Watchdog accuses Trump campaign of illegally masking millions in spending

A nonprofit watchdog group is accusing President Trump’s reelection campaign of breaking the law by masking millions of dollars in spending.

In an 81-page presentation, the Washington-based, nonprofit nonprofit, the Campaign Legal Center, alleged that the president’s re-election campaign and campaign committee hid nearly $ 170 million in expenses. to Trump vendors and relationships by channeling money through companies led by then-campaign manager Brad Parscale and senior campaign officials.

The FEC complaint filed Tuesday claims that “American Made Media Consultants” and “Parscale Strategy,” companies founded and operated by campaign officials, including Parscale, acted as a “distribution center” that disbursed Trump campaign funds. to contractors, “effectively protecting the identities of the underlying contractors who are paid for the work of the Trump campaign.”

The Trump campaign and the “Make American Great Again Committee,” a joint fundraising committee with the Republican National Committee, reported paying both companies nine figures for services including digital and online advertising, video production, software. , fundraising tools, renting databases and subscriptions. digital, consulting, print and online advertising, video production, list rental, software and subscriptions. However, neither American Made Media Consultants nor Parscale Stategy have disclosed campaign payment records, resulting in violations of Federal Election Commission rules that require campaigns to itemize disbursements.

“This is quite out of place,” Trevor Potter, president of the Campaign Law Center and former FEC commissioner, told CBS News. “I had never seen anything like it”.

“These schemes have disguised millions in payments to companies doing significant campaign work, as well as payments to Trump family members or senior campaign staff like Lara Trump and Kimberly Guilfoyle,” the Center complaint read. Campaign Law.

“By failing to report payments to true campaign sellers and employees, the Trump campaign and the Trump Make America Great Again Committee have violated, and continue to violate, the transparency requirements of federal law and undermine the vital role of information public that the reports must comply, “The complaint continues. “The fact that the campaign has not detailed disbursements to its final suppliers means that the public remains in the dark about the entities working for the Trump campaign, the nature of their services, and the total amount paid to them.” .

In a statement to CBS News, Trump campaign communications director Tim Murtaugh said: “[American Made Media Company] is a campaign provider responsible for organizing and executing media purchases and related services at fair market value. AMMC does not earn commissions or fees. Build efficiencies and save campaign money by providing these internal services that would otherwise be performed by external providers, “the statement continues.” The campaign reports all payments to AMMC as required by the FEC. The campaign complies with all campaign finance laws and FEC regulations. “

“Efficiency is that the campaign writes a check,” said Trevor Potter. “But based on everything we can see in the public record and everything the campaign has said, these entities go out and hire vendors to do the actual work of the campaign. And that’s what the public has a right to know.” said the former legal adviser. He told John McCain on CBS News. “Who are these sellers? What do they get paid?”

In 2012, the Mitt Romney operation paid for a campaign-created company, American Rambler, for media purchases, but FEC records reveal that the company actually placed campaign ads. According to the Campaign Law Center, Trump’s chosen campaign intermediary, AMMC, is not providing ad or media buying services, but is outsourcing to outside providers.

According to reports from the FEC, the Trump campaign, the Republican National Committee and the President’s various fundraising vehicles have paid more than $ 35 million in total in the past three years. In the lead-up to his demotion, Parscale was criticized by colleagues and Trump allies for capitalizing on the Trump campaign, which provided him with multiple homes and a 32-foot boat.

Although Parscale helped create American Made Media Consultants, he tweeted in 2019 that he does not own American Made Media Consultants and did not receive “any percentage of campaign ad purchases.”

American Made Media has raised more than $ 165 million from the Trump campaign and the joint fundraising committee, according to FEC reports.

Following a restructuring of campaign staff, CBS News reported that Trump campaign officials are conducting an “internal review” of campaign spending and infrastructure after Parscale’s demotion of campaign manager, and under the new leadership of Bill Stepien. Jeff DeWit, a former NASA chief financial officer and recently appointed director of operations for the Trump campaign, told Business Insider that the audit is not primarily focused on Parscale.

In the complaint from the Campaign Law Center is the software company Phunware, which helped develop the Trump campaign application. The Trump campaign has not reported direct payments to the company. CBS News previously reported that the company received millions from the federal small business coronavirus relief fund. Phunware, which has about 60 employees, was eligible for the low-interest loan through the Paycheck Protection Program. But the loan amount – $ 2.85 million – was almost 14 times the current PPP average of $ 206,000.

Another company, CloudCommerce, whose largest shareholder is Trump’s campaign manager, Brad Parscale, received nearly $ 800,000 from the federal small business coronavirus relief fund, according to a document filed with the U.S. Securities and Exchange Commission.

The Campaign Legal Center also filed a civil complaint against the Clinton campaign in 2016 for not disclosing payments from the “Trump-Russia dossier,” compiled by opposition research firm Fusion GPS with payments sent through the law firm of Washington Perkins Coie attorneys. Although the complaint filed against the Trump campaign reflects the legal argument presented against the Clinton operation, the amount of the payment “was approximately half of 1% of the amount that the Trump campaign is paying to the two companies that its executives have created “Potter told CBS News.

The Biden 2020 campaign is directly hiring the purchase of media, rather than using an intermediary. The main provider of the Biden campaign, media placement company Media Shopping & Analytics, has placed campaign ads, according to FCC reports.

It is unclear how the Federal Election Commission, which often faces stagnation and currently lacks the quorum of four commissioners needed to enforce the laws, will address Tuesday’s complaint. While the complaint is unlikely to be resolved before Election Day, the Campaign Law Center can file a lawsuit in court if the commission fails to act.