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Republicans scramble to dispose of campaign cash from Giuliani associates

Igor Fruman and Lev Parnas plead not guilty Wednesday to violating campaign finance laws

President Donald Trump’s personal lawyer Rudy Giuliani has ties to two men indicted for campaign finance violations. (Tom Williams/CQ Roll Call file photo)
President Donald Trump’s personal lawyer Rudy Giuliani has ties to two men indicted for campaign finance violations. (Tom Williams/CQ Roll Call file photo)

Republican lawmakers unwittingly entangled in a campaign finance scandal have scrambled to get rid of contributions from two men at the center of the alleged wrongdoing, both of whom were back in court Wednesday.

Igor Fruman and and Lev Parnas pleaded not guilty to violating campaign finance laws when they appeared in federal court in New York for their arraignment. Fruman, Parnas and two other men were indicted earlier this month for “engaging in a scheme to funnel foreign money to candidates.” The indictment alleged the two men did so to “buy potential influence with the candidates, campaigns, and the candidates’ governments.”

Fruman and Parnas, both Soviet-born U.S. citizens, are also tied to President Donald Trump’s personal lawyer Rudy Giuliani. They reportedly assisted with Giuliani’s quest to have the Ukrainian officials investigate former Vice President Joe Biden’s son Hunter, who served on the board of a Ukrainian energy company. Trump’s own push for Ukraine to investigate Biden and the Democratic National Committee is at the center of the ongoing impeachment probe.

While donations from Fruman and Parnas to the Trump campaign and an affiliated super PAC have grabbed headlines, Republican members of Congress were also drawn into the scandal, though they do not appear to have known that foreign contributions, which are prohibited by law, may have been involved. Prosecutors wrote the men “concealed the scheme from the candidates, campaigns, federal regulators, and the public.”

Current and former GOP lawmakers have worked to explain that they were not connected to the two men. They have also pledged to get rid of their contributions, though the mix of responses has raised questions about the process for handling tainted money.

Drawn into scandal

In 2018, Parnas and Fruman donated directly to Texas GOP Rep. Pete Sessions. Fruman also gave to South Carolina GOP Rep. Joe Wilson and to a joint fundraising committee tied to Florida Gov. Rick Scott in his successful bid for Senate. Both Sessions and Wilson have acknowledged meeting with both men. 

Sessions, who lost reelection last year and is seeking a comeback from a different seat, said in an Oct. 11 statement that he will donate the funds to “charities that serve abused women and children and the elderly in central Texas.”

Fruman and Parnas also gave to other joint fundraising committees, which drew more GOP lawmakers into the fray. A joint fundraising committee allows donors to write one large check, which can then be divided so that participating campaigns and party committees can receive up to their legal limits under federal law, which in 2018 was $2,700 per election for candidates.  The Supreme Court’s 2014 decision that struck down limits on how much an individual could contribute in aggregate to all campaigns has led to a boom in joint fundraising committees, according to two campaign finance experts. 

“Even though each participating candidate might only receive $2700 … a single donor’s ability to write that five- or six-figure check makes it much easier for them to buy access with powerful political figures,” said Brendan Fischer, a federal reform director at the Campaign Legal Center. The group’s 2018 complaint to the Federal Election Commission about contributions from a corporation Fruman and Parnas created led to the charges.

FEC records show that 22 other Republicans who were lawmakers at the time received contributions from Fruman, who misspelled his last name as “Furman” in filings in “a further effort to conceal the source of the funds and to evade federal reporting requirements,” according to the indictment.

Further review of the campaign contributions show that Fruman made many of his donations through the joint fundraising committee “Protect the House,” which House Republican leader Kevin McCarthy helped found for the 2018 cycle.

McCarthy spokesman Matt Sparks said after news of the indictment broke that the contributions “were made ahead of events sponsored by Protect the House.”

