Gormley for Senate Investigation Nets $115,000 in Civil Penalties

WASHINGTON -- The Federal Election Commission (FEC) has entered into conciliation agreements with Atlantic City Showboat, Inc., Marina Associates, Herbert Wolfe and David Jonas; Gormley for Senate Primary Election Fund; and Mirage Resorts, Inc. to resolve violations of the Federal Election Campaign Act resulting from contributions facilitated by Showboat, Marina and Mirage to William Gormley’s 2000 Senate campaign in New Jersey.  

      The conciliation agreements resulted in total civil penalties of $115,000.  The Gormley committee is responsible for $22,000 of the penalty.  Showboat, Marina, David Jonas and Herbert Wolfe are jointly and severally responsible for $53,000 of the penalty.  Mirage is responsible for $40,000 of the penalty.

      The Federal Election Campaign Act prohibits a corporation from making a “contribution” of money or anything of value in connection with any election for federal office. Corporations, including officers, directors or other representatives acting as agents for the corporation, are also prohibited from “facilitating the making of contributions to candidates or political committees, other than to the separate segregated funds of the corporations.” Facilitation means “using corporate . . . resources or facilities to engage in fundraising activities in connection with any Federal election  

      According to the conciliation agreement with Showboat, Marina, David Jonas and Herbert Wolfe, the candidate contacted Herbert Wolfe, an executive at Showboat, in early 2000 and asked him to raise funds for the campaign.  During an executive meeting at Showboat, Mr. Wolfe invited employees to contribute to the campaign, and told employees that they could leave contributions with his secretary and they would be forwarded to the Committee. Mr. Wolfe asked David Jonas, an executive at Marina, to raise funds for the campaign at Marina.  Mr. Jonas and his supervisor sent a memorandum to management team members requesting that they consider making a contribution. Marina employees who contributed to the Gormley committee delivered their contributions to his office, as requested by the memorandum, and left them with his secretary.  Thereafter, a Committee representative went to Mr. Wolfe’s and Mr. Jonas’ casino offices and picked up the contribution checks that had been collected.  The Committee reported depositing $13,000 in contributions from Showboat employees and their spouses.  The Committee reported depositing $24,275 in contributions from Marina employees and their spouses.

      In order to settle the matter, Showboat, Marina, and their employees did not contest the finding that they violated the Federal Election Campaign Act by using corporate resources to improperly facilitate contributions.

      According to the conciliation agreement with Mirage, they held a fundraiser for the candidate on February 9, 2000 at the Le Cirque restaurant in Las Vegas, Nevada that was attended by 29 individuals.  Mirage planned and organized the fundraiser, including reserving a location, arranging for catering, sending invitations for people to attend, and soliciting contributions.  Mirage initially sent the invitations only to executives within its restricted class.  Subsequently, Punam Mathur, then a Mirage executive, held conversations with other people about the fundraiser, including several people outside the restricted class and outside the corporation, and invited them to attend and contribute.  Ms. Mathur also instructed her assistant as part of her work responsibilities to work out a catering menu for the fundraiser, obtain a contribution commitment from some non-attendees and send a messenger to collect contribution checks.  Following the fundraiser, Mirage collected and forwarded $28,000 in contributions, including checks dated before and after the fundraiser, to the Committee.

      Mirage admitted to violating the law by using corporate resources to facilitate contributions to the Committee.  Mirage is required to pay a civil penalty and will cease and desist from violating the Act.  The Commission found reason to believe that Punum Mathur violated the law for consenting to the facilitation.  As part of the conciliation agreement with Mirage, Punam Mathur, without admitting or denying any violations of the Act, agreed to cease and desist from violating the Act.  The Commission took no further action against Ms. Mathur and sent her an admonishment letter.

      According to the conciliation agreement with the campaign committee, the committee accepted $63,275 in contributions facilitated by Showboat, Marina and Mirage (one contribution for $2,000 was returned to the donor).  In addition, the committee accepted an excessive in-kind contribution of $723 in the form of an airline ticket to the Las Vegas, Nevada fundraiser from Joseph Jingoli and failed to report the contribution, and failed to report an in-kind contribution of $220 from the candidate for payment of his hotel bill in Las Vegas, Nevada.  The committee is required to pay a civil penalty and will cease and desist from violating the Act.

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

It requires the votes of at least four of the six Commissioners to take any action. 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.

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