WASHINGTON – Today, Campaign Legal Center (CLC) filed a complaint with the Federal Election Commission (FEC) asking for an investigation into foreign nationals potentially making contributions to U.S. political committees in connection with foreign fundraising excursions advertised to Chinese citizens.

CLC’s complaint describes multiple instances where different tour organizers invite Chinese citizens to fundraising events for U.S. political committees, including Trump’s 2020 joint fundraising committee, where admission is generally contingent on making a contribution. Some invitations offer a picture with the president, a privilege only afforded to contributors who give or raise tens of thousands of dollars. Reports indicate that Chinese nationals are then attending these fundraisers and getting pictures with President Trump.

“Campaign contributions often buy access in the U.S. political system, and foreign actors quite clearly want to play the same game,” said Brendan Fischer, director, federal reform at CLC. “The consistent pattern of foreign invitations to high-dollar fundraising events and foreign national attendance at these events indicate that foreign funds are indirectly flowing into U.S. campaigns, potentially through straw donors.” 

It is not plausible that dozens of U.S. nationals are routinely using their own money to contribute thousands of dollars to Trump’s campaign, and then passing the perks associated with that contribution to a Chinese tourist who paid a travel firm many times that amount. It is far more likely that U.S. nationals are being reimbursed for their contributions using some portion of the funds paid by Chinese citizens participating in these political tours.

CLC’s complaint includes foreign invitations to Trump Victory fundraisers in places like New York City, Palm Beach, Florida, Dallas, Texas and Milwaukee, Wisconsin.

Cindy Yang, a South Florida-based entrepreneur and spa owner, is currently being investigated by the Federal Bureau of Investigation for potentially arranging for Chinese nationals to directly or indirectly make contributions through straw donors. However, CLC’s investigation shows that Yang is only one of many tour operators advertising political tourism to Chinese nationals.

Private jets, luxury hotels, and expensive meals are par for the course as a majority of leadership PAC spending strays further from its intended purposes.

WASHINGTON - A new report today released by Campaign Legal Center (CLC) and Issue One shows that instead of doling out funds to political allies, members of Congress routinely use leadership PAC funds to pay for expensive meals, rounds of golf, and luxury hotel stays — often under the guise of fundraising. During the final three months of 2018 alone, some members of Congress used leadership PACs to pay for trips to Puerto Rico and London, dues to exclusive social clubs, tickets to the Churchill Downs racetrack (home of the Kentucky Derby), and stays at the Trump International Hotel in Washington, D.C. — all while not giving the majority of their funds away to other candidates.

This continues the trend identified by the groups’ original July 2018 report that revealed that less than 50% of overall leadership PAC spending in recent years – according to data from the Center for Responsive Politics – has actually gone toward the purposes originally approved by the Federal Election Commission (FEC) – namely, contributions to candidates and political groups.

“The FEC’s failure to address the misuse of leadership PAC funds has allowed more politicians to exploit the system,” said Brendan Fischer, federal reform director at CLC. “We are long past due for a solution that would stop politicians from using leadership PACs as personal slush funds to pay for golf club memberships and trips to Vegas.”

“Leadership PACs are the decades-long ethics scandal in Congress that should outrage every American,” said Meredith McGehee, executive director at Issue One. “Members of Congress should embrace bipartisan legislation to curb the abuses of leadership PACs.”

Leadership PACs first came onto the scene in the late 1970s when the FEC decided to allow members of Congress to establish separate committees to raise extra money to give away to fellow politicians. Today, nearly every member of Congress in both parties operates a leadership PAC, and these lawmaker-controlled committees collectively raise tens of millions of dollars each year.

By law officeholders cannot use official campaign funds for “personal use” — like country club dues, clothing purchases, or family vacations. They are instead dipping into their leadership PAC funds for these expenses. This pattern arose, and has worsened, because the FEC has not applied the personal use prohibition to a politician’s leadership PAC.

The new report, “All Expenses Still Paid: A Look at Leadership PACs’ Latest Spending,” highlights a handful of expenditures from leadership PACs between October and December, including:

• Four members of Congress paid a combined  $113,263 from their leadership PACs to Sea Island in Georgia.
• Seven members of Congress together spent $82,408 from their leadership PACs on private jets.
• Three members of Congress paid a combined $72,561 from their leadership PACs to the Kiawah Island Golf Resort in South Carolina.
• Four members of Congress spent a total of $22,175 from their leadership PACs at Joe’s Seafood, Prime Steak & Stone Crab, an upscale seafood restaurant and steakhouse in downtown D.C.
• Thirteen members of Congress spent a total of $16,939 from their leadership PACs at Charlie Palmer Steak, a steakhouse located just three blocks from the Senate office buildings.
• Two members of Congress paid a combined $3,382 from their leadership PACs for tickets to events at the Capital One Arena in Washington, D.C., where numerous professional sports games and concerts are held.

There is growing bipartisan interest in curbing the abuse of leadership PACs. Legislation was introduced earlier this year that would expressly extend the personal use ban that applies to candidates’ official campaign committees to leadership PACs as well.

Additionally, Campaign Legal Center, Issue One, and five former members of Congress filed a letter with the FEC stating that the agency has for too long delayed taking action to apply the personal use prohibition to leadership PAC funds.

Read the full report, “All Expenses Still Paid: A Look at Leadership PACs’ Latest Outlandish Spending.”

