Latest Developments:
- The United States Supreme Court agreed to hear Federal Election Commission v. Cruz, a case that challenges the limit on the amount of personal loans that can be repaid to a candidate. Current law limits loan repayments to candidates at $250,000 from money raised after an election. The case raises the issue of whether the rule violates the Free Speech Clause of the First Amendment. Reuters explains that the “case involves a provision of a 2002 campaign finance law that limits the amount of money that candidates can accept from donors after an election as they try to recoup money they personally lent to their formal campaign organizations.”
- The Governor of California signed a series of bills that affect the Political Reform Act. SB 686, requires a limited liability company that qualifies as a committee under the Act to disclose its membership to the Secretary of State. AB 1367 increases the penalty for misusing campaign funds in a manner that results in an “egregious personal benefit.” AB 319 expands the state’s prohibition on contributions from foreign governments or principals to “contributions and expenditures in connection with an election of a candidate to state or local office.” The measures take effect January 1, 2022.
Reminder:
Corporate Political Activities 2021 – Latest Developments: The Pracitising Law Institute (PLI) will conduct its annual two-day conference on October 12-13, 2021, both in-person and online. You may register here.
In Case You Missed It:
- Campaign Funds for Legal Defense: According to the Chicago Sun-Times, the Illinois Supreme Court will “rule on the thorny question of whether Illinois politicians can dip into their campaign funds to pay for their criminal defense or other legal troubles.” The case involves a Chicago alderman who used $220,000 for defense lawyers while under federal investigation. The Chief Justice has recused herself because her husband, an Alderman, has spent over $2 million in campaign contributions on legal fees.
- PAC Funds to Support a Lifestyle: Newsweek describes a report [All Expenses Paid] from the Campaign Legal Center that alleges that some Members of Congress are “using their leadership PACs as ‘slush funds’ to pay for extravagances such as expensive hotels and fine dining…. Leadership PACs are meant for members of a party and lawmakers seeking reelection, but the groups’ findings suggest many in Congress are using the money for non-political expenses.”
- Paper Fined for Charging Candidates for Coverage: The Washington Public Disclosure Commission fined the Tacoma Weekly $15,000 for violating the law “on three occasions by soliciting money from three candidates seeking public office in 2020, as consideration for an endorsement, article or other communication…” The Tacoma Tribune characterized the action as “cash in exchange for news coverage.”
- Record Fine: The Oakland Ethics Commission announced that it issued a $309,600 fine in the case of a city building inspector “who was found to have committed 47 violations of the Oakland Government Ethics Act, including bribery, conflict of interest, failing to report income, misusing a City position, and misusing City resources.” The San Jose Mercury News notes that in one instance, he made a contract with an owner under court order to repair her property to “do the work himself — despite the conflict of interest — and then conducted incomplete inspections of his own work.”
- PAC Personal Use: A former Chicago Alderman pleaded guilty to “wire fraud and money laundering, admitting he took nearly $38,000 from the Chicago [City Council] Progressive Reform Caucus to pay for personal expenses.” The Chicago Sun-Times reports that he used the PAC money “as a personal piggy bank, stealing thousands to pay for a relative’s college tuition, skydiving excursions — and even at Lover’s Lane.”