July 13, 2016
The Federal Election Commission (FEC) just agreed to a massive fine for three Koch network-funded groups for illegally hiding the source of the funding for their political ads, as originally alleged by a 2014 Citizens for Responsibility and Ethics in Washington (CREW) complaint.
The 60 Plus Association (which agreed to pay $50,000 in a conciliation agreement with the FEC), the American Future Fund ($140,000) and Americans for Job Security ($43,000) spent millions of dollars in 2010 from the Center to Protect Patient Rights (CPPR, now known as American Encore), the Koch brothers’ main funding group at the time, on ads targeted by CPPR without disclosing the source of the money.
The groups claimed the money was for general expenses and not specific ads, so they were not required to disclose their donors. However, Sean Noble, who was the central figure in distributing Koch money in 2010 and 2012, told the National Review in 2014 that he was deeply involved with producing the ads and selecting their targets—meaning the groups were required to disclose the source of the funds. The FEC’s investigation found that Noble’s consulting firm even helped produce and place the ads for the groups.
“These rules provide some of the only windows into the funding of dark money groups, but the FEC almost never penalizes groups that break them,” CREW Executive Director Noah Bookbinder said. “It is hard to overstate how significant this is.”
To understand the magnitude of these fines, in the first five months of this year, the FEC gave out $273,000 in conciliation agreement civil penalties for an average penalty of $15,000. The penalties in this case alone totaled $233,000.
“This is the largest fine the FEC has collected from groups active in post-Citizens United elections,” Bookbinder said. “This case sends an important signal that groups that brazenly disregard the law will be held accountable. We hope this is a sign of things to come and the FEC will continue to hit dark money groups with major penalties for violating the law.”
This is the second highest penalty ever given in a case brought by CREW.