FEC Fine Sounds Alarm on Meddling in US Elections

(CN) – The Federal Election Commission handed down a nearly $1 million fine Monday stemming from an illegal campaign contribution to onetime presidential candidate Jeb Bush’s political action committee by Chinese nationals.

The fine comes amid the ongoing probe into possible collusion between President Donald Trump and the Russian government, as the United States continues to grapple with the extent to which foreign entities meddle in national elections.

The FEC fined both Right to Rise, the political action committee formed to support Jeb Bush, and Chinese-owned American Pacific International Capital a total of $940,000 for an illegal campaign contribution in the run-up to the 2016 presidential election.

“The commission found reason to believe that Right to Rise USA and Charles Spies in his official capacity as treasurer violated provisions of the Federal Election Campaign Act of 1971,” the commission said in the settlement documents released on Monday.

American Pacific contributed $1.3 million to the Jeb Bush-affiliated PAC at the request of Bush’s brother Neil, both sons of President George H.W. Bush and Barbara Bush.

“Today’s action is a rare and remarkable step by the FEC, and a reminder that safeguarding our elections against foreign interference is in America’s vital national security interests,” said Trevor Potter, president of Campaign Legal Center which filed the complaint with the FEC in August 2016.

Potter said the Citizens United decision by the U.S. Supreme Court, which allowed corporations to make unlimited campaign contributions to political action committees, has opened the floodgates for foreign operators to become involved in electoral politics in the United States.

“The fact that the FEC, which so often deadlocks and therefore fails to act in violations, could agree on this one highlights the very real danger this sort of activity poses to our democracy,” Potter said in a statement.

The nearly $1 million fine represents the largest since Citizens United in 2010. It is also the third largest in history.

Right to Rise was fined $390,000 for soliciting the donation, while American Pacific must pay $550,000 for making the donation.

Concerns that foreign actors can use the cover of corporations to make donations to political candidates in an attempt to curry favor are legitimate in the environment created by Citizens United.

“Foreign actors have a demonstrated interest in influencing elections, and corporations offer an easy way to for them to do so, usually without detection,” said Brendan Fischer, also with the Campaign Legal Center.

Fischer says it was only smoking-gun evidence that American Pacific president Gordon Tang directed the $1.3 million donation to Right to Rise that prompted the investigation in the first place.

Tang and Huidan Chen, are a married couple, majority owners of American Pacific and Chinese residents in their early 40s who reside permanently in Singapore. The couple met Neil Bush while he was on a business trip to Singapore in 2015.

Bush solicited the donation on behalf of his brother Jeb Bush’s campaign, and Tang said he would be willing to do so as long it was legal.

Right to Rise general counsel Charles Spies then sent a memo to Tang and Chen detailing various laws related to donations to super PACs, including the fact that donations can be made by subsidiaries of foreign entities as long as they are incorporated in the United States.  

Despite its foreign ownership, American Pacific is headquartered in San Francisco.

Under campaign finance rules, a company incorporated in the United States has the right to contribute money to presidential campaign, but with one provision: The decision to donate has to be made by a special committee comprised solely of U.S. citizens.

In the present case, the evidence of Tang directing the donation led to the investigation and subsequent fine. Both Potter and Fischer say had that email not been unearthed the donation would have passed muster under the letter of the law, but the spirit of the law barring foreign nationals from donating to campaigns would have been violated.

It’s why critics say the American Pacific case is an indicator of a widespread problem of foreign influence in American elections, pointing out that in most cases the special committee provisions are easily eluded.

“We can’t be sure how many other foreign nationals have funneled money into our elections through undisclosed donations to dark money groups,” Fischer said. “Law enforcement agencies need disclosure to enforce the laws protecting the integrity of our democracy. The law can’t be enforced against foreign money if the money isn’t disclosed at all.”

%d bloggers like this: