It’s not illegal so long as the candidate doesn’t overpay for their own “consulting” services (thereby giving the impression they are trying to enrich themselves using campaign donations), but the practice of “double dealing” is on the radar of ethics watchdogs — and Beto O’Rourke is doing it.
According to a report from the Daily Caller News Foundation (DCNF), the Democratic presidential candidate has paid out approximately $110,000 in campaign funds to a web development company that he and his wife have alternately owned.
Citing public records and FEC filings, DCNF discovered that Stanton Street Technology Group — a web development company O’Rourke founded in the late 90s — began receiving payments from O’Rourke campaign coffers as early as 2011.
Beto for Texas paid Stanton Street Technology Group $58,544 during the 2011-12 election cycle, $39,060 during the 2013-14 cycle, $9,290 in the 2015-16 cycle and $32,778 during the 2017-18 cycle, according to Federal Election Commission (FEC) records reviewed by The Daily Caller News Foundation.
As mentioned above, the payments are technically legal, but even a campaign finance novice could be forgiven for being understandably skeptical of a situation where a candidate takes in donations from private individuals and turns around and pays a company they own for their services (since the candidate is the one making a profit off those payments).
The DCNF links to an Atlanta Journal-Constitution piece explaining why some believe the practice pushes ethical boundaries.
Federal rules say candidates may pay their relatives and family businesses from campaign funds so long as those payments are for bona fide campaign expenses at fair market rates.
Campaign finance watchdogs say candidates’ payments to relatives raise concerns about nepotism. Attempts to ban the practice have failed in Congress, according to McGehee’s group, which is led by former Federal Election Commission Chairman Trevor Potter..
“In essence, it is a self-dealing transaction,” McGehee said. “It raises the appearance to the public that you might just be out there using other people’s money to enrich your family or yourself.”
AOC has recently come under fire for a similar issue wherein her campaign manager was also funneling funds to a company he set up and owned — and where she sat on the board — and that was apparently attempting to provide services well under fair market value. That situation led to a Virginia attorney filing a campaign finance violation complaint against her alleging she and he campaign manager were trying to be the “uber” of campaign consulting services.
Whatever one may think of the practice of double dealing, Beto’s embrace of it shows he intends to play hardball politics and plans to use whatever means necessary to do it.