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AO 2012-22 Commercial Website to Collect Candidate Contributions

A corporation may establish a commercial website to provide information about federal candidates and process users’ contributions to the candidates they choose.

Background

Skimmerhat is a for-profit corporation registered in Delaware that proposes to establish a web-based platform called skimmerhat.com (the "site"). The site will allow users to search for federal candidates using any of three primary search criteria—geographic location, ideological similarities or single-issue positions—and make campaign contributions to those they support.

Before making a contribution through the site, users must first confirm that they are knowingly and willingly making the contribution from their own funds and not from a prohibited source (e.g., a corporation). The site will limit individuals’ contributions to candidates to the current federal limits—$2,500 per election—and skimmerhat will assess an eight percent “processing and convenience" fee per transaction.

Analysis

The Federal Election Campaign Act (the Act) and Commission regulations prohibit corporations from making a contribution in connection with a federal election. See 2 U.S.C. §441b(a); 11 CFR 114.2(b)(1). To avoid making a prohibited contribution, corporations must receive adequate compensation for any services they provide to a political committee. The Commission has found that companies that process contributions for donors as a commercial endeavor—as skimmerhat proposes—are not making a contribution to the recipient political committees. See AO 2011-19 (GivingSphere).

In some respects, the service skimmerhat will provide to individual donors is analogous to mail delivery services that a contributor may use to deliver a contribution, or an electronic bill-pay service that banks provide. See also AO 2011-06 (Democracy Engine).

The eight percent processing and convenience fee charged by skimmerhat will not count toward the individual’s contribution limits to a candidate. Contribution amounts do not include processing fees paid by contributors, because the services provided by the vendor were "at the request and for the benefit of the contributors, not of the recipient political committees.” See AO 2011-06 (Democracy Engine).

Skimmerhat may also provide  basic factual information about candidates to its users. A previous advisory opinion found the provision of factual information to customers appeared to be a corollary of creating a web platform through which users could identify political committees and transmit contributions. See AO 2011-19 (GivingSphere).

Additionally, skimmerhat may compile and disseminate campaign finance data from reports candidates file with the FEC, so long as information about individual contributors is not included. The Act prohibits the use of information about individual contributors for commercial purposes. 11 CFR 104.15(a). See also AO 2004-24 (NGP Software); AO 1983-44 (Cass Communications); AO 1981-38 (Campac Publications); and AO 1980-101 (Weinberger).

Because skimmerhat will act as solely as a commercial service provider, it will not be required to file any reports with the Commission. See 2 U.S.C. §434(a)(1); 11 CFR 104.1.

Date Issued: August 2, 2012; Length: 11 pages.

(Posted 8/6/12; By: Alex Knott)

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The FEC Record is produced by the Information Division, Office of Communications. Toll free 800-424-9530; Local 202-694-1100; E-mail info@fec.gov. Greg Scott, Director; Alex Knott, Senior Writer/Editor; Myles Martin, Editor