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Auditing Obama

Will the FEC examine the president-elect's campaign finances?

11:00 PM, Dec 10, 2008 • By HANS A. VON SPAKOVSKY
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Compare Obama's campaign to Hillary Clinton's. To avoid the problems with Chinese donors that plagued her husband's campaign, she prudently required Americans living abroad to first fax a copy of their passport before accepting a contribution. In contrast, the Obama campaign had no controls whatsoever to prevent illegal foreign contributions by noncitizens. An investigation by Newsmax estimated that anywhere from $13 million to $63 million may have been received by the Obama campaign from overseas credit cards or foreign currency purchases (a red flag for possibly illegal contributions). The FEC itself has flagged 16,639 potential foreign donations to Obama's campaign. When confronted with this, the campaign started collecting passport numbers from foreign donors, a completely useless procedure since no effort was made to verify those numbers with the State Department to see if they were even valid.

Obama's campaign has claimed that FEC regulations didn't prohibit taking prepaid credit cards or require it to verify credit cards. That may be true, but that doesn't remove the campaign's obligation to accurately report donor information and to verify that a contributor is really eligible to donate money. Given Obama's unprecedented use of the Internet to raise funds, this is impossible unless you take such precautions at the front end. Any reasonable campaign would know that such steps were necessary to actually comply with FEC requirements on donor information and eligibility.

It is ironic that a candidate who in 2007 billed himself a "campaign reformer," who wanted to clean up the corruption caused by money in politics, would run a campaign that reportedly failed to implement any controls whatsoever to prevent these problems. If media accounts of Obama's campaign practices prove true, then it would seem that the decision was made to collect all of the money that came in, no matter what. Once the campaign was won, who would care if years from now the FEC eventually found a violation and imposed a civil penalty, especially when your campaign employs the best campaign lawyers in Washington that money can buy to fight the FEC and obfuscate the issues? Besides, Obama can assume the mantle of "campaign reformer" again in 2009 and sweep any findings by the FEC under the rug as he proposes "new and improved" campaign finance laws.

Campaign reform has been a bipartisan sport in Washington for years, with its advocates promising new laws and regulations would address perceived systemic ills. Those charged with applying the law at the FEC now face a decisive moment. Will they conduct their investigation to the benefit of both parties, or turn a blind eye to credible allegations of wrongdoing, to the long-term benefit of neither?

Hans A. von Spakovsky is a Visiting Legal Scholar at The Heritage Foundation (heritage.org). He is a former Commissioner on the Federal Election Commission.