Experts who’ve analyzed reporting gathered by the INDY, including a former North Carolina assistant attorney general, say some N.C. SCV officers appear to have committed multiple misdemeanors and at least one felony in their PAC activity.
In March 2019, Bill Starnes emailed his neo-Confederate colleagues to discuss what he saw as a need for more political influence in their movement.
Thanks to law enforcement, “it is not likely our current struggle will require the use of weapons to any high degree,” wrote Starnes, a lead officer and de facto enforcer for the North Carolina division of Sons of Confederate Veterans Inc. Instead, Starnes urged his membership to take steps toward greater political involvement, including one they could take immediately: Give more money to the NC Heritage PAC, a pro-Republican fundraising outfit that he and other N.C. SCV leaders had been running for years.
“We have men there,” Starnes wrote. “We can immediately provide them with funds to get the right folks in office.”
Less than a year after Starnes sent that email, the State Board of Elections opened an investigation into the political action committee. A coup-minded crusade of current and former N.C. SCV members exposed the operation from within, intensifying a schism in the group that has taken an increasingly public face ever since.
Now, Board of Elections Investigator Matthew Martucci has what one neo-Confederate describes as “a thick-ass file” in an ongoing investigation that’s scrutinizing the N.C. SCV for running the Heritage PAC in violation of its own tax-exempt status, and funding it through a separate illegal scheme for years, according to multiple people familiar with the matter, including the PAC’s co-treasurer and a dissenting SCV member who is assisting the investigation. Martucci declined to comment.
Since its inception in early 2016, the Heritage PAC has allowed the neo-Confederate group to raise money from its underlings, shuffle it to supportive Republicans under a different name, and avoid paying taxes on the effort by exploiting nonprofit law. The Heritage PAC has given at least $28,500 to various Republican campaign committees since it launched, including $3,500 to Agriculture Commissioner Steve Troxler — who has for years ensured a booth for the N.C. SCV at the Raleigh State Fair — and $2,500 to both House Speaker Tim Moore and Senate President Pro Tempore Phil Berger.
Experts who’ve analyzed reporting gathered by the INDY, including a former North Carolina assistant attorney general, say some N.C. SCV officers appear to have committed multiple misdemeanors and at least one felony in their PAC activity. Those charges could be recommended by Martucci’s investigation, though additional approval within the Board of Elections is required for indictments.
On July 22, the Heritage PAC went inactive: not dead, just dormant. It hasn’t made any campaign contributions in 2020, despite this being a major election year in local and state races. But it incurred one expense of note: $5,000 in “attorney fees” paid on February 18 to Brian LiVecchi, a litigation attorney with Cumalander Adcock LLP. LiVecchi couldn’t be reached for comment.
“Not doing this for shits and giggles”
The neo-Confederate group’s leaders received certification to run the Heritage PAC from the Board of Elections in February 2016. Their initial filing before that certification described the PAC’s political purpose as “supporting candidates who support North Carolina’s heritage” and named the N.C. SCV as its “connected organization.”
But that’s a fundamental problem; the N.C. SCV has always been forbidden from running a PAC. That’s because, for more than a decade, the neo-Confederate group has enjoyed a 501(c)(3) status with the U.S. Internal Revenue Service. Broadly speaking, the IRS grants this status to organizations that exist only for “charitable purposes.” The perks include not having to pay federal, local, or property taxes. But for these privileges, 501(c)(3)s are, among other things, “absolutely prohibited from directly or indirectly participating in” political campaigns, according to the IRS website.
The Board of Elections flirted with this issue in an early audit of more than $1,700 the Heritage PAC took from the N.C. SCV, but it later green-lit the money after the N.C. SCV sent a letter saying the contributions complied with state law. This green light was incorrect, say experts who’ve assessed the case, including John Wallace, former Assistant Attorney General in the N.C. Department of Justice’s Antitrust Division.
“What was omitted from all of that discussion, and what is absolutely inherent in the proper resolution of the issue, is that if you are a 501(c)(3), you are absolutely prohibited from intervening in political campaigns,” Wallace says.
The Heritage PAC took a new funding approach that dodged any mention of the N.C. SCV in its future disclosures: gathering mass donations from within the statewide SCV chapter, getting hundreds of mostly-unwitting members to claim slices of the money, and pumping each slice into the Heritage PAC as an individual contribution, disconnected from the SCV.
