On Thursday, all the Presidential candidates had to file their campaign finance disclosures for the fourth quarter of 2007. I gave the frontrunners’ reports a quick scour both to get an updated read on the money race (summary statistics here) and to hunt for any fresh instances of the irregularities that have made this cycle so engaging in the past.
So far, one schedule has made a special impression: Senator Clinton’s Itemized Receipts, Line 21.
Excerpted from the filing:
Line 21 is typically very boring, generally nothing more than interest income on bank deposits. But it’s also where candidates report income they’ve generated by selling, renting, or trading their contributor lists. The practice is compliant with FEC rules - you just don’t see it too often because it’s liable to anger the tens of thousands of people who parted with their hard earned cash to support a candidate they probably didn’t expect to (literally) sell them out.
But the problem here is not that the Clinton campaign decided (for the first time) to engage in the practice. The problem is the customer.
Walter Karl, Inc. is your typical list broker/junk mail company, with the exception of the identity of its parent company, infoUSA.
Alert readers will recall that the founder, chairman, CEO, and controlling shareholder of this public company is Vinod Gupta, a man with an impressive record of alleged improprieties involving funneling shareholders’ money to the Clintons.
When former President Bill Clinton and Senator Hillary Rodham Clinton took a family vacation in January 2002 to Acapulco, Mexico, one of their longtime supporters, Vinod Gupta, provided his company’s private jet to fly them there.
The company, infoUSA, one of the nation’s largest brokers of information on consumers, paid $146,866 to ferry the Clintons, Mr. Gupta and others to Acapulco and back, court records show. During the next four years, infoUSA paid Mr. Clinton more than $2 million for consulting services, and spent almost $900,000 to fly him around the world for his presidential foundation work and to fly Mrs. Clinton to campaign events.
Not surprisingly, infoUSA shareholders sued Gupta for squandering their money this way. And that’s not all.
In addition to the shareholder accusations, The New York Times reported [in May 2007] that an investigation by the authorities in Iowa found that infoUSA sold consumer data several years ago to telemarketing criminals who used it to steal money from elderly Americans. It advertised call lists with titles like “Elderly Opportunity Seekers” or “Suffering Seniors,” a compilation of people with cancer or Alzheimer’s disease.
And yes, as is the case with so many travelers in Clintonian circles, the back-scratching has been mutual.
Before leaving office, Mr. Clinton appointed Mr. Gupta to the board of the Kennedy Center for the Performing Arts. Earlier, Mr. Clinton had nominated him for two minor ambassadorships, which Mr. Gupta declined because of business commitments.
…
Mr. Gupta is clearly proud of his friendship with the Clintons. He once had a personal Web site — it was taken down last year — where he posted photographs of himself socializing with them. One showed him with Mr. Clinton on a golf course, arms draped around each other and smiling; another showed Mrs. Clinton posing with the Gupta family in Aspen. Mr. Gupta even dedicated two school construction projects he financed in a rural part of his native India to the Clintons, naming one of them after him and the other after her.
As recently as April of last year, Gupta remained an active Clinton financier, making the maximum allowable direct contributions to Hillary’s Presidential campaign. Gupta also donated $1 million to Bill Clinton’s Presidential Library. That’s the same Clinton Presidential Library which - stop me if you’ve heard this one - recently sold their famously secretive contributor list to infoUSA’s Walter Karl, Inc.
If you can stomach one more unseemly conflict, Gupta acquired polling firm Opinion Research on behalf of infoUSA in 2006 for $134 million (a deal of questionable merit, as it sent the shares plunging 20% in the week immediately following the announcement). Five months later, the firm began conducting Presidential polling for CNN.
Despite all the legal action, the familiar pay-to-play model of the Clintons’ dealings, and shareholder conflicts galore, there’s nothing illegal about Clinton’s decision to rent her Presidential campaign contributor list to Gupta’s company. But given the history between Clinton and Gupta, what kind of judgment does it require to now sell your list of contributors to his company? A company, it bears repeating, that authorities accuse of selling such lists to criminals.
It can’t have been for the money. Hillary had collected nearly $120 million dollars for her campaign war chest by the end of 2007. Is it even imaginable that she would risk reopening this dirty chapter in her and Bill’s playbook for a measly $8,000? I suspect Occam might favor the simpler explanation that the well-established pattern of apparent quid pro quos between Gupta and the Clintons is still at work.
Something along the lines of…
Hey Vin, give us a million dollars for Bill’s biblio-trailer and not only will we sell you access to the library’s contributor list, but when the time comes, we’ll throw in that most valuable asset of Hillary’s bid for the White House.
And that asset is valuable indeed (especially to a professional list broker), perhaps incalculably. Anyone can access the names (even addresses) of contributors to a federal campaign - through the FEC, the Center for Responsive Politics, and elsewhere. But it’s illegal to simply download the data and use it for commercial purposes. So Gupta would be in a heckuva pickle if he’d tried to use the Clinton list on behalf of infoUSA’s clients and people started asking questions about how he got it. Only the candidate committee itself is permitted to sell its list to a third party. So Hillary dangling access to these records in front of Gupta would make for a powerful bargaining chip, either as the quid or the quo.
As shady as this all is, and as nicely as it fits the Clinton m.o., there may not have been any untoward arrangements behind this strange transaction. While circumstances point that way, it’s possible Clinton simply wanted to scrounge a few extra bucks and was comfortable with this mild betrayal of her supporters’ privacy. But even if that’s the case, it speaks volumes about Hillary’s truly bizarre judgment, electing to transact with Gupta through her Presidential campaign committee, despite not only her and Bill’s history with this man, but their ongoing association with ethically challenged financiers in general.
While we wait for this to blow over without Senator Clinton being duly questioned about it, let’s take an informal survey. What’s your guess - surreptitious dealings or just astonishingly bad judgment?
Update: Just how valuable an asset (i.e. how powerful a bargaining chip) would Hillary’s fundraising list be? Ask John McCain.
By last November, John McCain’s presidential campaign was broke. To survive, he offered his fundraising lists as collateral for a $3 million line of credit from a local bank. But obtaining the loan required an unusual extra step: He had to take out a special life insurance policy in case he did not survive the campaign.
Ignoring the morbid afterthought, it’s worth pointing out that as of last November, McCain had raised a total of roughly $37 million. Hillary’s roster has produced 3x as much.
If a local bank perceived enough value in McCain’s list to accept it as collateral for a $3 million line of credit, a professional list broker would presumably place a handsome premium on Hillary’s far larger, more lucrative database.
He might even value it more highly than the $1 million he donated to the Clinton Library. Hmm.
Source: Suitably Flip
