shelnut's 1999 donations violated the law. Shelnut gave money to a wide range of Georgia politicians.

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As part of an agreement he signed with federal prosecutors in May 2006, Shelnut disclosed illegal contributions to a host of state and local politicians, ranging from former Gov. Roy Barnes to Richmond County's sheriff.

He also agreed to testify in the Schrenko case, officials said, but he didn't have to because the former state school superintendent pleaded guilty to embezzlement and money laundering. About half of the $600,000 federal officials said Schrenko helped steal was funneled into her unsuccessful 2002 gubernatorial campaign. Schrenko began serving eight years in federal prison in 2006.

More than a dozen attempts over four days to reach Shelnut for comment last week were unsuccessful. Messages left with his attorney were not returned. A U.S. Attorney's Office spokesman would not comment.

Before the Ethics Commission meeting last month, Shelnut told Morris News Service that he co-operated with the commission. "I look forward to this being behind me," he said.

The federal agreement, and a letter acknowledging the violations dated the same day the agreement was signed by Shelnut, are part of the Ethics Commission's investigative file reviewed last week by The Atlanta-Journal-Constitution.

In the letter, Shelnut told the Ethics Commission he was making a "voluntary disclosure."

But the commission's investigative records and its staffers say that's not the whole picture.

In a 2007 note in the investigative file, Kay Biebel, deputy executive secretary to the Ethics Commission, wrote that Shelnut "self-reported only because the feds made him or else he was going down with Linda Schrenko."

In all, Shelnut acknowledged giving more than $25,000 in illegal contributions, funneled through family members, friends, employees and businesses. He also said he made illegal contributions to congressional candidates, but those are outside the jurisdiction of the Ethics Commission. Those contributions were to the late U.S. Rep. Charles Norwood (R-Ga.) and unsuccessful Democratic congressional candidate Champ Walker of Augusta.

Most of the contributions were initially disclosed by candidates on paper reports. Today, candidates file electronically, making it much easier for commission staffers to audit the disclosures to make sure donors don't give more than the legal limits.

"If Timothy Shelnut, by way of his counsel, did not come forward because of this [federal] agreement, we probably would not have discovered this," said Rick Thompson, executive secretary of the State Ethics Commission.

Big, small candidates helped

Shelnut, founder of Four Seasons Financial Partners, is a prominent Augusta businessman who has given thousands to candidates big and small. At the federal level, recipients have included President Bush, former U.S. Sens. Zell Miller (D-Ga.) and Max Cleland (D-Ga.), the late U.S. Sen. Paul Coverdell (R-Ga.) and current U.S. Rep. John Barrow (D-Ga.). None of the contributions to those candidates or elected officials were part of the state investigation.

His donations to state and local politicians were another matter.

According to Shelnut's letter to the Ethics Commission, he contributed $6,000 to Schrenko, a Republican, when she ran for re-election as school superintendent in 1998. That was $1,000 more than the legal limit.

Two leading Democrats at the time, Barnes and state Senate Majority Leader Charles Walker, were among the biggest beneficiaries of Shelnut's contributions.

Walker, who is serving 10 years in federal prison after being convicted of tax evasion, mail fraud and conspiracy charges in an unrelated case, received more than $12,000 from Shelnut's companies when he ran for re-election in 2004.

Shelnut's letter to the Ethics Commission said one of his companies printed the invitations for a Walker fund-raiser and paid for the catering. Five of his companies donated $2,000 each.

At the time, the most Shelnut could legally contribute to a state senate campaign was $4,000.

Walker is the father of Champ Walker, the congressional candidate Shelnut helped in 2002.

In November 1999, Barnes' campaign received about $10,000 in contributions that came from Shelnut, three employees, an employee's daughter, three of his family members and a friend, the Ethics Commission letter said. Shelnut acknowledged in the letter that he was the source of those contributions. At the time, the legal limit for contributions during a non-election year was $1,000.

A year after Shelnut made those contributions, Barnes appointed him to the University System Board of Regents, a plum post that typically goes to big-money donors.

Contributions tracked more

Records show Shelnut spent $9,183 on a reception for Barnes' re-election campaign in May 2001. His wife contributed $10,000 more to Barnes' campaign that month.

Barnes wasn't the only governor who received help from the Shelnuts. State campaign records show his wife gave $10,000 to Republican Gov. Sonny Perdue in 2005 and Shelnut paid for $1,264 worth of Perdue's travel the week before the 2006 election. Those contributions were within the legal limit.

Barnes said there was no way he could have known the 1999 contributions exceeded the legal limit. The former governor said he never personally handled checks given to his campaign.

"We always ran checks to make sure they weren't coming from the same address," Barnes said.

Several checks coming from the same address might indicate a donor is giving several contributions under different names or entities.

Barnes said he remembers being introduced to Shelnut by a lawyer friend. "He was in the market, politically active," the former governor said.

Barnes said he first appointed Shelnut to the state lottery board, then to the Board of Regents after Augusta Regent Tom Allgood was killed in a plane crash.

Barnes was heavily criticized during his term for giving top board appointments to big-money campaign contributors, a practice that has been common for decades.

The former governor joked that he might not have appointed Shelnut if he'd known that he also supported Schrenko. Barnes and the superintendent were political enemies throughout his term in office.

Thompson said it's far less likely today that a donor could make illegal contributions to so many politicians without raising a red flag. "No one really looked at the reports back then," Thompson said. "They were filed with the Secretary of State's Office and the Ethics Commission didn't have immediate access."

However electronic filing and a recently beefed up commission staff has made it more likely violators will be caught. On the same day Shelnut was fined, the Georgia Association of Realtors agreed to pay $80,000 for failing to disclose more than $500,000 in campaign contributions. That was the largest fine of any kind ever meted out by the commission.

"I am confident that issues like this will be identified well before an individual has the opportunity to turn themselves in," he said. "We just have an overall better handle on the Ethics in Government Act and the filing of disclosures."