Friday, April 13, 2018

Using Campaign Cash Like A Personal Piggy Bank


Can you smoke cigars in prison? Duncan Hunter may soon find out

On Thursday a federal jury in Houston ruled that Steve Stockman, a far right-wing Republican, is guilty of 23 felonies, having defrauded two conservative mega-donors and funneling their $1.25 million into personal and campaign expenses as part of what prosecutors have described as a "white collar crime spree." The lunatic fringe Stockman is now at risk of having to serve decades in prison. The prosector Ryan Patrick, son of Texas Lt. Governor Dan Patrick, described Stockman, who was taken to prison immediately after the guilty verdict was read, as a flight risk.

Another of the many ways crooked congressmembers can steal campaign funds is to retire. Once they retire they can "hire"-- at a substantial salary-- a wife or a son or a parent to "administer" the left over campaign money. On Monday, Ken Doyle, writing for Bloomberg reported that Ex-Candidates May Face Restrictions on Campaign Cash. He started with two of Illinois' finest-- Jesse Jackson, Jr, who went to prison, and Aaron Schock, who's still in a long drawn out trial-- who used campaign war chests as personal piggy banks. Duncan Hunter, Jr (R-CA) is likely to go to prison for the same thing.
The Federal Election Commission is being asked to write new rules to draw a clear, bright line so ex-candidates can easily figure out how they’re allowed to spend their backers’ campaign donations.

...The FEC has asked for public comments on a petition filed by the nonprofit Campaign Legal Center, which seeks new restrictions on use of campaign money by anyone no longer running for election. There’s a “disturbing trend of lawmakers leaving office with sizeable campaign chests, and then using those leftover campaign funds in ways that appear to constitute personal use,” the group wrote.

The FEC will decide after the May 21 comment deadline whether to issue guidelines or write a new rule, spokesman Christian Hilland told Bloomberg Government in an email.

The Tampa Bay Times has found almost 100 “zombie” congressional election committees that are still spending money even though there’s been no campaign for many years. Some of the zombie committees merely contributed leftover cash to other candidates, as the law allows. Others spent money on salaries, meals, travel, rent, phone bills and other expenses not clearly related to any campaign.

In addition to campaign expenses, current lawmakers are allowed to use campaign money to cover certain costs related to carrying out duties as “a holder of federal office.”

A new class of retirees soon will have to learn to live without being able to tap campaign accounts for some expenses.

A Bloomberg Government review found that 35 current lawmakers who’ve announced they aren’t running for re-election had almost $38.6 million in their campaign accounts at the end of 2017, according to the most recent FEC disclosure reports.

The biggest war chest for a retiring lawmaker is more than $6.2 million held by the campaign of Sen. Bob Corker (R-TN). His campaign committee is still flush even after refunding more than $1.2 million in contributions last year, according to a year-end disclosure report filed with the FEC.
Here are the dozen members not running for reelection with the biggest nest eggs right now:
Bob Corker (R-TN) $6,234,997
Orrin Hatch (R-UT)- $4,980,936
Ed Royce (R-CA) $3,678,625
Pat Meehan (R-PA) $2,340,502
Ted Poe (R-TX) $2,054313
Elizabeth Esty (New Dem-CT) $1,437,905
Jeff Flake (R-AZ) $1,406,775
Trey Gowdy (R-SC) $1,364,419
Ryan Costello (R-PA) $1,364,121
Rodney Frelinghuysen (R-NJ)- $1,166,676
Gene Green (R-TX) $1,131,194
Darrell Issa (R-CA) $1,052,398
Note that each of them is a conservative-- what a coincidence!
Corker’s congressional office didn’t respond to a request for comment on what he plans to do with his leftover campaign money. Corker could hold money in his committee account for a future campaign, give it to other candidates or donate to charities.

Ex-candidates also can give unlimited amounts to a national committee of the Democratic or Republican party, though few retiring lawmakers appear to be doing so, a Bloomberg Government review of FEC reports found.

Another option is that a retiring lawmaker’s campaign committee can be converted to political action committee. A PAC can collect additional contributions to be used to help other candidates, but personal use restrictions would still apply under a series of FEC advisory opinions, according to commission spokesman Hilland. Campaign money given to a charity also can’t be used to pay a candidate or candidate’s family.

