Governor Awaiting Next Move in Auditor Case

TACOMA, Wash. (AP) — The first Washington state official indicted in 35 years escaped conviction at his five-week federal fraud trial, but that doesn't mean others in state government are any happier that he remains in office.

Gov. Jay Inslee says serious questions remain about Troy Kelley's ability to keep serving as state auditor, even after a jury deadlocked on the key charges against him.

Kelley, a Democrat elected in 2012, is the state official charged with rooting out waste and fraud in government operations. He took a seven-month leave before returning to work in December, but has otherwise spent the past year rebuffing calls for his resignation.

Prosecutors accused Kelley of pocketing $3 million in fees that they said he should have refunded to homeowners when he ran a real-estate services business.

After deliberating for 3½ days, the jury failed to reach a decision on 14 counts, including whether Kelley possessed stolen money,

TACOMA, Wash. (AP) — Democratic Gov. Jay Inslee says he is waiting to see what prosecutors do now that a federal jury has failed to reach a verdict on key charges in the federal fraud trial of Washington State Auditor Troy Kelley.

Inslee said in a statement Tuesday that the state does not have much-needed closure to the case.

"Regardless of the outcome in court today, serious questions remain about Troy Kelley's ability to successfully fulfill his role as state auditor," Inslee wrote.