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CORPORATEPOLITICAL ACTIVITIES

DESKBOOK

Kenneth A. GrossKi P. Hong

Patricia M. Zweibel

2017 Edition

Practising Law InstituteNew York City

#223645

This work is designed to provide practical and usefulinformation on the subject matter covered. However, it issold with the understanding that neither the publishernor the author is engaged in rendering legal, account-ing, or other professional services. If legal advice or otherexpert assistance is required, the services of a competentprofessional should be sought.

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About the Authors

Kenneth A. Gross leads Skadden’s Political Law practice and advisesclients on matters relating to the regulation of political activity. Anationally renowned authority on campaign law compliance, gift andgratuity rules, lobby registration provisions, and securities lawsregulating political activity and municipal securities transactions,Mr. Gross counsels numerous Fortune 500 corporations and politicalcandidates at the state and federal level. As former associate generalcounsel of the Federal Election Commission (FEC), Mr. Gross headedthe general counsel’s Enforcement Division and supervised the legalstaff charged with the review of the FEC ’s Audit Division.

Presently, his clients include commercial and investment banks,insurance companies, energy companies, pharmaceuticals, accountingfirms, real estate firms, media companies and trade associations. Headvises elected officials as well as candidates facing various federal andstate races. Mr. Gross also counsels senior-level political appointeesfacing Senate confirmation in matters related to compliance withgovernment ethics laws.

Mr. Gross is well-known for his experience regarding the Ethics inGovernment Act, the Lobbying Disclosure Act, the Honest Leadershipand Open Government Act, and the U.S. House of Representatives andSenate ethics rules. He also has worked extensively with federal andstate lobby registration laws, in particular compliance with the FederalRegulation of Lobbying Act and the Foreign Agents Registration Act.Additionally, he advises corporations on internal ethics guidelines andconducts internal investigations. Mr. Gross advises many corporationson their responses to shareholder proposals regarding disclosure ofpolitical and lobbying expenditures. Beginning with the underwritingscandals on political contributions in the late 1980s and 1990s that ledto MSRB Rules G-37/G-38 regulating the activities of broker-dealers,Mr. Gross has been at the forefront in advising clients on compliancewith pay-to-play rules. Such rules have broadened over the years torestrict activity by investment advisers (SEC Rule 206(4)-5) as well asswap dealers and major swap participants (CFTC Rule 23.451).

Mr. Gross repeatedly has been selected for inclusion in ChambersUSA: America’s Leading Lawyers for Business and The Best Lawyers inAmerica. Washingtonian magazine repeatedly has recognized him as atop lawyer in the field of ethics and election law. In addition, he wasrecognized as a leading Washington, D.C. attorney by Washington PostMagazine and was named Best Lawyers’ 2017 Washington, D.C.

vii

Government Relations Practice Lawyer of the Year. Roll Call namedMr. Gross among the outstanding lawyers when it last identified“Who’s Who Among the Congressional Ethics Bar.” He has beenlisted in multiple editions of Who’s Who in America. Mr. Grossreceived a 2013 ILO Client Choice Award, awarded by the Interna-tional Law Office in recognition of individual partners who excel acrossthe full spectrum of client service. In addition, in 2006, Mr. Grosswas the recipient of the Council on Governmental Ethics Law(COGEL) Award, the highest award given by COGEL in recognitionof service to the ethics community.

Mr. Gross is widely known as a speaker on ethics in governmentand election law. A frequent featured guest on CNN, Fox News, NPRRadio and other media outlets, Mr. Gross was CNN’s on-air electionlaw analyst during the 2000 Florida election dispute and made dailyappearances in covering the election. He advised NBC ’s televisionshow “The West Wing” on election law issues that arose in the show’sscripts.

In addition, he is the co-author of the Ethics Handbook forEntertaining and Lobbying Public Officials. His published articleson campaign finance have appeared in the Stanford Law & PolicyReview and the Yale Law & Policy Review (“The Enforcement ofCampaign Finance Rules: A System in Search of Reform”); Federal BarJournal; Corporate Political Activities (published by Business Laws,Inc.); Money, Elections and Democracy; and several other publications.He also is the author of supplements to a treatise titled “FederalRegulation of Campaign Finance and Political Activity.” He served as acommentator for the “Under the Influence” Experts Forum publishedby the National Journal. Mr. Gross has co-authored summaries of theSTOCK Act for the Harvard Law School Forum on CorporateGovernance and Financial Regulation.

Mr. Gross co-chairs the Practising Law Institute’s annual seminaron “Corporate Political Activities.” He is an adviser to the AmericanLaw Institute’s Members Consultative Group on the Principles ofGovernment Ethics. He chaired the Election Law Committee for theFederal Bar Association. Mr. Gross also served as an appointee offormer Sen. Daniel P. Moynihan (D-NY) on the New York JudicialScreening Committee, where he participated in the recommendationof New York federal judges and U.S. attorneys.

