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Audits Fault Clinton, Dole on '96 Party Ads

Clinton and Gore in 96 President Clinton and Vice President Gore during the 1996 campaign.

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  • Money Machine: The Fund-Raising Frenzy of Campaign '96 (Post Series, February 1997)

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  • By Roberto Suro
    Washington Post Staff Writer
    Wednesday, December 2, 1998; Page A1

    Federal Election Commission auditors have concluded that both President Clinton and former senator Robert J. Dole illegally financed nationwide television advertising blitzes during the 1996 presidential campaign and should repay millions of dollars in federal matching funds.

    The audits released yesterday mark the first time that government authorities have publicly examined the use of funds raised by political parties to pay for advertisements promoting the campaigns of presidential candidates -- the controversial practice that launched the Justice Department's campaign finance investigation two years ago.

    Based on an early draft of the audits, Attorney General Janet Reno this fall began a review to determine whether she should seek appointment of an independent counsel to investigate whether the president violated campaign financing laws during the 1996 campaign. She may finish her review next week.

    The FEC audits stop far short of alleging criminal activity by the Clinton or Dole campaigns and instead suggest that the alleged misdeeds can be remedied by repaying the federal matching funds they received in return for agreeing to limit their campaign spending. The Clinton campaign is being asked to repay $7 million while the Dole campaign is being billed more than $17 million.

    The full commission, made up of three Republicans and three Democrats, can accept, reject or modify the conclusions reached by the FEC staff.

    Attorneys for the Clinton and Dole campaigns yesterday challenged the legal analysis used in the audits and called on the commissioners to recognize that the 1996 campaign practices were legal.

    Lyn Utrecht, general counsel of the 1996 Clinton-Gore campaign, and Joe Sandler, Democratic National Committee general counsel, said in a joint statement yesterday that "we reviewed each DNC ad to ensure its legality and appropriateness and our clients followed and relied on our advice." They argued that regardless of what the FEC decides, there is no basis for a criminal investigation by an independent counsel because Clinton was acting on the advice of his lawyers.

    Like the lawyers for Clinton, Kenneth A. Gross, who represents the Dole campaign, argued that if the FEC believes that current law is faulty, the solution is to change the law. "The commission staff is attempting to improperly construct unprecedented unsupportable law through the audit process," he said.

    Republican leaders have repeatedly called for an independent counsel probe of Clinton's 1996 campaign on the grounds that the president and his top aides criminally conspired to evade campaign spending limits by illegally raising and spending funds in the name of the Democratic National Committee. The House Judiciary Committee yesterday moved to expand its impeachment inquiry into this territory.

    In their analysis of campaign practices, the audit reports conclude that both campaigns ran afoul of the complex laws and regulations governing the financial relationship between an individual candidate and political party organizations.

    At the heart of the controversy are "issue advertisements" that promoted positions held by Clinton and Dole, featured the candidates and criticized their opponents, but were not counted against the strict spending limits imposed on presidential campaigns that accept federal matching funds. Instead, the extensive television advertisements -- worth more than $46 million in Clinton's case, nearly $18 million for Dole -- were paid for by party organizations.

    The FEC audits concluded that the Clinton and Dole campaigns worked closely with the party organizations to coordinate the advertising efforts in particular by targeting media buys to benefit the candidates during both the primary and general election campaigns. Moreover, the audits included a detailed analysis of the ads and concluded they contained an "electioneering message" that clearly backed the Clinton or Dole campaigns.

    For example, the auditors cited three advertisements paid for by the DNC that were the same as ads broadcast by the Clinton campaign, and noted Republican ads that cast "Senator Dole as the best choice for the Republican nomination as well as the best choice for president."

    Because the spots were in effect advertisements for the two presidential campaigns, the FEC auditors concluded that the cost of producing and broadcasting them should be counted as in-kind donations by the party organizations to the individual campaigns. That form of accounting would have put the campaigns well above the allowed spending limits; as a result, the auditors argued, the campaigns should be found in violation of the agreements under which they accepted matching funds.

    Although Clinton's campaign allegedly engaged in greater overspending than Dole's, the FEC auditors sought a smaller repayment from the president's reelection effort because the Democratic expenditures were made during the primary season while the Republican excesses were attributed to the general election campaign, when different rules apply.

    After Justice Department investigators subpoenaed an early version of the audit report on the Clinton campaign last summer, Reno started the process of determining whether an independent counsel should investigate the alleged wrongdoing cited by the FEC staff. By law she has until Monday to decide whether to close the inquiry, seek an independent counsel or request a 60-day delay in making a decision.

    Even as his past campaign finance practices came under renewed scrutiny yesterday, the president returned to the fund-raising circuit for the first time since the midterm congressional elections. Clinton was the star attraction last night at two events intended to generate $1.1 million for the Democratic National Committee, including one with gay supporters and another with business leaders.

    © Copyright 1998 The Washington Post Company

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