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FEC fines 527 group $750,000 for campaign finance law violations

[JURIST] The Federal Election Commission (FEC) announced a settlement [press release] Wednesday in the case against the Progress for America Voter Fund (PFA-VF) [advocacy website] for violating campaign finance laws during the 2004 election cycle. The conciliation agreement [PDF text] indicates that PFA-VF will pay a $750,000 fine, the third largest fine in FEC history, and that PFA-VF agreed to register as a political organization.

The FEC had alleged that PFA-VF violated several campaign finance laws in 2004 by "failing to register as a political committee with the Commission, by failing to report contributions and expenditures, by knowingly accepting contributions in amounts exceeding $5,000 from individuals, and by knowingly accepting corporate and/or union contributions..." PFA-VF is a tax-exempt 527 group [Opensecrets.org backgrounder], which have been criticized as vehicles for political interest groups to avoid the soft-money restrictions required by the Bipartisan Campaign Finance Reform Act of 2002 [FEC materials], popularly known as the McCain-Feingold law. In the run-up to the 2004 election, the FEC decided to regulate 527 groups on a case-by-case basis, prompting a legal challenge [JURIST report] where the district judge demanded that the FEC explain why 527 groups would be handled on a case-by-case basis.

The PFA-VF website indicated on Wednesday that:

The FEC's inactions left all 527 groups, including PFA-VF, to their own interpretation of the law. The FEC subsequently announced a "case by case" enforcement policy and opened investigations into violations of the very statutes for which the Commission had refused to provide guidance...Given the ambiguous legal nature of this situation and the cost of litigating this dispute, PFA-VF has decided it is a more prudent use of its resources and energy to conclude this proceeding.
PFA-VF spent at least $30 million on advertising in support of President Bush during the 2004 election cycle. The New York Times has more.

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