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  • FEC Record: Advisory opinions

AO 2019-04: LLC’s contribution-processing service permissible

April 17, 2019

Prytany LLC may provide contribution-processing services through its platform without making any contributions or incurring any reporting obligations.

Background

Prytany, a non-partisan, for-profit LLC, has developed an online platform that enables individuals to make contributions to participating candidates’ principal campaign committees and national party committees. To make contributions, contributors must enroll with the platform. Similarly, principal campaign committees and national party committees must also enroll if they wish to receive contributions through the platform. Access to the platform is not restricted based on a committee’s political affiliation.

Enrolled committees pay an annual membership fee of $250 and a 3% per-contribution transaction fee. Individual contributors will not pay any fees to enroll with the platform, but will incur a processing fee of 2.9% of the amount contributed plus $0.30 if they make contributions using a credit or debit card.

Additionally, enrolled users can use the platform’s social networking functions to engage in group messaging, information sharing, and solicitations for contributions.

Analysis

In previous advisory opinions (cited within the opinion), the Commission has determined that the provision of contribution-processing services to a political committee by a commercial vendor does not constitute a contribution to the political committee if the commercial vendors meet the following criteria:

  1. The vendor renders services in the ordinary course of business and at the usual and normal charge;
  2. The vendor forwards contributions through a segregated account to candidates and political committees, and;
  3. The vendor employs adequate screening procedures to ensure that they are not forwarding illegal contributions.

The Commission concluded that Prytany’s business model satisfies all three criteria.

The Commission also concluded that committees enrolled with Prytany’s platform may utilize the social networking features of the platform to communicate with users and send solicitations without such use resulting in a contribution to those committees by Prytany, since the services are provided to all enrolled committees at a commercially reasonable rate, regardless of whether a committee receives contributions through the platform.

Additionally, the Commission concluded that, while these activities do not subject Prytany to any reporting requirements, Prytany is subject to requirements for the timely forwarding of contributions and contributor information to political committees.

Date issued: April 11, 2019; Length: 8 pages

Citations

Regulations

11 CFR 100.52
Gift, subscription, loan, advance or deposit of money

11 CFR 102.8
Receipt of contributions

11 CFR 110.6
Earmarked contributions

Resources

  • Author 
    • Paul Stoetzer
    • Communications Specialist