The House Ethics Committee is considering whether to change rules about lawmaker legal expense funds to expand the pool of people who can use them to pay for their legal bills connected to a campaign or office.
Rep. David Schweikert, R-Ariz., who faced lawsuits related to his 2022 primary race, asked the committee to allow campaign staffers, vendors and spouses draw from legal expense funds rather than having to use campaign funds.
Members can set up these trusts when they encounter legal exposure as part of their role in public office to help them pay the associated costs. As it stands, only members and current or former House staffers can use money from a legal expense fund.
In summer of 2022, as Schweikert’s primary race was hitting the final stretch, the Arizona Republican, members of his campaign team and his family were named in civil lawsuits related to that election battle.
Among them was a defamation lawsuit filed by CarGuard Administration, a company founded by Schweikert’s primary challenger, Elijah Norton. It names Schweikert; a campaign advisor, Christopher Baker; and a company owned by Baker. Another lawsuit over campaign advertisements names his wife, Joyce.
Those cases were settled earlier this year, according to court records.
Schweikert said lawsuits that name people who aren’t covered by a legal expense fund can create a “campaign tactic” to “chew up resources” from a campaign account.
“But do you get to cover your expenses if they named your wife? How about if they named your campaign manager? Or how about if they named your field person?” Schweikert said.
It’s unclear whether the rule change will happen. It would require a vote at the Ethics Committee, but not a House floor vote.
Rep. Michael Guest, R-Miss., chairman of the ethics panel, said the staff is in the process of examining the potential changes and that he hopes the committee will decide on how to proceed before the year ends.
“It’s currently being researched by the staff and, at some point, we will take that up as a full committee as to whether we think that it should be expanded,” Guest said.
For the chairman, it’s an easier sell to include spouses than campaign workers.
“I think, clearly, covering a spouse would be a much easier move for the committee to make,” Guest said. “When you start looking at campaign staff and then you get outside of that, vendors of the campaign, I think that that is probably less likely.”
Schweikert opened “The David Schweikert Legal Expense Trust” in October to pay for expenses that include the CarGuard matter, according to a filing reviewed by CQ Roll Call.
Dan Schwager, a former staff director for the House Ethics Committee, said there could be issues with expanding the regulations, such as if a member used the fund to pay for their child’s defense of a DUI charge or if a campaign vendor uses the money for an unrelated matter.
He said it is imperative, whatever the panel decides, for the legal expense fund cash to go toward issues that emerge from the person running for office or holding office.
“The regulations of the fund are meant to be limited to situations that arise from the fact that somebody is a member of Congress or they work for a member of Congress,” Schwager said. “While it’s certainly fair to recognize that allegations against the member can drag people outside of their office into aggressive and expensive investigations, the committee’s regulations need to stay strong and the committee needs to make sure that the matters that legal funds are used for stay limited to their original purpose.”
That means “only matters or allegations that arise out of a member’s official duties or the fact that they’re running for office,” Schwager said.
CarGuard’s lawsuit claims Schweikert’s team made “false and defamatory statements” about the car warranty services company, including calling it a “scam” that participates in “illegal robocalls” and other fraudulent conduct.
Those types of claims about CarGuard were published in Schweikert’s campaign advertising, statements to the press and on social media, the lawsuit states.
The Schweikert campaign distributed over 50,000 pieces of campaign mail that “falsely suggest” CarGuard participated in “illegal telemarketing calls” and other fraud, including “preying” on the elderly, the lawsuit states.
The complaint also accuses Schweikert’s team of creating a website, crookednorton.com, that falsely accused CarGuard of “sending out millions of illegal robocall as part of a scheme to convince Americans to purchase auto warranties that are effectively worthless.”
Schweikert’s campaign committee, Friends of David Schweikert, purportedly paid for that website, which was developed by Baker and his company, Blue Point, the lawsuit says.
Shortly after the CarGuard lawsuit was filed, Schweikert, his wife, Joyce, and his campaign committee were part of those named in a complaint by Leslie Hammon.
Hammon, with legal help from Norton, sued Schweikert and his team regarding ads implying Norton was romantically involved with Hammon, the Arizona Republic reported.
The Federal Election Commission has said money contributed to a properly approved legal expense fund is not a campaign donation. Through a legal expense fund, campaign supporters have a chance to double dip and provide up to $5,000 in a calendar year to the fund in addition to what they contribute to a particular person’s campaign account.
Schweikert has his own troubled history with the Ethics panel. In 2020, he was reprimanded on the floor of the House and forced to pay $50,000 back to the Treasury after the Ethics Committee found he violated federal law and House rules by letting his office misuse taxpayer money, circumventing Federal Election Commission reporting requirements, using campaign money for personal use and making his official staff do campaign work.