• 10 Questions for ACORN’s ‘Independent’ Investigator

    Posted by Geoff Embler on September 24th, 2009

    The Association of Community Organizations for Reform Now (ACORN) this week appointed former Massachusetts Attorney General Scott Harshbarger (D) to conduct an ‘independent’ investigation into recent allegations of potentially criminal activity by employees of the troubled organization.  Those accusations spurred the U.S. Census Bureau and Internal Revenue Service to terminate their relationships with ACORN.  The House of Representatives, led by the efforts of House Republicans, also overwhelmingly passed the Defund ACORN Act as an amendment to legislation providing for a government takeover of student lending.

    As if the news about ACORN in the last few weeks has not been troubling enough, a look back at an October 2008 Pennsylvania injunction hearing against ACORN provides even more reasons why the House must have a stand-alone vote on the Defund ACORN Act so that Democratic leaders sympathetic to ACORN cannot hold the Defund ACORN Act hostage to a government takeover of student loans.

    The injunction hearing included testimony from former ACORN employee Anita Moncrief, who worked in the group’s Washington, DC, office and had first-hand knowledge of its operations and offered a disturbing look at how ACORN works.  Based on testimony from the hearing, here are 10 questions for ACORN’s new ‘independent’ investigator to answer:

    1. IS THERE ANY DISTINCTION BETWEEN ACORN AND ITS AFFILIATES, OR ARE THERE DIFFERENCES IN NAME ONLY?

    Moncrief testified that “Project Vote is a sister organization of ACORN.  When I got there, I actually thought I was working for ACORN because that was the only thing I heard about during the interview.  But when I got there, I realized that I was working for Project Vote, and they explained to me the difference between the two organizations.  But as I was there, I learned there wasn’t much of a difference.”  Moncrief also said that “[h]onestly, there really isn’t a difference between Project Vote and ACORN except for the fact that one is a 501 (c) (3) and one is not a (c) (3).  As far as the – who does the voter registration work and how things get done, their – Project Vote is basically considered ACORN political operations.”

    Moncrief also testified when asked if there was active cooperation between ACORN’s political wing and Project Vote that “… we’re considered basically the same staff.  Nathan Henderson James was the strategic writing and research department – he was that director.  And then at the same time, he was research director for Project Vote.  Zach [Polett] was the executive director of Project Vote and the executive director of ACORN political.  All of the organizations shared the same space.  It was only starting in 2007 where I started to see a real division between the organizations where they were like, okay, you’ve got an ACORN address; let’s give you a Project Vote e-mail address.  Try to – they put a door up to keep the D.C. national side – I’m sorry, the D.C. local and the national side separate from Project Vote so it looked like it was two separate offices.”

    Moncrief testified that ACORN entities that are forbidden by law from engaging in political activities because of their tax status do in fact engage in political activities “[b]ecause there’s no separation between the organizations for real.  So when you have the same people that are working, that are – like, I was getting paid through Project Vote’s checkbook, but I was working on ACORN stuff.  I even did PowerPoints during the midterm elections for Jeffrey Robinson where they were like, okay, don’t vote for [then-Rep.] Albert Win (ph) [sic, Wynn (D-MD)] or vote for this person.  And they had doorknob – door hangers that they would go and put on people’s doors, and we turned this into a PowerPoint presentation.  So there was never any division between the staff where you could say, okay, this is [501] (c) (3) stuff and this is (c) (4) stuff.  It was just — I don’t want to say business as usual, but it was a lot of collaboration between the organizations.”

    Moncrief also testified that “[t]hey wanted to keep the – I think the word was keep the 501 (c) (3) pristine and keep that clean and separated from everything else because we needed that.” When asked if ACORN actually did that, Moncrief said “[p]ublicly, yes, they always stated that it was two different organizations” but that they weren’t in actual practice and that she was told “let’s hope we don’t get caught.” (Moncrief testimony, Monica Moyer, et al v. Pedro A. Cortes, Secretary of the Commonwealth of Pennsylvania, et al, In the Commonwealth Court of Pennsylvania (Harrisburg), Docket No. 497 MD 2008, 10/29/08, pp. 18, 22, 44, 89-91)

    2. DOES ACORN HAVE AN ACCOUNTING SYSTEM THAT ENSURES THAT TAXPAYER DOLLARS ARE NOT WASTED AND ARE NOT INTERMINGLED WITH OTHER FUNDS USED FOR POLITICAL PURPOSES?

    When asked how money flows between ACORN affiliates, Moncrief testified that “[t]he money goes into accounts at CCI [Citizens Consulting Incorporated, ACORN’s for-profit accounting arm].  CCI has dozens – dozens and dozens of accounts.  Some of them are Project Vote.  Some of them are ACORN.” Moncrief also said that CCI is “basically the accounting arm for all of the money, the payments, who gets what, the – how the organization operates and flows and makes sure its bill are paid.  All of that goes through CCI.” When asked how ACORN entities receive money, Moncrief testified that “CCI makes disbursements to them either directly into their account or does transfers between I guess the different organizations.”

    In 2007, Moncrief was tasked with reconciling accounts using ACORN’s accounting software called NewVision.  Moncrief testified that “[t]here was, like, a $9 million gap in between what we had in our donor system, Donor Perfect, and what was in the NewVision system.  … There were still some questions because we had a box of stuff we had got from the Ohio office when it closed.  I think it was Ohio.  But there was so many, like, random letters and money and checks that were never cashed that there was – at one point we felt that we had got it as good as it was going to get.”