Fruman and Parnas attended two Protect the House events, McCarthy campaign spokesman Drew Florio said in an email Tuesday. One was in Palm Beach, Florida, in February 2018 and the other a dinner in Washington in June 2018. Florio said Fruman donated to another Protect the House dinner in March 2018, but did not attend the event.

Asked if McCarthy had any direct contact with Fruman or Parnas, Florio wrote, “While Leader McCarthy attended events in which Mr. Fruman and Mr. Parnas were also present, at no time did the leader directly solicit them on behalf of Protect the House.”

FEC records show that Fruman donated $100,000 to the joint fundraising committee, while Parnas donated $11,000.

The scandal has forced the Republicans who ultimately received that money when Protect the House made distributions to their campaigns to explain that the donations came through the joint fundraising committee and that they did not directly solicit the contributions.

Despite being drawn into the scandal, a few GOP lawmakers said this week they were not frustrated with Protect the House, noting that it is difficult to vet donors.

“I don’t know that there’s a real opportunity to do it,” Florida Rep. Brian Mast said when asked if Protect the House should have flagged the contribution.

Nebraska Rep. Don Bacon said he didn’t blame the joint fundraising committee.

“It’s the two criminals’ fault,” he said. Both Bacon and Mast received more than $2,400 from Fruman via Protect the House.

It’s still unclear whether the specific donations that ended up with members of Congress were illegal. But most of the current and former GOP lawmakers have sought to get rid of the contributions anyway.

Donating the donations

Of the 25 Republicans who received direct contributions or money from the joint fundraising committee, 10 are still members of Congress. All of them are getting rid of the funds. 

Five of the GOP lawmakers involved who lost reelection — Sessions, Claudia Tenney of New York, David Valadao of California, David Young of Iowa and Scott Taylor of Virginia — are running for office again. All but Taylor, who is running for Senate, have pledged to donate the contributions to charity. Taylor’s campaign did not respond to a request for comment.

Eleven current and former GOP lawmakers have pledged to donate the money to charity, including Bacon, according to media reports and press statements. Florio clarified that McCarthy intends to donate the funds given to both his campaign and his leadership PAC to charity, saying, “This process is currently underway.”

Three lawmakers — Mast, Pennsylvania Rep. Lloyd K. Smucker and Texas Rep. Will Hurd — are sending the money to the U.S. Treasury, according to their campaigns and offices. Wilson said he refunded the donations to Fruman directly. And former New York GOP Rep. John J. Faso told the Albany Times Union he is waiting to determine whether the donations were legitimate to determine what to do with the money. 

Faso’s comment underscores some confusion about how campaigns deal with tainted money. Donating campaign funds from unsavory figures to charity is a common practice. But if the donations were made illegally, FEC guidelines for congressional candidates state that campaigns must refund the contributions or they can pay the funds to the U.S. Treasury.

Paul S. Ryan, vice president for policy and litigation for Common Cause, said the rush to donate the contributions to charity amid the ongoing court case signals that campaigns “don’t want to deal with the PR problem of having this tainted money.”

Some Democrats are trying to seize on the donations controversy anyway. The Democratic Congressional Campaign Committee sent out a handful of press releases highlighting the GOP candidates tied to Fruman. California Democratic Rep. TJ Cox, who faces a rematch with Valadao, sent a fundraising email on Oct. 13 with the subject line, “TJ’s opponent took cash from Giuliani’s Ukrainian associates.” The email was the Cox campaign’s most effective fundraising email so far this month, bringing in the highest number of donations, though Cox’s campaign declined to provide specific figures.

But so far some of the GOP lawmakers aren’t worried the campaign donations could be a political problem.

“Because it’s a partisan world we’re in, they’ll try to twist it,” Bacon said. “But most people will know that, ‘Hey, we didn’t know it was illegal.’”

Ed Timms and Simone Pathé contributed to this report.

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Correction 3:21 p.m. | An earlier version of this story misstated the amount Igor Fruman donated to the Protect the House joint fundraising committee. 

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