October 08, 2015

CREW Files IRS Complaint Against Michigan Advocacy Trust

Citizens for Responsibility and Ethics in Washington (CREW) today filed a complaint with the IRS urging the agency to investigate a secretive Michigan political organization called Michigan Advocacy Trust (MAT) for spending millions of dollars on political ads without disclosing its donors.  Under federal law, this kind of organization, known as a “527” group after the section of law governing them, must disclose its donors either to the IRS or to its home state.  MAT did neither.

Michigan Advocacy Trust spent $3.6 million dollars on television ads promoting Republican Bill Schuette and attacking his opponents during the 2010 and 2014 Michigan attorney general campaigns—more than the candidates combined in the latter race.  But there is no record of where that money came from and no specific information about how they spent it.

“Disclosure laws exist for a reason – to allow the people to know who is paying to influence elections and politics,” said CREW Executive Director Noah Bookbinder.  “While the IRS allows exemptions for 527 groups who have already disclosed financial activity to the state, you actually have to disclose to the state to claim them.”

MAT claims to be an administrative account of a local political party—the “23rd Michigan State Senate Republican District Political Party Committee of Ingham County Michigan,” and thus exempt from disclosing to the IRS under section 527.  The state of Michigan, on the other hand, makes it clear the group is not a local party committee.  State law only allows for congressional district committees, not state senate districts, and allows only one officially designated committee per county—the “Ingham County Republican Committee” beat MAT to the punch by more than 30 years on that count.

Furthermore, if MAT was actually the 23rd State Senate District Republican Committee, the organization would be involved with the 23rd State Senate District races.  It has not been, instead spending more than $3 million to aid Schuette.  MAT also cannot claim to be exempt from IRS disclosure as a local non-party political committee because that exemption only applies if the group disclosed its financial activities to the state of Michigan.  Again, it has not done so.

“These exemptions are in place to avoid requiring redundant reporting,” said Bookbinder.  “Section 527 clearly states that such organizations are subject to state law requiring they report financial activity.  Michigan Advocacy Trust has never disclosed to anyone, which is why the IRS must investigate.”

CREW is increasing its scrutiny of state races, which have been the recipient of ever larger amounts of campaign money from secretive organizations in recent years, often without significant oversight.
“It is important to shine a light on these kinds of abuses at the state level and to push for more investigations and stricter laws to reduce the influence of secret money in politics,” said Bookbinder.

CREW Calls on IRS to Investigate Center for Medical Progress

Following the public admission by the founders of the Center for Medical Progress (CMP) that the organization was designed from the beginning to infiltrate Planned Parenthood, Citizens for Responsibility and Ethics in Washington (CREW) today filed a supplement to its complaint with the IRS alleging that CMP knowingly misled the IRS when applying for tax-exempt status. At the same time the organization was working working on undercover videos, CMP presented a false and very different account of themselves to the IRS, leading them to be classified as a biomedical research organization. Read More ›

Noah Bookbinder Statement on the Guilty Plea of Brett O’Donnell

The plea documents released today by the Department of Justice in the case of Brett O’Donnell suggest a continuing investigation which could well result in further charges. It is very encouraging that the Department is continuing the aggressive approach to ethics and corruption matters that it has demonstrated over the past several months, and it is particularly important that the Department is bringing charges for lying to the Office of Congressional Ethics. These charges send a strong and much-needed signal that Congressional ethics investigations need to be taken seriously and that members, staffers, or consultants who obstruct them will be held accountable. Read More ›

Statement from Noah Bookbinder on the Indictment of Jesse Benton

In response to the Justice Department’s indictment of Jesse Benton, head of pro-Rand Paul Super PAC America’s Liberty PAC, and two others, CREW Executive Director Noah Bookbinder issued the following statement Read More ›

CREW Statement on the Indictment of Rep. Chaka Fattah (D-PA)

In response to the Justice Department’s indictment of Rep. Chaka Fattah (D-PA) today on public corruption charges, CREW Executive Director Noah Bookbinder issued the following statement: Read More ›

CREW Calls for Investigation into Center for Medical Progress for Lying to IRS

CREW asked the IRS to investigate the Center for Medical Progress' possible misrepresentation of itself as a journalist organization which monitors developments in biomedicine and bioengineering. Read More ›

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