    Moncrief also testified that “[s]ometimes the accounts will show negative a hundred thousand dollars, and then magically the money is in there the next week.  So there’s really no way at this point without a forensic audit to tell what are the assets of any one of the ACORN entities.” (Moncrief testimony, Monica Moyer, et al v. Pedro A. Cortes, Secretary of the Commonwealth of Pennsylvania, et al, In the Commonwealth Court of Pennsylvania (Harrisburg), Docket No. 497 MD 2008, 10/29/08, pp. 32, 43, 65)

    3. HAS ACORN EVER MISREPRESENTED INFORMATION TO THE FEDERAL GOVERNMENT REGARDING A TAXPAYER-FUNDED GRANT?

    Moncrief testified that “I received an email.  It was called dotting the Is and crossing the Ts, and it was based on an election assistance commission grant that we had just gotten.  And it was from [ACORN Online Communications Coordinator] Nathan Henderson James and to myself and one other person; I can’t remember the name.  But it was basically telling us, okay guys, it’s reporting time again; we need to show them what we did with this EAC money; so I want you to put this on letterhead – on ACORN letterhead and say something like, we had a really great time working with our partner, Project Vote.  And the attitude of the e-mail was quotation marks, you know — … [t] to where we knew that it wasn’t that there was any type of partner organization.  There might have been – on paper there might have been a partnership going on, but really it was ACORN and Project Vote together.  … It was worked on, but it wasn’t this whole nonpartisan thing that it was made out to be to get the money.  It was just, hey, guys, we need to get this done for Delaware because we just got this check; let’s get this done; let’s make this report out.” (Moncrief testimony, Monica Moyer, et al v. Pedro A. Cortes, Secretary of the Commonwealth of Pennsylvania, et al, In the Commonwealth Court of Pennsylvania (Harrisburg), Docket No. 497 MD 2008, 10/29/08, pp. 92-93)

    4. WILL ACORN IMPROVE THE ACCURACY OF THE VOTER REGISTRATION APPLICATIONS IT SUBMITS AND END THE PRACTICE OF FLOODING ELECTION OFFICES WITH APPLICATIONS AROUND SUBMISSION DEADLINES?

    Moncrief testified that ACORN officials were aware that duplicate voter registrations were being obtained by canvassers hired by ACORN, and said that “… they were striving for at one time 40 percent accuracy rate.  So 40 percent was okay.” Moncrief also described the attitude of ACORN officials regarding the practice of “dumping” large amounts of voter registration cards on election offices: “Well, I was told when I was working on the provisional voting survey that they already had a bad opinion of us because we would send so many cards over to them.  So I was to try to sweet talk them, make – they said, make them feel like they’re really helping you, thank them a lot, and if all else fails, tell them that you’re doing a provisional voting academic survey or something.  So I wouldn’t name myself.”

    Moncrief also testified that national officials with ACORN and Project Vote were aware of fraudulent voter registrations, and that absentee ballots are sometimes fraudulently voted.  (Moncrief testimony, Monica Moyer, et al v. Pedro A. Cortes, Secretary of the Commonwealth of Pennsylvania, et al, In the Commonwealth Court of Pennsylvania (Harrisburg), Docket No. 497 MD 2008, 10/29/08, pp. 45-47, 70)

    5. WILL ACORN END ITS “MUSCLE FOR MONEY” PROGRAM?

    In her testimony, Moncrief described two ACORN programs that were both known as “Muscle for Money.” Moncrief said that “[t]he first one is the official program, which is where they calculate the number of – the cost for registering voters, the cost for GOTV, and how close the elections were in certain states.  So it’s basically how CSI [Citizens Services Incorporated, ACORN’s for-profit political consulting arm] works, where they say they get this person to vote, to register this person and get them to the polls, it could cost you $17 and whatever cents; if you go through our program, we have proven methodologies; we know how to get this done; it will cost you this amount.  So there’s actually a CSI chart that breaks down how much it would cost to drive voters to the polls.  And they would use – they would say give us the money, we’re the muscle, we’ll get out there and get it done.”

    Moncrief also described a second, “unofficial” ACORN program also known as “Muscle for Money.” Moncrief said that “[t]hey got involved with a group called the Carlyle Group.  They were paid by SCIU [sic, SEIU] to harass a man named [Carlyle Group Managing Director] Mr. [David] Rubenstein, and they wanted me to go out – the D.C. local did, wanted me to go out and break up a banquet dinner, protest out in front of his home.  But the local – D.C. local did not have an invested interest really in messing with the Carlyle Group.  It was because they were paid by SCIU [sic, SEIU] to do this.  And it was always referred to as Muscle for Money because they would go there, intimidate these people, protest.  They did it in front of Sherwin Williams.  They did it at H&R Block, were – H&R Block was a target for years.  And instead of, you know, reforming the way they did the rapid anticipation loans, they ended up giving money to the ACORN tax sites which paid for new computers and money to run these tax filing sites around the country.”

    Moncrief testified that ACORN’s unofficial “Muscle for Money” program was known by another name: “Protection.  We were very – not to be flippant, but we were just always very sarcastic about it in the offices.  We knew what was going on.  And it’s not that we thought it was funny, it was just one of those things that we talked about.”

    Moncrief also testified that ACORN officials tried to use the voter registration program as a foil to divert attention away from the unofficial “Muscle for Money” program.  Moncrief said “… it was one of those things where if they were going to look at something, they would rather look at voter registration because there was – they’re used to fighting voter registration.  We have prepared responses that everyone was given to say that voter registration fraud doesn’t really happen, voter IDs affect people.  It was certain spiels that we were all given to say.  And at the meeting in 2007, there was actually a conversation about how you can make sure everyone was on the same page of how to respond to that because those responses like, oh, you don’t want African Americans to vote or you don’t want minorities to vote or things where it’s very hard to come back at and they were good at fighting that.” (Moncrief testimony, Monica Moyer, et al v. Pedro A. Cortes, Secretary of the Commonwealth of Pennsylvania, et al, In the Commonwealth Court of Pennsylvania (Harrisburg), Docket No. 497 MD 2008, 10/29/08, pp. 52, 54-56)