The strategy is akin to one faucet pumping a single stream of water into, say, 150 different filters that all lead into the same cup. In this case, the faucet water is the N.C. SCV’s money, the filters are N.C. SCV members laundering the money, and the all-encompassing cup beneath them is the Heritage PAC. This kind of tactic has a name in campaign finance circles: “Contributions in the name of another.” Wallace says it’s a Class II misdemeanor.
“A statement made under oath, such as that made by a treasurer ‘knowing the information to be untrue,’ is guilty of a Class I felony,” Wallace adds.
In an August 2017 email exchange, three N.C. SCV members taking credit for contributions asked the Heritage PAC’s co-treasurer, Mitchell Flinchum, what they were supposed to do with a “form” that “Bill said I needed to fill out.” Flinchum, an N.C. SCV member in Burlington, offered to share the form in question with them, and eventually took one member’s information to help finish the process for them. Flinchum’s role in the scheme here, Wallace says, is “in the nature of perjury,” because as a PAC treasurer, he’s responsible for honestly reporting financials to the state.
The Board of Elections investigation touched off after a January 22 complaint from veteran campaign finance watchdog Bob Hall, which reaffirmed a prior report by The Daily Tar Heel and called for “a comprehensive investigation and appropriate enforcement action.” Members facing scrutiny from the investigation brought in an attorney early this year, Flinchum told the INDY. He declined to give further specifics.
The Martucci-led inquiry won’t issue findings until at least after the 2020 general election, according to the neo-Confederate assisting the investigation. It isn’t uncommon for complaints to pile up at the under-resourced N.C. Board of Elections; Hall says some complaints he filed years ago are still in the board’s investigatory pipeline.
Regardless of timeframe, the N.C. SCV member assisting the inquiry says he’s helped at least 10 other members share evidence with investigators. “Sounds like to us, they’re not doing this for shits and giggles,” said Don Angel, a 43-year-old Newton resident who helped catalyze an ongoing power struggle within the N.C. SCV.
Angel is not engaging with the investigation, but he is part of a cadre of former and current members aiming to oust current commander Kevin Stone, a power player in the neo-Confederate world. In addition to leading the state’s Sons of Confederate Veterans chapter, Stone is the co-founder and national leader of the Mechanized Cavalry, a motorcycle-riding spinoff of the broader SCV. He also recently took over the national organization’s “Army of Northern Virginia,” which represents SCV members in Virginia, West Virginia, Pennsylvania, Delaware, Maryland, North Carolina, and South Carolina.
In his day job, Stone is a probation officer in Chatham County for North Carolina’s Department of Public Safety. His trusted circle includes Starnes and Boyd Cathey, a former state archivist who co-chaired televangelist Pat Robertson’s 1988 presidential campaign and, according to the Southern Poverty Law Center, “became a key player in the multi-year attempt by racist extremists to assume control of the Sons of Confederate Veterans” in the early 2000s. The three men have declined or not responded to requests for comment.
Some N.C. SCV members told INDY Week they didn’t realize that claiming contributions for the Heritage PAC was dubious because it was presented to them as a standard fundraising effort. Member Chadwick Rogers says that on two occasions, he was given $200 by Starnes, the N.C. SCV legislative officer, and told to give it to Stone as a donation to the Heritage PAC. “When I started asking questions about the form they asked me to fill out,” Rogers says, “he never asked me again.”
“A stalwart friend”
As buzz grew about his bid to become our state’s next governor, Dan Forest received two checks that were either too dirty to keep or that he simply never got the chance to cash.
Forest, who’s been North Carolina’s Lieutenant Governor for nearly eight years, wasn’t a stranger to the Sons of Confederate Veterans. At least, he wasn’t by October 22, 2018, the second time the Heritage PAC reported a $1,500 contribution to his campaign, only to walk it back months later.
More than two months prior, Forest stood chatting with a former treasurer of the neo-Confederate organization, Gerald Wilson, on the stage floor of a soon-to-be-energized arena in the coastal plains of southeastern North Carolina. Each man — Forest sporting a casual jeans-blazer combo, Wilson donning a more formal red tie with a double Styrofoam cup in-hand — firmed an arm behind the other’s back and smiled for a photo. Preparations continued around them in the lead-up to a campaign rally for state House Representative Jimmy Dixon, chairman of the House Agriculture Committee.
It’s unclear what brought Forest and Wilson together on the arena floor that night, or if this was their first encounter. But nearly three years into the N.C. SCV leaders’ pursuit of political influence, a personal connection with Forest — who has long supported Confederate monuments and opposed what he dubbed “communist agitators” tearing them down — would prove to be fruitful. It’s no surprise they’d already sought to fluff Forest’s campaign coffers.
