Senate Democrat calls for halt to refunds of illegal campaign contributions

Sen. Catherine Cortez Masto (D-Nev.) is calling on the Federal Elections Commission (FEC) to end its policy of providing refunds to donors who make illegal campaign contributions. 

Cortez Masto said in a letter to the FEC on Tuesday that recent instances of illegal campaign contributions have shown that some individuals are making these donations without any fear of “meaningful penalties.” 

FEC regulations require donors who make an illegal contribution to pay a fine, but they can receive their donation back. 

Cortez Masto said the fines are often smaller than the donation that was made to the campaign, allowing the donor to not lose money. 

“When illegal donations are then returned to the donor, this allows individuals who have violated the law to walk away in the black, having recouped more money than they paid in fines,” she said. 

She argued that returning the donations undermines the FEC’s ability to hold those who violate the law accountable for their actions. 

CNBC first reported on the letter. 

Cortez Masto said federal contractors are prohibited from making political donations to avoid the possibility of elected officials giving contracts and taxpayer dollars to those who supported their campaign. But she noted several instances where illegal contributions were returned to domestic companies that work with the government and penalties were offset by the donation. 

She said federal law also prevents foreign actors from making contributions or participating in others’ contributions to U.S. campaigns to ensure that foreign interests do not influence the country’s democracy, and violators need to receive a “strong signal” about the FEC’s seriousness on the issue. 

The Nevada senator also referenced an example of Barry Zekelman, who illegally made a $1.75 million contribution to the America First Action super PAC in 2018 and received one of the largest fines in the FEC’s history. But Zekelman, who is Canadian, received the donation back in full and was fined $975,000, much less than the donation he made. 

Cortez Masto said the FEC’s rules allow it to require that illegal contributions are given to the U.S. Treasury, and this penalty has been used before. She said the FEC should clarify the instances where this penalty can be used and use it as a penalty and a deterrent. 

“The federal government has an obligation to ensure that our election laws are upheld. Violators of the law should face strong penalties and real accountability—not receive a refund,” she said.