Can Trump use campaign funds to pay his $454 million civil fraud debt? Absolutely not.

Uncategorized

FILE - Former President Donald Trump holds up a copy of a story featuring New York Attorney General Letitia James while speaking during a news conference, Jan. 11, 2024, in New York. (AP Photo/Mary Altaffer, File)

FILE – Former President Donald Trump holds up a copy of a story featuring New York Attorney General Letitia James while speaking during a news conference, Jan. 11, 2024, in New York. (AP Photo/Mary Altaffer, File)

On March 18, 2024, lawyers for Donald Trump informed a New York court that he couldn’t acquire the 110% bond he needed to post for his $454 million judgment before he could appeal his loss in his civil fraud case. Apparently, 30 different bond companies turned him down. So where can Trump get the money?

It cannot be from his campaign coffers.

The rules for funding a presidential campaign are governed by the federal law known as FECA — the Federal Election Campaign Act. This law has been made into legal Swiss cheese with Supreme Court-fostered loopholes from cases like Buckley v. Valeo, Citizens United and McCutcheon v. FEC. But one of the parts of campaign finance law that is clear and still in effect is the prohibition on the personal use of campaign funds.

Under FECA, prohibited personal uses of campaign funds include using it to pay for:

(A) a home mortgage, rent, or utility payment;

(B) a clothing purchase;

(C) a noncampaign-related automobile expense;

(D) a country club membership;

(E) a vacation or other noncampaign-related trip;

(F) a household food item;

(G) a tuition payment;

(H) admission to a sporting event, concert, theater, or other form of entertainment not associated with an election campaign; and

(I) dues, fees, and other payments to a health club or recreational facility.

Moreover, FECA prohibits federal candidate committees from making expenditures for anything “that would exist irrespective of the candidate’s election campaign” or duties as a federal officeholder.

The Federal Election Commission (FEC) uses the “irrespective test” to determine whether using campaign funds is a prohibited personal use. If the expense would exist in the absence of the campaign, it generally is impermissible to use campaign funds to pay for it. The $454 million Trump owes for civil fraud related to his businesses including 40 Wall Street, the Trump Seven Springs estate, Trump Park Avenue, Mar-a-Lago, and Aberdeen, among others, clearly falls within this “irrespective” category as this financial fraud has nothing to do with either his 2024 campaign, 2020 campaign, 2016 campaign or his time as president.

The personal use prohibition is one of the parts of campaign finance law that the Department of Justice regularly enforces. For instance, just last September, the DOJ charged a four-time failed federal candidate for Congress with the alleged personal use of campaign funds and noted that he faces five to 20 years if convicted. The DOJ has even been known to prosecute cases that involve the person use of campaign funds in state elections — and this too can result in jail time, as happened to a St. Louis alderman who was convicted in 2020 after he dipped into his campaign funds for personal use.

Over the years there have been some colorful incidents involving sitting members of Congress running afoul of this campaign finance law. Rep. Jesse Jackson Jr.’s personal use of campaign funds was particularly bad. Jackson used $750,000 in campaign funds to fund his lifestyle. He spent the money on a home renovation as well as thousands on memorabilia including an Eddie Van Halen guitar, a football signed by American presidents, Bruce Lee memorabilia and Michael Jackson’s fedora. He had to forfeit all of the memorabilia as well as a mink cashmere cape and a mink reversible parka. The now-former representative went to jail for his personal use of campaign funds.

Another shocking incident involved Rep. Duncan Hunter, who pleaded guilty after being charged with personal use of campaign funds. He captured some headlines after reporters realized that Hunter had used some of the campaign money to fly his pet rabbit Eggburt on a vacation. He also used the campaign money to cheat on his wife. Hunter was pardoned by Trump so he never served time for this crime, despite having been sentenced to almost a year in prison.

More recently, Rep. George Santos was accused of violating the personal use rules. As federal prosecutors allege, “the funds received from Contributor[s] … were spent by [George] Santos for his personal benefit, including to make cash withdrawals, personal purchases of luxury designer clothing, credit card payments, a car payment, payments on personal debts[.]” He could be facing 22 years behind bars for this and other alleged crimes. Santos is innocent until proven guilty, although he is already in the history books: Santos was the just the sixth person to be kicked out of the House of Representatives in its entire history.

The closest personal use of campaign funds case to Trump’s situation may well be that of Sen. Larry Craig. In 2014 Craig was ordered by a federal judge to pay $242,000 for illegally using campaign funds to pay for his legal defense to a criminal sex solicitation charge arising from an incident in a Minnesota airport bathroom in 2007. In 2016, the U.S. Court of Appeals for the District of Columbia Circuit upheld this ruling against Craig. It stands to reason if a campaign cannot pay for Craig’s criminal defense lawyers, campaign money should not be used to ease Trump’s civil fraud burdens either.

It may sound basic, but campaign funds are supposed to be used for political campaigns, not shopping sprees or expensive litigation. The bad news for Trump is because of statutory interest that is accruing, the amount he owes grows roughly $100,000 bigger every day — although the former president received a reprieve of sorts after a New York court of appeals agreed to temporarily halt collection of the fine if Trump came up with a $175 million appeal bond.

Ciara Torres-Spelliscy is a professor of law at Stetson Law School and a fellow at the Brennan Center. She is the author of the forthcoming book, “Corporatocracy.”

Have a tip we should know? [email protected]

Source

Leave a Reply

Your email address will not be published. Required fields are marked *