Formed in late February, the group was funded almost entirely by members of Holding’s wealthy banking family, including $100,000 each from an aunt and uncle and $250,000 from a group of cousins, FEC records show.
Representatives of the Holding and Coble campaigns did not respond to requests for comment last week. During the campaign, Coble complained of the “disadvantage when one individual can afford to buy an election,” while Holding representatives characterized the group as a simple gesture of support from family and friends.
“In North Carolina, this was probably one of the first clear examples of what a super PAC is and how it completely changes the rules of the game,” said Bob Phillips, executive director of the state’s Common Cause chapter. He said Coble was “overcome by the money, and I don’t imagine that the average voter probably knew that it was from his opponent’s family.”
One common thread in many of the races is allegations that super PACs are improperly coordinating their activities with candidates. In the San Fernando Valley race, the campaign manager for Rep. Brad Sherman (D) filed an FEC complaint alleging that the pro-Berman group and the Berman campaign were illegally coordinating by using the same political consultant. The Berman campaign denied the allegations.
Parke Skelton, a Sherman political adviser, said there are “multiple overlaps” between the Berman super PAC and the campaign that call into question the group’s independence. The group has spent about $550,000 on Berman’s behalf, helping him survive the primary to face Sherman this fall.
“He’s counting on the super PAC to be able to raise a lot of money very quickly for him because he’s at a huge cash disadvantage to Brad going into November,” Skelton said, referring to $3 million that Sherman has in the bank. Funding from the super PAC, he said, “is going to be enough money to impact the race.”
Elliot S. Berke, a Republican campaign finance lawyer at McGuireWoods in Washington, said super PACs and other independent groups have wide flexibility as long as they avoid direct contact with candidates or their campaigns.
“The legal question really isn’t who is behind the super PAC from a relationship perspective,” Berke said. “Friends or relatives setting up a super PAC to support someone’s candidacy may create political questions and even trigger an FEC complaint by political opponents, but it doesn’t on its face violate any law or regulation.”
Nathanson, the investor who helped form the pro-Berman super PAC, said the group has abided by all regulations and will continue to do so.
“Look, I hate super PACs. I’m a Democrat and I always thought they were a Republican thing,” Nathanson said. “But I also realize now that there’s a law of the land, whether I like them or not. It’s part of the political financing world we have to deal with.”