One retiring lawmaker, Rep. Ileana Ros-Lehtinen (R-FL), recently converted her campaign committee to a PAC called South Florida First. That PAC then transferred more than $177,000 to a “leadership PAC” linked to Ros-Lehtenin, called IRL PAC, which was set up almost 20 years ago. The move was allowed by the FEC under a provision allowing transfers between “affiliated committees,” Hilland said, though he noted that contributions received by affiliated committees are subject to the same contribution limits.

According to its most recent disclosure report, Ros-Lehtinen’s IRL PAC had just over $8,000 in cash last October, when it received an infusion of $177,445 from South Florida First, the congresswoman’s converted campaign committee. Afterward, the leadership PAC contributed $16,000 to other Republican candidates but also spent more than $23,000 on “operating expenditures” including hotels, meals and tickets to Disney World.

Ros-Lehtenin’s congressional office didn’t respond to a request for comment.

Former Senate Majority Leader Harry Reid (D-NV) asked the FEC in 2015 whether he could use of hundreds of thousands of dollars in leftover campaign money for “substantial post-retirement obligations arising from his 34-year tenure as a federal officeholder and, in particular his twelve years as Democratic Leader.” Unlike House Speaker John Boehner (R-OH), who was retiring around the same time, Reid had no provision for special government funds to run an office and hire staff, the request noted.

The FEC effectively rejected the request. Two commissioners holding Democratic FEC seats-- Steven Walther and Ellen Weintraub-- recused themselves from voting, and a third FEC Democrat, Ann Ravel, said she would support Reid’s request. Republican commissioners Lee Goodman and Caroline Hunter repeatedly questioned whether granting the request would set a precedent giving all former members of Congress wide latitude to ignore legal restrictions on personal use of campaign money in retirement.

The request was withdrawn prior to a final commission vote.

Campaign Legal Center attorney Brendan Fischer said he expects this petition to result in action because Republican and Democratic FEC commissioners generally have taken a strict view of permissible uses of campaign money, especially for retiring lawmakers.

The Jackson and Schock cases stand out because there have been so few criminal prosecutions for campaign finance violations.

After 17 years in Congress, Jackson spent most of the following two years in prison and a halfway house. He pleaded guilty to skimming $750,000 from his campaign committee to pay for such items as a memorabilia collection.

Schock was a rising Republican star until he drew attention by decorating his congressional office like the PBS television show Downton Abbey. The charges he’s fighting involve the personal use of campaign and official accounts.

Rep. Duncan Hunter (R-CA) last year repaid tens of thousands of dollars to his campaign committee for family vacation and other expenses. Hunter is the subject of Ethics Committee and Justice Department investigations.

Last year, a civil enforcement case pursued for years by the FEC resulted in a court-ordered $30,000 in penalties levied against Christine O’Donnell, a former Republican Senate candidate from Delaware, for using campaign funds to pay her apartment rent. U.S. District Judge Leonard P. Stark rejected arguments that restrictions on personal use of campaign funds are unconstitutional because campaign spending is equivalent to free speech and protected by the First Amendment.

The Campaign Legal Center has filed an FEC complaint against the campaign committee of Mark Takai (D-HI), which reported that it continued to pay almost $6,000 per month to a consulting firm headed by campaign treasurer Dylan Beesley for 18 months after Takai died of cancer.

The group also has filed a complaint against the campaign committee of former Rep. Cliff Stearns (R-FL), which reported expenditures for cell phone bills, lobbying-related expenses, and payments to his wife for five years after leaving office.

The new FEC rulemaking petition proposes strict limits on what people who are no longer running for office can do with excess campaign cash. “It is very difficult to see how cell phone bills, office rent, travel expenses, or club dues are expenditures 'in connection with the campaign for Federal office' if a person is no longer a candidate,” according to the petition.

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At 7:55 AM, Anonymous Anonymous said...

With both faces of the Corporatist Party wailing about how they need money, I can't imagine how they haven't come up with rules requiring retiring members to turn over all of their remaining electoral war chest contents. They certainly have the means to emulate the Saudi Crown Prince Mohammed bin Salman in taking control of such assets, and can even provide the luxury hotel "prisons" MbS used to extort billions out of corrupt Saudis. I'm sure the CP hacks can come up with enough "inducements" to make such a practice productive.

One wonders why they haven't.


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