Wealthy Special Interests Continue to Use Shell Corporations to Evade Transparency Laws, New CLC Complaint Highlights

Two hands seen through frosted glass. One is passing a stack of what looks like money to another.

Two shell corporations appear to have illegally laundered $1.25 million to Democratic super PACs, according to a new Federal Election Commission (FEC) complaint filed by the Campaign Legal Center (CLC).

The Pacific Environmental Coalition (PEC) was formed as a nonprofit last fall, and within months had given over $1 million to the Democratic super PACs Senate Majority PAC, Unite the Country, and VoteVets. In the 2018 cycle, another nonprofit called the Pacific Atlantic Action Coalition (PAAC) gave $200,000 to Senate Majority PAC just months after forming.

There is no record of either group having engaged in any activity outside of those political contributions—however, both nonprofits have the same address, the same incorporator, and board members from the same tax consulting firm; the CEO of both is Matthew Cohler, a Silicon Valley investor and former Facebook executive.

The evidence strongly suggests that an unknown donor or donors gave funds to PAAC and PEC for the purpose of secretly financing these super PAC contributions. To reduce political corruption, we need real transparency about who is spending big money on elections so that politicians can no longer receive unlimited, secret money from wealthy special interests to support their campaigns.

CLC’s complaint alleges that that PAAC’s and PEC’s contributions violated federal law’s “straw donor” ban, which prohibits any person from making a contribution in the name of anybody else.

This is just the latest example of wealthy special interests using shell corporations to secretly launder funds into U.S. elections, and it echoes the campaign finance violation that led to the arrests of Lev Parnas and Igor Fruman last year.

Read CLC’s complaint here.

Brendan directs CLC’s work before federal regulatory agencies, such as the Federal Election Commission (FEC).