As an active participant in various nonprofit organizations, Mr.Gross serves on the board of trustees of the Campaign FinanceInstitute and is a member of the executive committee and counsel tothe American Council of Young Political Leaders. Mr. Gross is aco-founder of No Labels, a nonprofit focused on developing bipartisanapproaches toward solving our nation’s problems. He also is a member

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CORPORATE POLITICAL ACTIVITIES DESKBOOK

of the United States Holocaust Memorial Museum’s LawyersCommittee and a board member of the Public Affairs Council.

Mr. Gross has served on the faculty of George WashingtonUniversity and also at New York University. He often lectures atGeorgetown University Law Center, Fordham University School ofLaw and American University.

Ki P. Hong advises major corporations on the unique political lawissues they face when engaging in government affairs or governmentprocurement activity. These include federal and state campaignfinance, lobbying, gift, ethics and conflict-of-interest laws. He alsoadvises clients on pay-to-play laws that impose special restrictions onthe political activity of companies that have or seek governmentcontracts, as well as their covered employees. He advises clients onestablishing and maintaining comprehensive systems to ensure com-pliance with those laws. In addition, he represents clients at theenforcement stage.

Mr. Hong’s clients include companies from a wide range of differentindustries. He represents three of the “Big Four” accounting firms andleaders in other industries, such as technology, energy, media,insurance and communications. He also represents nine of the topten U.S. banks and nearly all of Wall Street.

Mr. Hong is well-regarded for his experience with state and federalpay-to-play laws. Such laws include MSRB Rules G-37/G-38, includingamendments to Rule G-37 that would apply to municipal advisors. Healso advises clients on implementing Dodd-Frank’s definition andregulation of municipal advisors. He has extensive experience in SECRule 206(4)-5 for investment advisers and drafted model policies andprocedures to address this Rule that have become the industrystandard. Mr. Hong also advises clients on the pay-to-play provisionswithin CFTC Rule 23.451 covering swap dealers and major swapparticipants.

He also has extensive experience advising clients on election,lobbying and government ethics laws. Mr. Hong routinely representsclients before federal enforcement agencies such as the Federal ElectionCommission, and he works with the House and Senate EthicsCommittees, the Office of Congressional Ethics and the Office ofGovernment Ethics. He also works frequently with various state ethicscommissions around the country. He advises clients on state laws thatrequire government contractors and investment advisers to register aslobbyists.

Mr. Hong regularly counsels major corporations on inquiries andproxy proposals issued by shareholder groups regarding transparencyin corporate political spending and lobbying activities.

ix

About the Authors

Mr. Hong served on the steering committee of the Council onGovernment Ethics Laws (COGEL), an association of the federal andstate government agencies that implement and enforce campaignfinance and ethics laws throughout the United States and Canada. Mr.Hong is the first attorney in private practice to be elected to thesteering committee in COGEL’s history.

Mr. Hong co-authored the Ethics Handbook for Entertaining andLobbying Public Officials, which was first published in 1994 andcontinues to be updated for subscribers. He co-authored severalchapters of the Practicing Law Institute’s publication “CorporatePolitical Activities” for every edition of the publication since 1993. Healso co-authors PLI’s “Corporate Political Activities Deskbook.”

Mr. Hong is a regular speaker at conferences, such as thoseorganized by the Practising Law Institute, the Investment AdviserAssociation and the Securities Industry and Financial MarketsAssociation. He also is a main speaker at an all-day seminar that heorganizes every year, having completed the 22nd annual seminar withmore than 230 attendees in May 2016. He is ranked in the top tier of“leading individuals” for political law in Chambers USA: America’sLeading Lawyers for Business. Washingtonian magazine repeatedly alsohas recognized him as a top lawyer in the field of ethics and electionlaw.

Patricia M. Zweibel is a counsel in the Political Law Group atSkadden, Arps, Slate, Meagher & Flom, where she advises clientson government affairs matters at the federal, state, and local levels,including ethics, lobbying, pay-to-play, conflict-of-interest, and cam-paign finance laws.

Ms. Zweibel is known for her experience with state and federalpay-to-play laws, particularly SEC pay-to-play Rule 206(4)-5, and sheadvises clients extensively on compliance policies, procedures, andimplementation. She conducts employee training sessions on pay-to-play compliance and works with clients on internal investigationsand SEC audits.

Ms. Zweibel counsels clients on the placement agent rules andpolicies of state and local public pension systems. She also advisesclients on municipal advisor issues under Dodd-Frank as well ascompliance with the SEC ’s and MSRB’s rules for municipal advisors.

Ms. Zweibel advises clients on the political law compliance issuesrelating to mergers and acquisitions, and represents clients beforefederal enforcement agencies such as the Office of CongressionalEthics and the Department of Justice. She regularly advises clientson federal and state lobby registration laws, in particular compliancewith the lobbying Disclosure Act and the Foreign Agents RegistrationAct. She works with clients on compliance issues raised under the


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Stop Trading on Congressional Knowledge Act (the STOCK Act),which confirms that insider trading provisions in the ’34 Act andRule 10b-5 apply to Congress and other federal officials.

Ms. Zweibel also counsels clients on the tax law issues raised bygovernment affairs activity, including issues of tax-exempt entitiesengaged in political affairs and lobbying, the tax treatment of lobbyingexpenses, and grassroots lobbying. In addition, she advises clients ontax matters of IRC Section 527 organizations (PACs).

