Still no verdict in trial of State Auditor Troy Kelley

Jurors failed to reach a verdict for a third day Monday in the criminal trial of State Auditor Troy Kelley.

The panel of five women and seven men completed their third day of deliberations without announcing whether Kelley, a Democrat from Tacoma, would be found guilty of felony charges including theft, money laundering and tax evasion.

A question posed by jurors about midday Monday implied they are having difficulty agreeing on one of the 15 criminal counts. The jury asked U.S. District Court Judge Ronald Leighton what it should do if it is split on one of the charges against Kelley.

U.S. District Court Judge Ronald Leighton said he didn’t want to provide “coercive” instructions to the jury, but wanted to see if more time could break a deadlock.

“I want them to own this process,” Leighton said.

After consulting with Kelley’s defense team and prosecutors, Leighton told the jurors: “If you believe more time in your process will be helpful, take it.”

Kelley is charged with 15 felony counts, the most serious of which is punishable by up to 20 years in prison.

Federal prosecutors say Kelley stole millions from homeowners from 2006 to 2008 while running his real-estate services business, Post Closing Department. The company tracked documents related to property ownership after closings of home sales and refinancings.

According to the prosecution, escrow companies took fees of $100 or more from homeowners and passed them to Kelley, their contractor. Prosecutors said Kelley was supposed to take a cut of $15 to $20, pay any third-party charges, and refund the rest of the fee to homeowners — but that he rarely issued refunds.

Kelley’s attorney, Angelo Calfo, argued during the criminal trial that the money wasn’t stolen because it didn’t belong to homeowners in the first place. He said Kelley was entitled to keep the money as fees for his services, which he said at least one escrow company acknowledged in writing.

Calfo also questioned the reliability of witnesses that testified for the prosecution, and accused prosecutors of targeting Kelley because of his status as a statewide elected official.

Should Kelley be convicted of any of the felonies, he will no longer be qualified to serve as state auditor, a statewide elected position tasked with rooting out financial fraud and waste in government.

Gov. Jay Inslee would then need to appoint a new person to the position, which is up for election in November.

This story was originally published April 25, 2016 at 3:17 PM with the headline "Still no verdict in trial of State Auditor Troy Kelley."