Whoops!
FEC Recommends Clinton Repay Funds
By KEVIN GALVIN Associated Press Writer
WASHINGTON (AP) -- A preliminary Federal Election Commission
report has recommended that President Clinton's re-election campaign be
required to repay $13.4 million in federal matching funds received during the
1996 primaries for violating rules governing so-called issues advocacy ads.
Information in the report by FEC auditors set in motion a 30-day review by
Attorney General Janet Reno, who must decide whether to seek an
independent counsel to probe the Democrat's fund-raising activities in 1996.
According to Democrats and legal sources familiar with the report, it is a
preliminary assessment of the campaign's spending that offers no new
evidence regarding the use of issues ads, but a new interpretation of their
intent.
''These ads were an entirely legal and perfectly appropriate way to
communicate with the American people and there is absolutely no reason to
appoint an independent counsel to review them,'' the DNC said in a
statement.
With midterm elections two months away, Democrats face the possibility of
an independent counsel investigation into their 1996 campaign on three
fronts: their television ads and allegations that Vice President Al Gore and
former White House aide Harold Ickes misled authorities about fund raising.
The same firm that developed the ad campaign for Clinton-Gore '96,
Squier, Knapp & Ochs, also developed ads on political issues for the
Democratic National Committee -- ads that Clinton had a hand in crafting.
The Justice Department has tended to hold that the issues ads fall outside
campaign law limits so long as they don't advocate the election or defeat of
any candidate or party.
But the 30-day inquiry was launched based on the FEC report's
interpretation of how the ads might have crossed that line so as to constitute
''electioneering.''
To receive matching funds, presidential campaigns in 1996 had to agree to
limit spending during the primary campaign to $37 million. If the ads paid for
by the party were used to improperly boost the president's re-election, then
the campaign could be held to have violated the spending limit.
''The FEC has long presumed that political parties' issue ads are
coordinated with their federal candidates and are intended, in part, to
promote those candidates' elections,'' the DNC statement said. ''A political
party ad that mentions a federal candidate does not count as a contribution
to that candidate unless it contains an 'electioneering' message.''
Both the Republican National Committee and Bob Dole's 1996 presidential
campaign relied on the same company, New Century Media, to produce
campaign ads. The Washington Post reported Friday that the FEC auditors
had reached a ''similar'' conclusion about that effort. Dole received $13.5
million in matching funds.
Additionally, FEC investigation of issues ads has looked at the Republicans
and spots run by the AFL-CIO.
Asked at her Thursday news conference whether an issues advocacy
investigation would focus on Republicans as well as Democrats, Reno said
''We are following every lead.''
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