Blog — Campaign Finance Reform

March 18, 2014

Going Rogue: Once a Reformer, John McCain Exploits Campaign Finance Loophole

By CREW Staff

John McCain - Guard Association of the United States General ConferenceIt turns out a determined member of Congress can find a way around the most straightforward of campaign finance regulations—and even someone once known as “Congress’s leading champion of campaign finance reform” isn’t above doing it.

Senator John McCain (R-AZ) found a creative way to skirt a $5,000 limit on contributions from a campaign committee to a political action committee (PAC). In fact, his method was so successful he was able to freely transfer an asset worth nearly $3 million: his campaign mailing list.

During the 2010 election cycle, Sen. McCain had a campaign committee, Friends of John McCain, Inc., and a leadership PAC, Country First PAC. On January 31, 2011, Friends of John McCain, Inc. was converted from a campaign committee into a leadership PAC named Patriot First PAC. Because both Patriot First PAC and Country First PAC were established and controlled by Sen. McCain, the Federal Election Commission (FEC) considered the two leadership PACs to be affiliated committees, which allowed them to transfer funds and assets to each other without limit.

The day after its creation, the Patriot First PAC transferred the mailing list to Sen. McCain’s pre-existing leadership PAC, Country First PAC, reporting the value of the transaction as nearly $3 million. Less than four months later, after a few more minor transactions, the Patriot First PAC was terminated, suggesting transferring the mailing list was the whole reason it existed in the first place. On December 27, 2012, Sen. McCain established a new campaign committee with the same exact name as the one he used during the 2010 election cycle – Friends of John McCain, Inc.

His original campaign committee could have rented the list to the Country First PAC, but it would have had to charge the PAC fair market value. Instead, a little maneuvering let Sen. McCain turn the valuable list over to his PAC for free. Tactics like this strengthen the perception that campaign finance law is so full of loopholes, politicians can do whatever they want.

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