In his effort to win re-election to a second term as Connecticut’s governor, Dannel Malloy certified that he would abide by Connecticut’s public financing program. In return for raising $250,000 in contributions no greater than $100 per person, the State Elections Enforcement Commission provided Malloy’s campaign with $6.5 million in public funds. As a requirement for taking those funds, Malloy swore, under oath, that he would not accept any other campaign donations.
However, in the course of the 2014 the campaign, and in conjunction with the Democratic State Central Committee, Malloy and his political operatives funneled more than $5.2 million dollars into a Democratic Party account. That money was used, in part, to pay for a series of glossy mailings urging people to vote for Malloy.
Not only was the use of the campaign funds illegal, but the funds that were used were tainted by the fact that it included donations from state contractors and others who are prohibited, by law, from participating in a Connecticut gubernatorial campaign.
As Connecticut law requires, the State Elections Enforcement began an investigation into the allegation that Malloy violated the law through the illegal use of campaign funds.
But rather than come clean about their activities, or even fight the accusations on the merits, Malloy and the Democrats did what would have once been unthinkable in state that proudly had one of the nation’s premier public finance systems… they spent the past year stonewalling the investigation and obstructing justice.
Team Malloy even refused to abide by an official subpoena issued by the Connecticut Elections Enforcement Commission.
See: Malloy and the Democratic State Central Committee – In plain English it’s called obstructing Justice (Wait, What? 8/3/2015)
In a couple of months, Dannel Malloy will take over as the chairman of the national Democratic Governors Association. The move will put him into the national spotlight.
Yet considering the legal precipice Malloy is sitting on, that light will be murky, at best.
In an article entitled, Court Fight Heats Up Over Subpoena Of Democrats’ Emails About Malloy’s Campaign, Jon Lender recently provided an update on the situation.
The state Democratic party’s latest move in its fight against an investigation by state regulators generated a flare-up this week with the office of the attorney general, as the case has suddenly gained momentum toward a courtroom confrontation on Oct. 27.
Democratic State Central Committee’s lawyer David Golub, filed a revised complaint saying that the SEEC “is prohibited from investigating or imposing sanctions on a state political party” in situations like this one — where Democrats say federal campaign-finance laws “pre-empt,” or supersede, Connecticut’s clean-election laws.
“The SEEC is the state agency empowered to hear and investigate complaints of violations of state election laws,” said Jepsen’s spokeswoman, Jacqueline Falkowski. “The General Assembly has vested the SEEC with broad investigatory powers, and the SEEC unquestionably can investigate a complaint of state election law violations.”
Superior Court Judge Anthony Robaina has set a court hearing for Oct. 27 in Hartford Superior Court in SEEC’s suit against the Democratic Party. The suit seeks to force the party’s state central committee to comply with a May 29 subpoena that the SEEC issued in its investigation of whether Democrats spent money illegally last year to support Gov. Dannel P. Malloy’s re-election with mass campaign mailings.
Wait, What? and the Hartford Courant have written multiple stories about the Malloy campaign’s tactics.
Just last week, Ken Dixon at the Connecticut Post added another detailed report about the issue.
In Political campaigns rake in cash despite ban, Dixon wrote;
Connecticut’s clean elections law prohibits those who do business with the state from contributing to the campaigns of politicians who could award or influence state contracts — including the governor and legislators.
But that hasn’t stopped the relentless flow of state contractor cash. It has merely diverted it.
Nearly 25 percent of the money collected in the Democrats’ federal account since January, 2013 has come from more than 460 builders, lobbyists, lawyers and others who are prohibited from contributing to statewide and/or General Assembly races, the investigation has shown.
Of the $4.8 million the Democrats’ federal PAC raised in those 32 months, $1.1 million of it came from businesses and individuals who are on a state list of 5,500 outlawed contributors, according to Federal Election Commission records.
And yet, just days before the election last year, the Democrats raided the fund for more than $318,000 to pay for mass mailings supporting Gov. Dannel P. Malloy. This spending is the focus of a Republican complaint to the State Elections Enforcement Committee and a lawsuit filed by Democrats to stop the investigation. The case, in state Superior Court, is headed for trial October 27.
National election watchdogs say the use of the federal account is simply a backdoor system of pay-to-play.
“This is an old game,” said Meredith McGehee, policy director at Washington-based Campaign Legal Center. “Strip away the legalese and this money comes from a party that intends to curry favor with public officials. Politicians are just as complicit. Contractors feel like they’re in a shakedown.”
Connecticut’s campaign-finance reforms were created after John G. Rowland, the disgraced former governor, was sent to prison for taking kickbacks from companies that won lucrative tax breaks and contracts.
Michael J. Brandi, executive director of the SEEC, noted it was 10 years ago this month that the bipartisan Campaign Reform Act of 2005 was signed into law.
“So far it’s been enormously successful and we’re committed to seeing it succeed for a long time into the future,” Brandi said in a statement. “But it’s also had a lot of challenges along the way, and this current lawsuit is another direct challenge to its survival.”
Under the rules of the Citizens Election Program, candidates for governor who want public funding must agree to limit their campaign spending to a set state grant after raising $250,000 in small contributions. Candidates who accept public financing and then take outside money face penalties ranging from fines and forfeiture of their grants to criminal prosecution.
Traditionally, state parties’ federal accounts were not used for state races at all, but only congressional and national campaigns. Democrats last year, however, facing a tough challenge from GOP gubernatorial candidate Tom Foley, decided to take the chance and transfer hundreds of thousands of dollars for Malloy’s end-game push.
The Hearst investigation has found that among the big check signers are officials from HAKS Engineers, a major design firm that is banned from contributing to both statewide and General Assembly races. Executives at the New York and Connecticut-based company contributed at least $75,000 to the Democrats’ federal account, including $32,500 from Husam Ahmad, president and CEO, and his wife. HAKS had more than $8 million in state contracts in 2013 and 2014, according to state records.
The owners, employees and families at Viking Construction in Stamford, which has done major state-financed work throughout Southwestern Connecticut, and is also prohibited from donating to statewide and General Assembly campaigns, contributed $77,500 to the federal account. The firm is currently part of a consortium awaiting the go-ahead on a half-billion-dollar contract to rebuild the Stamford train station, led by the JHM Financial Group, whose president, John H. McClutchy Jr. of Darien, and his family, contributed $65,000 since 2013.
Officials from HAKS, Viking Construction and the JHM Group did not return multiple requests for comment. James A. Manafort Jr. president of Manafort Brothers Inc. of Plainville, declined comment on $14,000 in family contributions to the DSCC. The company had 91 state contracts, mostly with the Department of Transportation, in 2013-14, totaling $29.1 million.
The contractors’ contributions are legal. Individuals are allowed to give up to $10,000 a year to the federal account.
But, if any of the $318,000 transferred from the federal account was used to supplement Malloy’s $6.5-million public-financing grant, as Republicans allege and as the SEEC wants to investigate, the state Democrats could have violated the law.
Democrats say the mailing in question was a legal Get out the Vote (GOTV) flyer that happened to feature Malloy and required funding from the federal account. To stonewall the SEEC’s investigation, which would reveal tactics and strategy in their high-stakes campaign fundraising operation, the Democrats filed the lawsuit.
You can read the Connecticut Post’s entire story at Political campaigns rake in cash despite ban