Romney’s Old Campaign Sitting on Illegal Campaign Dollars

May 9, 2018 Ken Doyle

Mitt Romney’s presidential campaign and the Republican Party haven’t relinquished $141,300 in illegal contributions they found out about years after they thought they’d closed the books on the unsuccessful 2012 run.

The money came from a health care company that contributed through company managers — making what’s known as “straw donor” contributions.

Cancer Treatment Centers of America (CTCA), the true source of the funds, sent a letter last summer to a lawyer for the Romney presidential campaign saying the money was illegal and would have to be given up, according to Federal Election Commission documents.

The letter instructed the committee to shed the funds by sending them to the U.S. Treasury — a process known as disgorgement.

The Romney presidential campaign had more than enough money to cover the disgorgement. Earlier this year, Romney transferred $1 million in leftover cash from the presidential campaign to a newly formed campaign committee for Romney’s current U.S. Senate campaign in Utah. The Republican primary is set for June 26.

The presidential campaign had a cash balance of $222,755 as of its most recent FEC disclosure report, filed last month.

Romney’s Senate campaign aides declined to speak for the previous campaign organization.

However, two people close to the campaign who spoke on condition of anonymity said there was no obligation to give up most of the requested money — $105,800 — because that sum moved through a disbanded joint fundraising committee, Romney Victory Inc.

Waiting for the FEC

The joint fundraising committee — which had raised nearly $500 million during the 2012 campaign — was terminated with FEC approval about four months before the settlement of CTCA’s enforcement case.

Except for operating costs, Romney Victory passed its money along to the Romney presidential campaign, the Republican National Committee and several state Republican Party committees.

As for the rest of the Romney money subject to disgorgement — $35,500 — one of the campaign’s officials who spoke on condition of anonymity said the money would be turned over to the Treasury if a request comes directly from the FEC.

FEC spokespeople declined to comment.

FEC documents obtained through a Freedom of Information Act request show that CTCA sent disgorgement request letters last August to 35 campaign committees.

The letters told the committees they should shed illegal contributions that together totaled more than $605,000. In response, 15 committees immediately turned over more than $265,000, according to documents posted on the FEC website.

The campaign committees of Sens. Orrin Hatch (R-Utah) and Jeff Flake (R-Ariz.) made the largest disgorgements of illegal CTCA contributions: $60,000 for Hatch and $54,000 for Flake.

Two committees — the RNC and the campaign of Sen. Mitch McConnell (R-Ky.) — followed up later with disgorgements totaling $2,010.

The rest are supposed to disgorge about $340,000 in illegal CTCA money. Some of the recipients, though, lost their elections so their campaigns are dormant.

Of the unknowing recipients of illegal cash who won their elections, Sens. Dean Heller (R-Nev.) and Pat Toomey (R-Pa.) and Reps. Charlie Dent (R-Pa.) and Peter Roskam(R-Ill.) were told to disgorge a total of $56,400.

FEC documents show that hasn’t happened.

Bloomberg Government contacted the four congressional offices. They either didn’t respond or declined to provide a comment.

The RNC, which has disgorged $1,010 of the illegal money, didn’t respond to an email requesting comment.

Adav Noti, a former FEC attorney now with the nonprofit Campaign Legal Center, said it should be easy to track how much CTCA money was transferred by the joint fundraising committee to the Romney campaign and Republican Party committees, and then disgorge the money.

He criticized the FEC for its handling of the matter, including failing to tell campaign committees about their obligation to get rid of illegal contributions.

“The FEC should rectify that and there’s no reason that they can’t,” he said.

Decade-Long Scheme

In its enforcement settlement, CTCA acknowledged violating campaign finance laws for more than a decade by paying bonuses to managers to cover company-directed political contributions to dozens of candidates and groups.

The settlement called for CTCA to pay a fine of $288,000, the largest imposed by the FEC in recent years. It also called for the company to contact all recipients of the illegal contributions and seek disgorgement of the contributions to the Treasury.

The committees weren’t accused of any wrongdoing because they didn’t know at the time that the contributions were illegal. However, FEC rules require that, if a campaign discovers it has accepted an illegal contribution, it must get rid of it within 30 days.

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