Ms. Zweibel has given numerous presentations on political lawissues, both for firm clients and for outside groups. In her pro bonopractice, Ms. Zweibel focuses on nonprofit tax issues, and she is amember of the Dean’s Advisory Board of the Mitchell Hamline Schoolof Law.

About the Authors

xi

Introduction and Acknowledgments

A major issue recently surrounding corporate political activity isdisclosure: to what extent a corporation must disclose its politicalcontributions, lobbying, and related activities to its shareholders andthe public generally. The Securities and Exchange Commission’s(SEC) Division of Corporate Finance recently abandoned a potentialrulemaking requiring public companies to disclose to their share-holders the use of corporate resources for political activities, but theissue is still important for corporations and their Boards of Directors toconsider. Shareholders in particular have recently become increasinglyvocal in demanding a more thorough accounting of corporate politicalactivities. Given the rising trend of shareholder action in this regard, itis important that companies be aware of this issue and its potentialimpact. A recent study of S&P 500 companies found that whiletransparency and corporate oversight of political spending have recentlyrisen, thorough disclosure of such activities to shareholders remainslow. In some cases, shareholders have turned to proxy attempts to passresolutions requiring more detailed disclosure of corporate politicalactivity.

The scope of the requested disclosure in a shareholder proxy votecan be broad. Shareholders have asked for company policy andprocedures governing oversight of political contributions and indepen-dent expenditures and lobbying (including any lobbying done on thecompany ’s behalf by trade associations), as well as disclosure of allpolitical contributions and independent expenditures, and spendingon direct lobbying and grassroots lobbying communications. Share-holders have also targeted disclosure of membership in and paymentsto any tax-exempt organization that writes and endorses modellegislation.

This trend of pressuring companies to disclose political activities,policies and procedures highlights the reputational and economic risksfor companies. Boards of Directors should conduct an Enterprise RiskAssessment on their procedures and policies in place for handling theissues discussed in this book and that may be the subject of a share-holder disclosure action. Having a Company Code of Conduct isimportant, but insufficient. Likewise, simply prohibiting all politicalactivity by employees is not feasible because of the interference withconstitutional rights. Rather, companies should have a governmentaffairs compliance preclearance and training program for continuingcompliance with the federal, state, and local versions of the lawsdiscussed in this book:

xiii

• Campaign Finance Laws restrict the ability of a company andits PAC to make political contributions to candidates, politicalparty committees, and other political organizations.

• Pay-to-Play Laws prohibit a company from entering into busi-ness arrangements or contracts with a government entity if thecompany, its PAC, or in many cases directors, certain employ-ees, or their family members (such as spouses or children)make or solicit political contributions in that jurisdiction. Aviolation could result in a ban from doing business withsignificant economic and reputational implications.

• Lobbying Laws require registration and disclosure if a companyor its agents/employees seek to influence legislation, regula-tions, policy, or even seek to obtain financial arrangements orcontracts with a government entity. “Procurement lobbying” isan area of particular risk because it is not typically thought ofas lobbying. Selling products or services to the governmenttriggers registration and reporting in twenty-nine states andnumerous localities. Violation of these laws could result infinancial penalties, loss of business, or criminal convictions.

• Gift and Entertainment Laws restrict the ability of a companyor its agents/employees to provide anything of value to publicofficials. The Honest Leadership and Open Government Act,the “Sarbanes-Oxley of ethics laws,” requires a proactivecompliance program because a corporate officer of a companythat employs a federal lobbyist must affirmatively certifycompliance with gift rules. The company cannot simply relyon a code of conduct. Most states, and many counties, cities,and towns, have in addition their own restrictions on gifts.Doing business with localities can involve navigating multiplelayers of ethics laws at the state and local levels.

All of these are potential vulnerabilities for the unaware or un-prepared company. With shareholder scrutiny of corporate politicalactivity on the rise, robust compliance programs have never been moreessential.

* * *

We would like to acknowledge all the people who have generouslyprovided assistance to us in the writing of this book. In particular, weextend grateful thanks to our colleagues in the Political Law Group atSkadden, Arps, Slate, Meagher & Flom LLP, in particular associatesChristine Kirk, Shayla Parker, Tanya Sehgal, Rachel Applestein; reportsanalysts Patrick Krason and Jennifer Thomas; and practice managerMichele Taulton. Lastly, we especially thank our editor Bob Bouchard,without whose guidance this book would not have been possible.

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Preface

This book is truly a practice manual for in-house attorneys advisingcorporations about involvement in the political process, describing thecurrent state of the law on federal and state campaign finance, pay-to-play, lobbying, and gift compliance. It draws on the extensive practiceand regulatory experience of authors Ken Gross and Ki Hong.

Rather than the extensive analytical approach of a treatise, thisdeskbook emphasizes the rules and provides practical examples of bestpractices and “do’s and don’ts.” In many cases, these suggestions gobeyond the black letter requirements to incorporate advice aboutpractices that will help you utilize the available avenues of interactingwith the government while avoiding negative press, public as well aslegal regulatory attention.

