AO 2008-07: Use of campaign funds for legal and media expenses
David Vitter for U.S. Senate, the principal campaign committee of Senator David Vitter (LA) may use campaign funds to pay for, and reimburse Senator Vitter for, legal services related to a third party criminal proceeding in which he was subpoenaed as a witness.
Background
In March of 2007, Deborah Palfrey was indicted by a federal grand jury on criminal charges, including money laundering and racketeering. Senator Vitter’s telephone number appeared in Ms. Palfrey’s telephone records. Senator Vitter retained counsel to monitor the criminal proceedings because of the perception that Ms. Palfrey had a “strategy of dragging public figures into her legal proceedings.”
In July of 2007, Ms. Palfrey released her telephone records and posted them on the Internet. Senator Vitter issued a public statement concerning the presence of his phone number in Ms. Palfrey’s records. Later that month, Citizens for Responsibility and Ethics in Washington (CREW) requested that the Senate Select Committee on Ethics (Senate Ethics Committee) investigate Senator Vitter for possible violation of the Senate Rules of Conduct by allegedly soliciting for prostitution. Senator Vitter retained separate counsel to defend himself against the Senate Ethics committee complaint.
In November of 2007, Ms. Palfrey subpoenaed Senator Vitter to testify at a pre-trial hearing. In March of 2008, Ms. Palfrey subpoenaed Senator Vitter as a trial witness. Counsel hired by the Senator consulted with government attorneys and appeared in court in an attempt to quash both subpoenas. In addition to monitoring the trial, attempting to quash the subpoenas and consulting with counsel assisting Senator Vitter in the matter before the Senate Ethics Committee, counsel also consulted with Senator Vitter and his public relations professional. Counsel billed approximately $85,322 in legal fees for work relating to quashing the subpoenas; $31,341.25 in legal fees for consultations, including with the Senator, the Ethics Counsel and a public relations professional; $75,212.75 in legal fees for monitoring the Palfrey criminal proceeding; and $15,301.50 for miscellaneous expenses such as transportation and photocopying.
Analysis
The Federal Election Campaign Act (the Act) identifies six permissible uses of federal campaign funds including campaign-related expenses; ordinary and necessary expenses incurred in connection with the duties of the individual as a federal officeholder; and any other lawful purpose that is not considered “personal use.” 2 U.S.C. §439a(a) and 11 CFR 113.2.
Contributions accepted by the candidate’s authorized campaign committee may not be converted to personal use by any person. “Personal use” is any use of campaign funds to fulfill a commitment, obligation or expense that would exist irrespective of the candidate’s campaign of officeholder duties. 2 U.S.C. §439a(b)(2) and 11 CFR 113.1(g).
The Commission has previously recognized that if a candidate can demonstrate that expenses resulted from campaign or official duties, the Commission will not consider the use to be personal. The Commission examines the use of campaign funds for legal fees and expenses on a case by case basis. Senator Vitter asked the Commission to use campaign funds to pay for legal expenses for “(1) monitoring and participating in Ms. Palfrey’s trial and quashing the subpoenas issued to him; (2) assisting in the defense of a Senate Ethics Committee complaint; and (3) making informed decisions about how to manage the case and address it publicly.”
Applicability of the use of funds provision
The FEC determined that Senator Vitter’s principal campaign committee may use campaign funds to pay some, but not all, legal fees and ex- penses rendered in connection with a legal proceeding against a third party. The Commission concluded that legal fees and expenses incurred in consultation with Senator Vitter’s Ethics Counsel and in responding to press inquiries and news stories would not have existed irrespective of the Senator’s campaign or duties as a federal officeholder and could be paid with campaign funds. The Commission further concluded that the Committee may pay miscellaneous expenses incurred in connection with assisting Ethics Counsel, and in connection with press relations, as described above, and reimburse Senator Vitter for that part of his personal payment of $70,000 to Subpoena Counsel representing legal fees and expenses that the Commission has determined the Committee could pay with campaign funds. The Committee must maintain appropriate documentation of any disbursements made to pay permissible legal expenses and report the recipient’s full name, address and purpose of payment. The Commission could not reach a conclusion regarding the use of campaign funds for quashing subpoenas or monitoring the criminal proceeding.
Date Issued: August 21, 2008; Length: 7 pages.