OLYMPIA — Sherry Bockwinkel told state investigators in August 2012 that something wasn’t right with the financing gymnastics involving signature-gathering firm Citizen Solutions and initiative promoter Tim Eyman.

In a complaint filed with the Public Disclosure Commission, the Tacoma woman spelled out how it looked like the two parties had conspired to take contributions collected for one initiative and spend it on another without disclosing it as required by Washington’s campaign finance laws.

On Monday, in a Thurston County courtroom, her theories were proved right.

Thurston County Superior Court Judge James Dixon ordered Citizen Solutions, and its principal, William Agazarm, to collectively pay nearly $1.1 million for their role in secretly moving money among those ballot measures and illegally kicking back hundreds of thousands of dollars to Eyman for his personal use.

Dixon’s order stems from a March 2017 civil lawsuit filed by Attorney General Bob Ferguson against the company, its leaders and Eyman. The judgment does not apply to Eyman because his case is proceeding separately.

The judgment requires Agazarm and Citizen Solutions to each pay $150,000 in civil penalties, and to jointly pay $117,500 in unpaid contempt sanctions and $622,255 in court costs and fees of state attorneys. Altogether, the defendants owe $1,039,755.

“Bob Ferguson did a good job. It was a very tangled web that Eyman and his co-conspirators wove and deliberately so,” Bockwinkel said Tuesday.

But Bockwinkel said she wished the punishment had been greater.

“That’s the frustrating part. Hiding information about campaigns just got the green light,” she said. “They have been doing this. They’ll keep on doing it. This is just a slap on the wrist.”

Andrew Villeneuve, founder and executive director of the Northwest Progressive Institute, has teamed with Bockwinkel for years to bird-dog Eyman’s political conduct. He’s glad the court finally acted.

“We’re not disappointed that yesterday’s ruling didn’t go further, but we do want to see follow-up, both in terms of enforcement of this order as well as legislative action. We need to strengthen our public disclosure laws,” he said Tuesday. “The ongoing kickbacks were bad, but the concealment was worse. It prevented the public from being able to follow the money.”

Ferguson was pleased with the outcome.

In a statement, he said, “This judgment reflects the serious and intentional violations of Washington’s campaign finance laws. Mr. Agazarm and Citizen Solutions knowingly participated in a scheme to hide how contributions to Tim Eyman’s campaigns were really being used.”

Attorney Mark Lamb of Bothell, who represented the two named defendants, declined to comment. The defendants could appeal or ask the judge to reconsider his decision.

In her original complaint, Bockwinkel alleged Eyman failed to report the shifting of money donated for Initiative 1185, a tax-limiting measure, into the campaign for Initiative 517, which sought to reform the initiative and referendum process. Eyman crafted the first measure and backed the second.

Under state election law, money can be moved from one political committee to another but it must be disclosed in reports to the commission. And the sources of the money that is getting shifted must be revealed.

PDC investigators conducted an exhaustive three-year probe. They used bank records, emails and interviews to diagram how Eyman steered payments through his political committee, Voters Want More Choices, to Citizen Solutions knowing a portion of the money would be paid back to him for personal use and political activities.

Upon reviewing the findings, the five-member citizen commission referred the case to Ferguson’s office in 2015. The lawsuit was filed in March 2017.

Voters Want More Choices conducted the campaign for I-1185 and paid Citizen Solutions $623,325 for collecting signatures. The firm actually earned nearly $1.2 million for its work, with the bulk of the rest coming from the Association of Washington Business and Washington Beer and Wine Wholesalers.

On July 11, 2012, four days after Eyman turned in I-1185 petitions with 320,000 signatures, Citizen Solutions wired $308,185 to Eyman through his for-profit company, Watchdog for Taxpayers.

Dixon’s order says Agazarm “personally approved Citizen Solutions’ kickback payment” to Eyman. And that he did so knowing Eyman planned to use it for personal expenses and in support of gathering signatures for I-517.

Dixon concluded the defendants helped Eyman “mislead contributors into believing their contributions would go to support ballot initiatives, when in fact, they were benefiting Defendant Eyman personally.”

And, he wrote, the defendants assisted Eyman “in laundering payments purportedly for signature gathering, which were made after the signature gathering was completed” and accepted solely to conceal that they were being funneled to Eyman.

In 2017, Ferguson said if a judge found Citizen Solutions and Agazarm intentionally concealed the payment to Eyman, they could be fined up to $924,555.

Monday’s judgment doesn’t impose a penalty for the kickback itself.

The order, drafted by state attorneys, sought fines for the concealment of five contributions — which became payments to Citizen Solutions — made between June 28 and July 6 in 2012. They included two from Voters Want More Choices totaling $218,525, two from the Association of Washington Business totaling $109,000, and one from the Washington Beer and Wine Wholesalers for $27,150, according to the court order. The contributions were the source of money for the company’s payment to Eyman.

Meanwhile, Ferguson continues to pursue Eyman who continues to claim he’s broken no laws. A civil trial is set for July 2020.

The 2017 lawsuit seeks $1.8 million in penalties plus return of the payment he received from the signature-gathering firm.

That figure has risen as Eyman’s fines for contempt grow daily and are hovering around $225,000. Ferguson also wants the court to bar Eyman from managing, controlling, negotiating or directing financial transactions of any kind for any political committee in the future.

Eyman issued a brief statement Tuesday which made no mention of the judgment.

“As a political activist, I’m focused on passing our $30 Tabs Initiative, raising funds to get paid back the $500k Karen and I loaned to get it qualified, and asking friends for help with my legal defense fund so we can survive the $900k+ the AG’s litigation has cost us so far,” he said.

At this stage, Eyman’s case is more complicated.

In January, the state amended its complaint to add new allegations that Eyman employed various schemes to solicit money, including seeking direct gifts to him and his family members, that should have been reported as contributions.

Last month, in response to a state request, Dixon ruled that $766,447 collected by Eyman between February 2012 and July 2018 should be treated as contributions in support of his political endeavors and not gifts for his personal use. Eyman has said they are gifts.

Eyman is trying to get Dixon to reconsider that decision.

Jerry Cornfield: 360-352-8623; jcornfield@herald net.com. Twitter: @dospueblos