With the current regulatory environment and active press attentionto business practices, we hope this new publication will serve as amost helpful tool to the corporate counsel community. While we havemade every effort to base our discussion on the latest laws involvingcorporate political activities, it is important to keep in mind that theselaws have been undergoing some dramatic changes in the last severalyears and are continuing to evolve, whether by legislative, agency orjudicial action. For example, as is explained in latter chapters, inJanuary 2010, the Supreme Court of the United States ruled thatcorporations and labor unions can pay for political ads that call for theelection or defeat of a candidate, as long as their activity is notcoordinated with the candidate. This ruling has required lower courts,legislature and regulatory agencies at the federal, state and local levelsto reassess and change many of the existing laws and regulations, aprocess which is still ongoing. It has also given rise to several otherchallenges to the campaign finance laws, which are currently makingtheir way through the courts. In addition, in 2010 and 2011 there weresignificant changes to the regulation of investment advisers registeredwith the Securities and Exchange Commission (SEC) regarding poli-tical activities. Therefore, you should always check the latest develop-ments before proceeding with any new activities.

The book begins with corporate political activities. While it is notintended to provide in-depth coverage of each state’s distinctiverequirements, we hope the federal information, and the state sum-mary information, will help the reader more easily and quicklydetermine when further, state-specific study or advice is necessary.Subsequent chapters address federal lobbying and gift rules; theForeign Agents Registration Act; practice and appearances before the

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FEC; and a final chapter addresses state campaign finance, lobbying,gift, placement agent rules and pay-to-play rules, including the na-tional rules affecting those that do business with state or localgovernment entities (for example, Municipal Securities RulemakingBoard (MSRB) Rule G-37 (the pay-to-play rule for broker-dealers thatengage in municipal securities underwriting business), Securities andExchange Commission (SEC) Rule 206(4)-5 (the pay-to-play rule forinvestment advisers), and (as of press time) proposed pay-to-play rulesfor participants in swaps, and municipal advisors registered underDodd-Frank). Throughout, we use sidebars to highlight practice notesand themes that run through many sections of the book.

Please note that this book is not an exhaustive manual but ratheronly serves to introduce the reader to the ethics issues we believe are ofthe most immediate and day-to-day relevance to corporate in-housecounsel who are dealing with United States federal, state and localgovernments and officials. Other ethics issues (for example, conflict-of-interest rules, post-employment restrictions, Foreign Corrupt Prac-tices Act), and issues that may also apply to readers of this book (forexample, SEC and MSRB registrations, procurement rules), are notaddressed although they may be in subsequent editions.

KENNETH A. GROSS

KI P. HONG

PATRICIA M. ZWEIBEL

xvi


Table of Chapters

Chapter 1 Campaign Finance Under the Federal ElectionCampaign Act of 1971 (FECA)

Chapter 2 Political Action Committees

Chapter 3 Executive Fundraising

Chapter 4 State Laws, Rules, and Policies ImpactingCorporate Government Relations

Chapter 5 Pay-to-Play Rules

Chapter 6 Federal Lobbying and Gift Laws

Chapter 7 The Foreign Agents Registration Act (FARA)

Chapter 8 The Federal Election Commission: Processesand Enforcement

xvii

Table of Contents

About the Authors ............................................................................vii

Introduction and Acknowledgments..............................................xiii

Preface .............................................................................................. xv

Table of Chapters ........................................................................... xvii

Chapter 1 Campaign Finance Under the Federal ElectionCampaign Act of 1971 (FECA)

§ 1:1 FECA and the Citizens United Decision ........................ 1-2§ 1:1.1 FECA and the McCutcheon Decision ..................... 1-5

§ 1:2 Specific Prohibitions Against Corporate Contributions ....1-8§ 1:2.1 National Bank Prohibition ...................................... 1-8§ 1:2.2 Foreign National Prohibition................................... 1-8

§ 1:3 Other Specific Prohibitions........................................... 1-10§ 1:3.1 Contractor Ban...................................................... 1-10§ 1:3.2 Officer and Director Liability ................................ 1-10§ 1:3.3 “Name of Another” Fraud Schemes ...................... 1-11

[A] Classic Markers of Criminal Fraud ....................... 1-11§ 1:4 What Political Activity Can Be Engaged in by

Corporations? ............................................................... 1-11§ 1:4.1 Commercial Transactions with a Candidate ......... 1-12§ 1:4.2 Bank and Brokerage Loans .................................... 1-12§ 1:4.3 Special Provision for Vendors of Food and

Beverages ............................................................... 1-13§ 1:5 Non-Federal Contributions........................................... 1-13§ 1:6 Appearances by Officeholders ....................................... 1-14

§ 1:6.1 “Meet and Greets” and Non-PoliticalAppearances on Company Premises...................... 1-14

§ 1:6.2 Candidate Appearances ......................................... 1-14§ 1:7 Communicating with Corporate Managers and

Stockholders (The Restricted Class) ............................. 1-15§ 1:7.1 The General Rule .................................................. 1-15§ 1:7.2 Registration and Get-Out-the-Vote Drives ............ 1-17

