Bush-Cheney fined $90,000; failure to disclose recount acts

News Releases, Media Advisories
For Immediate Release
April 20, 2004
Contact: Kelly Huff; Bob Biersack; Ian Stirton; George Smaragdis

BUSH-CHENEY 2000 TO PAY $90,000 CIVIL PENALTY
FOR FAILING TO DISCLOSE RECOUNT ACTIVITY
WASHINGTON -- The Federal Election Commission (FEC) has entered into a conciliation agreement with Bush-Cheney 2000, Inc. resulting from the failure to report to the FEC receipts and disbursements associated with its recount activities. Bush - Cheney 2000, Inc. has agreed to pay a $90,000 civil penalty.

According to the conciliation agreement, Bush - Cheney 2000 held a bank account designated "Bush-Cheney 2000, Inc. - Media." After the November 7, 2000 presidential election, the Committee redesignated this bank account "Bush-Cheney 2000, Inc. - Recount Fund" and used the account to raise funds and pay costs associated with the recount. However, the Committee failed to include that activity in disclosure reports filed with the Commission.

The Federal Election Campaign Act (the Act) requires authorized committees of candidates for federal office to report the total amount of all receipts of disbursements in committee accounts, and to itemize them when the aggregate amount or value exceeds $200 in an election cycle. In Advisory Opinions 1998-26 and 1978-92, the Commission held that while separate organizations established solely to fund a recount effort would not be required to file disclosure reports, a federal political committee establishing a bank account for recount purposes must report those receipts and disbursements.

Filings submitted to the IRS in 2002 and 2003 suggest the recount account raised approximately $11 million and spent approximately $13 million.

Bush- Cheney 2000 admitted that the failure to report the receipts and disbursements associated with its recount activity and to properly itemize them as "other receipts" and "other disbursements" violated the Act. The committee agreed to cease and desist from violating these sections of the Act and agreed to submit a miscellaneous filing to the FEC that discloses and itemizes, where appropriate, its recount receipts and disbursements.

The investigation stemmed from a complaint filed by Terence R. McAuliffe, Chairman of the Democratic National Committee.
1. MUR 5199 RESPONDENTS: Bush-Cheney 2000, Inc., David Herndon, treasurer
COMPLAINANT: Terence R. McAuliffe, Chairman, Democratic National Committee
SUBJECT: Failure to report receipts and disbursements for recount activities
DISPOSITION: Conciliation Agreement: $90,000 civil penalty
DOCUMENTS ON PUBLIC RECORD: Documents from this matter are available from the Commission's web site at http://eqs.sdrdc.com/eqs/searcheqs by entering 5199 under case number. They are also available in the FECs Public Records Office at 999 E St. NW in Washington.

*There are four administrative stages to the FEC enforcement process:

1. Receipt of proper complaint 3. "Probable cause" stage
2. "Reason to believe" stage 4. Conciliation stage

It requires the votes of at least four of the six Commissioners to take any action. The FEC can close a case at any point after reviewing a complaint. If a violation is found and conciliation cannot be reached, then the FEC can institute a civil court action against a respondent.