A major misstep by a conservative nonprofit has led to a dramatic turn of events in the Golden State. In what was first a case of a mysterious Arizona group laundering political money for two key ballot initiatives in California, the scandal may quickly evolve into a criminal investigation that could rock the foundations of Capitol Hill by unmasking the most prominent dark money slush fund in the country.
It’s all up to Kamala Harris, California’s attorney general, who was elected two years ago on a platform of getting tough on white-collar crime. Her office told reporters today that she is laying out the options for either a criminal or civil investigation into this major secret money group.
First, some background:
• On October 15, a mysterious nonprofit in Arizona called Americans for Responsible Leadership cut a stunning $11 million donation to a committee in California dedicated to defeating Prop 30 (a ballot initiative to raise taxes to fund the budget) and passing Prop 32 (an anti-union effort to ban payroll deductions), but didn’t disclose where that money came from. The move violated a brand new rule in California mandating that even 501(c) nonprofits disclose the source of their donations.
• Three days later, on October 18, Common Cause, a government watchdog, filed a complaint with the California Fair Political Practices Commission asking for an inquiry. The commission, a state campaign finance regulator that puts the Federal Election Commission to shame with its aggressive pursuit of the public interest, took up the case and on October 25, advised Americans for Responsible Leadership that it had 25 hours to comply with a request for information about the source of that $11 million check.
• Americans for Responsible Leadership hired Holtzman Vogel, a DC-area law firm retained for years by Karl Rove and other Republican leaders, to try to quash the FPPC’s requests, claiming at one point to a local judge that the Supreme Court’s Citizens United decision protected the group from having to disclose its donors. As the Sacramento judge accurately observed, the Citizens United decision did no such thing.
• In a surprise last week, an appellate judge, without comment, agreed with the Arizona group in preventing the FPPC from action. This forced a late minute appeal that led to an emergency decision by the California Supreme Court, which ruled 7-0 on Sunday to force disclosure.