Election Watchdog Fines Senator Cruz for Failure to Report Loans Totaling Over $1 Million, in Violation of Federal Law
Cruz fined $35k for keeping voters in the dark about source of loans
WASHINGTON – Today, Campaign Legal Center (CLC) announced that the Federal Election Commission (FEC) has fined U.S. Senator Ted Cruz $35,000 for inaccurately reporting the source of campaign loans totaling $1,064,000, a violation of federal law, stemming from a complaint filed by CLC and Democracy 21 in 2016. After concluding their investigation, the FEC found Cruz obtained loans from Citibank and Goldman Sachs for use in his 2012 Senate campaign but improperly reported these loans as coming from his “personal funds.”
“Candidates should take seriously their legal requirement to disclose where their campaign money comes from. Today’s announcement is an acknowledgement that Cruz’s campaign deprived voters of that critical information,” said Tara Malloy, senior director, appellate litigation and strategy at CLC. “In the homestretch of a high-profile election, voters were misled about Cruz’s personal and campaign finances. This is particularly harmful given that financial issues were at issue in the campaign and could have factored into voters’ decision-making at the ballot box.”
The FEC conducted an audit of Cruz’s campaign activity and found that of the $1.43 million in loans that were reported as having come from Cruz’s personal funds, he actually borrowed $800,000 from three loans secured by a Goldman Sachs brokerage account he held jointly with his wife. In a conciliation agreement with the FEC, the Cruz campaign admits that it failed to timely provide the required information about the loans and concedes it has still not amended its reports.
Cruz faced scrutiny for not disclosing the Goldman Sachs loan he used for his 2012 Senate campaign after a 2013 interview with The New York Times in which Senator Cruz reportedly stated that he and his wife, Heidi Cruz, a managing director at Goldman Sachs, agreed to “liquidate” their “entire net worth” to free up the funds necessary for the campaign. Only now, years after the campaign, the public has a clear picture of the holes in that story – which was once a major narrative of his campaign.