"As Governor I will propose
legislation to punish willful and knowing violations of the campaign
finance laws as a felony [such as] intentional and knowing money
laundering to hide the true source of a contribution," Arnold pledged
The Gov’s various campaign reports filed yesterday are rife with
accounting deceptions geared toward hiding the true source of money and
evading the state’s campaign rules. Those laws are designed to make
certain donors know to whom they are giving, the public understands
where money comes from, and that committees subject to restrictions are
limited in how much money they receive from each donor.
Particularly shady are a series of transfers that emanate from "Arnold
Schwarzenegger’s Total Recall Committee, Vote Yes to Recall Gray
Davis," which received six figure contributions because the committee
was not subject to the normal campaign finance limits. From September 2
to November 10, Arnold transferred $1,310,394.33 from this "Total
Recall Committee" to the "Californians for Schwarzenegger" campaign
fund — which is subject to a $21,200 per donor limit. Arnold bills
these transfers as "Reimbursement of Allocated Expenses," which sounds
a lot more like Enron-style accounting than the transparency that he
promised. The laundering seems particularly pronounced when you
consider that on November 10 insurance giant AIG gave $100K to the
"Total Recall" committee — even though the recall was over a month
earlier — and that same day "Total Recall" transferred $78,766.66 to
the "Californians for Schwarzenegger" committee.
Then there’s $100,000 paid by "Total Recall" to "California Recovery
Team." This transfer is listed as a "civic donation." But the Secretary
of State labels the Recovery Team as a "Payment to Influence" entity,
meaning it’s a lobbying committee. "Total Recall" later gave another
$200K to a group called "Schwarzenegger’s California Recovery Team,"
which is primarily organized to work on ballot initiative campaigns.
That committee then transferred a million dollars to Governor
Schwarzenegger’s "Yes on 57 & 58" committee.
Donors to the "Total Recall Committee" — who were contributing to
recall Gray Davis not to fund Arnold’s lobbying and pet ballot measures
— were defrauded. Arnold’s movement of large sums of campaign cash
also undermines voter-approved campaign finance restrictions and the
Governor’s own promise to do away with money laundering. At very least,
Arnold owes the public a better accounting of these transfers. For
example, what specific advertisements or other activities did the $1.3
million from Total Recall to Californians for Schwarzenegger
"reimburse?" Without such transparency the Governor’s office will never
get the Gray out.