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How Is It Illegal for Foreign Nationals and Governments To Contribute to U.S. Campaigns?

Amid an ongoing investigation into foreign interference with the 2016 presidential election, many might also wonder whether foreign nationals and governments can contribute money directly to U.S. campaigns.  The answer is unambiguously “no.” 

The Federal Election Campaign Act makes it illegal for a foreign national to contribute to a candidate’s campaign in any American election – federal, state, or local.  Similarly, American candidates can also violate the statute by receiving, soliciting, or accepting foreign contributions.  In this context, a foreign national is any person that is not a U.S. citizen that does not have a green card.

The Federal Election Commission (FEC) generally enforces this statute by imposing civil fines on people who violate the law.  But criminal liability is also a possibility.  If a person knowingly and willingly accepts foreign contributions, for example, the FEC can refer the case to the Department of Justice (DOJ) for criminal prosecution.  The DOJ can also prosecute these cases on its own without a referral from the FEC.

One significant loophole exists.  Federal law exempts organizations known as Social Welfare Organizations (SWOs), like the NRA and the AARP, from disclosing their donors, so long as at least half of the SWO’s activities are non-political.  As a result, the SWO could accept donations from foreign nationals and governments and then donate to another organization, such as a political Super PAC.  The Super PAC would have to disclose the SWO as a donor, but the SWO’s foreign donors would remain a secret. 

Foreign nationals do violate the law, however, if they donate money to a SWO and earmark the donation as a campaign contribution for a specific candidate.  The problem with this “dark money,” though, is that it is hard to trace where it comes from because of the lenient disclosure laws applicable to SWOs.

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