Prior to these changes it was common for individuals who had even nominal contact with the Executive and Legislative Branch officials to register. Many of these individuals were concerned that if they were seen walking in the halls of Congress and agencies, someone could question why they were not registered. So to avoid the appearance of impropriety, they registered. But after HLOGA and the President’s restrictions, many registrants re-examined that decision and concluded that if they were not spending 20 percent of their time engaged in lobbying activities on behalf of a client or employer, they shouldn’t be registered. The desire to err on the side of transparency and voluntarily register was outweighed by the desire to avoid the prohibitions, restrictions, requirements and sanctions, not to mention the politically motivated stigma associated with being a registered lobbyist. As a result, many of the voluntary registrants terminated their registration and with it went the information that previously was disclosed in their LDA reports.
There is no scandal associated with these de-registrations, but rather a growing trend of registrants availing themselves of a basic provision of the LDA -- the 20 percent lobbying activity exemption. Of course, Congress enacted the exemption and can change or eliminate it, as some like the American League of Lobbyists have suggested.
But what about those lobbyists who are registered? Are they complying with the LDA? According to a just-released Government Accountability Office (GAO) audit mandated by HLOGA, lobbyists are doing so at a remarkably high rate.
To conduct its audit the GAO reviewed a random sample of LD-2 and LD-203 reports and interviewed the filers to determine whether there was proper documentation to support the information that was included in the reports, such as income and expenses incurred for lobbying activities, the names of lobbyists listed, and the chambers of Congress and federal agencies lobbied.
The results may seem startling to some. The GAO found extremely high degrees of compliance. For example, the audit showed that 97 percent of filers could provide documentation to support reported income expenses. It also found that for LD-203 reports, only six percent of all LD-203 reports omitted one or more reportable political contributions that were documented in the Federal Election Commission database.
The one lesson that all LDA registrants should take from the audit results is the need to have a system of record-keeping, and to ensure that it is followed, in the event that the registrant is selected for an audit or enforcement action. The LDA does not prescribe any special recordkeeping provisions but does require each registrant to have a reasonable system in place and good faith compliance with that system.
It may be fear of jail or stiff fines that drive the high rate of compliance and if so, HLOGA’s enhanced penalties have succeeded. The audit revealed that from 2009 through 2012 the U.S. Attorney’s Office has received approximately 2,062 referrals from the Secretary of the Senate and the Clerk of the House for noncompliance. The largest number of referrals was in 2009 with 678 referrals and the lowest was 2012 with only 135. Virtually all referrals were settled either by subsequent compliance or de-registration. Since HLOGA, there have been only three settled enforcement cases, with fines ranging from $30,000 to $50,000.
More than 5 years after HLOGA was enacted, lobbyists continue to be associated with the few outliers like Jack Abramoff. Taken as a whole, the GAO’s audit results are one objective indication that such characterizations are undeserved. No profession is without its bad apples and it is unfair and un-American to visit the sins of those few on an entire group of individuals.
Spulak is a King & Spalding partner and chairs its Government Advocacy and Public Policy Practice Group. He served as Staff Director and General Counsel of the House Committee on Rules, and as General Counsel to the House.