The Democratic Party of Tennessee agreed to pay a six-figure fine to settle a Federal Election Commission case alleging that it misreported millions of dollars in campaign funds, according to new FEC documents.
In January, FEC commissioners voted unanimously that they found “reason to believe that the Tennessee Democratic Party violated” the law by “failing to report total receipts and disbursements,” “failing to itemize receipts received via joint fundraising transfers,” and “failing to maintain monthly payroll logs.”
The FEC said that “during the 2016 election cycle, the [Party] Committee failed to disclose receipts and disbursements totaling $2,739,911 on its original reports filed with the commission.”
It also “filed to itemize $1,509,766 in contributions” linked to joint fundraising activity, the term for when a political party splits donations with a campaign. Joint fundraising committees are the epicenter of wealthy political influence because parties are permitted to take larger donations than individual politicians can.
“In addition, the Committee failed in its amended report to correctly report a gross, unitemized $78,999 fundraising contribution,” the FEC said.
The Party also failed to properly separate work on state and federal campaigns, an important distinction since the two operate by separate rules.
On July 28, the Party admitted to violations and agreed to settle the investigation by paying a fine of $103,000, as well as agreeing to undergo training.
But FEC Commissioner Ellen Weintraub, a Democratic appointee who is a long-serving member of the campaign finance regulatory body, did not think the Commission should have voluntarily settled the case.
“The negotiated agreement requires the Tennessee Democratic Party to pay a civil penalty of $103,000 for the $3,677,981 in misreported activity… These extensive violations merited a higher penalty,” she wrote on August 27.
“The penalty in this matter deviates from and is below what the Commission would normally seek or accept,” she wrote, adding that “fair, proportionate, and consistent penalties are a hallmark of a credible enforcement program.”
She said such a favorable settlement offered little deterrent for future wrongdoing. “Inconsistent and inappropriately low penalties such as the one in this matter amount to little more than the cost of doing business,” she wrote.
An audit also found that when people gave more than was permitted, instead of notifying them of that, the Party transferred the money from a federal to a state account. “TDP did not maintain a separate account for questionable contributions,” the audit found.
When audit staff raised issues at an “exit conference,” “TDP representatives did not provide any comments and did not submit any additional documentation.”
The FEC also held “Carol V. Abney in her official capacity as treasurer” responsible.
Abney told the FEC that she is an accountant who was elected treasurer in January 2021 and that problems around the 2016 election cycle were “primarily caused by the acts and omissions of” a company called Next Level Partners.
Next Level Partners did not immediately return a request for comment from The Daily Wire, nor did the Democratic Party of Tennessee.
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