Witness In Auditor Trial Recounts Hiring, Investigator Call

DOVER, Del. (AP) — Employees in the office of Delaware State Auditor Kathy McGuiness did not take kindly to the hiring of the auditor’s daughter and a friend for part-time work, according to testimony Thursday in McGuiness’ criminal corruption trial.

Virginia Bateman, the friend of the daughter, told jurors that staff in the auditor’s office were “outwardly rude” to her and Elizabeth McGuiness after they were hired as “casual-seasonal” employees in the spring of 2020.

“I walked past them and we never exchanged anything,” said Bateman, who described herself as Elizabeth’s best friend. “From the first day, ... they would talk behind our backs.”

Bateman’s testimony came on the fourth day of the trial of Kathy McGuiness, a Democrat who was elected in 2018 to the office responsible for rooting out government fraud, waste and abuse.

McGuiness faces felony counts of theft and witness intimidation, and misdemeanor charges of official misconduct, conflict of interest and noncompliance with procurement laws.

Prosecutors allege, among other things, that McGuiness hired her daughter and Bateman as temporary employees in May 2020, even though other temporary employees had left because of the lack of available work amid the coronavirus pandemic. They also say Elizabeth McGuiness was granted special favors, such as having access to a state vehicle, and continued to be paid even after she left for college in South Carolina.

Bateman testified that she and Elizabeth McGuiness usually traveled to and from work with Kathy McGuiness in her state vehicle, and that Bateman always drove. She also said she usually drove when she and the younger McGuiness would run work-related errands in the auditor’s state-issued vehicle.

During Bateman’s testimony, jurors also heard a recording of a phone call she received from Franklin Robinson, the chief investigator in the case, in June 2021.

Robinson, who was called to the stand for the playing of the recording, began the phone call by identifying himself as an investigator with the Department of Justice and telling Bateman that he was investigating how casual-seasonal workers had been treated. But he did not explain that he was referring specifically to employees in the auditor’s office until Bateman asked him, and did not say he was conducting a criminal investigation. He then briefly questioned her about how she came to be hired and what she did while at the auditor’s office.

Bateman testified that, following the phone call, she texted Elizabeth McGuiness and also called Kathy McGuiness, but she could not recall exactly what she told them.

Kathy McGuiness is charged with intimidating and retaliating against employees who reported her alleged wrongdoing or who she believed might be cooperating with investigators. Prosecutors allege that the intimidation, which included monitoring employees’ emails, began as early as March 2019, but defense attorney Steve Wood has argued that McGuiness did not learn until September 2021 she was the subject of a criminal investigation. That was roughly three months after she received the phone call from Bateman, after her conversation with Robinson.

In other testimony Thursday, the director of the state Division of Accounting, Jane Cole, acknowledged that employees in her agency made mistakes in approving certain payments by McGuiness’ office to an outside contractor because the payments brought the total above the amount in the purchase order for the contract — and no change order or waiver request had been submitted.

Cole also testified that the way in which McGuiness’ office made the payments, including using a credit card and resubmitting smaller payment vouchers for approval, was “improper” under the state’s accounting rules.

Prosecutors allege that McGuiness, in her role as auditor, improperly orchestrated a no-bid “communications services” contract for My Campaign Group, which she had used as a campaign consultant when running for lieutenant governor in 2016, then deliberately kept the contract payments under $5,000 each to avoid having to get the payments approved by the Division of Accounting.

While questioning the propriety of how payments to My Campaign Group were made, Cole also acknowledged under cross-examination that — contrary to allegations in a search warrant affidavit signed by Robinson in September 2021, and in an October 2021 indictment — the auditor’s office did not make multiple payments of less than $5,000 each to My Campaign Group in the fall of 2020 to pay two invoices that exceeded $9,000 each.