Group backing Clinton gets $1M from untraceable donors
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Group backing Clinton gets $1M from untraceable donors
Aug. 10, 2015
WASHINGTON (AP) — Hillary Rodham Clinton told a cheering crowd at her largest rally so far that "the endless flow of secret, unaccountable money" must be stopped. Two weeks later, the main super PAC backing her bid for the Democratic presidential nomination accepted a $1 million contribution that cannot be traced.
The seven-figure donation, made June 29 to the pro-Clinton Priorities USA Action, came from another super political action committee, called Fair Share Action. Its two lone contributors are Fair Share Inc. and Environment America Inc., according to records filed with Federal Election Commission.
Those two groups are nonprofits that are not legally required to reveal information about their donors. Such contributions are sometimes called "dark money" by advocates for stricter campaign finance rules.
"This appears to be an out-and-out laundering operation designed to keep secret from the public the original source of the funds given to the super PAC, which is required to disclose its contributors," said Fred Wertheimer, director of one such group, the Washington-based Democracy 21.
Wertheimer urged Priorities to return the money and said that Clinton should demand that the super PAC "publicly disclose all of the original sources of money" of any contribution it receives.
It's a suggestion rejected by Priorities USA, whose spokesman, Peter Kauffmann, said the group is "playing by the rules."
"In the face of a billion dollar onslaught by right wing groups, there is too much at stake for everyday Americans for Democratic groups to unilaterally disarm," he said. Priorities USA raised about $15.6 million in the first six months of the year.
While another Democratic competitor, Vermont Sen. Bernie Sanders, has rejected the support of super PACs altogether, Clinton has been plain that she needs big-money help.
"We're going to have to do what we can in this election to make sure that we're not swamped by money on the other side," she said last month.
Several of the Republican candidates for president also have nonprofits dedicated to helping their candidacies.
Conservative Solutions Project, a group paying for ads that boost Florida Sen. Marco Rubio, says it raised about $16 million through June. Former Florida Gov. Jeb Bush also has such a group, called Right to Rise Policy Solutions.
The law does not require these nonprofits to disclose their donors, but they are limited in how much they can directly advocate for a candidate.
Super PACs have much more latitude in their political activities. As a trade-off, they must report their donors to the FEC.
But as is the case with June's $1 million donation to Priorities USA Action, sometimes the named donors are nonprofits that collect money from anonymous sources. Other times, donors to super PACs are limited liability corporations or trusts that are difficult if not impossible to trace.
A prime example is Stand for Principle, a super PAC helping Republican Texas Sen. Ted Cruz. Almost all of the $250,500 the super PAC raised in the first six months of the year came from "V3 231 LLC," a corporation made up of three other LLCs, according to federal court records reviewed by The Associated Press.
Identifying the people behind an LLC can take weeks or months of intensive investigation, because corporate registration records typically identify only a street address and contact for a registered agent, usually a lawyer.
Clinton's allies have taken over Priorities USA, a super PAC that was set up in 2011 to help President Barack Obama win re-election. It's now led by Guy Cecil, a veteran of Clinton's 2008 presidential campaign, and her longtime advocates Harold Ickes and David Brock are among its board members.
Tax and campaign finance records show Fair Share Inc. and Environment America Inc. — the nonprofit donors behind the $1 million Priorities USA contribution — did not give to Priorities USA in the Obama era. Fair Share advocates for job creation, and Environment America works on issues such as climate change. Both have existed since at least 2007.
Contributions flow to both of those nonprofits thanks in part to the Democracy Alliance, a left-leaning donor network that meets privately twice a year. Brock attends most of those gatherings.
David Elliot, a spokesman for the nonprofit Fair Share, said the group raises its money primarily from small donors online. Elizabeth Ouzts, a spokeswoman for Environment America, described that nonprofit's funding as being from "itty, bitty donors," and not big check-writers or corporations.
But because neither group is required to disclose its donors to federal regulators, as required of a campaign or super PAC, those statements are impossible to verify.
The Environment America money that ultimately landed in Priorities USA's bank account was a show of support for Clinton, Ouzts said, "because she shares our priorities."
Anonymous money is helping Clinton in other ways, too.
American Bridge 21st Century, founded by Brock, assists Clinton by providing her campaign and other Democrats with opposition research on Republicans. It operates both as a super PAC that reveals donors and a nonprofit that doesn't.
The latest FEC filings show that the super PAC side of American Bridge raised $5 million, and the nonprofit side gave the group about $1.2 million in overhead expenses such as office space and salaries. That nonprofit money can't be traced to any donors.
Associated Press writer Ted Bridis contributed to this report.
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