PAC for Clinton takes veiled $1M

She faulted untraceable money, but group says it stays

Democratic presidential candidate Hillary Rodham Clinton, shown Monday at a high school in Exeter, N.H., has criticized the use of “dark money,” though a super PAC supporting her received $1 million from donors who can’t be traced.
Democratic presidential candidate Hillary Rodham Clinton, shown Monday at a high school in Exeter, N.H., has criticized the use of “dark money,” though a super PAC supporting her received $1 million from donors who can’t be traced.

WASHINGTON -- At a June rally, Hillary Rodham Clinton told a cheering crowd 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 can't be traced.

The seven-figure donation, made June 29 to the pro-Clinton group Priorities USA Action, came from another super political action committee, called Fair Share Action. The two contributors of the donation are Fair Share Inc. and Environment America Inc., according to records filed with the 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 those who advocate 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 the Washington-based advocacy group Democracy 21.

Wertheimer urged Priorities USA to return the money and said Clinton should demand that the super PAC "publicly disclose all of the original sources of money" 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 one of Clinton's Democratic competitors, Sen. Bernie Sanders of Vermont, has rejected the support of super PACs altogether, Clinton has said 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 are boosted by nonprofits dedicated to helping their candidacies.

Conservative Solutions Project, a group paying for ads that boost Sen. Marco Rubio of Florida, said 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 such 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 but must disclose their donors.

But as is the case with the $1 million donation to Priorities USA, 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 to trace.

An example is Stand for Principle, a super PAC helping Sen. Ted Cruz, R-Texas. 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 limited-liability companies, according to federal court records.

Identifying the people behind a limited-liability company is difficult 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 on its board.

Tax and campaign finance records show Fair Share Inc. and Environment America Inc. -- the nonprofit donors behind the $1 million contribution -- did not give to Priorities USA during Obama's campaign. 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 Fair Share, said the group raises its money primarily from small donors online. Elizabeth Ouzts, a spokesman for Environment America, described that nonprofit's funding as being from "itty, bitty donors," and not big checks 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.

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 election commission 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. The nonprofit money can't be traced to any donors.

Information for this article was contributed by Ted Bridis of The Associated Press.

A Section on 08/11/2015

Upcoming Events