CLC offers the FEC new evidence of the super PAC’s illegal compensation to Steve Bannon, asks California Attorney General to examine Bannon’s “Glittering Steel”

WASHINGTON - Today, the Campaign Legal Center (CLC) filed new evidence with the Federal Election Commission (FEC) alleging that the super PAC Make America Number 1 made illegal contributions to Donald Trump’s presidential campaign. CLC also asked the State of California to investigate a company owned by Bannon, Glittering Steel LLC, for failing to comply with state registration and public disclosure laws.

The FEC letter provided new evidence that the Mercer super PAC illegally compensated Steve Bannon’s work as Donald Trump’s campaign CEO, and that the super PAC and campaign engaged in unlawful coordinated spending by using the common vendor Cambridge Analytica. The letter is a follow-up to the complaint filed by CLC on Oct. 6, 2016.

“The evidence suggests that the Mercer-backed super PAC secretly subsidized Bannon’s work for the Trump campaign by payments to ‘Glittering Steel,’ which we now know has been chaired and is owned by Bannon and which paid him a monthly consulting fee,” said Brendan Fischer, director of the federal and FEC reform program at the Campaign Legal Center.

Additionally, Fischer added, “both Bannon and Make America Number 1’s leadership owned and were on the board of Cambridge Analytica, and news reports indicate that the Trump campaign hired Cambridge Analytica at the urging of Make America Number 1’s head, strengthening the inference that Cambridge Analytica was used as a means of sharing information between the campaign and super PAC, in violation of federal law.”   

CLC also filed a new letter with California’s Attorney General and Secretary of State asking for a review of Glittering Steel LLC’s compliance with state law. Glittering Steel never registered to do business in California, but Make America Number 1’s FEC filings show millions in payments to Glittering Steel at a California address, and Bannon on his personal financial disclosure stated that he was paid by Glittering Steel through his California-based consulting firm. Entities engaged in intrastate commerce in California must register and publicly disclose their board membership, and may be subject to taxation.

“Bannon’s company appears to have dodged the California disclosure requirements that would provide more public information that could inform whether it broke federal campaign finance law,” said Fischer.

WASHINGTON - Today, the US District Court for the Southern District of Texas held, once again, that the state’s strict voter ID law, enacted in 2011, was written with racially discriminatory intent.

“Today’s ruling is a crucial step in the six-year journey towards justice for Texas voters since this restrictive voter ID law was passed,” said Danielle Lang, deputy director of voting rights at the Campaign Legal Center. “Judge Ramos was absolutely correct in her judgment that this law was designed to harm minority voters and cannot stand. SB 14 was expertly crafted to harm minority voters in order to minimize their voice just as their political power was growing. Legislators must respond to their electorate, not silence their voters. While the Department of Justice sadly withdrew their intent claim in this case in February, we will continue to fight this discriminatory law in court.”

Read the court order.

Read more about the case Veasey v. Abbott.

WASHINGTON – Today, New Mexico Governor Susana Martinez vetoed Senate Bill 96, which would have required groups attempting to influence New Mexico elections to provide critical information to voters before Election Day. The bill was supported by Democrats and Republicans in the New Mexico Senate and House of Representatives, including the Republican leaders in both chambers.

“Gov. Martinez is out of step with a majority of New Mexicans, who value transparency in politics,” said Catie Kelley, state and local program director at the Campaign Legal Center. “Democracy requires transparency and accountability. Secret campaign spending withholds important information from the public. The disclosure of who is paying for political advertisements is necessary for voters to properly evaluate the message and make informed decisions at the ballot box.”

New Mexico will continue to fall behind the majority of states that require outside groups to disclose the sources of advertising designed to influence state elections. According to reports by the Albuquerque Journal, polls conducted by Albuquerque-based Research and Polling over a four-year period consistently show New Mexicans favor increased disclosure requirements on independent political expenditures.

Judicial Crisis Network Ads Wrongly Classified as “Non-Political”

Today, the Campaign Legal Center (CLC) asked the Federal Communication Commission (FCC) to review broadcast filings from the Judicial Crisis Network (JCN), which has spent millions of dollars on advertisements urging U.S. senators to confirm President Trump’s Supreme Court nominee, Neil Gorsuch, but did not provide the disclosure required under federal law.  

The Communications Act provides that broadcasters must disclose specific information about the source of advertisements when those ads air “a message relating to any political matter of national importance.” The JCN ads indisputably meet this standard, and yet JCN incorrectly labeled its advertisements as non-political.

“Broadcasters have an obligation to ensure voters have relevant information about who is attempting to influence their views," said Brendan Fischer, director of federal and FEC reform at the Campaign Legal Center. "By broadcasters accepting at face value Judicial Crisis Network’s claims that their ads did not pertain to any ‘political matter of national importance,’ the public was deprived of the important information that federal law and regulations require."

“Some stations conducted their due diligence and required Judicial Crisis Network to amend their improper filings, but the majority of stations did not," said Meredith McGehee, strategic advisor at the Campaign Legal Center. "The FCC must follow up with these broadcast licensees and ensure that they comply with their obligations under the law."

