A Federal investigation into New York City Mayor Bill de Blasio's and his Administration's fundraising is turning into a potential scandal for his administration, and there are new developments regarding the Mayor's work to elect Democrats to the State Senate in 2014.
Investigators are examining the Mayor's effort to help Democrats take over the State Senate in 2014. The State Board of Elections (BOE) conducted its own probe and found the Mayor's team appears to have deliberately violated Campaign Finance Laws and the Board referred the case to the Manhattan District Attorney. The Mayor was part of fundraising efforts for three unsuccessful State Senate races upstate.
According to multiple reports, the investigation alleges that the Mayor's team circumvented donation limits for individual campaigns by funneling money through County Political Committees, which have much higher limits. The investigators say donations from unions, developers, and businesses totaling hundreds of thousands of dollars were processed in this way, which can also serve to disguise the identity of donors. Also, allies of the Mayor are under investigation in part for channeling millions of dollars in campaign donations to County Committees, which allowed them to skirt contribution limits.
The board also suggested that those actions may have been criminal.
"All of these party committees do this," said Blair Horner, the New York Public Interest Research Group (NYPIRG) Legislative Director. "The question really is the line where you walk over from being too explicit."
The practice is not an unusual one and Republicans in previous years have been aided in the past by large contributions from single donors, such as when Michael Bloomberg donated to Party Committees and the Independence Party. The problem arises when those contributions come with clear instructions of where to donate the money.
"There's typically a truly small number of truly contested races in the Legislature, so the party committees are trying to raise money for those races. Everyone knows it. You don't have to be explicit, and the campaign contribution limits are sky high for the party committees," Horner said. Legal or not, the system encourages large donations through County Party Committees. Horner says it's a sign the contribution limits of $109,000 to County Committees needs to be dramatically lowered. "The incentive is there to raise big bucks, transfer an unlimited amount as you want to the candidate of your choice and you circumvent the contribution limits."
The issue first came to light in a leaked memorandum from the Independent Enforcement Counsel at the State BOE, Risa Sugarman. She's an appointee of Gov. Andrew Cuomo and the leak raised questions over whether the investigation is motivated by the governor's rivarly with the mayor.
"The independent counsel's office has largely been hitting at the smaller issue in terms of campaign finance violations. This is really the first time she's taken on a big fish as far as I can tell," Horner said.
Sugarman declined to speak with us on camera, but did say she does not know who leaked the memorandum.
Cuomo's office maintains there is a strict separation between their office and the work of the enforcement counsel.
The Mayor has repeatedly maintained he and his staff have done nothing illegal. "I believe everything we did was legal and appropriate and careful. I welcome this being done and being done promptly," he said.
The mayor's camp says it acted well within the limits of State Law.
Now his Campaign Lawyer, Lawrence Laufer, has sent a harshly-worded letter to the Board's Chief Enforcement Counsel. It says in part, "Beyond the legal and regulatory issues implicated by your office’s memorandum being improperly leaked to the press, your memorandum reflects either a shocking lack of understanding or a complete disregard of the most fundamental aspects of the state’s election laws." The letter was also sent to the Manhattan District Attorney's office.
Laufer also says he has filed a Freedom of Information request to see if the Board's memo was leaked illegally.
CLICK HERE to read the 29 page memo.
NYC Wins When Everyone Can Vote! Michael H. Drucker
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