On the eve of the New York primary, the Bernie Sanders campaign accused Hillary Clinton and the Democratic National Committee of skirting campaign finance rules by using funds from a joint fundraising committee to benefit Clinton's presidential run.
In a letter to embattled DNC Chairwoman Debbie Wasserman Schultz, Sanders campaign attorney Brad Deutsch questioned whether the Clinton campaign had "violated legal limits on donations" through activities associated with the Hillary Victory Fund. The HVF is a joint fundraising committee, which raises and spends money on behalf of Hillary for America (Clinton's official campaign committee), the DNC, and 33 state Democratic parties.
The Sanders campaign said that the way the committee was set up allowed it to receive individual donations worth hundreds of thousands of dollars, aruging that some donations to the committee exceeded up to 130 times the $2,700 individual donors are allowed to contribute to campaigns under federal election rules. A lot of that money is flowing to Clinton's campaign to pay for campaigning activities and salaries, Deutsch said, in "serious apparent violations" of the law.
In total, individuals can give up to $358,000 to the joint fundraising committee, should a Democratic donor choose to max out to Clinton's campaign, the DNC and each state party. But the Clinton campaign itself can only accept $2,700 from each individual donor, which is processed through the joint fundraising committee and passed on to her campaign. The Sanders team is arguing that the remaining high-dollar donations are still benefiting her, even though the money is not directly flowing through her campaign's coffers.
"Bernie 2016 is particularly concerned that these extremely large-dollar individual contributions have been used by HVF to pay for more than $7.8 million in direct mail efforts and over $8.6 million in online advertising," Deutsch wrote in the letter.
The Sanders campaign claimed that, "at best, the joint committee's spending on direct mail and online advertising appears to represent an impermissible in-kind contribution" — essentially a gift that must be reported as if the Clinton campaign itself spent the funds — "from the DNC and the participating state party committees."
"At worst, using funds received from large-dollar donors who have already contributed the $2,700 maximum to HFA [Hillary for America] may represent an excessive contribution," the letter read.
Deutch also said filings showed that all $2.6 million of HVF's costs for staff salaries and overhead associated with running the joint committee were actually reimbursements to the Clinton campaign, which provided those services. Deutch argued that that fact "raises equally serious concerns" that Clinton is using the joint fundraising committee to "subsidize" her campaign.
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The Clinton campaign did not immediately respond to a request for comment on Monday. Earlier in February, the Clinton campaign told the Washington Post that its use of funds from the joint committee was proper and that state parties would also benefit from millions of dollars raised by the committee, which has reached more than $59 million this election cycle.
"Republicans are spending record amounts trying to beat Democrats, and we want to ensure that the Democratic nominee and candidates up and down the ballot are backed by a strong party with the resources needed to win," campaign spokesman Josh Schwerin said.
The purpose of the joint committee's funds is largely to spend funds on behalf of the Democratic nominee and downballot candidates in the general election, meaning that Sanders, too, would benefit from the committee's largesse should he defeat Clinton at the convention in July. But as Politico noted last week, the bulk of HFV's spending in the first three months of this year went to support Clinton.
Sanders' campaign sent out an email to supporters shortly after publicly releasing Deutch's letter, working to fundraise off of the concerns. "This should anger EVERYONE," the campaign wrote.
Earlier in February, the Federal Election Commission issued the Sanders campaign with its own warning over its fundraising, including possible impermissible contributions that exceeded the $2,700 limit, and donations originating from outside the United States and from unregistered political committees.
Sanders spokesman Michael Briggs said at the time that the FEC had questioned the campaign about some 200 donations that appeared to exceed the contribution limit, out of some 125,000 individual contributions from that month. Briggs told USA Today that those inquiries were "standard."
"This happens all the time in campaigns, and the FEC's rules explicitly allow 60-days from receipt of an over-the-limit contribution for campaigns to remedy the excessive portion of the contribution," Briggs wrote in an email.
Both Sanders and Clinton have openly advocated for the repeal of the Supreme Court's 2010 Citizens United decision that allowed corporations and individuals to spend unlimited amounts on campaigns through super PACs.
Sanders' campaign has consistently outraised Clinton in recent months, though the former secretary of state has benefited from the assistance of super PACs supporting her campaign. Sanders outraised Clinton last month by nearly $13 million, continuing a trend from previous months of both outraising and outspending the Democratic frontrunner, mostly with grassroots donations that have now reached some 2 million individual contributions.
On Monday, the Clinton campaign announced that Sanders had outspent the former secretary of state by more than $2 million in television ads in New York ahead of Tuesday's primary. "New York and California are the two biggest states left to vote, so what happens on Tuesday could well determine how large our lead is heading into the convention in July," the Clinton campaign wrote in a fundraising email Monday.
Clinton continues to outpace Sanders in the race for delegates to the Democratic National Convention, with 1,307 pledged to her campaign, while Sanders has 1,094. Clinton is also leading Sanders in votes, earning nearly 2 million more votes than the Vermont senator in the primary contests that have occured thus far.
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