Monday, November 5, 2007

Legally Getting around the $2300 Limit and prohibitions on Foreign Donations

Topic: Presidential Campaign 2008
North Carolina Libertarian Forming 527 "Soft Money" Organization

Jerry Collette, a libertarian from North Carolina is attempting to create a 527 "soft money" liberty-advocacy organization to support Ron Paul's candidacy and other, similar causes in support of liberty.
by Walt Thiessen

Libertarian activist Jerry Collette of North Carolina has announced that he is forming a Section 527 organization for the purpose of providing an avenue for large contributors to continue to independently support the campaign of Ron Paul and other pro-liberty causes legally outside the restrictions established by the Federal Elections Commission. His new organization is tentatively planned to be called, and he is in the initial planning stages as this article goes to press. will be targeting people who have maxed out giving to Ron Paul's campaign. Jerry's plan at this point is to only accept donations in excess of $1,000, since there are plenty of avenues (particularly at the Paul campaign website) for small donors to support Ron Paul. There is no limit to how much money you can give to a 527, which is why this vehicle is the new darling of the soft money crowd. Collette will be checking with the IRS this week to learn about what restrictions there are on collecting corporate and foreign money with his new brainchild. He is especially hoping that can be a vehicle for foreign donors who want to do their part within America's borders to support the fight for liberty.

A 527 group is a type of American tax-exempt organization named after a section of the United States tax code, 26 U.S.C. § 527. Such groups cannot be run by a political campaign or a political action committee (PAC), and indeed this is where most of the current controversy with such groups comes from. For instance, the Swift Boat Veterans came under fire for their support of George Bush against John Kerry in 2004, primarily because of alleged overlap between their organization and the Bush campaign itself.

Wikipedia has an interesting article on the subject. As the article points out, "Under federal election law, coordination between an election campaign and a 527 group is not allowed." The article includes a very interesting table showing the largest 527 groups that participated in the 2004 campaign. Curiously enough, while both the Swift Boat Veterans and are on the list, neither are at #1. That distinction belongs to now-defunct "America Coming Together," a liberal group devoted to get-out-the-vote activities. A watchdog website, reported:

"On June 23, 2004, the Associated Press revealed that an undetermined number of ACT's fulltime canvassers were felons, convicted for crimes ranging from drug dealing to burglary, assault, and sex offenses....
"In August 2007, reported that the Federal Election Commission (FEC) was fining ACT some $775,000 for having used unregulated soft money to help John Kerry and other Democratic candidates in 2004. The FEC determined that most of the $137 million ACT had raised for its get-out-the-vote effort that year, was derived from contributions that violated federal limits. The settlement was the third largest enforcement penalty in the FEC's 33-year history"

Collette has been a libertarian since the Berlin Wall came down, and he was briefly Dick Boddie's campaign manager in 1992. He is a paralegal and has considerable legal expertise which will obviously come in handy with this new venture. He plans to do all the legwork necessary to make sure that doesn't fall into the same traps as America Coming Together and the Swift Boat Veterans found themselves in. Much of the controversy surrounding 527 groups comes from legal interpretation of the IRS rules. For instance, would have to be careful not to run ads using the exact slogans that Ron Paul's campaign uses in their ads and marketing. Collette believes that the Paul campaign gives plenty of opportunity to successfully maintain its legally defined separation from the Paul campaign given the fact that so much of the campaign has been spontaneously developed from grassroots efforts.

Collette plans to target a number of libertarian and conservative famous names to help provide a popular face for the organization. For instance, he it thinking about contacting such notables as economist Walter Williams, author Robert Ringer, investment guru Doug Casey, and author/politician Pat Buchanan to see if he can gain the support of any or all of these relatively famous people within the liberty movement. This is all old-hat to Collette, who used to be a headhunter for about six years. He also says that because of his paralegal experience he is very used to being in situations where you have to tip-toe around laws. He says that you have to make sure your 527 is not behaving like a PAC or a campaign, and he hopes to build the positioning and leverage needed to attract such notable support and build his organization's visibility. He notes that he just started contacting potential supporters this weekend, and already he is finding that lots of people are interested in what he is doing and have given at least tacit support to the project.

Collette is looking to hear from people who work behind the scenes in the fight for liberty and who do not have the big money to give but would like to help promote He is looking to fill a number of roles, including someone with 527 administrative experience, spokespeople, promoters and supporters. If you would like to participate in his project, visit his help wanted page for additional information. All others are invited to visit his website at to learn more about the project.



jerryc said...

Sorry, we found out we cannot take money from foreign nationals who do not have permanent US resident status. The org is coming together nicely. We should have a treasurer in the next few days and be organized.

jerryc said...

Here is a solution for foreign nationals: