Michigan GOP chair claims Weiser made 'secret deal' to pay for exit of candidate

Lansing — Ron Weiser, who's poised to return as chairman of the Michigan Republican Party, is now facing a claim of brokering a "secret deal" that involved paying a former secretary of state candidate $200,000 in undisclosed GOP funds.

In a development that could alter the future of state Republican politics two days before the Saturday chair election, current party Chairwoman Laura Cox sent an email to activists Thursday morning, revealing her concerns about the payments. In the message, Cox said Stanley Grot of Shelby Township received the money "so he would withdraw as a candidate for secretary of state" in August 2018 while Weiser was chairman.

Grot labeled the allegation "nonsense" and said Thursday he was paid for work he did for the party. In a Facebook post, Weiser called the claim "baseless allegations" and "a desperate attempt to smear my name, based on a longstanding political grudge."

But the situation raises ethical concerns about Weiser, who is also a University of Michigan regent, and the potential of violations of Michigan campaign finance law, Cox wrote in a letter addressed to GOP activists.

"I, in good conscience, cannot sit quietly while Weiser refuses to address this enormous issue he created," Cox wrote. "I am sharing this with you because he cannot and should not be the Republican Party chair." 

Cox, a former state lawmaker from Livonia, also asked GOP delegates to reelect her as temporary chairwoman on Saturday instead of selecting Weiser for a two-year term. If she wins, Cox, who had dropped out of the race on Jan. 6, said she would immediately resign on April 3 to allow the state committee to pick a new party leader.

In addition, Cox sent a letter Thursday to the Michigan Bureau of Elections on behalf of the state party, self-reporting a "possible campaign finance violation." The bureau, which falls under Democratic Secretary of State Jocelyn Benson's authority, will review the claim to determine if an investigation is necessary, said Jake Rollow, spokesman for the Michigan Department of State.

On Facebook, Weiser said Cox's allegations had been reviewed by former Michigan Supreme Court Justice Robert Young and other legal experts who "all agree there have been no violations."

"I'm disappointed by Laura's shameful attempt to destroy our party with unfounded and reckless conspiracy theories so that she can get back in the chair's race and save her paycheck," Weiser wrote. "We must focus on our party and our future."

Cox's message to party members included a 14-page internal report by attorney Jon Lauderbach on the payments to Grot. Cox said she asked Lauderbach, past campaign chairman for former Attorney General Bill Schuette, to initiate the report.

In it, Lauderbach said Weiser told him that "nothing wrong" had happened with the payments to Grot. The attorney also said they arrived "at no definitive conclusion" in the report but believed "the circumstances merit further investigation."

The report is dated Jan. 15, but Cox says she knew of the payments in 2019.

"Mr. Weiser expressed a belief that this investigation is politically motivated," Lauderbach wrote. "He believes that the investigation was commenced to aid Ms. Cox’s campaign for reelection as state party chair, and hence hinder his own campaign for that office."

Lauderbach added: "Mr. Weiser reiterated his question about the timing of the investigation, asking 'they've known about this for two years, why didn't they do this before?'"

In her letter, Cox said she regretted "not taking action sooner." The chairwoman said she had been respectful of Weiser's "health and family issues" and his service to Michigan Republicans. The party's bylaws require a review of party expenditures for each election cycle. That review of spending from Election Day 2018 to Election Day 2020 forced her to confront the payments to Grot, Cox said.

Ahead of the party's Aug. 25, 2018, convention, Grot, a longtime party activist from Shelby Township, abruptly withdrew from the secretary of state race on Aug. 17, 2018. Grot cited “family obligations, timing and the overall political atmosphere” as influencing his decision. He had been competing for the GOP nomination with Grosse Pointe Farms businesswoman Mary Treder Lang.

"I didn’t have a chance to win," Grot said in a Thursday morning interview. "And I knew it. That’s why I got out."

