Krolicki pleads not guilty to felony charges

Lt. Gov. Brian Krolicki pleaded not guilty Tuesday to felony charges he mishandled state funds while serving as treasurer.

Krolicki’s arraignment in District Court marked the first time he has appeared in court to face the charges. He was indicted earlier this month by a Las Vegas grand jury.

Also pleading not guilty Tuesday afternoon was Krolicki’s chief of staff, Kathy Besser, who faces two felony counts.

Krolicki, 47, is charged with two counts of misappropriation and falsification of accounts by a public officer and two counts of misappropriation by a treasurer. Each charge is a felony carrying a potential penalty of one to four years in prison and a fine of up to $5,000. Probation is also a possibility.

Prosecutors claim Krolicki and Besser mishandled state funds associated with a state-run college savings program that began in 2001 to help families prepare for higher education expenses. The two are not alleged to have pocketed any money themselves.

A legislative audit found that more than $6 million in fees earned by the $3.3 billion state program was not deposited in state accounts as required by law. Krolicki, prosecutors allege, made unauthorized expenditures and failed to properly account for the funds.

Krolicki, a Republican who has contemplated challenging Senate Majority Leader Harry Reid in 2010, has depicted the prosecution as a partisan witch hunt and says he is innocent of wrongdoing.

Addressing the media briefly after the arraignment, Krolicki did not take questions but said he was looking forward to his day in court. “The facts will absolutely vindicate me on this,” he said.

“What I do know is that we created one of the greatest college savings plans in the country,” he added, helping numerous families and the state. “It was balanced to the penny when I left office.”

A jury trial was set Tuesday for July 14 before District Judge Elissa Cadish. More immediately, Krolicki attorney Kent Robison said, the defense plans a blizzard of motions challenging the prosecution’s tactics, including the method of indictment and venue of the case.

“We have no clue whatsoever why we’re here,” he said. “This is a Carson City situation.”

The lead prosecutor on the case, Chief Deputy Attorney General Conrad Hafen, declined to discuss what he said were strategic and legal reasons behind bringing the case in Clark County. He said prosecutors are confident in the charges they have brought.

“We’re prepared to prove our case beyond a reasonable doubt,” Hafen said.

Contact reporter Molly Ball at mball@reviewjournal.com or 702-387-2919.