The Federal Election Commission (FEC) plays a key role in fostering transparency in our elections, including requiring campaigns to disclose how they are spending their money. However, a 1983 FEC Advisory Opinion has eroded that transparency, by not requiring itemized breakdowns of campaign expenditures where a vendor is also paying a subvendor, which has led to widespread use of this loophole.

The issue has only grown every election cycle with over 570 political campaigns directing more than half of their spending to a single vendor in the 2020 election cycle. The funds were then likely distributed among third-party contractors, but given the lack of transparency it is impossible for voters to know where campaigns’ funds are being spent, such as to enrich family members or pay for opposition research. The Trump campaign in 2020 reportedly used a shell company as a vehicle through which to pay Trump family members large sums of money for campaign staffing. 

CREW has submitted a comment to the FEC urging the Commission to revise the current regulations on disbursement reporting, and require greater transparency and itemization of subvendors’ spending.

If the FEC is to work for its intended purpose, it will reevaluate the lack of transparency in its current policies surrounding campaign disbursement reports to bring transparency and to donors and the public.

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