Forest’s campaign, however, either never received the PAC’s checks or realized they were too risky to accept. The Heritage PAC’s disclosures list two $1,500 donations it sent Forest in 2018 — one in April, then a second in October — but it voided both contributions months after the fact.
Andrew Dunn, a spokesperson for Forest’s 2020 campaign, declined a request for an interview with the lieutenant governor on the topic, saying in an email that Forest “believes our society focuses too much time and attention on issues that divide.” N.C. SCV members who formed the PAC also declined to comment or didn’t respond to the INDY.
The checks were small fries relative to Forest’s overall donor haul as he prepared for this year’s showdown for governor. But their failure to land are two hiccups in a line of question marks and outright red flags demonstrated by the Heritage PAC, and missed by campaign finance regulators, for years.
The Heritage PAC’s disclosures consistently show money coming in from members of the N.C. SCV and Mechanized Cavalry. Membership statuses have been confirmed through other members, a list of Mechanized Cavalry members in North Carolina, and an internal spreadsheet listing nearly 58,000 active and inactive SCV members throughout the world as of some point in 2016. The time frame was estimated in an analysis of the spreadsheet’s metadata with Elon University computer science professor and data-mining expert Megan Squire and the Southern Poverty Law Center’s Howard Graves.
The first time the Heritage PAC put its money in play hit close to home. It sent $1,000 in April 2016 to the campaign of then-state House Representative Gary Pendleton, an inactive N.C. SCV member at the time. The membership spreadsheet includes Pendleton’s name, middle initial, and address, and attributes him to an SCV chapter that covers much of the Triangle region. It lists him as inactive, which often means a member hasn’t paid their annual SCV dues.
Pendleton told the INDY he has never been a member of the SCV and wasn’t aware of any Heritage PAC contributions. But multiple neo-Confederates confirmed they know he’s been a member. A November 2016 blog post by the Heritage PAC lists Pendleton among its endorsements, referring to him as “a stalwart friend of North Carolina’s rich heritage.” In a post about nine months earlier, the PAC thanked Pendleton for leading a charge “at the request of” the N.C. SCV to continue flying the Confederate flag atop the State Capitol in Raleigh three days a year.
Despite the boost from his Confederate brethren, Pendleton lost his 2016 election to now-incumbent Democrat Cynthia Ball.
“Confederate Memorials are coming down all over our state while our so-called leaders surrender them to the radical left,” Paul Burr, a former N.C. SCV camp leader, wrote in a July email to members.
But some who remain loyal to Stone’s incumbent team have taken their own action in the name of “memorial defense.”
“An agitator, if not a terrorist”
On the morning of May 31, Jeffrey Alan Long, a 49-year-old Kernersville resident, got the same email hundreds of others received from their embattled commander.
Many of them hadn’t heard from Stone in months. His message — sent to N.C. SCV and Mechanized Cavalry members with the subject line, “Monuments under attack” — noted that racial-justice protests after “the arrestee’s death in Minneapolis” showed no sign of ending soon. “Our intelligence,” Stone ambiguously claimed, showed “domestic terrorist groups including Antifa and BLM and communist groups” were coordinating unrest with a secret goal: to “tear down our memorials.” Stone urged his underlings to conduct vigilant “Memorial patrols and networking with local law enforcement and government bodies.” He reminded them to “remain safe and follow the law while completing this mission.”
Around 10 hours after Stone sent that email, Long, a member of both the N.C. SCV and Mechanized Cavalry, was arrested on two misdemeanor counts, and later charged with a felony of inciting a riot for twice shooting one of two guns on his person into the air during a peaceful protest in Salisbury.
Long declined to comment. Witnesses say he fired his gun just a short distance from protesters who’d gathered around the town’s “Fame” Confederate monument.
Gemale Black, president of the Salisbury-Rowan NAACP, helped coordinate the protest in Salisbury that day. He said he was monitoring the crowd from its periphery around the Confederate monument when Long first approached, around an hour before his arrest. As Black describes it, Long pointed at him and other bystanders, telling each that he would kill them until the crowd prompted police to direct Long out of the area. The “agitator” returned an hour or so later, at which time, Black alleges, Long threw a “bottle of water dead into my face.” When bystanders tried to push Long out of the area, Black said the rogue N.C. SCV member moved a short distance away, fired his gun twice, and walked away from the scene.