    6. WILL ACORN ACCEPT RESPONSIBILITY FOR THE ACTIONS OF ITS EMPLOYEES?

    Moncrief testified that ACORN employees were given talking points on how to discuss employees accused of voter registration fraud.  Moncrief said that one of those talking points was “… just a lone employee acting alone in doing this and ACORN was going to prosecute them to the fullest.  And most – of anything, it had to do with employee wrongdoing, had something to say in there about how we’re distancing ourselves from them, they did this, let’s get them.” (Moncrief testimony, Monica Moyer, et al v. Pedro A. Cortes, Secretary of the Commonwealth of Pennsylvania, et al, In the Commonwealth Court of Pennsylvania (Harrisburg), Docket No. 497 MD 2008, 10/29/08, pp. 57-58)

    7. IS THE PURPOSE OF ACORN VOTER REGISTRATION DRIVES TO REGISTER NEW VOTERS OR TO RECRUIT NEW MEMBERS FOR ACORN, AND DOES ACORN USE A QUOTA SYSTEM FOR THESE REGISTRATION DRIVES?

    Moncrief testified that “[a]t ACORN, it was about getting more members, which means more money.  Project Vote, there’s – actually they’d say the more [voter registration] cards you get, the more money you get.  It’s in the – in the way they train the – I’m trying to explain it; the way they train the people for voter registration.  It’s to let them know that the cards are tied to money.  So the more cards you get, the more money you get.  If people aren’t producing cards, they’re wasting your time, get rid of them, get people who are producing.  … They get – the Project Vote side gets money from certain liberal organizations or – to run these voter registration drives.” ACORN Pennsylvania Political Director Krista Holub testified that voter registration applications distributed by ACORN employees include ACORN membership applications.

    Moncrief also testified that ACORN uses a quota system with canvassers during voter registration drives, saying “I’m not exactly sure how many cards per day, but I know that at the minimum, I’ve – I’m aware of at least 20 cards per day” and that if canvassers don’t turn in the minimum amount “[y]ou get fired.” (Moncrief testimony, Monica Moyer, et al v. Pedro A. Cortes, Secretary of the Commonwealth of Pennsylvania, et al, In the Commonwealth Court of Pennsylvania (Harrisburg), Docket No. 497 MD 2008, 10/29/08, pp. 23, 29, 148, 165)

    8. HOW MANY ACORN AFFILIATES EXIST?

    When asked how many ACORN affiliates exist, Moncrief testified that “[t]he number changes all the time.  To the best of my knowledge, it’s got to be at least over 170.  The last number I heard was 176, but that’s constantly changing.” When asked if Project Vote is a separate corporate entity from, but yet an affiliate of, ACORN, Moncrief said “Correct.  They call it the council of organizations.” (Moncrief testimony, Monica Moyer, et al v. Pedro A. Cortes, Secretary of the Commonwealth of Pennsylvania, et al, In the Commonwealth Court of Pennsylvania (Harrisburg), Docket No. 497 MD 2008, 10/29/08, p. 26)

    9. WHAT DID POLITICAL ORGANIZATIONS AND CAMPAIGNS RECEIVE IN EXCHANGE FOR SHARING DONOR LISTS WITH ACORN?

    When asked from which organizations Project Vote received donor lists, Moncrief answered “Political parties, some of the campaigns.  … Organizations that did the same type of work, like ACT, America Coming Together.  Those – we’d get those types of lists.” When asked from which presidential campaigns Project Vote received donor lists, Moncrief said “Kerry, Clinton, and the Obama campaign.” (Moncrief testimony, Monica Moyer, et al v. Pedro A. Cortes, Secretary of the Commonwealth of Pennsylvania, et al, In the Commonwealth Court of Pennsylvania (Harrisburg), Docket No. 497 MD 2008, 10/29/08, p. 41)

    10. DO ACORN OFFICIALS BELIEVE THAT ONE OF THE GOOD THINGS ABOUT ACORN IS THAT IT FIGHTS CAPITALISM?

    In her testimony, Moncrief reviewed notes, admitted into evidence, of a regional meeting of ACORN officials.  Included in the notes is a list of reasons the group who met thought that ACORN was “good.” One of the reasons listed was “Fighting capitalism.” (Moncrief testimony, Monica Moyer, et al v. Pedro A. Cortes, Secretary of the Commonwealth of Pennsylvania, et al, In the Commonwealth Court of Pennsylvania (Harrisburg), Docket No. 497 MD 2008, 10/29/08, p. 76)

     

    [— SOURCE NEEDED —]

  • Fox Hypes Unsubstantiated Claim That Obama May Be Receiving Illegal Foreign Donations

    Research ››› MIKE BURNS

    Fox has seized on a conservative group’s report to suggest President Obama’s reelection campaign is receiving millions of dollars in illegal donations from foreign donors. In fact, the report provides no evidence to support this claim and the group’s co-founder has himself acknowledged that it possesses no such evidence.

    Report Found That Almost Half Of Online Visitors To Obama Campaign Website Were From Outside U.S.

