Intercept Investigation Leads to Record Fines Over Foreign Campaign Contributions

[homersapien 11,363]

We really need to legislate around Citizen's United if that's possible. It was a horrible decision for the country.

 

The Federal Election Commission has unveiled one of the most significant enforcement actions in its history, citing a 2016 investigative series by The Intercept.

That series, “Foreign Influence,” detailed how Right to Rise USA, a Super PAC supporting the 2016 presidential candidacy of Jeb Bush, received $1.3 million in campaign donations from American Pacific International Capital, a California corporation controlled by two Chinese citizens.

The FEC fined APIC $550,000 and Right to Rise USA $390,000. The total of $940,000 is the 3rd-largest financial penalty ever issued by the FEC.

It is illegal for foreign nationals to contribute money in connection with U.S. elections. However, APIC and Right to Rise USA attempted to use an odd loophole created by the Supreme Court’s 2010 Citizens United decision to funnel overseas cash into American politics.

The details of the enforcement action were released today in a letter to the Campaign Legal Center, a campaign finance watchdog that filed a complaint based on The Intercept’s investigation.

“This case was so egregious that, once it was revealed, even the dysfunctional FEC was forced to act,” said Robert Weissman, the president of Public Citizen, in a statement to The Intercept.

The letter revealing the fine includes conciliation agreements that lay out the facts of the case, which correspond to The Intercept’s original reporting.

Barack Obama warned during his 2010 State of the Union address that the Citizens United ruling would “open the floodgates for special interests, including foreign corporations, to spend without limit in our elections.” APIC was attempting to do exactly this.

Before Citizens United, only individual American citizens could contribute limited amounts of money to support U.S. political activities. Post-Citizens United and related decisions, American companies can donate directly from their corporate treasuries to Super PACs in unlimited amounts.

However, any company incorporated in the U.S. counts as an “American” corporation under current law — even if it is wholly-owned by foreigners.

This was the case with APIC, a U.S. affiliate of the SingHaiyi Group, a Singapore-based real estate conglomerate. According to SingHaiyi’s 2014 public filings, APIC is owned by SingHaiyi founders Gordon Tang and Huaidan Chen, a married couple who are citizens of China and legal residents of Singapore. Neil Bush, the brother of both Jeb and George W. Bush, sits on APIC’s board.

The concept of the donations was first vetted by Charlie Spies, a powerful GOP lawyer and the treasurer of Right to Rise USA. Spies produced a memo in February 2015 green-lighting the contributions under the same reasoning used by Obama. “A domestic subsidiary corporation,” Spies wrote in reference to APIC, “may now directly contribute to a Super PAC in connection with a federal election.” Following its receipt of the memo, APIC made two donations, the first for $1 million and another for $300,000.

“Obama was right,” says Brendan Fischer of the Campaign Legal Center. Prior to Citizens United, “APIC would have been prohibited from making contributions altogether.”

Read the rest at:

https://theintercept.com/2019/03/11/intercept-investigation-leads-to-record-fines-over-foreign-campaign-contributions/