3 easy steps to avoid the threat of FEC penalties

Incurring penalties from the Federal Election Commission can expose your campaign to attacks from your political opponents. Whenever possible, your campaign’s operational processes should lead to internal discoveries of common mistakes and inadvertent diversions from protocol. By following these three easy steps, you can neutralize the risk of FEC penalties. 

1. Identify which person is your Reports Analysis Division (RAD) analyst is at the FEC.

It always comes back to personal relationships. Based on our experience working both as campaign staff, and as part of CMDI's data-management and compliance team, we know that the analysts at the FEC are neither consistent, nor always 100 percent accurate in how they review and respond to disclosure reports. If a transactional situation arises that is unprecedented for your committee, it’s helpful to simply call your analyst for guidance as to how they would prefer to see the data in the next disclosure report. Don’t guess. Speak to your FEC analyst.

RAD analysts are required to make notes of each call from an authorized committee representative and refer to these notes when reviewing a disclosure report. By contacting the analysts directly, you can eliminate the worry about an inevitable RFAI (request for additional information) regarding any unfamiliar or new situation that will be accounted for in the next FEC report. Your analyst will have a reference point as to how they advised your committee to show the information, for example, on which line number, etc.

RAD analysts are people too. They may not all be as experienced or knowledgeable as you are regarding campaign finance laws, reporting requirements and standard treasury practices, but they have the resources at their fingertips to help you. If your committee has found a mistake in a report, your analyst can help you revise your information properly and discreetly. Often you can avoid having to file an amendment and simply submit a Form-99, which is a brief note of explanation. The FEC also offers a “Best Practices” guide for committees, which is often used as an internal map for campaign structure and protocol.

2. We’re human, mistakes will happen. But internal steps must be employed to stop often-recurring or egregious errors. 

One common error: spending personal funds on campaign expenses other than travel and sustenance during travel, and failing to be reimbursed within the required 30-days (for cash/check purchases) or 60-days (for credit card purchases).  This situation amounts to an unauthorized, unaccounted-for, in-kind contribution that will go undisclosed. Untimely reimbursements can result in the need for amended FEC reports, and there just isn’t a bigger waste of time for a campaign treasury office during the course of the campaign. Campaign management and/or the CFO must determine the appropriate course of action for multiple offenses, and document the potential for this for staff review and signed-acknowledgement. It’s imperative that the candidate, treasurer, CFO and campaign management are well-versed in safe harbor, so the candidate and treasurer never find themselves in the position of being legally responsible for financial misconduct.

Another common mistake: making disbursements without proper approval. Obtaining proper approval can be interpreted as a roadblock or time-constraining requirement, which is why the approval process must be electronic and possible at virtually any time of day from division directors, budget managers, the CFO, the campaign manager and each individual’s own deputy. Without approvals, bills get paid twice or not at all, which can lead to unreported items that belong on the FEC report’s debt-schedule.  Disorganization in paying bills isn’t just a concern for anxious vendors seeking payment. It’s a major concern for budget preservation and accurate expense and debt-disclosure reporting. Staff must be made aware that obtaining proper approval for campaign expenses, especially for a campaign in receipt of any government matching-funds, isn’t an option, it’s mandatory by law.

Incentivize campaign staff to reveal errors immediately, rather than bully or shame them into hiding. The worst campaign management examples allow for blame gaming, throwing one another “under the bus” and indiscreet handling of personnel missteps. 

Encouraging compliance awareness and self-auditing in everyday treasury functions should result in a few problematic cases that are possible to correct before any report has been filed. It shouldn’t result in cover-up efforts and dishonest practices that will inevitably snowball.

Foster an environment of cooperation between naturally “opposing” forces. The finance and treasury divisions, for example, where the finance staff are constantly on the hook for reaching their goals, while the treasury team must apply its standard in making “unusual” contributions compliant, if acceptable at all. 

3. Hire partisan professional data managers and compliance experts.

It’s important to understand the value of working with a partisan provider who’s dedicated to your victory. Partnering with partisan vendors allows you to discuss and address sensitive political issues while insuring that your vendor won’t sabotage your campaign (even inadvertently) this election or even the next. Partisan vendors can make the special efforts to help you win that would be unethical for a bi-partisan vendor.

Congressional campaign committees are working toward cash-on-hand figures that resemble ’90s-level presidential war chests. In an age of near billion-dollar presidential campaigns the solution should not be to employ, train and manage huge campaign staffs. Instead, we must look to cutting-edge technologies for process automation and trusted providers to manage the handling of the daily volume that can be

thousands of pieces of mail, thousands of online donations, and hundreds of contribution-checks every day.

Concomitantly, campaigns must change their perspective when purchasing the best software option for their operation. Dangerous options such as, PayPal, or free Web-based programs are going to give you what you pay for. A campaign manager must realize the savings that is also achieved when it comes to additional salaries, consultant fees and FEC fines when it invests in customized, comprehensive software.

Emily currently works in the political department of CMDI where she has served multiple presidential campaigns, JFCs and senatorial committees. Prior to joining CMDI, Emily served as treasury operations manager for the McCain-Palin campaign, comptroller on the 2008 Giuliani presidential campaign, and budget manager for the Bush-Cheney ’04 campaign.


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