    Government Accountability Institute Used Findings To Suggest Obama Donation Website Could Be Receiving Foreign Donations. On September 26, the Government Accountability Institute (GAI) issued a report showing that 43 percent of online traffic going to the Obama campaign website came from foreign countries. The report stated that both Americans living abroad and foreign nationals interested in the president make up part of the international traffic to the campaign website, but did not claim that the Obama campaign had received any unlawful contributions. From the report:

    The main campaign website BarackObama.com receives approximately 43% of its traffic from foreign IP addresses, according to Markosweb.com. Though Americans living abroad no doubt generate some of this interest, the majority is likely from foreign nationals. Though there is nothing inherently wrong with the President’s international attention, his donation pages’ lack of CVV means that this interest creates significant vulnerabilities for the integrity of the campaign’s donation process. [Government Accountability Institute, 9/26/12]

    Fox Seized On Report To Cast Doubt On Obama Donations

    Steve Doocy: “If Your Number Is Accurate, And It’s 43 Percent Comes From International, We’re Talking Tens Of Millions Of Dollars.” On Fox & Friends, co-host Steve Doocy seized on the GAI report to claim that Obama’s reelection campaign may be receiving tens of millions of dollars from foreign sources in violation of federal law. Interviewing GAI co-founder and conservative activist Stephen Bannon and president and co-founder Peter Schweizer, Doocy said: “If your number is accurate, and it’s 43 percent comes from international, we’re talking tens of millions of dollars.” [Fox News, Fox & Friends, 10/8/12, via Media Matters]

    Sean Hannity: Obama Campaign Site “Does Allow For A Foreigner To Make A Contribution Without Proper Disclosure.” Introducing an interview with Bannon and Schweizer, Hannity said, “My next guests say they have a new bombshell report showing how the Obama campaign website makes it possible to receive contributions from foreign nationals in countries all around the world,” adding: “As of now there’s no confirmation that they may be doing this knowingly, but the website does allow for a foreigner to make a contribution without proper disclosure.” [Fox News, Hannity, 10/8/12]

    Monica Crowley: Obama’s Foreign Web Traffic “Makes It Much Easier For Foreign Donations” To Come Into His Campaign. Discussing the GAI report, Fox News contributor Monica Crowley said the fact that 43 percent of online traffic going to the Obama campaign website comes from foreign countries “makes it much easier for foreign donations, which are illegal under our system, to come into” Obama’s campaign:

    CROWLEY: Now, we’re not talking about donations, but we’re talking about the total traffic. But it makes it much easier for foreign donations which are illegal under our system to come into the Barack Obama campaign.

    […]

    CROWLEY: Under the system we have now, if you donate to a campaign and it’s under $200 it doesn’t have to be reported. So you can have all kinds of dummy people mocked up. You can have dummy corporations mocked up. If they’re donating under $200 it doesn’t have to be reported. We saw this problem last time around, 4 years ago, with the Obama campaign. All these investigations showed that so many of his campaign donations, hundreds of millions of dollars, could not be traced. They were untraceable. One of the reasons why is, as you just pointed out, there was no, and there still, on the barackobama.com website, there is no verification firewall, meaning if you on any website and you buy something, usually you have to type in the credit card security number, that three number thing.

    There are all kinds of firewalls so that they can trace you to that credit card, you as an American citizen, you as to a U.S. address. The Obama campaign does not have that firewall in place. They got caught last time around, 4 years ago, not having this in place. They fixed it. But this time around when they ought to have known better, if we give them the benefit of the doubt that they didn’t know what that was. They ought to have known better, and they still don’t have it in place. And here’s the kicker, Eric (Bolling, Your World guest host). The kicker is, on that barackobama.com website, if you want to go on that site and buy campaign merchandise, an Obama t-shirt or a cap, you have to type in all of that information so the firewall exists for all of the swag but not for the actual donations. [Fox News, Your World with Neil Cavuto, 10/8/12]

    Fox Nation: “Report: Foreign Fundraising Scandal Rocks Obama Campaign.” Fox Nation linked to a Washington Examiner article on the GAI report under the headline “Report: Foreign Fundraising Scandal Rocks Obama Campaign.” The Washington Examiner article was headlined “Report: Obama.com solicits foreign contributions for prez.”

     

    [Fox Nation, 10/8/12]

    In Fact, GAI Has Made Clear Report Alleges No Wrongdoing

    GAI Co-Founder Acknowledged GAI Has No Evidence That Obama’s Campaign Has Received Donations From Foreign Sources. On Fox & Friends, Bannon acknowledged that GAI has no evidence to support the claim that Obama’s reelection campaign has received tens of millions of dollars from foreign sources in violation of federal law. From Fox & Friends:

    DOOCY: If your number is accurate, and it’s 43 percent comes from international, we’re talking tens of millions of dollars.

    BANNON: Forty-three is what goes to their homepage and goes back. We’re not saying that 43 percent comes, but that has to be checked. Without credit card security —

    DOOCY: Because you don’t know.

    BANNON: You don’t know. [Fox News, Fox & Friends, 10/8/12, via Media Matters]

    GAI’s Schweizer Admitted Foreign And Fraudulent Donations Are Just A “Concern.” Writing in the Daily Beast, GAI president and co-founder Peter Schweizer and Newsweek‘s Peter J. Boyer highlighted the GAI report and said that “there has been surprisingly little focus on perhaps the most secretive and influential financial force in politics today: the wide-open coffers of the Internet.” Schweizer and Boyer further wrote that unlike other presidential campaigns, Obama’s “does not use a standard security tool, the card verification value (CVV) system — the three- or four-digit number often imprinted on the back of a credit card, whose purpose is to verify that the person executing the purchase (or, in this case, donation) physically possesses the card.” Schweizer and Boyer noted that fraudulent and foreign donations are a “concern,” but at no point said that the Obama campaign is receiving illegal donations. [Daily Beast, 10/8/12]

    Erick Erickson Fails To Document Evidence That Obama’s Campaign Is Committing Some Sort Of Fraud Through An “Illegal Donor Loophole.” In an October 8 Red State blog post headlined “I Donated to Barack Obama,” CNN contributor Erick Erickson documented his attempt to demonstrate that Obama’s campaign is committing fraud through an “illegal donor loophole” that allows them to accept contributions from overseas. In the 13th paragraph Erickson indicates that after attempting to donate to Obama as a Russian with a made-up passport number, he had his contribution rejected by the campaign. [Media Matters, 10/8/12]

    Slate’s Dave Weigel: GAI Report “Includes A Series Of Blog Posts From Foreigners Talking About The Ease Of Giving, But Not Saying That They’ve Actually Given.” In an October 8 post, Slate’s Dave Weigel wrote that the GAI report is “not conclusive. How could it be?” Weigel added, “You can’t easily determine whether a foreign national has given a donation. This report includes a series of blog posts from foreigners talking about the ease of giving, but not saying that they’ve actually given.” [Slate, 10/8/12]

    Obama Campaign Has Protections In Place To Prevent Illegal Donations

    Obama Campaign: “Credit Card Contributions To Obama For America Are, In Fact, Processed Using” Address Verification System. In a post on the Election Law Blog, election law expert Rick Hasen posted a statement from the Obama campaign rejecting claims that it doesn’t follow certain practices to prevent fraudulent campaign donations:

    “Credit card contributions to Obama for America are, in fact, processed using AVS (Address Verification System).

