Record amounts of overseas money are flowing into the presidential campaigns, and finance experts say there is no sure way to rule out that foreigners are making illegal donations.
Sen. Barack Obama (D-Ill.), who spoke to an adoring crowd of 200,000 in Berlin last week, has already received twice as much money from abroad as President Bush and Sen. John Kerry (D-Mass.) did together during the entire 2004 campaign.
{mosads}While only American citizens by law may donate to the campaigns, finance experts say it would not be that difficult to circumvent the safeguards that have been put into place to prevent foreigners from giving to U.S. presidential campaigns — if they are willing to make false statements and risk legal trouble in the U.S.
“An individual can easily donate online and otherwise, and if they’re dishonest or overenthusiastic, they can lie about who they are and what their status is to make an unlawful contribution,” said Jan Baran, an elections and ethics lawyer with the firm Wiley Rein.
Federal laws mandate that contributors to federal, state and local elections must be U.S. citizens or permanent residents with green cards. But with so many Americans living abroad and donating to campaigns, it can be difficult to make sure donations are truly from American citizens, experts say.
If the contributor deceives the campaign in order to donate, the liability falls on the contributor, not the campaign.
“If a contributor lies to campaigns, that’s outside the control of the campaigns,” said Baran, the election lawyer. “That’s a lot of legal risk for a lousy $2,300.”
“There’s no doubt there’s been more fundraising overseas,” said former Federal Election Commission (FEC) Chairman Michael Toner, who is now a lawyer at Bryan Cave.
A review of federal election records by The Hill found that through June, Obama received $2.8 million in contributions from abroad, including people living in American territories and serving in the military overseas. That is seven times more than the $381,809 that presumptive Republican presidential nominee Sen. John McCain (Ariz.) has received from Americans abroad so far.
In 2004, Bush took in $747,857 from abroad, while Kerry received $550,834.
These types of donations account for more contributions to the Obama campaign than the totals for several states. The Illinois senator’s campaign has a special webpage for Americans abroad who would like to donate. They are asked to include a valid U.S. passport number or alien resident number, in addition to the information regularly asked of contributors.
{mospagebreak}McCain’s website does not request additional information of Americans living abroad, but both sites require contributors to check off a box indicating that the donor is a U.S. citizen or permanent resident, along with other criteria.
An Obama aide told The Hill, “If we were to learn of a donation from a foreigner, we would return it.”
McCain’s campaign did not comment.
Asking for a passport number or a photocopy of a passport for mail-in donations is not a requirement by the FEC, but it is a “safe harbor” for the campaigns to ensure they are receiving their donations legally, FEC spokesman Bob Biersack said.
{mosads}“If you got [a passport number], and you didn’t have any reason to believe it was fraudulent, that would be sufficient for us,” Biersack stated.
Larry Noble, a former FEC general counsel and former executive director of the Center for Responsive Politics, said donations from foreign nationals have “always been an issue.”
“Sometimes it’s a mistake and sometimes it’s intentional,” added Noble, who is now with Skadden, Arps, Slate, Meagher & Flom. He also pointed out that the ability to give money online “has raised the ease with which someone could make a foreign national contribution.”
The FEC began suggesting the use of passport numbers as a “safe harbor” after a campaign finance controversy in 1996 involving donations from China to the Democratic National Committee.
“I think there’s been heightened sensitivity” to donations coming in from abroad, said Toner, the former FEC chairman.
Getting passport information has been “an important, concrete step” to ensuring the legality of contributions, he added.
According to FEC rules, a campaign cannot “knowingly” accept a contribution from a foreign national. If a contribution appears suspect, it is the campaign’s responsibility to ensure the legality of the donation.
“If somebody has a German name and they live in Bethesda, there’s nothing there that would cause anyone to think it was problematic,” said former FEC associate general counsel Ken Gross. “But if they lived in Düsseldorf and they had a very German name, that might lead a reasonable person to at least inquire.”
Penalties to an illegal contributor can include civil and criminal charges, if the illegal contribution is willful, but officials “probably wouldn’t put many resources into tracking them down,” Gross said.
Prosecution could also be difficult because of extradition rules, he said.
Potential punishment for illegal contributions by foreign citizens would also depend on the scope of the contributions.
“If someone was orchestrating a serious effort to bring foreign money into our elections, then yes, there would be criminal penalties,” Gross said.