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FEC report shows how national party committees allegedly blow past contribution limits

The 2019 general counsel’s report, which gained little notice at the time, calls attention to a loophole in individual giving limits

Then-Republican presidential nominee Donald Trump and Democratic candidate Hillary Clinton arrive for their second presidential debate in St. Louis on Sunday, Oct. 9, 2016. (Melina Mara/The Washington Post)
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A fundraising committee operated jointly by the Trump campaign and the Republican National Committee in 2016 served as a vehicle for state parties to pass more than $27 million to the national party in possible violation of contribution limits, the Federal Election Commission’s general counsel found almost three years ago.

The general counsel’s report, available since 2019, was newly released Friday in an updated and unredacted form because of a development in an associated case. It mirrors findings from the FEC general counsel’s office about similar activity by a joint fundraising committee benefiting Hillary Clinton in 2016. The alleged sum funneled through state party committees in that case was even larger: $112 million.

The inquiry into Trump Victory, which gained little attention at the time, brings new light to what some FEC commissioners and campaign finance experts see as a loophole made possible by the Supreme Court’s decision in the 2014 McCutcheon v. FEC case, which invalidated caps on how much individuals can contribute overall to federal candidates and committees.

Without those caps, the FEC general counsel found, donors used Trump Victory to route excessive contributions to the RNC through state party committees. According to the complaint that prompted the general counsel’s review, which was filed by the left-leaning American Democracy Legal Fund, more than 100 transactions between Sept. 30, 2016, and Dec. 26, 2016, betrayed a pattern of near-simultaneous transfers into state party committees and then from those committees to the national party. A complaint by a Trump-aligned group in 2017 made similar claims about transfers in and out of state-level Democratic committees between Oct. 1, 2015, and Nov. 8, 2016.

“The facts of this case appear to present the scenario that troubled numerous Justices in McCutcheon: a pre-arranged plan to circumvent the contribution limits via joint fundraising,” the general counsel’s report found in both cases. It determined there was reason to believe the national committees accepted excessive contributions and recommended the FEC reach a similar conclusion.

The commission could not muster the votes to pursue investigations, though it did embark on cases against state party committees for reporting violations. For instance, the commission last year levied a fine of $52,000 against the Wyoming Republican Party.

Ellen Weintraub, a Democratic commissioner who voted to pursue a broader investigation in both cases, said Friday the failure to do so gives a greenlight for the parties to continue blowing past contribution limits.

“Both the Trump and Hillary Victory Fund did this,” she said. “And the takeaway is that they got away with it in 2016. They certainly did it again in 2020 and will likely also do it in 2024 because there is no political will at the FEC to go after these violations.”

Brett Kappel, a campaign finance lawyer at D.C.-based Harmon, Curran, Spielberg & Eisenberg, said the report makes clear that joint fundraising committees are enabling a “giant money laundering scheme allowing wealthy individuals to get hundreds of thousands of dollars to national party committees by funneling it through state parties.”

According to the general counsel’s reports, the RNC and the DNC both argued the activities of their joint fundraising committees were legal.