“I would definitely call him an agitator, if not a terrorist,” Black said.
Salisbury police arrested Long on a street near the Confederate monument’s now-former standing place at around 7:00 p.m., according to his arrest report. City officials voted unanimously to move the Fame monument in the name of public safety just weeks later, according to the Salisbury Post.
Separate from Long, other N.C. SCV members have taken to their own forms of antagonism. Burlington resident James Conrad Smithson, a member of the N.C. SCV and Mechanized Cavalry, has used Facebook to share memes about shooting protesters, including a plea that “PRESIDENT TRUMP SHOULD ISSUE A SHOOT ON SITE ORDER” against “BLM and ANTIFA.” In one post, Smithson gleefully linked an article about potential protections for drivers who hit protesters with their cars. “Quit dont git hit!!! Pants up don’t loot!!!,” he wrote.
Smithson received the N.C. SCV’s inaugural “Hold the Line Award” earlier this year for being “very instrumental in conducting operations in Pittsboro.”
He is separately a member of the League of the South, a group that the Library of Congress describes as “a Southern Nationalist organization whose ultimate goal is a free and independent Southern republic.” The Southern Poverty Law Center has designated it a white nationalist hate group.
Flinchum, the Heritage PAC co-treasurer, is also a member of the League of the South. He denied the affiliation when recently asked, but has said the opposite in past publications, including a 2012 email now archived on southernheritage411.com saying, “I’ve been proud to be a member of the League of the South as long as I have been in the SCV.” The N.C. SCV likely has more than 70 members who are jointly in the League of the South, according to an analysis by the Southern Poverty Law Center’s Hatewatch of spreadsheets from sources claiming to be in each group. Cross-referencing them shows 73 individuals who were members of both groups at some time between 2013 and 2016.
Some dissenting members describe a recent trend of “sketchy guys,” as one member put it, joining the Mechanized Cavalry.
Starnes, the former Mechanized Cavalry leader in North Carolina, may have sparked the N.C. SCV’s splinter with an alleged threat to shoot a member on Aug. 3, 2019, during an annual meeting. Three members who say they witnessed the event and others speaking from hearsay repeat the same account: Starnes stood up as Paul Burr — who was pushed out of the SCV after the incident — was openly criticizing Stone’s leadership, and began pulling his gun from his holster until bystanders stopped and led him out of the room. One camp leader cited the incident in a resignation email he sent about a year later, saying “That day I saw our Division Commander and General of the Mechanized Cavalry throw all principle out the window.”
In December, Starnes claimed this account is a lie, created and spread by a small group of members seeking to smear him and the group’s leadership.
Another internal pressure point: the feeling of being on the low-end of “a Ponzi scheme,” as Angel describes it. In March, the Mechanized Cavalry donated $15,000 to a “National Confederate Museum” that the national SCV has planned on building since 2008 near Columbia, Tennessee. Paul Gramling, the national SCV’s former commander-in-chief, asked all members in the U.S. on March 28 to donate at least 20 percent of their $1,200 federal stimulus check to the museum. “God don’t want but 10 percent,” said Smitty Smith, a 68-year-old dissenting member in Newton. “I mean, that’s begging,”
Hundreds of members have paid a one-time $100 fee over the years, separate from their annual N.C. SCV dues, to join the Mechanized Cavalry, according to multiple members and an internal roster that names more than 500 active and inactive members of the motorcycle group in North Carolina as of early 2020. They’ve been told to pay only with cash or check made out directly to Starnes. It appears highly unlikely that the group has reported all of this income in recent-year tax filings with the IRS.
“As far as I know, and being #53 in the Mech Cav and #16 here in NC, I know pretty far back, we have never had a bank account. We tend to have the cigar box in the gun safe approach,” Starnes said in an April 2019 email to members.
Smith says over the last month, Stone’s leadership team has suspended and kicked out high-ranking members who ask questions about the state Board of Elections investigation or the group’s financial records — “or anybody that doesn’t just do what they say.” The N.C. SCV’s dissenters say they aren’t looking to destroy the neo-Confederate group. They want to refocus it on a battle over historical memory that’s existed since as early as 1866. But with about a dozen members cooperating with the ongoing investigation and any potential charges still pending, the group’s future is uncertain. Still, Smith’s outlook is bullish.
“We’re in this to get rid of all of the corrupt people and make it a good organization, where people could join and be shown respect, and asked what their opinions are on stuff,” Smith said. “You don’t know what else is coming either. There’s a lot more coming.”
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