An ethics resolution for the new Congress
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A donation to a political campaign is not supposed to be a monetary gift to the candidate. But that is exactly what a donation becomes under a loophole that permits the campaign committee of a member of Congress to be used as a personal money-making operation. This loophole can be closed easily though a change in the House Code of Official Conduct to prohibit members of Congress and their families from leasing property and selling goods or services to any campaign organizations to which they are affiliated. Agonizing debates over campaign finance reform are not required, and the beginning of the new 117th Congress is the perfect opportunity for this ethics rule upgrade.

While the House Code of Official Conduct ostensibly prohibits converting campaign donations to personal use, there is an exception in the rules that permits reimbursement for campaign expenses. The House Ethics Committee interprets the exception broadly to allow members of Congress and their family members to sell goods or services to the member’s campaign if “there is a bona fide campaign need” and if “the campaign does not pay more than fair market value.” As if that standard is not flexible enough, the committee also allows their congressional colleagues “wide discretion” to decide if a particular expenditure serves a campaign purpose. For example, a member may use money donated to their campaign to lease space in a building the member owns, as well as to pay their own spouse to cater meetings or other campaign events held in the leased space. The member or spouse also set the rate of remuneration, and thus campaign donations are converted to personal profit in a scenario that is perfectly acceptable under the current rules.

The opportunity to use campaign funds for pecuniary gain leads to real life situations such as the one now vexing a member who reportedly charged his own campaign committee over $60,000 for rental of space on his family farm, and had an additional $127,000 in campaign donations paid to a family affiliated accounting firm. Under current House rules, expenditures of this kind may turn out to be completely permissible. When I was counsel for the Federal Election Commission and the House Ethics Committee, I investigated these kinds of cases. The investigations entailed months of reviewing records and questioning witnesses to find the truth of whether questionable campaign expenditures were legitimate. A standard as vague as “fair market value” can be especially difficult to ascertain.

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But if the purpose of House ethics rules is to conform the conduct of members of Congress to the highest ethical standards, then a rule that necessitates a costly inquiry to divine the intent of a campaign expenditure falls short of that goal. This is because whether or not goods or services paid to a member or their family using campaign donations were priced according to the market and served bona fide campaign purposes, the end result is still found money in the bank account of the member or their family. Simply put, members doing business with their campaigns results in at least the appearance of a self-dealing conflict of interest that reflects poorly on the House as a body whenever a member is caught in the act.

The House Ethics Committee already restricts a member from “personally selling or endorsing goods or services in which the Member has a financial interest.” This is sound guidance, and the restriction should extend to a member or their family doing business with an affiliated campaign because those transactions inherently involve the selling goods or services for which the member has a financial interest. Similarly, the House Code of Official Conduct already prohibits a member from accepting any compensation “by virtue of influence improperly exerted” from their position in Congress. The rule should apply to all situations involving campaign contributions that are transformed to personal wealth.

The meaningful separation between member campaign and personal accounts is essential to foreclose the appearance of corruption from campaign contributions. This is uncomplicated common-sense reform and an opportunity for the House to be an ethics leader when public confidence in government is truly needed.

Author is formerly Deputy Chief Counsel and Director of Investigations and Enforcement for the House Ethics Committee and Assistant General Counsel for the Federal Election Commission, and currently teaches Constitutional Law at The Catholic University of America. All views are the author’s in his personal capacity.