I don't know who is currently serving as Joe Lieberman's Campaign Treasurer, but, during the primary, the individual in charge of campaign finances was Lynn Fusco. Fusco is the President of Fusco Construction in New Haven, CT and a long time contributor and fund raiser for both Lieberman and DeStefano. It doesn't appear that she has any particular financial background. Her role as CFO for Lieberman's primary bid appears to have been primarily as a point person for fundraising, from what I can see.
As someone who has taken accounting courses, worked with accountants and hired accountants over the years, I must say that I was astonished upon first hearing about the $387,000 "petty cash" account. Let me be perfectly clear: no one keeps $387,000 in petty cash, and no half-way decent accountant would ever account for that much money in a petty cash account. There are plenty of journal accounts in which to bury that kind of money if the expenses are at all questionable. So why were the expenses accounted for in such a blatantly unprofessional manner? What follows is my conjecture.
First, let's take a look at CT politics. Even the most rudimentary document search indicates that the political infrastructure in CT is about as dirty as New York, New Jersey, Illinois and some of the other political machine states. The Democrats have pretty much controlled the intra-state machinery through mayoralities and township committees, and although Lieberman became a Federal figure by virtue of his election to the U.S. Senate, his roots go back to state politics, beginning with the role of Attorney General; so he's part of the state machine.
Is it any wonder, then, that he didn't have a professional re-election campaign in place getting ready for this year's run? The fix was in, so to speak, and for the longest time he refused to take Ned Lamont's candidacy seriously. Why? Because Lamont wasn't part of the internal state machine, and Joe counted on the machine--and past favors--to keep Lamont in check. Lieberman's problem, as I see it, is that he only dispensed favors for campaign contributors. Small towns asked him to come visit and he ignored them. CT citizens wrote him for help or to ask him to vote for or against an upcoming issue, never receiving so much as a form letter in response. As Colin McEnroe opined recently, Joe forgot to water his CT roots.
Still, Joe's name, and all his free Fox News publicity, made him appear too formidable a candidate for many of the likely CT Democrats who might have run against him, such as Dick Blumenthal, the respected CT Attorney General. Ned, however, while a long time contributor to and fund raiser for Democratic candidates, such as Bill Clinton and, naturally, Joe Lieberman, wasn't part of the political machine. Lamont, and other moderates like Weicker, saw the increasing danger of Joe's positions, all the while watching the country spiral into total fiscal irresponsiblity and declining relationships with our allies. Ned could afford to take a chance, and he did.
Joe had to quickly put a ground team in place for the primary, and here's where I think things fell apart. He placed Lynn Fusco in charge of campaign finance, undoubtedly thinking that fundraising and schmoozing with past supporters would carry the day. However, Fusco has her own business to run, and I suspect that the actual bookkeeping was performed by a temp (or a political crony looking for a part time job) without professional supervision or review by Joe's finance staff.
Here's the scenario I imagine: The temp (we'll call him/her a temp for the purposes of this supposition) receives a request for a large check made payable to one of the individuals who is part of the "street team". The temp, not being an experienced campaign bookkeeper, asks the highest ranking individual in the office how she should account for the expense, since it doesn't seem to fit into any of the routine categories. She is told to just put the item into petty cash by someone who also isn't experienced in campaign finance. Now the categorization has been determined, and for future disbursements, our bookkeeper, rather than bother the campaign team again on the same issue, diligently records all future payments as "petty cash". Since no one is reviewing the financials, they are submitted without the scrutiny of a campaign pro, or even an accountant, who would know better. Of course, I don't know if this is precisely what happened, but I know that this type of occurrence happens all the time in poorly managed businesses.
It is also possible that the recording of large individual payments as "petty cash" was pure hubris. Perhaps I'm not giving Fusco enough credit for knowledge of campaign essentials, and that while she knew that the booking of the amounts was sloppy, she assumed that the "political machine" would take care of any little problems, perhaps forgetting that campaign finance is overseen by Federal election laws, or else not giving Lamont's team enough credit for being able and willing to act upon any discrepancies.
Was it actually "street money" that was paid out? Well, in addition to what we have already learned from preliminary investigations by the New Haven Register, let's take a look at Lynn Fusco and what she owes Joe Lieberman. According to an archived article in the New Haven Advocate, Fusco Corp. was near bankruptcy when Mayor DeStefano forced an out-of-state developer to take on the Fuscos as a partner in the Long Wharf mall deal in New Haven. Another article, from the Yale Herald, had this to say about the project:
The city's decision to go with the New Haven-based corporation has raised some eyebrows because the Fusco family has been a major supporter of the Mayor's campaigns. Lynn Fusco has headed the fund-raising committees for the mayor, Congresswoman Rosa DeLauro, and Senator Joe Lieberman, all of whom have been instrumental in progress on the plans.
Sounds to me like some favors were owed and, this time, Joe called them in. Again, this is all speculation on my part, but piecing together the information, I'd say Ned is up against a much dirtier campaign team than he realized when he first started his quest. If he wins next Tuesday, it may well strike a real blow against the culture of corruption in CT.