§ 1:8 Public Communications ............................................... 1-18§ 1:8.1 Special Rule for Public Endorsements of a

Candidate .............................................................. 1-18

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§ 1:8.2 Public Get-Out-the-Vote Efforts............................. 1-18§ 1:8.3 Voter Education Activities ..................................... 1-19

§ 1:9 Independent Expenditures ............................................ 1-19§ 1:9.1 What Is an “Independent Expenditure”? ............... 1-20

§ 1:10 What Is a “Coordinated Communication”?.................. 1-21§ 1:10.1 Content Requirement: The Subject Matter

of the Communication.......................................... 1-21§ 1:10.2 Conduct Requirement: Level of

Interaction Between the Spender and theBenefiting Candidate ............................................. 1-21

§ 1:10.3 Safe Harbor Exception ........................................... 1-22§ 1:11 What Is an “Electioneering Communication”?............. 1-23

§ 1:11.1 Reporting Requirements for ElectioneeringCommunications................................................... 1-23

§ 1:12 Donations to Nonprofit Issue or AdvocacyOrganizations ............................................................... 1-24

§ 1:13 Use of Corporate Assets ............................................... 1-26§ 1:13.1 Facilities and Employee Services ........................... 1-26§ 1:13.2 Corporate Aircraft ................................................. 1-26§ 1:13.3 Legal and Accounting Services .............................. 1-28

§ 1:14 Media Companies—Press Exemption........................... 1-29§ 1:15 Other Activity Subject to Exemption or Special

Treatment Under FECA................................................ 1-29§ 1:15.1 Sponsorship of Candidate Debates........................ 1-30§ 1:15.2 Presidential Nominating Convention Activities.... 1-30

[A] Convention Activity of Commercial Vendors........ 1-30[B] Services and Goods ............................................... 1-31[C] Host Committee Contributions ............................ 1-32

§ 1:16 Presidential Inaugural Activities ................................... 1-33§ 1:17 Best Practices ................................................................ 1-34Appendix 1A Checklist for Candidate and Officeholder

Events ............................................................App. 1A-1Appendix 1B SpeechNow v. FEC .......................................App. 1B-1Appendix 1C United States Code Editorial

Reclassification Table Title 52—Voting andElections ....................................................... App. 1C-1

Chapter 2 Political Action Committees

§ 2:1 Introduction.................................................................... 2-4§ 2:2 Establishing a Federal PAC ............................................. 2-5

§ 2:2.1 Internal Corporate Steps and PAC Structure .......... 2-5[A] Corporate Authorization ......................................... 2-5[B] Legal Form of the PAC ............................................ 2-5


xx

[C] Multiple Federal PACs—Pros and Cons .................. 2-6[D] PAC Name............................................................... 2-7[E] Treasurer.................................................................. 2-8[F] Membership ............................................................ 2-8

§ 2:2.2 Other Organizational Issues.................................... 2-9[A] Affiliation ................................................................ 2-9[B] Impact of Corporate Restructuring........................ 2-11[C] Additional Considerations for PACs of

Domestic Subsidiaries of Foreign Companies ....... 2-12[D] PAC Solicitation of Foreign Nationals................... 2-13

§ 2:2.3 Articles/By-Laws Checklist .................................... 2-13§ 2:2.4 PAC Officers: Their Powers and Responsibilities.... 2-14

[A] Duties and Responsibilities of the Treasurer ......... 2-14§ 2:2.5 PAC Registration and Tax Status........................... 2-16

[A] Registration ........................................................... 2-16[B] Federal and State Tax Status of Corporate PACs .... 2-17

§ 2:2.6 Introducing the PAC to Potential Contributors..... 2-18§ 2:3 Operating a PAC........................................................... 2-19

§ 2:3.1 Permissible Corporate Support of the PAC ........... 2-19§ 2:3.2 Contribution Limits—Financial ............................ 2-20

[A] Achieving Multi-Candidate PoliticalCommittee Status ................................................. 2-20

[B] Contributions to the PAC ..................................... 2-21[C] Multi-Candidate PAC Contributions to

Candidates............................................................. 2-21[D] Designation of Contribution for Primary or

General Election .................................................... 2-21§ 2:3.3 Other Candidate Support ...................................... 2-23

[A] In-Kind Contributions........................................... 2-23[B] Valuation of In-Kind Contributions ...................... 2-23[C] Election Designation for In-Kind Contributions .... 2-23

§ 2:3.4 Independent Expenditures: Independent VersusCoordinated Communications .............................. 2-23

[A] Content Prong ....................................................... 2-25[B] Conduct Prong ...................................................... 2-25

§ 2:4 Soliciting Contributions: Who May Be Solicited? ........ 2-26§ 2:4.1 The Solicitable Class Defined ............................... 2-26

[A] Employees.............................................................. 2-27[B] Employees of Related Entities ............................... 2-28[C] Stockholders .......................................................... 2-28[D] Family Members.................................................... 2-29

§ 2:4.2 Practice Suggestion: Defining the RestrictedClass and Determining Who to Solicit ................. 2-29