WASHINGTON – Today, the U.S. Court of Appeals for the D.C. Circuit turned back a legal challenge brought by the Libertarian National Committee (LNC) to multiple federal limits on contributions to political parties. Campaign Legal Center (CLC) and Democracy 21 filed a friend-of-the-court brief on Oct. 12, 2018 to defend these limits.

The LNC challenged the application of the federal contribution limits to money left to the LNC by a deceased donor, arguing that such limits are only constitutional as applied to individuals who give with corruptive intent – basically, an intent to violate bribery laws. The LNC also argued that a 2014 law that raised the limits on contributions given to parties for certain designated purposes created an unconstitutional “content based” restriction on speech. Judge Tatel, writing for the majority, rejected all of the LNC’s arguments, which – if successful – would have undermined the viability of contribution limits nationwide.

“Today’s decision reaffirms that contribution limits are a vital preventative measure to protect voters against the worst forms of political corruption,” said Tara Malloy, senior director at CLC. “Even if, as Judge Tatel writes, the courts through some magical power could ferret out the innocent contributions from the nefarious, an appearance of corruption would remain. That’s why this decision is so important: unregulated contributions could inflict almost as much harm on public faith in the integrity of our elections as a clear exchange of money for favors.”

“The DC Circuit correctly rejected the Libertarian Party’s challenge to the contribution limits that apply to national party committees,” said Donald Simon, general counsel to Democracy 21. “For more than 40 years dating back to Buckley v. Valeo, the Supreme Court has upheld the constitutionality of contribution limits and that law is now firmly established. While we opposed Congress’s 2014 decision to raise contribution limits for certain special purpose funds set up by the parties, that congressional policy mistake did not undermine the constitutionality of the basic limit on party contributions that was challenged by the Libertarian Party. The D.C. Circuit got the analysis right.”

Learn more about the case Libertarian National Committee v. FEC.

Seattle’s System Passed by Over 60% of City Voters in 2015

OLYMPIA, WA – Today, the Washington Supreme Court will hear oral arguments at 4:30pm ET in Elster v. City of Seattle, a First Amendment challenge to Seattle’s pioneering public financing system.

The Superior Court of the State of Washington for King County found the city’s public financing system constitutional in a November 2017 opinion that said that the program was a valid tool for the city government to foster citizen involvement in elections, calling that goal “vital to a self-governing people.” Plaintiffs have challenged this ruling to the highest court in the state of Washington. If plaintiffs are successful and the court overturn the Superior Court’s ruling, it would strike a blow not only to campaign finance reform efforts nationwide but to the constitutional principle of self-governance.

Seattle’s Democracy Voucher Program was approved by over 60 percent of city voters in 2015. The program – which went into effect in 2017 – offers any eligible adult city resident who is a U.S. citizen with four $25 “democracy vouchers” to give to qualified candidates of their choosing.

Available data from Seattle show that the democracy voucher program has already spurred impressive levels of local engagement. According to the University of Washington’s Center for Studies in Demography and Ecology, a total of 20,727 Seattle residents used their vouchers to contribute to local candidates in 2017. In addition to increasing the absolute number of city residents who contributed, Seattle’s voucher program attracted a more diverse makeup of donors to local campaigns. Compared to individuals giving a private cash contribution in Seattle’s 2017 election, voucher users were more likely to be low-to-middle income and to reside in the city’s poorest neighborhoods. Further, the population of voucher donors contained a higher share of minority groups and residents under the age of 30 than the cash contributor pool.

The following groups gave statements in support of Seattle’s Democracy Dollars program:

Paul Smith, vice president at Campaign Legal Center (CLC):

“Seattle’s public financing system loosens the stranglehold that large donors have had over the terms of political debate. This case is not only about protecting campaign finance reform efforts around the country, it’s about upholding the constitutional principle of self-governance. Seattle citizens spoke loud and clear when they overwhelmingly passed the Honest Elections Seattle Initiative. The court should prioritize the First Amendment rights of city residents, by giving more people an opportunity to have their voices heard in our democracy.”

Adam Lioz, political director of Demos:

“Seattle’s Democracy Voucher program builds upon a long and clearly legal legacy of using limited public funds to ensure that a diverse range of residents drive local public election campaigns—not a narrow slice of the wealthiest donors, who are overwhelmingly white.  The voucher program serves the compelling First Amendment interest in promoting democratic self-government by reducing wealth-based barriers to entry, increasing the pool of candidates for elected office, and ensuring people of color—and anyone without thousands of dollars to spare for political contributions—can have their voices heard in the decisions that govern their lives.  We look forward to the Washington Supreme Court confirming what is already clear—the voucher program raises all City residents’ voices while silencing nobody, and is a win for local democracy.”

Tiffany Muller, president of End Citizens United:

“By publicly financing elections, Seattle’s Democracy Voucher Program is not only changing the status quo – it’s rapidly expanding voter engagement and restoring power back to the people. More women, young people, and communities of color are participating in their democracy than ever before. The program has been so successful that municipalities, cities, and states across the country are looking to Seattle as a model to help root out the influence of Big Money. End Citizens United supports Seattle’s Democracy Voucher Program and we urge the Washington Superior Court for King County to uphold it.”

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CLC and Common Cause filed a friend-of-the-court brief on Sept. 20, 2017 in support of the city’s public financing system.

Learn more about Seattle’s public financing system by visiting CLC’s action page.