Cox said after Grot withdrew, he was paid $200,000 between Aug. 20, 2018, and Feb. 12, 2019, from the party's administrative account, a fund that can receive money from corporations and doesn't have to publicly disclose its contributions or spending.

Among the $200,000 paid to Grot were six $10,000 payments and a $140,000 payment that was paid two weeks before Cox became chairwoman in February 2019, according to her letter to activists. Weiser didn't seek reelection as chairman in 2019.

"The $140,000 was so substantial that the party’s CFO had to borrow from the party’s line of credit," Cox wrote in her letter.

Grot said Thursday that he wouldn't discuss an alleged $140,000 payment in 2019.

These types of administrative accounts, which both parties maintain in Michigan, are allowed to be secret under state law because they are not supposed to directly engage in campaigning for candidates.

The payments could represent "potentially serious violations of the Michigan Campaign Finance Act" if it's determined that undisclosed corporate funds were used to influence a state race, Cox wrote in her letter to Republicans.

In the separate letter to the Bureau of Elections, the chairwoman asked the bureau to determine if the payments to Grot qualified as campaign spending that should have been reported and disclosed. If election officials determine that they were official expenditures, Cox said the state party wanted to enter into a conciliation agreement to resolve the issue, which can involve a fine. Under state law, conciliation agreements also can bar further civil or criminal action.

Cox also said Weiser "admitted" to her in spring 2019 that he "paid $200,000 to Grot to get him out of the SOS convention race and guarantee the nomination of Grot’s opponent, Ms. Treder Lang," according to her letter.

Multiple Republicans said Treder Lang was the preferred candidate by some party leaders because she would be the lone female nominee for the three top-of-the-ticket positions. The GOP nominated Schuette for governor and then-House Speaker Tom Leonard for attorney general. Democrats nominated three women for the positions: Gretchen Whitmer for governor, Dana Nessel for attorney general and Jocelyn Benson for secretary of state.

The Democrats won all three races.

Jason Watts, an Allegan Republican who worked on Treder Lang's campaign, said there was a desire to avoid an all-male ticket. Watts voiced frustration with Weiser's handling of the secretary of state race, saying $200,000 was more than the party spent to help Treder Lang in her contest against Benson.

"This is deeply troubling," Watts tweeted of the claim again Weiser. "To undermine our SOS nominee by executing an illegal transfer of party administrative funds hurts our party, our candidates, & our brand."

In the Lauderbach report, Henrietta Tow, who served as the party's chief financial officer, said the party's then-Chief of Staff Colleen Pero advised her on Aug. 20, three days after Grot dropped out of the race, to draw a check payable to Grot for $10,000.

"Ms. Pero told Ms. Tow that she needed the check that day," the report said.

Tow also said she was told by Pero or Sarah Anderson, who later became chief of staff, "that Mr. Grot was paid to withdraw from the 2018 race for the secretary of state nomination," according to the report.

Weiser's alleged actions appeared to be legal unless there is documented evidence of a quid pro quo, said Democratic consultant Adrian Hemond, CEO of Lansing-based Grassroots Midwest.

“That doesn’t mean it’s savory or ethical. But unless there’s some documented evidence of a quid pro quo, they can spend those administrative funds for whatever they want,” Hemond said. “That’s what those slush funds are for.”

Grot did not agree to an interview with Lauderbach, according to his preliminary report.

"The foregoing facts provide at least some circumstantial evidence that the payments to Mr. Grot may have been a quid pro quo for his withdrawal from the race for secretary of state, which could violate Michigan campaign finance laws," Lauderbach wrote. "While we arrive at no definitive conclusion here, we believe the circumstances merit further investigation."

Pero denied that something improper had happened, the report said.

Grot had been tapped to help with delegate recruitment, organize events and help with legislative races in Macomb County, Pero told Lauderbach.

"I don’t think anything untoward was done," Pero said, according to the report.

cmauger@detroitnews.com

Staff Writer Christine Ferretti contributed.