COLUMBUS, Ohio – A leader of the Ohio Republican Party State Central Committee’s reform caucus has offered more details regarding the poor integrity of the state GOP’s financial records and practices as well as a warning to fellow members in a recent letter sent to the Committee’s 66 members.
The latest salvo from Mark Bainbridge, a District 16 SCC member from suburban Columbus, specifically calls out U.S. Senate candidate and former ORP Chairwoman Jane Timken for failing to put in place internal financial controls and practices necessary during her tenure and what he considers a conflict of interest in the selection of an auditor for the party books earlier this year.
In the letter, Bainbridge said the McLean, Virginia-based Rightside Compliance LLC consulting firm in 2017 offered a detailed look into the ORP accounts which have not been audited for at least 16 years despite the ORP bylaws requiring such a robust examination of its financial accounts every year.
That internal report, Bainbridge said, revealed the Ohio GOP needed to rework its books to comply with generally accepted accounting procedures – or GAAP, in financial accounting parlance.
Specifically, Bainbridge said the report flagged other issues with the Ohio GOP’s records and accounting practices, including the need for internal accounting controls, implementation of financial audit processes and the hiring of an experienced chief financial officer.
“Rather, Timken permitted an incompetent employee with a degree in political science to manage the financial records for over four years,” Bainbridge charged, “and the Audit Committee did not meet for the four years after the Rightside Compliance report was issued.”
Bainbridge’s letter also charged Timken, who resigned as chairwoman in February in order to run for the GOP nomination for U.S. Senate, had a personal conflict in the spring 2021 hiring of the Canton, Ohio office of the accounting firm of CliftonLarsonAllen to perform the first GOP audit of the 2020 and 2019 balance sheets.
The tax accounting division of the CliftonLarsonAllen firm did work not only for Timken’s personal accounts, he wrote, it also performed accounting services for a Canton-based family business called McKinley Strategies.
The CLA firm was not among those auditing firms Bainbridge, a certified public accountant of more than 40 years and a retired partner and senior business adviser for the top-tier Ernst & Young accounting firm’s Columbus office, had suggested to Jane Timken in late 2020 as ones he felt qualified to perform the audit.
Timken’s hiring of the CLA firm, Bainbridge wrote, “was done without disclosing the conflict of interest to the Audit Committee. This conflict set up a situation that led to CLA’s recent decision to resign as the ORP’s auditor.”
The Ohio Star first began detailing the alleged financial issues in a July 29 story quoting numerous internal emails sent from SRCC fiscal review committee members Bainbridge and Denise Verdi, of District 25, and audit committee member Laura Rosenberger, of District 10, to current ORP Chairman Bob Paduchik and Justin Bis, the Ohio GOP’s executive director and other committee members.
Those emails focused on an undocumented $640,000 account receivable entries Bainbridge had discovered dating to 2017 that Paduchik allegedly wrote off without the fiscal review committee’s knowledge or approval for the May 2021 balance sheets. The Star reports included some of those unaudited financial statements.
The three had also questioned the improper erasure of a net $1.7 million from the party financial statements without adequate explanation and had sought in vain to expand the scope of the audit to 2018 and 2017 to consider those unexplained accounting entries during Timken’s tenure as party chairwoman.
“Chairman Paduchik has done everything he can to block meetings of the Audit Committee and Fiscal Review Committee from addressing prior year and current year financial issues,” Bainbridge wrote.
Timken camp responds to letter
The Ohio Republican Party leadership declined to comment on the letter when contacted by The Star.
However, Rob Secaur, the former ORP executive director under Timken who now serves Timken campaign manager, responded to inquiries with the following statement to The Star:
In 2016, the Ohio Republican Party was
led by a corrupt Chairman whose behavior was somewhere between unethical and criminal and who had turned its back on our nominee, President Donald Trump. While other candidates hedged their bets, sat on the sidelines, or bashed President Trump, Jane took action against the establishment, ousted the (Governor John) Kasich-regime (at ORP), and injected new leadership to a Party that had been badly mismanaged and broken.
After requesting and performing an audit in 2017, the (Rightside) findings were presented to the Committee in detail and significant changes to its financial reporting and accounting practices were made to ensure we were in compliance with legal standards and best practices.
Jane is proud of the work she did to get the ORP back on solid financial ground and she is confident that the completion of an audit will bear that out.
Secaur added, “It is disappointing that some disgruntled members of the Committee chose to interfere with the audit process, bringing it to a halt. We are hopeful the Committee will find a new firm to conduct an audit and that members will allow the process to be completed without interference so any legitimate questions being raised will be answered and resolved.”
Warnings of “trainwreck,” personal liability
Bainbridge spent the bulk of the letter explaining to State Central Committee members of their ethical duty and legal obligations as board members of a nonprofit to actively provide oversight on management, including Bis and Paduchik, the latter of whom is an outside chairman not elected by Republican voters from a Ohio Senate district but through a vote of the Central Committee members.
In the letter, Bainbridge reminded members the party is a construct of the Ohio Revised Code governed by ORP standing rules, or bylaws.
“ORP bylaws are a legally binding document,” he wrote, “…that all members are obligated to obey or risk breaching their fiduciary duty.”
He carried the theme onto the fourth and final page of the letter:
“As members of the governing board of the ORP, we must uphold our fiduciary duty to the organization in order to stop what I consider – in my professional opinion – a financial trainwreck. … It is imperative you understand these issues and act quickly to help save the ORP which is slipping into financial chaos due to years of fiscal, structural and governance neglect and abuse.”
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Brian R. Ball is a veteran Columbus journalist reporting for The Ohio Star and Star News Network. Send him news tips to bball@theohiostar.
Photo “Jane Timken” by Jane Timken.