    “If a billing address is verified via AVS, then the credit card contribution is processed without delay. Some transactions caught by AVS may initially appear to a donor to have been accepted even though this is not the case. Obama for America employs a manual process to review any transaction flagged by AVS, also taking into account other fraud risk factors, and using fraud detection services provided by our credit card processor.

    “As an example, the contribution discussed here http://www.powerlineblog.com/archives/2012/04/dubious-donations-illustrated-illegal-contributor-edition.php may have initially appeared to have gone through when the donor completed the transaction at 10:18 a.m. but it was rejected at 4:51 p.m. under our standard fraud detection procedures.

    “So any claims that Obama for America has disabled AVS are inaccurate; any question about this would have been answered — if the question had been asked.” [Election Law Blog, 10/8/12]

    Obama Campaign Fact Check: “Obama For America Only Accepts Contributions From Eligible Americans.” An Obama campaign blog post explained that the campaign “only accepts contributions from eligible Americans,” and does not accept “donations from foreign nationals or any other ineligible individual.” The post, headlined “Fact check: Obama for America only accepts contributions from eligible Americans,” further explained that the campaign uses the Address Verification System to ensure the legitimacy of all credit card contributions:

    OFA does not accept donations from foreign nationals or any other ineligible individual — and the campaign voluntarily goes above and beyond Federal Election Commitments to ensure the integrity of fundraising efforts.

    Here’s how we do that:

    • All credit card contributions are processed using AN Address Verification System (AVS) to ensure their legitimacy.
    • OFA invests significant resources into a manual process to review any transaction that’s been flagged by the campaign’s credit card processor’s fraud detection services.
    • Though not required by law, OFA requires a copy of a valid passport from any contributor who has been affirmed as eligible but donates with a mailing address outside the U.S. If they do not offer in one in a timely manner, the donation is returned.
    • OFA screens all online credit card contributions that originate from a foreign IP address and, if any questions arise regarding the contributor’s U.S. citizenship, the campaign requests proof of a current and valid U.S. passport in order to be in compliance with the FEC’s safe harbor guidelines.

    OFA has strong and rigorous safeguards in place to ensure our donors are eligible and that our fundraising efforts comply with all U.S. laws and regulations. While no campaign can control who visits their websites, OFA is in no way directing solicitations to foreign nationals nor knowingly seeking foreign contributions — that is the legal standard. [BarackObama.com, 10/8/12, (emphasis original)]

    FEC Audit In 2008 Found No Evidence To Back Up Similar Illegal Donation Claims

    WSJ: In 2008, Republicans Filed FEC Complaint Alleging Obama Campaign Was “Accepting Donations From Foreign Nationals.” In a 2008 article about Republicans’ concerns over whether the Obama campaign was “accepting donations from foreign nationals,” the Wall Street Journal wrote:

    Republican Party officials said they will file a complaint with the Federal Election Commission Monday asking for an audit of Barack Obama’s campaign contributions.

    In announcing the move Sunday, they said they were concerned that the Democratic presidential candidate may be accepting donations from foreign nationals, and may also be taking a large number of donations that exceed federal limits for individuals.

    U.S. law prohibits foreign nationals from contributing to American candidates, but campaigns from both parties have sought money from Americans living abroad.

    The Republican Party cited a large amount of money coming to the Democratic presidential candidate from overseas, and a small amount of money that he has returned from foreigners, in explaining their complaint.

    The party’s lawyers also pointed to news reports of foreigners giving money to Sen. Obama, although the Obama campaign says it has either rejected or returned the money. [The Wall Street Journal, 10/6/08]

    Wash. Post: “FEC Audit … Found No Evidence To Substantiate Those Allegations.” In an article reporting on an audit of Obama’s 2008 campaign by the Federal Election Commission, the Washington Post wrote:

    In 2008, Republicans made an issue out of the millions in small donations that Obama’s campaign raised in the last two months of the campaign, charging that he was accepting money from foreigners or fictitious people.

    The FEC audit, which included an investigation of “contributions from prohibited sources,” found no evidence to substantiate those allegations. [The Washington Post, 4/19/12]

    Former FEC Chief Michael Toner: “The FEC Spent Two Years Picking Over $750 Million In Contributions And Expenses And Found One Violation.” Following the release of the Federal Election Commission’s report, Michael Toner, a former FEC chairman, stated that the FEC report was “a very clean audit report for the Obama campaign,” adding, “The FEC spent two years picking over $750 million in contributions and expenses and found one violation.” From the article:

    U.S. President Barack Obama’s 2008 election campaign failed to properly report nearly $2 million in last-minute donations to the juggernaut that swept him into the White House, but that was the only violation found in a Federal Election Commission audit of Obama’s $778 million campaign.

    The audit, posted online on Thursday, shows Obama’s campaign did not file notifications on time for 1,312 donations totaling $1,972,266, received before the November vote.

    The law requires campaigns to submit notices to the FEC about contributions of $1,000 or more received less than 20 days but more than 48 hours before an election.

