SBOE Enforcement Counsel Settles Case

In today’s Times Union, Chris Bragg follows up on his earlier article regarding the State Board of Elections Chief Enforcement Counsel lawsuit against the campaign committee of Assembly candidate Shirley Patterson. He reports that the Chief Enforcement Counsel has entered into a settlement agreement with the campaign committee.

Under the settlement, the campaign committee acknowledged that it accepted donations that exceeded the contribution limits and agreed to refund the excess amounts. In addition, the campaign committee admitted that it “knew, or should have known” that certain contributions it accepted “were from a source other than the entity/LLC/P.C. identified in the campaign finance disclosure statements” and agreed to pay a $10,000 penalty.

The article indicates that the settlement “could pave the way to future state cases challenging limited liability company donations,” and quotes the Chief Enforcement Counsel as saying “Candidates who take money should know where it’s coming from. They should know who the LLC is, not just that a donation is coming from ‘LMNOP’ LLC.”

After reading the settlement, I don’t understand exactly what campaign committees are supposed to do with regard to the LLC contributions that they receive. The campaign admitted violating Election Law § 14-120, which requires campaign contributions to be made “under the true name of the contributor,” but it’s not clear to me how this case is step toward closing the “LLC loophole.” (It would be very useful if the Board were to provide some guidance as to the responsibilities of candidates and treasurers in this respect.)

Regardless, this settlement is yet another reminder of the importance of understanding the significant legal responsibilities of campaign committee treasurers, and of the potential consequences of failing to live up to those responsibilities.