Judge throws out rule shielding campaign donors

[March 31, 2012]  WASHINGTON (AP) -- The Federal Election Commission overstepped its bounds in allowing groups that fund certain election ads to keep their financiers anonymous, a federal judge ruled Friday.

U.S. District Judge Amy Berman Jackson's ruling could pave the way to requiring groups that spend money on electioneering communications -- ads that don't expressly advocate for or against a candidate running for federal office -- to disclose their donors.

The FEC ruled in 2007 that corporations and nonprofits did not have to reveal the identities of those who financed such ads. That regulation came in response to a Supreme Court ruling that gave more latitude to nonprofit groups -- like the Karl Rove-backed Crossroads GPS and the President Barack Obama-leaning Priorities USA -- on pre-election ads.

Campaign-finance regulations have received new scrutiny this election cycle, following a handful of federal court rulings that stripped away long-established limits on how much individuals and organizations may contribute to groups favoring certain candidates.

One such high-profile case, known as Citizens United, gave a green light for corporations and labor unions to spend unlimited sums of their cash on campaign ads. That effectively led to the expansion of "super" political action committees, which have expended more than $50 million on the Republican primary elections and are largely funded by wealthy donors.

Democratic Rep. Chris Van Hollen of Maryland, who brought the suit against the FEC last year, has also proposed a bill that would require more detailed disclosure requirements for campaign finance, known as the Disclose Act. That bill has garnered support in light of nonprofits funneling anonymous money to their affiliated super PACs, effectively shielding the names of some donors.

In her 31-page ruling, Jackson said the FEC did not have legislative authority to substantially change McCain-Feingold, officially known as the Bipartisan Campaign Reform Act of 2002. She said it is up to Congress, not the FEC, to make such changes.

The FEC, created in the 1970s in the wake of the Watergate scandal, is empowered to set regulations on campaign-finance law and enforce subsequent violations. The commission has struggled in recent months to define new regulations, largely due to a bitterly divided makeup of three Republican and three Democratic commissioners.

Under McCain-Feingold, groups that spend more than $10,000 per year on such campaign ads must file reports with the FEC. Some groups later testified before the FEC that disclosing all donors -- not ones who specifically earmarked their money for ads -- would be an administrative burden.

[Associated Press; By JACK GILLUM]

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