Egregious Violations in Ashcroft PAC Case Require Investigation by Department of Justice

Jan. 15, 2003

Egregious Violations in Ashcroft PAC Case Require Investigation by Department of Justice

 

Statement of Craig Holman, Legislative Representative, Public Citizen

 

Nowhere is the integrity of democratic governance more at stake than in the field of money in politics. Campaign finance laws and regulations are developed with the intent of ensuring that officeholders and candidates abide by fair and reasonable rules in raising and spending campaign funds, and that these financial activities be open to public scrutiny.

These principles were violated by the leadership PAC of John Ashcroft, called Spirit of America, and his campaign committee, Ashcroft 2000. There is also reason to suspect that these violations were done knowingly and willfully and in a manner intended to conceal the violations from the public.

That illegal contributions were made between Ashcroft’s leadership PAC and campaign committee is undisputed. Even a divided Federal Election Commission (FEC) voted that contribution violations had occurred and leveled a fine against both the PAC and the campaign committee.

But in its “conciliation agreement” with the Ashcroft committees, the FEC failed miserably at carrying out its duties to enforce the law. The commission levied a $37,000 fine against a series of illegal contributions that could have amounted to as much as $1.7 million, and avoided altogether dealing with the issue that there may have been criminal conspiracy in concealing the illegal transactions.

The FEC’s fine amounts to about 2 percent of the potential value of the violation.

The reason behind the elections agency’s extraordinary leniency can be found in the “Statement of Reasons” issued by two of the Republican members of the commission, David Mason and Michael Toner. After describing the issue as a “garden variety complaint,” the commissioners begin their analysis by dismissing the complaint as “political attacks by opponents of the current Administration” and the “sitting Attorney General.”

Partisanship may or may not have been a motivation behind the complainants; of that, I – and the FEC – are not to judge. But partisanship clearly formed the basis of the FEC providing only a slap on the wrist for Ashcroft’s campaign.

Without getting into too much detail of the violations, a brief synopsis shows why even those who wish to defend the sitting attorney general could not dismiss the complaint outright.

Within a period of a month, John Ashcroft established both his campaign committee (Ashcroft 2000) and his leadership PAC (Spirit of America). Though there is no legal precedent for leadership PACs, the FEC has generally accepted their existence as long as they do not serve as conduits for candidates to evade the contribution limits. Leadership PACs are intended as unaffiliated committees that usually make contributions to other candidates, subject to the contribution limits.

Ashcroft’s leadership PAC developed a contribution list of more than 100,000 contributors at a cost of about $1.7 million. The PAC is prohibited from making a contribution to Ashcroft’s campaign committee beyond $5,000, which includes the transfer of anything of value such as a contributor list.

 

So, Spirit of America transferred exclusive control of the contributor list to John Ashcroft personally rather than his campaign committee, then Ashcroft transferred the list to his campaign committee. The transfer was unreported.

This is nothing short of laundering a campaign contribution – a huge one at that.

To make matters even more flagrant, the Spirit of America routed additional proceeds for the rental of the list to Ashcroft 2000, and Ashcroft 2000 derived even more income from renting the list to others as well. Both committees have a common treasurer, Garrett Lott.

The value of the laundered campaign contributions can be a matter of dispute. But it is highly unlikely that John Ashcroft, a former governor and senator, or that his financial manager, would have been unaware that such transactions are illegal. And the professional manner in which the illegal transactions were conducted raises red flags sufficient to lead to criminal investigations of lesser-known candidates.

All this, and the FEC does nothing more than fine the sitting attorney general’s campaign a meager $37,000, with no criminal culpability.

The violations of law in this case are egregious. And the enforcement thus far has been patronizing. Public Citizen asks that the Department of Justice take this case with all the seriousness it is due.

###