    “Overall, this is a very clean audit report for the Obama campaign. The FEC spent two years picking over $750 million in contributions and expenses and found one violation,” said Michael Toner, a former FEC chairman and now a lawyer at Wiley Rein in Washington.

    According to the FEC tally, Obama’s campaign that year raised $778 million. It did ultimately report the donations in question, most of which came through a transfer from the joint fund it shared with the Democratic National Committee, but not on time, according to the audit file. [Reuters, 4/19/12]

     

    [ Source: Click here: Fox Hypes Unsubstantiated Claim That Obama May Be Receiving Illegal Foreign Donations | Research | Media Matters ]

  • Obama’s donation website accepts illegal foreign contributions

    Barack Obama’s electronic contribution site (https://donate.barackobama.com/page/contribute/abroadHP — not hyperlinked for obvious reasons) accepts donations from countries like China, Iran, Pakistan, Saudi Arabia and Somalia — although someone had the sense to remove North Korea from the list. The donor is only required to click a check-box, which attests they are legally allowed to contribute.

    Remember, Federal election law expressly forbids soliciting, accepting or receiving contributions or donations from foreign nationals:

    As noted earlier, the Act prohibits knowingly soliciting, accepting or receiving contributions or donations from foreign nationals. In this context, “knowingly” means that a person:

    * Has actual knowledge that the funds solicited, accepted, or received are from a foreign national;
    * Is aware of facts that would lead a reasonable person to believe that the funds solicited, accepted, or received are likely to be from a foreign national;
    * Is aware of facts that would lead a reasonable person to inquire whether the source of the funds solicited, accepted or received is a foreign national…
    No other presidential candidate allows such an easy channel for illegal campaign contributions. For example, John McCain and Hillary Clinton do not accept donations from abroad without a complete, written documentation packet sent via postal mail.

    It would seem to me that Obama’s form is in direct violation of federal law. I think we should demand an accounting of these foreign contributions and his campaign should follow precedent by requiring documentation of legal status for foreign donors.

    [ Source: Click here: Doug Ross @ Journal: Obama’s donation website accepts illegal foreign contributions]

  • Corruption: Exposing Barack Obama’s Illegal Foreign Campaign Money Loophole

    Oct 08, 2012 08:15 AM EST

     

    A new report obtained by Townhall from the non-partisan Government Accountability Institute [GAI] shows the Obama campaign has potentially violated federal election law by failing to prevent the use of fraudulent or foreign credit card transactions on the official Obama for America [OFA] donation webpage.

    For the past eight months, GAI has been investigating the potential influence of foreign online campaign donations in House, Senate and presidential elections. The report was conducted using spidering software and found thousands of foreign sites linking to campaign donation pages. The investigation was conducted with the guidance of a former U.S. attorney. GAI is led by Peter Schweizer, who recently exposed congressional insider trading in his book Throw Them All Out.

    “As FBI surveillance tapes have previously shown, foreign governments understand and are eager to exploit the weaknesses of American campaigns,” the report says. “This, combined with the Internet’s ability to disintermediate campaign contributions on a mass scale, as well as outmoded and lax Federal Election Commission rules, make U.S. elections vulnerable to foreign influence.”

    OFA seems to be taking advantage of a “foreign donor loophole” by not using CVV on their campaign donation page. When you donate online to the Obama campaign using a credit card, the contribution webpage does not require donors to enter a secure CVV number (also known as CSC, CVV2 or CVN), the three-digit securing code on the back of credit cards. This code, although not 100 percent effective, is used to ensure a person making a purchase physically possesses the card. According to the report, 90 percent of e-commerce and 19 of the 20 largest charities in the United States use a CVV code, making its use standard industry practice in order to prevent fraud. Another anti-fraud security measure includes software, better known as an Address Verification System, to verify a donor’s address matches the address on file with the credit card company. The investigation could not determine whether OFA is using this type of software to prevent fraudulent or illegal donations.

    Because of the lack of a CVV code requirement, the door is opened for OFA to accept robo-donations, or in other words, large numbers of small and automatic donations made online to evade FEC reporting requirements. Although it isn’t illegal to decline the use of a secure CVV credit card code for campaign donations, it is illegal to accept campaign donations from foreign sources. Campaigns are required under criminal code not to solicit, accept or receive foreign donations in any amount. The Federal Elections Commission doesn’t require campaigns to disclose the names of donors making contributions of less than $200 unless audited. In addition, FEC rules don’t require campaigns to keep records of those giving less than $50. These rules combined with the lack of a CVV numbers make it easy for campaigns to get away with taking foreign donations.

    According to GAI, it is the duty of the campaign to “ensure compliance with the law. Indeed, they risk criminal prosecution for the conscious failure to do so. This means that whether or not the FEC requires it to be reported, campaigns have an independent duty under the law to discover and protect against criminal campaign contributions.” Protecting against criminal campaign contributions is easily accomplished by requiring a CVV code on the campaign donation page.

    OFA has specifically touted its “grassroots” success by showcasing the majority of its donations coming from those giving less than $200. It appears the campaign also solicits funds for less than $200 in order to avoid having to report the name of the person making a donation under FEC rules. The GAI documents included the following email from Barack Obama to campaign supporters:

    IT ALL ADDS UP

    A large part of the Team Obama operation is outsourced. More than 200 domain names with the word “Obama” in the web address have been purchased. The most significant of these websites may be Obama.com, which is owned by an Obama bundler in Shanghai, China with “questionable business ties to state-run Chinese enterprises,” according to the report.

    Obama.com was purchased in 2008, and, although Obama.com is owned by a third party, not the campaign itself, the site redirects its foreign traffic, a whopping 68 percent, directly to the official Obama for America campaign donation page. The Obama campaign’s official and main website, BarackObama.com, sees 43 percent of its traffic coming from foreign IP addresses, according to web metrics firm Markosweb and noted in the report.

