FEC engulfed in power struggle over staff independence

Long-standing dysfunction at the Federal Election Commission reached a new level of personal acrimony in recent weeks, fueled by a power struggle between Republican commissioners and the agency’s top lawyer, who abruptly resigned.

The battle threatens to further obstruct the work of the beleaguered commission, which is charged with policing candidates’ and political groups’ compliance with disclosure rules and other requirements of the vast campaign finance system.

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The fight is centered on a push by the Republican commissioners to bar FEC staff members from sharing information with federal prosecutors unless the panel — currently dominated by GOP members — gives its approval.

The commission’s lone Democrat and many campaign-finance experts say the move could politicize such decisions and hamper the ability of the FEC and the Justice Department to prosecute election violations.

The dispute comes in the wake of the most expensive election in U.S. history, which followed court rulings that freed corporations to engage directly in political campaigns and gave rise to super PACs financed by unlimited donations.

The panel has been deadlocked for three years over how to update its rules to cope with the new campaign funding environment.

Advocates of campaign-finance limits view the latest fight as part of a broader Republican attempt to weaken the election agency and the regulatory system it oversees.

“You have three commissioners who are aggressively trying to stop the enforcement of the law,” said Larry Noble, president of Americans for Campaign Reform, who served for 13 years as FEC general counsel. “Now it appears they are trying to give themselves the ability to stop the FEC from assisting another agency. I cannot see a good motive for this.”

Leading the push to stop the staff from cooperating with prosecutors is Commissioner Donald F. McGahn, an outspoken conservative who is slated to leave the panel once a replacement is approved by the Senate.

In a wide-ranging interview, McGahn said the proposed policy is aimed at reining in the general counsel’s office, which he accused of exceeding its authority by sharing records with the Justice Department and then withholding information about interagency cooperation from commissioners. The most recent head of the office, Anthony Herman, ended his tenure Friday after submitting his resignation last month.

“This isn’t a power grab,” McGahn said. “It’s a question of who’s responsible and who’s accountable.”

McGahn invoked the recent scandal at the Internal Revenue Service, whose employees singled out groups with certain words in their names for extra scrutiny.

“You just can’t have an agency where the staff is sort of left to their own devices to come up with lists and do their own thing, because it creates such an opportunity for people to accuse the place of playing political games,” McGahn said.

Herman said McGahn’s portrayal of the Office of General Counsel is “not true.” He said he had continued a long-standing practice of responding to Justice Department requests for material related to criminal investigations. Until recently, no commissioners objected, Herman said.

“The OGC in its relations with the Department of Justice operates no different than the OGC has operated for years and years, and the commissioners were all aware of that, including Commissioner McGahn,” Herman said. “I’m perplexed by the allegation.”

Democratic Commissioner Ellen Weintraub, who has often sparred with McGahn, expressed bewilderment at his depiction of the FEC staff. “If anything, my concern would be that the staff had become cowed by commissioners and it may be coloring their independent judgment,” she said.

The turf war erupted in connection with an effort to establish a formal FEC enforcement manual for the first time, a step urged in 2011 by the House Administration Committee, which oversees the agency. The GOP commissioners proposed several revisions to a draft prepared by the staff. The changes would limit attorneys to consulting government Web sites when researching the merits of a complaint before the commission had authorized a formal investigation. The use of other common resources would not be permitted, including media reports, business databases, Internet search engines, social media services, YouTube videos and candidate Web sites.

The proposed restrictions are viewed dimly by many election law experts.

“That’s just ridiculous,” said campaign finance lawyer Kenneth Gross, a former FEC associate general counsel. “To hamstring staff from taking into account information out there in the public arena makes no sense. I’ve never heard of such a thing.”

McGahn said his concern is that FEC attorneys are asking the subjects of complaints to respond to allegations made in “speculative and unreliable” news articles and blog posts.

“It just doesn’t have any standards and, therefore, allows for a form of selective prosecution,” he said. “It’s left to the whim of an individual line attorney to decide how much he’s going to probe somebody.”

The most-charged debate has been over how the FEC should interact with prosecutors. Under federal law, four commissioners must approve any “referral” or “report” of possible campaign-finance violations to the Justice Department. The Republican commissioners say the rule should also apply to the sharing of internal documents requested by the Justice Department or other government agencies.

In their proposed revision of the enforcement manual, the Republicans added language stating that “the decision of whether or what to share with DOJ will rest exclusively with the Commission.” The Justice Department would have to submit written requests or subpoenas to the panel when seeking internal records.

In recent years, cooperation between the two offices has increased. FEC staff members have provided prosecutors with materials they had requested related to several major cases, including an investigation into illegal contributions to Rep. Vern Buchanan (R-Fla.), Herman told commissioners in a memo last month. A Justice Department spokesman declined to comment on how the proposed policy would affect its investigations.

Several former federal prosecutors said the approach could hinder criminal prosecutions.

“It would, at best, slow down the flow of information and potentially turn it into a political issue,” said Jonathan Biran, a 17-year veteran of the Justice Department, who worked with FEC staff on campaign-finance cases.

In a 21-page memo written before he left, Herman argued that the proposal would also disrupt communications in the other direction, limiting the ability of FEC staff members to obtain information quickly from their Justice Department counterparts, and could expose the agency to allegations of partisan decision-making.

The commission could vote on the enforcement manual as early as its next public meeting, scheduled for July 25.

The six-member panel is currently short one Democratic commissioner. Last month, President Obama nominated one person to fill the vacancy and another to replace McGahn. The nominees have yet to be confirmed by the Senate.

In a letter to the FEC on Friday, Americans for Campaign Reform and two other advocacy groups, Democracy 21 and Campaign Legal Center, said that the proposed measures would impose a “gag rule” on the staff and that McGahn was engaged in “a lame-duck power play.”

McGahn said action is urgently needed because the agency is operating without clear rules.

In one recent case, he said, the general counsel’s office alerted prosecutors to a possible criminal violation by Arlen Cenac Jr., the owner of a Louisiana truck company who made illegal campaign contributions in the name of others. Such a referral requires commission approval, which the staff did not seek, McGahn said.

The FEC settled the case with Cenac for a $170,000 fine, but the commissioners did not vote to refer the matter to the Justice Department, which later prosecuted him for making false statements to the agency.

Herman said the general counsel’s office did not initiate any referrals to the Justice Department on its own and has been “fully transparent” with the commission. He said he instituted a policy in April requiring that commissioners be told about all information shared with prosecutors after he learned that the staff had not done so consistently.

Herman said he decided in April to leave the agency and return to private practice at the firm of Covington & Burling, where he had worked for 23 years before joining the FEC in 2011. He declined to say what led to the decision.

“I had accomplished what I set out to accomplish, as much as I could,” Herman said. “It was time to go back home.”

 
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