FOR IMMEDIATE RELEASE
New Report: Federal Campaigns Lack Barriers to Stop Influx of Illegal Foreign Donations
Eight Month Investigation Finds Almost Half of Congress - 47.3% - Vulnerable to Foreign and Fraudulent Online Donations—Presidential Candidates Vulnerable Too
TALLAHASSEE, Fla. (October 8, 2012) --- The Government Accountability Institute (GAI), a non-partisan investigative and research watchdog group, announced today the release of a 108-page report entitled: "America the Vulnerable: Are Foreign and Fraudulent Online Campaign Contributions Influencing U.S. Elections?,” the first in a series regarding the impact of the Internet on American elections. The report reveals that over an eight-month investigation, GAI discovered President Obama’s campaign website, along with nearly half of congressional websites, lack some of the common, industry-standard security measures used by most e-commerce websites. In addition, the report found that the Obama campaign has actively solicited donations from foreign nationals.
GAI is led by Peter Schweizer whose landmark book, Throw Them All Out, exposed congressional insider trading and led to the recent passage of the STOCK Act. GAI is the same organization that provided a detailed report of the Justice Department’s lack of prosecutions of Wall Street executives for the financial bailout and revealed that President Obama has attended 43.8% of his Presidential Daily Briefs (PDB) on intelligence and did not attend his in-person briefings the week prior to the September 11th attacks on U.S. embassies in Cairo and Benghazi.
“There has been a lot of discussion of the role that money plays in our elections but little or no focus on the vulnerabilities of our election system to be influenced and or possibly manipulated by foreign and fraudulent campaign donations. That is precisely what this report is about, and it’s very troubling,” said Peter Schweizer, President and Co-Founder of the Government Accountability Institute. “The findings in this report reveal that foreign agents of influence can easily be contributing untold amounts of illegal money into presidential and congressional campaigns. Here’s the good news for most of those who are vulnerable: it’s a three-minute, couple-of-clicks solution,” said Schweizer. “We are urging all congressional offices and President Obama to turn on anti-fraud credit card protections immediately.”
The report found almost half (47.3%) of congressional campaign donation websites lack anti-fraud credit card security systems common on most e-commerce websites. As for Gov. Mitt Romney’s campaign, the research found his website does maintain the proper security measures.
Chairman and Co-Founder of GAI, Stephen K. Bannon, stated: “America the Vulnerable is exactly the kind of complex, long-term investigative effort GAI was established to execute. Just like GAI President Peter Schweizer’s insider trading investigation led to the passage of the STOCK Act, we hope this report will result in immediate action to ensure the security of the American electoral system.”
Other key findings include:
Nearly Half of Congress Vulnerable to Fraudulent and Foreign Donations: Of the 446 House and Senate members who have an online donation page, 47.3% do not require the three or four digit credit card security number (officially called the Card Verification Value, or the CVV) for Internet contributions. The CVV is an industry-standard anti-fraud credit card security feature used by over 90% of all e-commerce operations and nineteen of the twenty largest charities in the United States. By not protecting themselves with industry-standard security, larger campaigns pay millions of dollars in extra card processing fees that could otherwise be avoided with the use of the CVV.
Given the scope of the problem within Congress, the Institute created an interactive 50-state map to allow citizens and journalists to identify which members of Congress lack industry-standard anti-fraud credit card protection on their campaign donation websites. Go to:www.CampaignFundingRisks.com
•Third-Party Fundraising Organizations Lacking Industry-Standard Anti-Fraud Credit Card Security Funnelling Millions to Federal Candidates: Third-party political fundraising organizations, such as ActRight and ActBlue, distribute millions of dollars to federal candidates, but lack industry-standard anti-fraud credit card security features to block fraudulent and international donations.
•Presence of Fake RNC and DNC Donation Websites: The Institute uncovered and identified an individual who established websites posing as both the Republican and Democratic National Committees. The individual has operated the phony websites for years and has accepted thousands of dollars in “donations.” GAI’s findings were detailed by ABC News.
•Donation Solicitations On Foreign Websites To Then-Candidate Marco Rubio’s 2010 Donation Page: The Institute discovered multiple Spanish language, foreign websites featuring video links that included embedded advertising directing individuals to the donation solicitation page of then-U.S. Senate candidate Marco Rubio. In addition, Rubio lacked CVV protection, which was corrected in May of 2012. As of this report’s publication date, many of these links are still up and active. This is a potential violation of the Federal Election Commission (FEC) solicitation laws.
•Presidential Candidates Lack Transparency Of Small Donations: Campaigns are not required to disclose donations from individuals who gave less than $200 in a campaign cycle unless the campaign is audited. Furthermore, campaigns do not even need to keep records of those who gave less than $50. Presidential candidates are raising large amounts of money that fall under the $200 threshold and audits are rare unless a campaign accepts federal matching funds. To this date (September 26, 2012), the Romney campaign has raised $58,456,968 and the Obama campaign has raised $271,327,755 in contributions under $200 for the 2012 campaign cycle. In the 2008 presidential elections, the Obama campaign raised $335,139,233 in donations under $200. Neither campaign has accepted federal matching funds nor have ever been audited.
•Threat Of “Robo-Donations”: The absence of industry-standard anti-fraud credit card security features render campaigns more vulnerable to so-called “robo-donations.” Robo-donations are large numbers of small, automated donations made through the Internet to evade FEC reporting requirements.
•Given the state-of-the art digital sophistication of the President’s re-election campaign—including social media, micro-targeting and data-mining—its online donation system contains at least three major security vulnerabilities:
1.The absence of the industry-standard CVV and unknown use of AVS anti-fraud security for online credit card donations.
2.The presence of a branded, major third party-owned website (www.Obama.com) redirects its 68% foreign traffic to a campaign donation page.
3.Active foreign solicitation using indiscriminate email solicitations and exposure to social media.
Specifically:
•Obama Campaign Lacks the Industry-Standard Level Of Credit Card Security For Donations, But Uses It For Merchandise Purchases: To purchase Obama campaign merchandise, the campaign requires buyers to enter their credit card CVV security code, but does not require the credit card security code to be entered when making an online campaign donation. By GAI’s estimates, the Obama campaign’s failure to utilize industry-standard protections potentially costs the campaign millions in extra processing fees.
•Obama.com
•68% Of Traffic To Anonymously Registered Obama.com
To see the online donations, and to receive the official page report, America The Vulnerable: Are Foreign and Fraudulent Online Campaign Contributions Influencing U.S Elections? visit: www.CampaignFundingRisks.com
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