Top Democrats urge Yellen to crack down on dark money groups

Top Democrats urge Yellen to crack down on dark money groups
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Top Democrats in the Senate are urging Treasury Secretary Janet YellenJanet Louise YellenOn The Money: Treasury creates hub to fight climate change | Manchin throws support behind union-backed PRO Act | Consumer bureau rolls out rule to bolster CDC eviction ban Overnight Energy: Treasury creates hub to fight climate change through finance | Sanders, Ocasio-Cortez introduce 'Green New Deal for Public Housing' | Treasury creates hub to fight climate change through finance MORE to crack down on dark money spending in political campaigns.

Sens. Elizabeth WarrenElizabeth WarrenWorld passes 3 million coronavirus deaths Poll: 56 percent say wealth tax is part of solution to inequality Democratic senators call on Biden to support waiving vaccine patents MORE (D-Mass.) and Sheldon WhitehouseSheldon WhitehouseFor a win on climate, let's put our best player in the game Lawmakers say fixing border crisis is Biden's job Democrats wrestle over tax hikes for infrastructure MORE (D-R.I.) wrote a letter to Yellen on Wednesday arguing that it’s time for Treasury and the IRS to regulate and enforce laws around the explosion of campaign spending by nonprofit organizations formed as 501(c)(4) groups, which do not have to publicly disclose where their contributions came from.

“The IRS’s regulation and enforcement related to 501(c)(4) organizations has been woefully inadequate in the post-Citizens United era,” Warren and Whitehouse wrote. “We urge you to undertake a careful review of what the IRS has done, reform its approach, and rein in abuse by ‘dark money’ organizations.”


“Our most powerful political forces now hide from open debate and public accountability by virtue of having interposed a one-way mirror between themselves and the public sphere,” the letter continues. “The result has been widely described as a ‘tsunami of slime.’ ”

There has been an explosion of political spending by dark money groups since the Supreme Court’s 2010 Citizen’s United decision.

The 501(c)(4) groups are not supposed to engage predominantly in political activities or spend directly on political campaigns, but there are scores of loopholes for the groups to exploit and the IRS has largely not intervened.

It used to be that Republican and conservative groups dominated the dark money landscape.

However, in 2020, President BidenJoe BidenObama, Clinton reflect on Mondale's legacy Biden, Harris commend Mondale in paving the way for female VP Mondale in last message to staff: 'Joe in the White House certainly helps' MORE’s campaign was the beneficiary of $145 million in dark money donations, according to a Bloomberg analysis, compared to only $28.4 million for former President TrumpDonald TrumpHouse votes to condemn Chinese government over Hong Kong Former Vice President Walter Mondale dies at age 93 White House readies for Chauvin verdict MORE. Biden’s total surpassed the previous record of $113 million set by the GOP’s 2012 nominee, now-Sen. Mitt RomneyWillard (Mitt) Mitt RomneyAdvocacy groups pushing Biden to cancel student debt for disabled 15 Senate Republicans pledge to oppose lifting earmark ban The Hill's 12:30 Report - Presented by Facebook - All US adults now eligible for COVID vaccines MORE (R-Utah).


Warren and Whitehouse are asking Yellen to address the explosion of spending first by working with the Justice Department to investigate whether dark money groups helped organize the Jan. 6 siege on the Capitol.

They’re asking Treasury to back California Attorney General Xavier BecerraXavier BecerraOvernight Health Care: All adults in US now eligible for COVID-19 vaccine | White House launches media blitz to promote vaccines Top House Republicans ask Harris for meeting on border White House launches media effort to promote coronavirus vaccines MORE (D) in a case that is expected to go to the Supreme Court, in which a group backed by billionaire conservative philanthropist Charles Koch is challenging a regulation in California that requires nonprofits to report donor information to the state.

And they’re calling on Yellen to enforce existing regulations under the 501(c)(4) code that they say have been flaunted by nonprofit groups in the decade since Citizens United.

“As members of the Senate both before and after Citizens United, we can personally attest to the corrosive influence of dark money,” the senators wrote. “We hope that under your leadership, Treasury will reexamine how it regulates dark money groups and restore transparency to our political landscape.”