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For Immediate Release                                                                               Contact: Bob Biersack
April 11, 2007                                                                                                         George Smaragdis
                                                                                                                              Michelle Ryan

FEC Fines Jim Gerlach for Congress Committee $120,000

WASHINGTON – The Federal Election Commission (FEC/the Commission) recently reached a conciliation agreement with the Jim Gerlach for Congress Committee (the Committee) and its treasurer over their failure to comply with several reporting provisions of the Federal Election Campaign Act (the Act).  The Committee agreed to pay a civil penalty of $120,000.

The Jim Gerlach for Congress Committee is the principal campaign committee of Representative Jim Gerlach (R-PA/6).  The Commission found reason to believe that the Committee over-reported total election cycle-to-date contributions by $2,156,770 in several 2004 and 2005 reports and misreported $8,911.21 in refunded contributions as unitemized contributions in its October Quarterly Report in 2005.  The Commission also found reason to believe that the Gerlach Committee failed to itemize contributor information in its 2004 Year End Report after receiving a disbursement of $8,832 from a joint fundraising committee.  The Act requires joint fundraising participants to disclose the total amount received from the joint fundraising committee and also to itemize individual contributor information for the original sources for each joint fundraising disbursement on reports filed with the Commission. 

This release contains only disposition information.

1.

MUR 5690

RESPONDENTS:

(a) Jim Gerlach for Congress Committee, Michael DeHaven, in his official capacity as treasurer

(b) Friends of John Perzel, Gordon R. Johnson, treasurer

(c) Valley Forge Investment Corporation

(d) Alan Randzin

(e) Richard Ireland

COMPLAINANT:

Lois Murphy

SUBJECT:

(a) Failure to itemize joint fundraising contributions

(a) Failure to disclose accurately total contributions for the election cycle-to-date

(a) Failure to disclose refunded contributions accurately

(a) Failure to report correctly contributions received from persons other than a political committee
(a) Failure to report correctly election cycle-to-date contribution totals for individuals

(a) Failure to report cash on hand correctly

(a) Failure to maintain an accurate account of small contributions

(b) Making an excessive contribution

(a) Knowing receipt of excessive contribution

(a) Failure to disclose accurately disbursements to the Internal Revenue Service or taxes withheld from contractors

(c,e) Making a prohibited corporate contribution

(a) Acceptance of prohibited corporate contribution

(d) Violation of the Act and its regulations

DISPOSITION:

(a) Conciliation agreement: $120,000 civil penalty*

(a) Admonished and no further action regarding the following:

  • Failure to report correctly contributions received from persons other than a political committee
  • Failure to report correctly election cycle-to-date contribution totals for individuals;
  • Failure to report cash on hand correctly

(a) The following matters were dismissed:

  • Failure to maintain an accurate account of small contributions
  • Knowing receipt of excessive contribution

(a) No reason to believe regarding the following matters:

  • Failure to disclose accurately disbursements to the Internal Revenue Service or taxes withheld from contractors
  • Acceptance of prohibited corporate contribution

(b) Dismiss the matter

(c,d,e) No reason to believe

The complaint alleged that the Jim Gerlach for Congress Committee violated several reporting provisions of the Act by filing inaccurate disclosure reports in 2004 and 2005.  Specifically, the complaint alleged that the Committee did not itemize contributor information for contributions raised through joint fundraising, over-reported and misreported contributions, under-reported cash-on-hand and improperly reported disbursements to the Internal Revenue Service.  The complaint further alleged that the Friends of John Perzel Committee made excessive contributions to the Gerlach Committee and that Valley Forge Investment Corporation made a prohibited contribution in 2004 that was attributed to Richard Ireland.

The Commission found reason to believe that the Gerlach Committee and Michael DeHaven, in his official capacity as treasurer, violated the act by failing to itemize contributor information in the 2004 Year End Report after receiving funds from a joint fundraising committee, incorrectly reporting the total contributions for the election cycle-to-date in several 2004 and 2005 reports and by misreporting refunded contributions as unitemized contributions received in the 2005 October Quarterly Report.  Alan Randzin was treasurer of the Committee at the time the violations described herein occurred. Michael DeHaven became treasurer of the Committee on November 9, 2005, after the violations described herein occurred and is named herein only in his official capacity.(1) The Commission also found reason to believe that the Committee incorrectly reported the following information: contributions from persons other than a political committee, total election cycle to date contributions for an individual, and cash on hand.  The FEC sent an admonishment letter and took no further action regarding these matters.  The Commission found no reason to believe that the Committee failed to accurately report disbursements to the IRS or taxes withheld from contractors or accepted prohibited corporate contributions.  The FEC dismissed the allegation involving Friends of John Perzel and found no reason to believe Valley Forge Investment, Richard Ireland or Alan Randzin violated the Act.

DOCUMENTS ON PUBLIC RECORD:

Documents from this matter are available from the Commission’s web site at http://www.fec.gov by entering 5690 under case numbers in the Enforcement Query System. They are also available in the FEC’s Public Records Office at 999 E St. NW in Washington, DC.

(1) This release was modified on March 17, 2008 to include a reference to the change in treasurers.

*There are four administrative stages to the FEC enforcement process:

1. Receipt of proper complaint

2. “Reason to believe” stage

3. “Probable cause” stage

4. Conciliation stage

FEC decisions require the votes of at least four of its six Commissioners.

The FEC can close a case at any point after reviewing a complaint.  If a violation is found and conciliation cannot be reached, then the FEC can institute a civil court action against a respondent.                                                     

**The Enforcement Priority System (EPS) rates all incoming cases against objective criteria to determine whether they warrant use of the Commission’s limited resources.

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