§ 2:4.3 Limited Solicitation of All Employees ................... 2-30

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§ 2:4.4 What May Be Said to All Employees inGeneral Corporate Communications .................... 2-31

§ 2:5 Soliciting Contributions: Solicitation Methods andProcedures..................................................................... 2-32

§ 2:5.1 FECA’s Anti-Coercion Focus ................................. 2-32§ 2:5.2 Solicitation Methods Available to Unions............. 2-33§ 2:5.3 Soliciting via Mail or Email .................................. 2-34§ 2:5.4 Other Fundraising Mechanisms: Raffles and

Events.................................................................... 2-35[A] Tax Issue re Raffles: Exempt Function Income ..... 2-35

§ 2:6 Contributions Through Payroll Deduction................... 2-36§ 2:6.1 In General ............................................................. 2-36§ 2:6.2 Affirmative Authorization ..................................... 2-37§ 2:6.3 Payroll Deduction Process: Collecting Agent

Rules...................................................................... 2-38[A] Solicitation Restrictions ........................................ 2-38[B] Handling of the PAC Contributions...................... 2-38[C] Use of Corporate Accounts for Payroll

Deduction.............................................................. 2-39[D] Role of Payroll Vendors.......................................... 2-39[E] Reciprocal Union PAC Payroll Deductions............ 2-39

§ 2:7 PAC Contributions to Candidates ................................ 2-39§ 2:7.1 Choosing Contribution Recipients ........................ 2-39§ 2:7.2 Transmittal/Delivery of Contribution Checks ....... 2-40

§ 2:8 PAC Reporting and Recordkeeping ............................... 2-40§ 2:8.1 General Reporting Requirements........................... 2-40

[A] Coverage of First Report ........................................ 2-41[B] Best Efforts ............................................................ 2-41[C] Timely Filing ......................................................... 2-41[D] Electronic Filing .................................................... 2-42[E] Public Review of Reports ....................................... 2-42[F] “Sale or Use” Restriction....................................... 2-42

§ 2:8.2 FEC Reporting Schedules ...................................... 2-43Table 2-1 FEC Reporting Due Dates..................................... 2-43

[A] Administrative Fines for Late Filing...................... 2-44§ 2:8.3 Contents of Reports .............................................. 2-45

[A] FEC Form 3X ........................................................ 2-45Figure 2-1 Form 3X Detailed Summary Page—Receipts ........ 2-46Figure 2-2 Sample FEC Form 3X—Schedule A...................... 2-47

[B] Schedule A—Itemized Receipts ............................. 2-47Table 2-2 Summary Page Instructions—Receipts.................. 2-48

§ 2:8.4 Miscellaneous Receipt Issues................................. 2-51[A] Reporting Payroll Deduction Contributions

Through a Collecting Agent .................................. 2-51


xxii

[B] Itemization of Payroll Deduction Contributions .... 2-52[C] Names on Checks—Joint Contributions............... 2-52[D] Returned or Bounced Checks ................................ 2-53

§ 2:8.5 Schedule B Itemized Disbursements ..................... 2-53Figure 2-3 Form 3X: Detailed Summary Page—

Disbursements ...................................................... 2-54[A] Parallel Itemization Threshold .............................. 2-54[B] Itemization Threshold for Disbursements

Other than Contributions to Candidates .............. 2-55Table 2-3 Summary Page Instructions—Disbursements ....... 2-56

§ 2:8.6 Policy Issues About Disbursements....................... 2-57[A] Reporting the “Purpose of Disbursement” ............ 2-57[B] Completing the Category Code ............................. 2-58[C] Treatment of In-Kind Contributions ..................... 2-58[D] Earmarked Contributions...................................... 2-59[E] In General ............................................................. 2-59

§ 2:8.7 Schedule E—Reporting IndependentExpenditures ........................................................... 2-59

[A] Itemization ............................................................ 2-59Figure 2-4 Schedule: Independent Expenditures .................... 2-60

[B] Treasurer Certification........................................... 2-60[C] Timing of Special Independent Expenditure

Reports .................................................................. 2-60Table 2-4 Due Dates for Independent Expenditure Reports.... 2-61

[D] Twenty-Four-Hour Notices of IndependentExpenditures.......................................................... 2-61

[E] Forty-Eight-Hour IndependentExpenditure Reports .............................................. 2-61

[F] Electronic Filing .................................................... 2-62[G] Aggregation Requirements..................................... 2-62[H] Dates for Aggregation............................................ 2-62

§ 2:8.8 Other Reporting Issues .......................................... 2-62[A] Investment Income ............................................... 2-62[B] Bank Loans—Schedule C-1 ................................... 2-63

Figure 2-5 Form C-1: Bank Loans.......................................... 2-64§ 2:8.9 Documents and PAC Recordkeeping ..................... 2-65

[A] Email ..................................................................... 2-65[B] What Records Must Be Retained? ......................... 2-65[C] How Long Must Records Be Retained?.................. 2-65[D] FEC Guidance About Recordkeeping

Policies and Procedures ......................................... 2-65[E] Contribution Limits Applicable to

