Straw Donor Campaign Contributions

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Last week The Ninth Circuit reversed a trial court’s dismissal of charges in an indictment alleging that a California man had violated federal law by contributing $26,000 to the Edwards for President campaign through 13 individuals who were primarily employees of his law firm. According to the indictment Pierce O’Donnell arranged for these individuals to each donate $2,000 ostensibly in their own names but with the understanding that he would either advance them the funds or reimburse them after the donation was made. Based on this conduct O’Donnell was charged for violation of 2 U.S.C. Section 441f, which provides that “no person shall make a contribution in the name of another person”.

Read the decision and the Campaign Legal Center and Democracy 21’s amicus brief for more on the case.

Based on this reaffirmation of the illegality of straw donor contributions, employers and managers, especially in professions where political contributions are a common occurrence, must ensure that funds provided to their employees through salary increases, awards or bonuses carry with them no expectation that any portion of such funds will be used as a contribution to a particular campaign. Employee decisions regarding whether to contribute and which campaigns they contribute to must be completely voluntary in both letter and spirit.

Contributions for this campaign season are bound to come under tight scrutiny given prevailing political situation. As such it is important that everyone is clear on the rules to ensure robust and compliant advocacy.

[This blog post is meant for informative purposes only and should not be construed as legal advice.]

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