    According to industry leading web analytics site Markosweb, an anonymously registered redirect site (Obama.com) features 68 % foreign traffic. Starting in December 2011, the site was linked to a specific donation page on the official BarackObama.com campaign website for ten months. The page loaded a tracking number, 634930, into a space on the website labeled “who encouraged you to make this donation.” That tracking number is embedded in the source code for Obama.com and is associated with the Obama Victory Fund. In early September 2012, the page began redirecting to the standard Obama Victory Fund donation page. Search engine optimization (SEO) efforts, using common spamming techniques, may have been undertaken by unknown third-parties, generating foreign traffic to Obama.com.

    China has a long history of trying to illegally influence American elections. Their efforts were most prominent in the 1990s.

    In the past, foreign governments have relied on middlemen to transfer illegal campaign contributions. With the explosion of Internet campaign fundraising, the prospect of foreign powers, criminal gangs, foreign individuals, or domestic fraudsters making direct campaign contributions to American elections becomes far more likely. Put simply, campaign fundraising crimes are now just a click away. Rather than risking detection or relying on a middleman, donations can be anonymously donated through campaign websites. The state of Internet security of many political campaigns’ websites leaves American elections vulnerable to fraud or foreign influence.

    AN HONEST MISTAKE, OR SOMETHING MORE?

    Is the non-use of CVV code verification simply an oversight or mistake made by Obama for America? Most likely, no. The Obama campaign is willing to pay millions in fees in order to accept unsecured contributions on their donation page without the CVV code. Attorney Kenneth Sukhia analyzed the GAI’s findings and this revelation in the following way in a separate report.

    “As GAI points out, if a campaign is truly seeking to do all it can to prevent illicit contributions, there is no reason not to employ these basic fraud prevention tools. First, these tools are easily installed, and once set up, operate with a minimum of administrative oversight by the vendor. They are fully automated, but can be easily re-calibrated as called for. “

    “Under these circumstances, a campaign’s decision to turn off either of these systems despite the increased fees raises legitimate questions as to a campaign’s knowing failure to use its best efforts to comply with the laws prohibiting foreign contributions. Indeed, it’s reasonable to ask why any campaign would ever opt to pay card issuers more for less information and less security. More importantly, why pay card issuers more when doing so lessens a campaign’s ability to comply with the law? It’s hard to imagine any campaign would pay extra for less security and marketing intelligence, unless it stood to benefit in some way from doing so.”

    “Because a campaign’s decision to opt out of the standard security measures and to pay more to receive less information about their contributors defies all conventional campaign logic, and because it is difficult to identify a more plausible motive, there is reason to suspect that such decisions may be motivated by the belief that more money could be raised through foreign contributions than lost in added fees by declining security tools designed to stop them.”

    OFA isn’t run by amateurs and has a highly sophisticated online presence. OFA is known as the “gold standard” in online technology with a Facebook co-founder, veteran YouTube videographer and an award-winning CNN producer keeping everything running smoothly.

    Not to mention, the campaign obviously sees the benefits in using a CVV code to prevent fraud. After all, OFA uses a CVV security code for merchandise purchases. To purchase a sweatshirt or other item in the OFA store, a CVV code must be entered at check out, but the donation page does not require a credit card security code to be used. In addition, the chief technology officer of the Obama campaign, Harper Reed, is a former chief technology officer of the T-shirt company Threadless. Threadless requires a CVV code for online purchases. They clearly know how CVV codes work.

    THE NUMBERS

    As of September 26, 2012, the Obama campaign has raised $271,327,755 in contributions under $200 for the 2012 cycle. In 2008, it was $335,139,233. The Romney campaign has raised just $58,456,968 in contributions under $200 and has all CVV and online security measures in place. In total, the Obama campaign raised $500 million online in 2008 with $335 million in contributions–more than half–falling under the $200 reporting requirement. Obama has raised more online funds than any campaign in history.

    As reported over the weekend, the Obama campaign raised $181 million in September alone–only 2 percent of those donations are required to be reported to the FEC.

    The campaign said that just over 1.8 million people made donations to the campaign last month. According to the campaign, over 500k of these were brand-new donors, having neither given in 2008 nor 2012. 98% of contributions were under the reporting threshold of $250. Of these, the average contribution was $53. [It’s] really a tale of two worlds. 35k people gave an average of $2,600, while just over 1.7 million people gave an average of $53. Half the campaign’s haul came from people giving around the maximum amount and half from people who don’t have to be disclosed. Seems a bit odd. The average of $53 from small donors is particularly noteworthy. Contributions under $200 don’t have to be disclosed, but the campaign still has to keep track of the donor’s name, in case subsequent donations push their contribution over the reporting threshold. For contributions under $50, however, the campaign doesn’t even have to keep track of the donor’s name. It is effectively considered a “petty cash” donation. A person could theoretically make 10 $49 donations and never be reported, even though their total contributions are above the FEC’s reporting threshold. With an average donation of $53 from small donors, Obama has A LOT of donors who will never be disclosed and whose names aren’t even known to the campaign. Tens of millions of dollars worth.

    HOW LIABLE?

    As previously mentioned, the GAI report mentions campaigns have an obligation to protect against illegal campaign contributions. The law under U.S. Code makes it illegal for campaigns or political committees to accept direct or indirect contributions of money from foreign nationals. It is also illegal for a campaign or committee to “solicit, accept, or receive a contribution from a foreign national.” Penalties for violations are stiff, according to the report.

    While no person can be held accountable under the law for violations he or she is powerless to prevent or for violations of which a person had no knowledge, the law recognizes that to permit meaningful enforcement a person cannot escape responsibility for a crime by deliberately ignoring facts and circumstances that would lead a reasonable person to conclude that a crime is most likely being committed. Moreover, the FEC regulations make it clear that a campaign official cannot avoid criminal culpability by ignoring facts that would lead a reasonable person to inquire whether foreign nationals are contributing funds to the campaign.

