Secret, Foreign Money Floods into Obama Campaign

Monday, September 29, 2008 9:23 PM

By: Kenneth R. Timmerman
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Foreign Donations

And then there are the overseas donations -- at least, the ones that we know about.

The FEC has compiled a separate database of potentially questionable overseas donations that contains more than 11,500 contributions totaling $33.8 million. More than 520 listed their "state" as "IR," often an abbreviation for Iran. Another 63 listed it as "UK," the United Kingdom.

More than 1,400 of the overseas entries clearly were U.S. diplomats or military personnel, who gave an APO address overseas. Their total contributions came to just $201,680.

But others came from places as far afield as Abu Dhabi, Addis Ababa, Beijing, Fallujah, Florence, Italy, and a wide selection of towns and cities in France.

Until recently, the Obama Web site allowed a contributor to select the country where he resided from the entire membership of the United Nations, including such friendly places as North Korea and the Islamic Republic of Iran.

Unlike McCain's or Sen. Hillary Clinton's online donation pages, the Obama site did not ask for proof of citizenship until just recently. Clinton's presidential campaign required U.S. citizens living abroad to actually fax a copy of their passport before a donation would be accepted.

With such lax vetting of foreign contributions, the Obama campaign may have indirectly contributed to questionable fundraising by foreigners.

In July and August, the head of the Nigeria's stock market held a series of pro-Obama fundraisers in Lagos, Nigeria's largest city. The events attracted local Nigerian business owners.

At one event, a table for eight at one fundraising dinner went for $16,800. Nigerian press reports claimed sponsors raked in an estimated $900,000.

The sponsors said the fundraisers were held to help Nigerians attend the Democratic convention in Denver. But the Nigerian press expressed skepticism of that claim, and the Nigerian public anti-fraud commission is now investigating the matter.

Concerns about foreign fundraising have been raised by other anecdotal accounts of illegal activities.

In June, Libyan leader Moammar Gadhafi gave a public speech praising Obama, claiming foreign nationals were donating to his campaign.

"All the people in the Arab and Islamic world and in Africa applauded this man," the Libyan leader said. "They welcomed him and prayed for him and for his success, and they may have even been involved in legitimate contribution campaigns to enable him to win the American presidency..."

Though Gadhafi asserted that fundraising from Arab and African nations were "legitimate," the fact is that U.S. federal law bans any foreigner from donating to a U.S. election campaign.

The rise of the Internet and use of credit cards have made it easier for foreign nationals to donate to American campaigns, especially if they claim their donation is less than $200.

Campaign spokesman LaBolt cited several measures that the campaign has adopted to "root out fraud," including a requirement that anyone attending an Obama fundraising event overseas present a valid U.S. passport, and a new requirement that overseas contributors must provide a passport number when donating online.

One new measure that might not appear obvious at first could be frustrating to foreigners wanting to buy campaign paraphernalia such as T-shirts or bumper stickers through the online store.

In response to an investigation conducted by blogger Pamela Geller, who runs the blog Atlas Shrugs, the Obama campaign has locked down the store.

Geller picked up on the revelation, which Glenn Simpson of The Wall Street Journal reported first, that donors from the Gaza Strip had given more than $33,000 to the Obama campaign, through bulk purchases of T-shirts they had shipped to Gaza.

The online campaign store allows buyers to complete their purchases by making an additional donation to the Obama campaign.

A pair of Palestinian brothers named Hosam and Monir Edwan contributed more than $31,300 to the Obama campaign in October and November 2007, FEC records show.

Their largesse attracted the attention of the FEC almost immediately. In an April 15, 2008, report that examined the Obama campaign's year-end figures for 2007, the FEC asked that some of these contributions be reassigned.

The Obama camp complied sluggishly, prompting a more detailed admonishment form the FEC on July 30.

The Edwan brothers listed their address as "GA," as in Georgia, although they entered "Gaza" or "Rafah Refugee camp" as their city of residence on most of the online contribution forms.

According to the Obama campaign, they wrongly identified themselves as U.S. citizens, via a voluntary check-off box at the time the donations were made.

Many of the Edwan brothers' contributions have been purged from the FEC database, but they still can be found in archived versions available for CRP and other watchdog groups.

The latest Obama campaign filing shows that $891.11 still has not been refunded to the Edwan brothers, despite repeated FEC warnings and campaign claims that all the money was refunded in December.

A Newsmax review of the Obama campaign finance filings found that the FEC had asked for the redesignation or refund of 53,828 donations, totaling just under $30 million.

But none involves the donors who never appear in the Obama campaign reports, which the CRP estimates at nearly half the $426.8 million the Obama campaign has raised to date.

Many of the small donors participated in online "matching" programs, which allows them to hook up with other Obama supporters and eventually share e-mail addresses and blogs.

The Obama Web site described the matching contribution program as similar to a public radio fundraising drive.

"Our goal is to bring 50,000 new donors into our movement by Friday at midnight," campaign manager David Plouffe e-mailed supporters on Sept. 15. "And if you make your first online donation today, your gift will go twice as far. A previous donor has promised to match every dollar you donate."

FEC spokesman Biersack said he was unfamiliar with the matching donation drive. But he said that if donations from another donor were going to be reassigned to a new donor, as the campaign suggested, "the two people must agree" to do so.

This type of matching drive probably would be legal as long as the matching donor had not exceeded the $2,300 per-election limit, he said.

Obama campaign spokesman LaBolt said, "We have more than 2.5 million donors overall, hundreds of thousands of which have participated in this program."

Until now, the names of those donors and where they live have remained anonymous -- and the federal watchdog agency in charge of ensuring that the presidential campaigns play by the same rules has no tools to find out.

http://www.newsmax.com/timmerman/Obama_fundraising_illegal/2008/09/29/135718.html