CREW sues to challenge the FEC’s dismissal of dark money scheme complaint

CREW, on behalf of two Georgia voters, is challenging the Federal Election Commission’s decision to dismiss their complaint identifying a scheme to launder $5 million in dark money through multiple entities to influence the 2020 Senate elections in Georgia. Despite the recommendation of the FEC’s expert staff to investigate the scheme, the FEC deadlocked along partisan lines, preventing the agency from proceeding.

As alleged in the complaint, in 2020, an unknown donor or donors gave over $5 million to a recently created nonprofit, American Coalition for Conservative Policies (ACCP), which in turn split the funds between two more purported nonprofits, one sharing a treasurer with ACCP and also created shortly before the transfers. Soon, about $2.7 million were deposited with three super PACs. The three super PACs, and one of the nonprofits, then spent money with the intention to influence the 2020 Senate elections in Georgia, all while without revealing the source who originally provided the $5 million to ACCP. As part of the larger scheme to evade disclosing the source of the donation, the transactions were structured so that no single entity would appear to devote more than half of its spending to reportable political activities, something that would have subjected the entities to disclosure obligations.  

CREW’s lawsuit challenges the FEC’s dismissal on several bases, including that Republican FEC commissioners failed to make their dismissal justification available to their Democratic colleagues until after dismissal, which is unlawfully late. The law requires the justification for the agency’s actions to exist prior to taking action, not after-the-fact, and particularly not in secret.

Furthermore, their justification for dismissal misinterprets the law by imposing a heightened bar for the voters to bring forward their complaint, before the agency even investigates the accusations. This high bar has led to the agency failing to open almost any investigations in recent history.

The Republican commissioners’ justification also gutted the FECA’s ban on conduit contributions by interpreting the provision so narrowly as to ignore the common schemes dark money groups use to evade disclosure through straw donors. Currently, the law requires the disclosure of the true source of political contributions and bars contributions in the name of another. It also requires political committees like super PACs to report the identity of the true source of contributions and anyone who acted as a conduit for a contribution, which did not happen in this case

Lastly, the decision to dismiss also failed to take into account compelling evidence that persuaded the FEC’s non-partisan expert staff that an investigation was warranted, especially since the decision to dismiss failed to address most of the voters’ claims entirely. CREW’s challenge on behalf of these two Georgia voters will force the FEC to reexamine its decision to improperly dismiss this complaint.