Ads that pertain to “a message relating to any political matter of national importance” are placed into a broadcaster’s political file, and the advertiser must report who is behind the ad and to list the executive board members, or highest-ranking officers, of the sponsoring group. If completed truthfully and fully, the online files should provide the public the information needed to accurately identify who is behind the ads.

Read the letter here

Read the Judicial Crisis Network FCC Filings, compiled by the Center for Responsive Politics

Today, Larry Noble, senior director, regulatory reform programs and general counsel at CLC, released the following statement reacting to press reports about Ivanka Trump's new White House role:

"Ivanka Trump’s announcement that she has 'heard the concerns' about her serving  as a volunteer advisor in the White House and 'will instead serve as an unpaid employee in the White House office, subject to all of the same rules as other federal employees,' is at least a nod to the very legitimate ethics concerns that have been raised.

However, her statement does not necessarily mean she is going to seriously address those ethics concerns. Not all federal employees are subject to the same ethics rules and which rules are applicable are generally tied to an employee’s pay level. By not being paid, Ms. Trump may be attempting to limit which rules apply her, even though her position and power will be far from that of your average federal employee.

Her statement suggests she will follow the same rules she earlier said she would voluntarily follow when she claimed not to be an employee. Does this mean she will not file a public financial disclosure report?  It does seem to mean that she will still not divest her business nor put it in a blind trust. Rather, it is likely her business will remain in a trust run by family members, with her having access to information about how it is doing and her being able to ultimately reap the financial benefits when she leaves the government. While the ethics rules she is willing to subject herself to may require her to recuse herself from involvement with matters that directly involve her company, does she intend to be involved with broader government rules and policies involving such subjects as trade, corporate taxes, business policies, manufacturing, retail sale and employee rights, which will affect her business interests?  If so, she is still going to be subject to numerous conflict of interest issues.

If Ms. Trump not only heard, but also understood, the ethics concerns expressed by many, she will abide by the principles and goals of the ethics rules designed for the high-level position she will hold in the U.S. government, regardless of her not being paid."

On March 24, CLC co-authored a letter expressing deep concern about the propoed arrangement for Ms. Trump to work as an unpaid employee with no title or salary.

Federal Court Rejects FEC’s Attempt to Dismiss Lawsuit Calling for FEC Investigation into Anonymous Contributions

WASHINGTON – A federal district court today refused to throw out a lawsuit Campaign Legal Center and Democracy 21 filed against the Federal Election Commission (FEC). CLC and D21 filed the suit in the United States District Court for the District of Columbia after the FEC failed to act on five complaints calling on the agency to investigate donors who broke disclosure laws by hiding behind opaque corporate entities like Limited Liability Companies (LLCs) to anonymously make contributions to super PACs.

In response to the lawsuit, the FEC called on the court to dismiss the case, on the ground that CLC and D21 failed to show standing, or the right to sue. The court disagreed as to the majority of the FEC complaints and now the case will be heard on the merits. 

“The Federal Election Commission is out of control and this court has made clear that the agency will not be able to easily avoid being held accountable for failing to do its job in enforcing campaign finance laws,” said Larry Noble, senior director of regulatory reform programs and general counsel for CLC. “The U.S. Supreme Court has made it clear that disclosure laws play a vital role in providing the electorate with critical information to make informed choices. Each time the FEC fails to pursue a serious violation of the law, it weakens our democracy and the ability of Americans to know who is truly influencing our elections. It also sends a loud and clear message that those who violate campaign finance laws will face no penalties. We can’t sit idly by and let the FEC destroy the integrity of our democracy.”

“We have reached the point where the only way it seems possible to get the dysfunctional FEC to do its job is by suing them,” said Democracy 21 President Fred Wertheimer. “The FEC’s failure to adopt regulations that properly interpret the campaign finance laws is a major reason why so much dark money is pouring into federal elections. We are very pleased that the district court judge has refused to go along at this stage of our lawsuit with the FEC’s stonewalling opposition to our efforts to obtain campaign finance disclosures that the America people have a right to know.”

CLC and D21, over the course of several years, filed complaints with the FEC against several newly formed corporate entities and their undisclosed donors for violating the “straw donor” provision of Federal Election Campaign Act (FECA). These donors’ anonymous contributions ranged from $857,000 to over $12 million, and some of the donors openly admitted in the media that they had used or even created personal companies to hide their identities from the public. Still, the FEC dismissed all five complaints, after the three Republican commissioners voted not to investigate and sanction these donors.   

The lawsuit states that in dismissing these complaints, the FEC has “undermined FECA’s purposes, including its goal of promoting transparency in elections and providing the electorate with information about who is speaking to it during elections.” CLC and D21, along with the public, “were deprived of timely information about the sources of the contributions made to the super PACs – information to which they are legally entitled to under FECA.”

The lawsuit calls for the court to find that the FEC’s dismissal of the complaints was “arbitrary, capricious, and an abuse of discretion, and otherwise contrary to the law,” and seeks a judicial order demanding the FEC enforce the law within 30 days.