    DIRECT SOLICITATIONS FROM OFA TO FOREIGN NATIONALS AND THE ONLINE PAPER TRAIL

    The internet for the Obama campaign has proved to be a cash cow, but it’s also provided a digital paper trail of potential illegal activity for investigators. When foreign bloggers received donation solicitations from the Obama campaign, they wrote about it online. GAI found their sites and documented their experiences. Social media accomplished the same thing–an online trail of Obama campaign solicitations to foreign nationals.

    1. In July and August, a Chinese blogger reposts letters he has received from the Obama campaign, each of which contains a solicitation for $3 or $5 (note that these smaller donations don’t require the campaign to keep any record of them).118 Markosweb states that 87.8% of the traffic flowing to the site comes from China while only 4.5% is from the United States. The website contains hyperlinks that lead to the campaign’s donation page. The website also contains graphics showing the disparity between Romney’s and the President’s fundraising and a countdown clock to the date of the election. Other than the campaign solicitation letters, the website is in Chinese characters.

    2. On August 9th, 2012 the Obama campaign sent a solicitation letter to “Hikemt Hadjy-Zadh,” an Azerbaijani citizen. His email address is on an Azerbaijani domain and he posts numerous solicitation letters he has received from the Obama campaign. Mr. Hadjy-Zadh reposts the complete letters on a discussion forum, including numerous hyperlinks that go directly to the campaign’s donation page.

    3. A writer in Vietnam writes on a website for the Vietnam Institute for Development Studies (a government-backed think tank) and posts emails he has received from my.barackobama.com with more than 24 total links to the campaign’s donate page embedded in the emails. The website is in the Vietnamese language, hosted on a Vietnamese server, and uses a Vietnamese domain address. In one instance, a letter from Mitch Stewart, Director of the Obama campaign’s “Organizing for America,” asks for donations. Ironically, Stewart laments that the U.S. Chamber of Commerce is reportedly taking money from foreign sources. The reader is then prompted to give his name and email address and thereafter begins receiving solicitation letters for donations.

    4. A Dutch blogger writing in Dutch on a Dutch website reprints an email from March 22, 2010 in which President Obama thanks his supporters for their help. “You’re welcome, Mr. President,” he writes back.

    5. The Dutch blog “His Dirk” received a donation request from the campaign. Aware of the U.S. law, the blogger decided not to contribute. The blogger observed, “I imagine many non- Americans have money transferred to the Obama campaign. It’s just too easy.”

    6. A member of the Italian Radical Socialist movement and an administrator of their website reposts solicitations from the Obama campaign which he reports receiving regularly for three years. “And because we are three years in his mailing list…But frankly after 3 years his letters excite me much less…”

    7. A Japanese blogger named Isogaya posts a link to the Obama campaign’s donation page. When posting the link, Isogaya notes that an option in giving would be to give a gift card.

    8. A Norwegian blogger posts a solicitation from the Obama campaign, including the link to the donate page. When another blogger opines that non-U.S. citizens cannot contribute because of American law, the blogger responds in Norwegian,“I have in practice given money to Obama, I had done it.”

    9. A blogger in Egypt who serves on the board of the Union of Arab Bloggers posts the solicitation letters he reports to regularly receive from the Obama campaign.127 “We as Arabs and Muslims” support the “Democratic party, compared to the Republican Party,” but notes his objection to the President’s stand on gay marriage.

    WIDESPREAD CORRUPTION

    Although GAI’s findings were most prominent with Obama for America, the “CCV loophole” is a problem across the political spectrum. The report found nearly half of Congress is at least vulnerable to fraud and foreign donations.

    Of the 446 House and Senate members who have an online donation page, 47.3% do not require the three or four digit credit card security number (officially called the Card Verification Value, or the CVV) for Internet contributions.

    During his run for U.S. Senate, then Republican candidate Marco Rubio’s campaign donation website didn’t have CVV protection. The protection was put in place in May 2012 after the campaign was over. The report alleges the connection to foreign websites could be a violation of the Federal Election Commission solicitation laws and at minimum put Rubio at risk for fraud in his campaign.

    The Government Accountability Institute found considerable international interest in the Rubio campaign, including significant foreign traffic going to the website marcorubioforussenate.com. Links on foreign websites often took the form of videos that featured links to “donate” to the Rubio campaign.

    Sukhia also mentioned the Rubio campaign in his anaylsis of the report.

    “The Government Accountability Institute found considerable international interest in the Rubio campaign, including significant foreign traffic going to the website marcorubioforussenate.com.”

    “GAI found numerous video links on foreign websites that featured running ads to “donate” to the Rubio campaign.”

    Although campaigns may have CVV in place, organizations they take money from often times do not. For example, Massachusetts Senate candidate Elizabeth Warren has accepted more than $5.7 million from ActBlue, a fundraising organization that does not require U.S. citizenship verification or a CVV code when accepting contributions.

    Because the problems of potential fraud due to a lack of CVV use are so widespread, GAI created a 50-state interactive map to show which members of Congress lack standard secure campaign donation websites.

    SOLUTION FOR OBAMA CAMPAIGN

    In his 2010 State of the Union Address, President Obama said, “I don’t think American elections should be bankrolled by America’s most powerful interests, and worse, by foreign entities.”

    In this situation, the foreign donation problem coming from online sources can be solved and President Obama’s promise of transparency can be kept in one click by enabling all security protections and releasing the names and records on all transactions under $200 to verify Obama for America is a clean campaign operating within FEC law.

    Overall, major reforms are needed to ensure foreign contributions are not interfering with or influencing elections in the United States.

    Obama for America did not return calls for comment.