PAC Activities ....................................................... 2-66

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Table 2-5 Contribution Limitations Under BCRA................ 2-67§ 2:9 Special Membership and Solicitation Rules for

Trade Associations ........................................................ 2-68§ 2:9.1 Solicitation of Voluntary Contributions to

a PAC or SSF of a Trade Association..................... 2-68[A] Who May Be Solicited? ......................................... 2-68[A][1] Individual Members ............................................. 2-68[A][2] Trade Association Employees ............................... 2-68[A][3] The Restricted Class of Member Corporations ......2-69[A][3][a] Prior Approval .................................................. 2-69[A][3][b] Making a Request ............................................. 2-70[A][4] Affiliated Companies............................................ 2-70

§ 2:9.2 Method and Number of Permitted Solicitations..... 2-71Appendix 2A Sample Resolution Establishing a PAC ....... App. 2A-1Appendix 2B Sample PAC By-Laws .................................. App. 2B-1Appendix 2C Sample PAC Contribution Card..................App. 2C-1Appendix 2D FEC Document on Internal Controls

and Political Committees............................App. 2D-1Appendix 2E TransCanada ................................................App. 2E-1Appendix 2F FEC Notice Regarding Treasurer Liability ....App. 2F-1

Chapter 3 Executive Fundraising

§ 3:1 Introduction.................................................................... 3-2§ 3:2 Contribution to a Candidate .......................................... 3-2

§ 3:2.1 Definition of Contribution...................................... 3-2§ 3:2.2 Exempted Activity ................................................... 3-3

[A] Volunteer Activity.................................................... 3-3[B] Use of a Personal Residence .................................... 3-3[C] Travel and Living Expenses ..................................... 3-3

§ 3:3 Are Corporate Resources Used?...................................... 3-3§ 3:3.1 Time Spent on Volunteer Activity ........................... 3-4§ 3:3.2 Spending by the Executive....................................... 3-4

§ 3:4 Use of Corporate Resources for External Fundraising .... 3-5§ 3:4.1 General Rule............................................................ 3-5§ 3:4.2 Use of Facilities Incidental to Volunteer Activity

Exemption ............................................................... 3-5§ 3:4.3 Use of Staff and Other Resources Exemption—

Advance Payment Required ..................................... 3-6§ 3:5 Bundling and Conduit Reporting.................................... 3-7

§ 3:5.1 Conduit Forwarding and/or Reporting Rules ........... 3-8[A] To the Campaign Committee.................................. 3-8[B] To the FEC .............................................................. 3-9

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§ 3:6 Additional Bundled Contribution ReportingRequirements for Lobbyists ............................................ 3-9

§ 3:6.1 Reporting Rules Regarding BundledContributions by Lobbyists ................................... 3-10

§ 3:6.2 Lobbyist/Registrants and Lobbyist/RegistrantPACs...................................................................... 3-10

§ 3:6.3 Definition of a Bundled Contribution................... 3-11§ 3:6.4 Impact of Records on Bundling Status .................. 3-11§ 3:6.5 Is Everyone Credited As a Fundraiser by a

Reporting Committee Considered a Bundler forReporting Purposes if They Are Employedby a Company Registered As EmployingLobbyists? .............................................................. 3-11

§ 3:6.6 Application of the $17,600 Threshold if Morethan One Lobbyist Co-Sponsors a FundraisingEvent ..................................................................... 3-12

§ 3:6.7 Determining Whether a Person Is ReasonablyKnown to Be a Lobbyist/Registrant orLobbyist/Registrant PAC ........................................ 3-13

§ 3:6.8 Effective Date for the Additional LobbyistContribution Reporting Rules ............................... 3-13

§ 3:7 Summary of Executive Fundraising Dos and Don’ts .... 3-14§ 3:8 The Organization Types That Frequently Solicit

Donations ..................................................................... 3-15§ 3:8.1 Brief Introduction to Tax-Exempt Organizations.... 3-15

Table 3-1 Permitted Campaign Activity of Tax-ExemptOrganizations ........................................................ 3-16

§ 3:8.2 Background of 527s............................................... 3-16Appendix 3A FEC Form 3L: Report of Contributions....... App. 3A-1Appendix 3B Instructions for FEC Form 3L..................... App. 3B-1Appendix 3C FEC Form 1: Statement of Organization ....App. 3C-1Appendix 3D Instructions for FEC Form 1.......................App. 3D-1

Chapter 4 State Laws, Rules, and Policies ImpactingCorporate Government Relations

§ 4:1 Introduction—Campaign Finance .................................. 4-1§ 4:1.1 Prohibitions ............................................................. 4-2§ 4:1.2 Federal Election Financing Requirements................ 4-2

§ 4:2 Corporate Contributions to State/Local Candidates,Party Committees and PACs .......................................... 4-2

Table 4-1 Current State Law: Contributions ofCorporate Funds...................................................... 4-3

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§ 4:3 Treatment of Federal PACs Under State Laws andRegulations ..................................................................... 4-4

§ 4:4 State Lobby Laws and Gift Laws..................................... 4-6§ 4:4.1 Lobby Laws.............................................................. 4-6§ 4:4.2 Gift Laws................................................................. 4-7

