New York Times: Three Men Charged With Running ‘Scam PACs’ That Bilked Small Donors

New York Times: Three Men Charged With Running ‘Scam PACs’ That Bilked Small Donors

Paul S. Ryan, the vice president of policy and litigation at Common Cause, a watchdog group, called the indictment “good news for democracy and small donors,” adding that Mr. Tunstall was perhaps the best known of the fund-raising operatives taking advantage of donors in this way. “This should send a sign to potential scam artists that the Department of Justice is watching,” Mr. Ryan said. Mr. Ryan said he expected that a superseding indictment would eventually cover Mr. Tunstall’s past four years of activity. He noted that the charges filed were made under financial crimes statutes and not under campaign finance law. And he urged federal lawmakers to stiffen the existing campaign-finance rules to better protect small contributors. “Congress really needs to act here,” Mr. Ryan said.

The Justice Department on Wednesday accused three political operatives of running a scheme to mislead donors and enrich themselves, charging the men with defrauding people of $3.5 million in 2016 and 2017.

The allegations involve two political action committees and include wire fraud, money laundering and making false statements to the Federal Election Commission. It was the latest indictment against operatives who raise money for what are known as scam PACs, which direct much of the proceeds back to the people who run them. …

The charges are notable in part because there are numerous political groups that raise money from unsuspecting small donors and then spend most of the funds not on actual politicking but on themselves, often directing cash to companies owned by the operatives behind the groups.

Paul S. Ryan, the vice president of policy and litigation at Common Cause, a watchdog group, called the indictment “good news for democracy and small donors,” adding that Mr. Tunstall was perhaps the best known of the fund-raising operatives taking advantage of donors in this way.

“This should send a sign to potential scam artists that the Department of Justice is watching,” Mr. Ryan said. …

Mr. Ryan said he expected that a superseding indictment would eventually cover Mr. Tunstall’s past four years of activity. He noted that the charges filed were made under financial crimes statutes and not under campaign finance law. And he urged federal lawmakers to stiffen the existing campaign-finance rules to better protect small contributors.

“Congress really needs to act here,” Mr. Ryan said.