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Recent FEC Enforcement Cases Involving PACs and PAC Staff
October 8, 2015 , Covington Alert
December 13, 2016, Covington Alert
As the President-elect begins to nominate individuals for Senate-confirmed positions in his administration, one of the major hurdles these individuals face is the statutory requirement that the Director of the Office of Government Ethics (“OGE”) review and certify a public disclosure of each source of income exceeding $200 and each property interest exceeding $1,000 in value. While for many classes of assets, identifying and disclosing the relevant assets is relatively straightforward, it is often much more difficult to file a compliant report for pooled investment fund assets, such as hedge funds, since the details of the underlying assets are often undisclosed to the investor by the fund manager or subject to a confidentiality agreement between the investor and the fund manager. This client alert summarizes the most recent OGE guidance applicable to pooled investment fund holdings.
May 23, 2016, Covington Alert
As we move toward the 2016 general election, campaign activity at the federal, state, and local levels continues to heat up. Super PACs again promise to play a prominent role in federal races, while at the same time impacting a wider range of non-federal races further down the ballot.
April 13, 2016, Covington Alert
Federal Election Commission (“FEC”) regulations permit a corporation to communicate with its “restricted” or “solicitable class” on any subject, including electoral advocacy and political fundraising. See 11 C.F.R. § 114.3(a). This includes solicitations of contributions to the corporation’s PAC. We frequently see questions arising about who falls within the restricted class in one of two contexts: (a) in an effort to ensure the class is not too narrowly defined, depriving the PAC of potential donors; and (b) when a company reads the definition of “professional or administrative personnel” in the statute to only be a question of whether the employee is “salaried” or not, not considering the second prong of the test described below.
Congress has defined a corporation’s restricted class as consisting of the following:
- The corporation’s “executive or administrative personnel.”
- The corporation’s “stockholders,” as defined by FEC regulations.
- Individuals who are members of the restricted class of any subsidiary, branch, division, or “affiliate” of the company (the FEC has a multi-part test for determining which entities count as affiliates”).
- Immediate family members of the above individuals.