Putting Names to Money: Closing Disclosure Loopholes

by | May 10, 2020 | ,

Elections create an opportunity for voters to get to know the candidates, but elections also give voters the opportunity to get to know their fellow voters. Campaigns are obligated to disclose the identity of their donors, which can make these donors’ political affiliations known to the world. Also, the identity of a donor can adversely affect the recipient’s public image and potentially, the election. These disclosure requirements arguably enable stigmatizing candidates and fellow voters for their political ideology, but this is offset by the desire to make elections transparent.

In today’s polarized society, the risk of stigma seems greater than in the past—imagine wearing a MAGA hat in San Francisco or an Alexandria Ocasio-Cortez shirt in rural Alabama—but it pales in comparison to the need for transparency in elections. After the 2016 Presidential Election, Democrats and Republicans alike claimed that nefarious actors attempted to influence the election: be it through foreign interference or election fraud. While there are some disclosure requirements that help mitigate such influence, the current requirements have several loopholes that actors use to remain anonymous.

This Note evaluates three of these disclosure loopholes: (1) the 501(c) disclosure exemption for independent expenditures; (2) the internet loophole for certain electioneering communications; and (3) the straw-donor laundering loophole. Throughout this analysis, one theme stands out: the structure of the Federal Election Commission (FEC) has crippled the agency’s ability to enforce disclosure laws. Absent unlikely assistance from Congress, the solution lies with the courts.

Recent judicial decisions portend the possibility of meaningful judicial review of FEC inactions. While questions remain about whether FEC decisions based on “prosecutorial discretion” are exempt from judicial review, the Federal Election Commission Act gives the courts authority to review FEC decisions that are contrary to law. This Note concludes by arguing that FEC enforcement decisions are not exempt and should be nullified if they are “contrary to law.”