Troubled Louisville councilman will pay back debt, lawyer says

Troubled Louisville councilman will pay back debt, lawyer says
James Craig (Source: WAVE 3 News)
James Craig (Source: WAVE 3 News)

LOUISVILLE, KY (WAVE) – Metro Councilman Dan Johnson may sell his house to pay off debts that came to light in recent lawsuits from two Louisville businesses.

Johnson's attorney, Thomas McAdam, said the councilman will pay back $2,673, plus interest and court costs, to Edlin Company Fine Jewelers after a six-month dispute over a bad check ended up in court.

Johnson on Wednesday asked council leaders to quickly audit his office accounts to "reassure" people that he hadn't taken city money and had continued his elected duties even while facing personal financial hardship.

"I don't see that this has anything to do with his job representing the people in his district," McAdam said. "I think it's a separate thing."

[VIEW: Dan Johnson's audit request]

Johnson will earn $45,074 this year as a Metro Council member, city records indicate. He also buys and sells knives and jewelry at swap meets on the weekends.

McAdam blamed Johnson's debt on the economy and his re-election campaign, saying they have caused Johnson's side business to suffer. 

Johnson is running unopposed in November.

McAdam said he filed settlement paperwork in Jefferson County Circuit Court on Wednesday, agreeing that Johnson will pay back the money owed to Edlin Company.

[VIEW: Gus Goldsmith vs. Dan Johnson]

After details about that lawsuit became public, high-interest loan provider Gus Goldsmith filed suit alleging Johnson owed him $8,000 for a bounced check. Goldsmith runs Action Loans in downtown Louisville.

Johnson wrote the check in September as collateral for a $15,000 loan, and Goldsmith must've known Johnson didn't have the money to repay him, McAdam said.

“I know that it is an embarrassment (to Johnson),” McAdam said. “Whenever you see your name in the paper that you haven't paid a bill, that would embarrass anybody.”

McAdam said he wasn't immediately sure how much money Johnson owed to Goldsmith, but said the councilman was considering refinancing or selling his home to pay off debt.

Johnson is vice-chairman of the council's Democratic caucus, and it was not immediately clear whether Johnson intended to continue in the position. He was out of town on business, said Tony Hyatt, a spokesman for council Democrats.

Council President Jim King believed that requesting the audit was the proper thing for Johnson to do, Hyatt said.

Chris Poynter, a spokesman for Mayor Greg Fischer, declined comment, saying it was a “council issue.”

Johnson's legislative assistant, Bryan Mathews, has also faced scrutiny over a bad check, according to court records.

In February 2013, Mathews faced a misdemeanor charge of theft by deception/using cold checks of less than $500.

The case, which began with a $226 debt to an auto repair company, was settled when Mathews agreed to repay the debt this summer, said James Craig, Mathews' attorney.

Mathews, whose $51,000 a year salary is greater than Johnson's, came into the spotlight in June when it was revealed he had been fired from his previous job at the Kling Center in Old Louisville.

The center's director told WAVE 3 News that Mathews had repeatedly used a racial slur, something Mathews and Johnson have denied.

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