Two Arizona-based groups with ties to the conservative, billionaire Koch brothers have admitted to making millions in illegal contributions during the 2012 California elections.
The non-profits Center to Protect Patient Rights and Americans for Responsible Leadership face record fines of $1 million and $15 million in disgorgement. The groups illegally donated a total of $15 million to campaigns targeting Gov. Jerry Brown’s (D-Calif.) tax increase and promoting an initiative to make it harder for unions to participate in politics. Both of their efforts failed.
"California's Fair Political Practices Commission said it will sue to recover the rest of the $15 million in illegal donations from the California organizations that received them,” said a report by NPR’s Ina Jaffe.
Despite the fact that federal regulations do not require non-profits to disclose contributions, it is required under California law. Through a joint investigation the FPPC and the attorney general’s office found the groups concealed millions in contributions that should have been reported to the Small Business Action Committee (SBAC) by passing the money around through backchannels.
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The groups are responsible for the disgorgement of $11 million to the SBAC and a $4.08 million contribution made to the California Future Fund, California Attorney General Kamala D. Harris said in a press release.
"This case highlights the nationwide scourge of dark money nonprofit networks hiding the identities of their contributors," said FPPC Chair Ann Ravelin a statement. "The FPPC is aggressively litigating to get disclosure and working on laws and regulations to put a stop to these practices in California."
Gov. Brown called the investigation results “shocking.”
"Secrecy and money don't mix well in a democracy," Brown said in a statement. "For 40 years, I have been fighting for disclosure and honest reporting of campaign spending. Today's shocking revelation by the FPPC makes it plain we still have big loopholes to close."
Charles and David Koch are the owners of oil giant Koch Industries, builder of the Keystone XL pipeline, which if completed would bring $100 billion in profits for the private owned company. The Koch Foundation funds Americans for Prosperity, the Heritage Foundation, the Cato institute and the Manhattan Institute, which promote climate skepticism and oppose tax increases and healthcare reform, among other things.