Why Aren’t Heads Rolling?

Late last week, I was able to get a little bit of a head start on what was supposed to be a “bombshell” regarding the Obama campaign. After I got all of the information, I then had an obligation to sit on it until yesterday. I had a client’s interest at stake, so not only did I have to keep some degree of objectivity, but I couldn’t use any of it for my own use. Until now. As it turns out, the story’s big – but if I was worried about coming in late with it, I shouldn’t have been.

This “bombshell” that was supposed to annihilate not only the Obama Administration, but the political sector as a whole, is absolutely damning. Except the media’s not reporting it – with the exception of a brief report from Sean Hannity Monday night and one reference (that I saw) today on Fox. Why this hasn’t been blasted all over the airwaves is beyond me.

The Loophole

There is a loophole that’s being used that allows donations to be made to various political campaign websites from foreign interests. This “foreign donor loophole” is compromised when a site doesn’t require that three digit code on the back of our credit cards be keyed in. The security codes, or CVV codes, prevent the so-called robo-donors from fraudulently contributing to any campaign. When you donate online to the Obama campaign using a credit card, the contribution web page does not require the CVV – and I verified this for myself. But it’s what’s in the report that’s so disturbing – mostly because it’s clear there are those who know they’re above the law and who can bypass the criminal justice system.

So here’s what all of this is about –

A new report came out on Monday from the Government Accountability Institute. The U.S. Attorney’s office also played a role in putting together all of the information that’s been collected over the past eight months. The focus was on “potential influence of foreign online campaign donations in House, Senate and presidential elections”, although the in-depth information has to do with the current Obama campaign. There’s so much in this 100+ page report – and I strongly encourage you to check it out here (y’all know I’m all about doing the research and making decisions based on the facts – read it and come to your own conclusions).

Criminal Repercussions

According to GAI, it is the duty of the campaign to “ensure compliance with the law”. When that doesn’t happen, the door is opened for criminal prosecution for the conscious failure to do so. The Obama campaign raised $181 million in September. A mere 2% of those donations are required to be reported to the FEC. That means 98% of those donations were less than $200 each – and most were less than $50 each. None of these have the security codes – but if you buy an official Obama t-shirt or coffee mug, guess what? You have to use your CVV code for a $15 mug.

By contrast, the Mitt Romney campaign has raised $58,500 in contributions under $200. The difference, aside from the dollar figures is that with every single Romney donation, there exists a CVV code; in fact, you can’t make a contribution without that three digit number. And if you’re wondering, Barack Obama has raised more money online than any other presidential candidate in history.

The report reads, “Protecting against criminal campaign contributions is easily accomplished by requiring a CVV code on the campaign donation page.” Yes – criminal campaign contributions. Although it isn’t illegal to decline the use of a secure CVV credit card code for campaign donations, it is illegal to accept campaign donations from foreign sources. Campaigns are required under criminal code “not to solicit, accept or receive foreign donations in any amount”. The Federal Elections Commission does not require any campaigns to disclose the names of donors making contributions of less than $200, unless extreme circumstances are at play. In addition, FEC rules don’t require campaigns to keep records of any kind of those giving less than $50. These rules combined with the lack of a CVV numbers make it easy for campaigns to get away with taking foreign donations. This is illegal and there are criminal repercussions.

Exploiting Weaknesses

FBI surveillance tapes have previously shown foreign governments understand and are eager to exploit the weaknesses of American campaigns,” the report says. “This, combined with the Internet’s ability to disintermediate campaign contributions on a mass scale, as well as outmoded and lax Federal Election Commission rules, make U.S. elections vulnerable to foreign influence.”

There are several revelations in this report, but there’s one more I want to include:

You may think obama.com is owned by Barack Obama, but it’s not. It’s a “branded, major third-party owned website” and it redirects 68% foreign traffic to a campaign donation page. This website was created in Shanghai, China, by an “Obama bundler”. Here’s the kicker: the registration and identification is hidden. The main website, BarackObama.com, sees 43% of its traffic coming from foreign IP addresses.


As GAI points out, if a campaign is truly seeking to do all it can to prevent illicit contributions, there is no reason not to employ these basic fraud prevention tools. First, these tools are easily installed, and once set up, operate with a minimum of administrative oversight by the vendor. They are fully automated, but can be easily re-calibrated as called for. Under these circumstances, a campaign’s decision to turn off either of these systems despite the increased fees raises legitimate questions as to a campaign’s knowing failure to use its best efforts to comply with the laws prohibiting foreign contributions. Indeed, it’s reasonable to ask why any campaign would ever opt to pay card issuers more for less information and less security. More importantly, why pay card issuers more when doing so lessens a campaign’s ability to comply with the law? It’s hard to imagine any campaign would pay extra for less security and marketing intelligence, unless it stood to benefit in some way from doing so.”

Let me be clear – do not take my word for it. Read the report, do your research and come to your own decisions. Remember, there are some of the biggest changes in this nation’s history coming our way as a result of this election. Regardless of who’s elected, things are going to change – they’re going to change fast and it’s going to be significant. I don’t care who you vote for and I’ve been the first to admit it when someone questions my own motives: I do NOT think either of these candidates have a place in the White House. My vote is simply based on who I dislike less. I’m OK with that too – I can live with it. But each of us needs to be OK with whatever we decide and that can only happen if we’re moving forward with the information that ensures it. 


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