AP IMPACT

Campaigns take cash, seek details later

[August 20, 2008]  WASHINGTON (AP) -- Neither Barack Obama nor John McCain has consistently followed the government's instructions for keeping prohibited foreign money out of their presidential campaigns, and some of that banned money has slipped into Obama's campaign.

During interviews with 123 donors in 11 countries, The Associated Press found contributions Obama accepted from at least three foreigners. Just five of the donors checked, three for Obama and two for McCain, said the campaigns asked to see copies of their current U.S. passports -- as instructed by the Federal Election Commission to avoid legal problems.

Obama's campaign said it would refund the money to the foreign donors the AP identified.

One donor, Tom Sanderson of Canada, made clear his $500 contribution came from a foreign source. He included a note that said, "I am not a American citizen!" Obama's campaign took the money anyway, even publishing Sanderson's cautionary statement about his citizenship in its official finance reports.

Democratic hopeful Obama and Republican rival McCain portray themselves as meticulously abiding by campaign finance laws. But the fundraising review of hundreds of thousands of donations -- involving AP bureaus around the globe -- found clear evidence that both campaigns took money first and asked questions later, if ever. Shining a light on a weakness in the nation's campaign finance laws, the review turned up a smattering of illegal foreign donations to Obama as well as missing details from both Obama and McCain in federal paperwork the law requires.

Only American citizens or green card holders are legally permitted to give campaigns money, a longtime ban intended to protect U.S. elections from foreign meddling and influence. The Federal Election Commission instructs that candidates ask to see an overseas donor's current U.S. passport, considered the strongest safeguard against illegal foreign money. Screening donors can be a daunting task in a presidential race, especially one with record sums and millions of dollars coming in over the Internet.

Obama has raised at least $2 million abroad, far more than McCain's total of at least $229,000, according to the AP's review of campaign finance records. The amount reported flowing in from outside the U.S. is a small percentage of the roughly $390 million raised so far by Obama and the $167 million by McCain. But few contributors contacted by the AP said the campaigns asked to see their passports.

"I donated to the Obama campaign because I was so excited and thrilled to hear him speak," said Sanderson, a property manager in Calgary. "I like what he says and I like what he represents, and it's a world stage today for any political leader."

Sanderson said he donated money using Obama's Web site and doesn't remember checking a box certifying he was a U.S. citizen, instead noting next to his address that he wasn't. After the AP contacted Sanderson by phone, he asked the campaign for a refund: "It was an error of me to give the donation, and it was an error that it was accepted," he said.

A spokesman for Obama, Ben LaBolt, said campaign workers "consistently review our procedures to make sure that we are taking every reasonable step to ensure that the contributions we receive are appropriate and follow FEC guidelines, and we will do so again in light of this new information."

McCain's campaign said it was impractical to ask Internet contributors for copies of their passports. "We're always looking for ways to best comply with all provisions of campaign finance regulations, and obviously take swift action anytime flags are raised regarding potentially problematic campaign contributions," spokesman Brian Rogers said.

The AP analyzed 1.27 million campaign contributions to Obama and McCain to identify 6,948 contributions from people who appeared to live outside the United States and who were not obviously in the U.S. military. The AP contacted 123 donors in Australia, Canada, France, Germany, Hong Kong, Israel, Italy, the Netherlands, South Africa, Spain and Switzerland and interviewed them about their citizenship and donations.

Obama has far more overseas donors than McCain, and that was reflected in the number of interviews: the AP was able to reach 116 Obama supporters, six McCain backers and one donor who gave to both.

Australian Richard Watters gave Obama's campaign $1,000 over the Internet, entering a fake U.S. passport number -- a random jumble of numbers and letters -- so the site would take his money. He said he also checked a box stating that he was an American living overseas, "because I could see it wasn't going anywhere if I didn't do that."

Watters was surprised when a reporter told him it was illegal for foreigners to donate to U.S. presidential campaigns, but he said he was still glad he gave.

"I wouldn't give up, because I believe in the man -- I really do," said Watters, 76, of Sydney, a stock market trader. "Maybe I just feel he can put a smile back on the face of the world."

Swiss citizen Gilles Massamba gave Obama at least $436 and received campaign souvenirs. He said the campaign didn't ask whether he was a U.S. citizen.

Just three donors to Obama and two for McCain told the AP the campaigns asked to see their passports. One Obama donor, in France, was asked to show her U.S. driver's license at a fundraising event. Others said if they did anything, they checked a box on the campaigns' Web sites affirming they were U.S. citizens or were asked to provide their passport numbers, or both.

A spokesman for the FEC, Bob Biersack, said it was prudent for the campaigns to ask online donors to check a box confirming they are U.S. citizens, but obtaining copies of U.S. passports from overseas donors is the only protection against enforcement action.

In dozens of instances, the AP could not determine whether donors had foreign addresses since their addresses were missing from campaign finance reports. Other key information also was missing. McCain and Obama each omitted information identifying the employers for at least 10,000 contributions in their most recent donor data. In most cases, the campaigns appear to have asked supporters to provide those details.

The ramifications of accepting foreign money can vary from political embarrassment to federal investigations: The last major foreign money scandal, a 1996 Democratic case involving Asian money and the Clinton-Gore re-election effort, resulted in record FEC fines totaling $719,000 and probation for some of those involved.

Sometimes the foreign connection comes from who collects the money rather than who donates it. McCain's campaign announced this month it will return $50,000 solicited by a foreigner and business partner of a McCain volunteer fundraiser in Florida.

The candidates are supposed to disclose detailed information about donors who give $200 or more, including their addresses, employers and occupations. At a minimum, if donors give more than $50, the candidates are expected to record their names.

No donor names appeared in Obama's campaign finance reports for a handful of donations over $50. In dozens of cases, there were names but no addresses. "Anonymous," "999 Anonymous Street," "XX" or "Info Requested" are listed for roughly 200 donations to McCain.

The requirement to include employers is intended to let the public and news media see who is giving and help identify favors that donors or their employers may receive.

The FEC expects campaigns to follow up with donors to seek missing information, but they do not have to try very hard: One attempt, such as a postcard sent to the contributor's address, is considered due diligence under fundraising rules.

In Canada, Sanderson left a message with Obama's campaign and sent an e-mail after learning his donation was illegal. He said he hoped his contribution wouldn't "rustle any feathers." Sanderson considered a mischievous move to neutralize the political value his donation might have, but in the end, just asked for a refund.

"I was going to donate to McCain last night," he said, "and my wife talked me out of it."

[Associated Press; By SHARON THEIMER and TROY THIBODEAUX]

Associated Press writers Anrica Deb in Amsterdam, Netherlands; Jorge Sainz in Madrid, Spain; Matt Moore in Berlin; Eliane Engeler and Alexander Higgins in Geneva; Min Lee, Jeremiah Marquez and Dikky Sinn in Hong Kong; Steve Weizman in Jerusalem; Devon Haynie in Johannesburg, South Africa; Gaelle Faure and Elaine Ganley in Paris; Marta Falconi in Rome; Kristen Gelineau in Sydney, Australia; Rob Gillies in Toronto; and Stephanie Garlow, Ann Sanner and Christine Simmons in Washington contributed to this report.

Copyright 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.'