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FEC Dismisses Complaint Against Leadership Forum

The Federal Election Commission voted earlier this month to dismiss a complaint that had alleged a pair of 527 groups were violating new campaign finance restrictions by acting as “shadow” fundraising vehicles for national party committees, though the commission did vote to admonish the National Republican Congressional Committee.

The complaint, filed by several watchdog groups, had accused the Leadership Forum — run by ex-Rep. Bill Paxon (R-N.Y.) and Susan Hirschmann, a former top aide to Rep. Tom DeLay (R-Texas) — of being a front for the NRCC and alleged that the Democratic State Party Organization was simply an arm of the Democratic National Committee.

On April 2, the FEC voted 4-2 to accept the finding of the agency’s Office of General Counsel that the two groups did not violate provisions of the Bipartisan Campaign Reform Act that prohibit the raising and spending of soft money by national parties.

“The FEC ruling validates what we have said all along. … The Leadership Forum was set up to and will function in compliance with BCRA,” said Hirschmann. “This ruling reaffirms a citizen’s right to actively participate in the political process.”

The Leadership Forum garnered attention when press reports revealed that the NRCC had given the group $1 million. The Forum returned the money in January, after the complaint was filed with the FEC.

In the “statement of reasons” released by the FEC on Monday, the commission revealed that it had found there was “reason to believe” the NRCC had violated campaign finance regulations by donating the funds to the Leadership Forum. But the commission voted 4-2 to send a letter of admonishment to the NRCC while taking no further action in the matter, largely because the money had already been returned.

An NRCC spokesman said the committee had not yet received a letter from the FEC and would thus not comment.

While four of the six FEC commissioners voted to dismiss the complaint against the two groups, several of the commissioners differed from each other over the reasoning behind the dismissal.

Larry Noble of the Center for Responsive Politics, one of the groups that filed the FEC complaint, pointed to the commission’s findings regarding the NRCC as evidence that 527 groups could not act in close concert with national parties.

“We’re pleased that the general counsel’s office found that the [$1 million] would have been illegal had [the Leadership Forum] kept it,” said Noble. “I think the analysis sends a very strong warning shot across the bow of these groups.”

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