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Insurer will pay to end two-year probe that accused Jay of misspending $1.4 million from Project Clean Slate, other charities

TRIBUNE FILE PHOTO - Prominent businessman Roy Jay, past winner of the Spirit of Portland award, has agreed to a $600,000 settlement with Oregon DOJProject Clean Slate, once a popular cause that sought to help ex-cons secure a second chance, is officially no more after prominent Portland businessman Roy Jay and three nonprofits he co-founded have agreed to a $600,000 settlement to end a long-running Department of Justice probe.

Under the settlement, Clean Slate and two other nonprofits co-founded by Jay agree to dissolve and sell off assets, even as an insurance company pays the state of Oregon to make the probe, which had already lasted two years, go away.

In the settlement, Jay — a past winner of the Spirit of Portland award whose real name is Roy J. Harris – admits to no wrongdoing. He and several associates in the nonprofits agree to not take on any positions of charitable financial responsibility in any Oregon nonprofit without DOJ permission for the next seven years.

Those involved in the case "determined that the potential costs of further investigation, evaluation, and examination will exceed the potential benefits to the Parties," according to the settlement.

It's a sad official ending to Project Clean Slate, which had amassed major public acclaim. The group received at least $1.8 million in government funding as well as more than $400,000 in other funds from other nonprofits and fees from felons seeking to have their records expunged at $350 a pop.

The probe was launched after eight critics and former business associates of Jay's went to DOJ with several accusations against him in 2014. The investigation culminated last year with an Oregon DOJ filing that accused Jay and his late wife, Juanita Head Walton, of misspending $1.4 million in nonprofit funds.

State court filings alleged the money was misspent unlawfully by Jay and his late wife for their personal benefit, including condos, travel, vehicles and fine clothes.

While the nonprofits involved had already ceased operations, the settlement requires they be completely dissolved, with any assets transferred to another nonprofit.

The $600,000 figure was the product of a mediation in which both sides were able to present their cases to a neutral party. The funds will be paid by an insurance company, Philadelphia Indemnity Insurance Company. In return for the settlement, Oregon DOJ promised to drop the case.

Jay did not immediately respond to a request for comment. A spokesman said he would release a statement on Thursday.

In the past, Jay's representatives have said the case was unfounded, and that Jay would be owed an apology when the matter was concluded.

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