The Fair Political Practices Commission thinks the Small Business Action Committee PAC should disgorge (pay back) $11 million dollars that came our way during last year’s election—obviously already spent. The reason they say that is because other groups—not SBAC PAC—violated the Political Reform Act.
SBAC did nothing wrong. In fact, we did everything right and more so. We reported the donation after checking on the Arizona donor group before accepting the donation. That group was supposed to tell us that it received the money from another Arizona group, and because they didn’t that is why they were fined $500,000. Still, we informed the donor to our PAC in a detailed letter beyond what the FPPC requires that they had reporting obligations.
Furthermore, when it was revealed that there were other donors involved and an investigation ensued, we cooperated – fully. The authorities told us that our group was the only one that initially cooperated. After the Attorney General’s office investigated, they told us that SBAC had done nothing wrong.
Just hours before a press conference yesterday, the FPPC told our attorney that they were going to ask SBAC to pay back $11 million. This is a penalty more than twenty-two times the fine paid by each of the admitted wrongdoers. We were not given the opportunity to explain that we believe the FPPC has completely misapplied the disgorgement law in this case. Disgorgement is an equitable (fair) concept in the law that forces someone who violates the law to give back money generated by the illegal activity. That does not apply to SBAC in this case.
What this decision amounts to is punishing the innocent.
The Fair Political Practices Commission should explain what is “fair” about this situation.
So we will fight this.