A company run by David Trone, the Potomac wine magnate who was a candidate for Congress in Maryland’s 8th District this year, made more than $250,000 in illegal contributions to political candidates between 2011 and 2014, state prosecutors say.
Trone’s attorney said the company admits no wrongdoing, but agreed to pay a $5,000 fine for each illegal contribution, totaling $60,000.
Before he mounted the most expensive self-funded congressional campaign in history — spending more than $13 million in his Democratic primary loss to state Sen. Jamie B. Raskin (D) — he was best known as a major-party fundraiser, hosting President Obama, Hillary Clinton and a long list of other political figures at his home.
The Maryland State Prosecutor’s Office announced Friday that it had issued 12 citations to Retail Service and Systems Inc. (RSSI), charging that the company or its subsidiaries violated what was then the $4,000 limit on giving to a single candidate. It has since been raised to $6,000.
According to an affidavit from the prosecutor’s office, the improper contributions were made by Trone’s companies to the 2014 gubernatorial campaign of then-Lt. Gov. Anthony G. Brown (D), his running mate Ken Ulman, and the 2014 reelection campaign of State Comptroller Peter Franchot (D).
From Aug. 18 to Sept. 30, 2014, RSSI and 24 wholly owned subsidiaries made a total of $124,000 in “over-contributions” to Brown, according to the affidavit. Franchot’s campaign received $62,000 in illegal donations from RSSI and its affiliates from Jan. 4, 2012, to Dec. 29, 2014. The campaign committee of Ken Ulman, the former Howard County executive, received $82,000 in excess donations from May 5 to Oct. 31, 2014.
Contributions from Trone-owned companies to candidates across the country became an issue in the congressional primary. Trone said in an interview that he made the payments “to buy access” in states where his chain of retail beer and wine stores, Total Wine & More, was doing business or planned to expand. Trone was outspoken in his criticism of Maryland regulations that limited Total Wine to two operating licenses.
“Contributions of hundreds of thousands of dollars, given at the direction and under the control of a single entity, could result in the appearance of undue influence on the part of the contributors,” Maryland State Prosecutor Emmet C. Davitt said in a statement.
Davitt added that the state had “no evidence that the over-contributions were made knowing that the act was unlawful.”
The contributions were made while the “LLC loophole” was still on the state’s books. Business owners who wanted to enhance their influence could make contributions through each of their subsidiaries. That practice was outlawed after the 2014 election.
RSSI general counsel Robert Shaffer said in a statement late Friday that the terms of the civil settlement include “no fine, no penalty, and no admission of any wrongdoing or liability.”
Shaffer said the company had a strong case for challenging the state but “ultimately decided it is in our best interest to accept the terms of this settlement and close this matter rather than pursue litigation.”
The prosecutor’s announcement was first reported by the Baltimore Sun.