§ 4:5 Placement Agent Rules ................................................... 4-7§ 4:5.1 National Rules......................................................... 4-8§ 4:5.2 State and Local Rules .............................................. 4-9

Table 4-2 State Regulation of Placement Agents................... 4-10§ 4:6 Conflict of Interest Laws .............................................. 4-11

§ 4:6.1 In General ............................................................. 4-11§ 4:6.2 Liability ................................................................. 4-11

Appendix 4A Survey of Federal and State LobbyingLaws ............................................................ App. 4A-1

Appendix 4B Survey of State Contribution Laws.............. App. 4B-1

Chapter 5 Pay-to-Play Rules

§ 5:1 What Are Pay-to-Play Rules? .......................................... 5-3§ 5:2 Basic Features of Pay-to-Play Laws ................................. 5-4Table 5-1 Jurisdictions with Pay-to-Play Rules........................ 5-5§ 5:3 Municipal Securities and the MSRB............................... 5-6§ 5:4 MSRB Rule G-37 ............................................................ 5-6

§ 5:4.1 Restrictions and Reporting RequirementsUnder Rule G-37..................................................... 5-6

§ 5:5 Terms Defined Under the Rule....................................... 5-7§ 5:5.1 Which Government Officials Are Covered

Under This Rule? .................................................... 5-7§ 5:5.2 What Does “Municipal Securities Business”

Mean?...................................................................... 5-8§ 5:5.3 What Is a “Contribution”? ...................................... 5-9§ 5:5.4 What Is an “MFP”? ................................................. 5-9

[A] Newly Hired or Qualified MFPs: Retroactivity ofMFP Status ............................................................. 5-10

[B] Former MFPs: Retention of MFP Status ............... 5-11§ 5:6 Treatment of MFP Contributions ................................. 5-11

§ 5:6.1 Contribution Checks from Joint Bank Account .... 5-11§ 5:6.2 Volunteer Work ..................................................... 5-12§ 5:6.3 Contributions to National, State, or Local

Political Parties ...................................................... 5-12§ 5:6.4 Attendance at Fundraisers ..................................... 5-14

§ 5:7 Exemption from the Ban .............................................. 5-14§ 5:7.1 Automatic Exemption ........................................... 5-14§ 5:7.2 Discretionary Exemption....................................... 5-14

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§ 5:8 Reporting Requirements ............................................... 5-15§ 5:8.1 Who Is Required to Report? .................................. 5-15§ 5:8.2 When Are the Reports Due?.................................. 5-15§ 5:8.3 What Must Be Reported? ...................................... 5-16

[A] Reporting of Contributions ................................... 5-16[B] Reporting of Municipal Securities Business .......... 5-16

§ 5:9 MSRB Rule G-38 .......................................................... 5-16§ 5:9.1 Communications with Issuers That Are Not

Solicitations........................................................... 5-17[A] Incidental Communications with Issuer............... 5-17[B] Limited Promotional Communications ................ 5-18[C] Post-Selection Communications ........................... 5-18[D] Communications Incidental to Providing

Recognized Professional Services ........................... 5-19[E] Communications with Private Obligor in a

Conduit Issuance .................................................. 5-19§ 5:10 MSRB Rule G-20 .......................................................... 5-19

§ 5:10.1 Exemptions from MSRB Rule G-20 ...................... 5-19§ 5:11 Enforcement of MSRB Rules G-37, G-38, and G-20.... 5-20§ 5:12 Changes to MSRB Rule G-37 ....................................... 5-20

§ 5:12.1 Contributions to Bond Ballot CampaignCommittees........................................................... 5-20

§ 5:12.2 Affiliated Bank PACs ............................................. 5-22§ 5:13 SEC Pay-to-Play Rule Applicable to Investment

Advisers ........................................................................ 5-23§ 5:13.1 Who Is Covered? ................................................... 5-24§ 5:13.2 What Is a “Covered Associate”? ............................ 5-24§ 5:13.3 What Is the Extent of the Ban? ............................. 5-25§ 5:13.4 Who Are Covered Officials? .................................. 5-26§ 5:13.5 What Are Covered Investment Pools?................... 5-26§ 5:13.6 Ban on Indirect Contributions .............................. 5-27§ 5:13.7 Recordkeeping Requirement .................................. 5-28§ 5:13.8 Exemptions............................................................ 5-28§ 5:13.9 Placement Agent Ban ............................................ 5-29§ 5:13.10 Effective Dates....................................................... 5-30

§ 5:14 CFTC Pay-to-Play Rule for Swaps ................................ 5-30§ 5:14.1 What Type of Business Is Covered?....................... 5-31§ 5:14.2 Prohibition on Political Contributions .................. 5-31§ 5:14.3 Definitions and Additional Provisions .................. 5-31§ 5:14.4 Exemptions............................................................ 5-33§ 5:14.5 Indirect Violations................................................. 5-34

§ 5:15 Adopted SEC Rules for Swaps....................................... 5-34§ 5:15.1 What Type of Business Is Covered?....................... 5-34§ 5:15.2 Prohibitions on Political Contributions ................ 5-34

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§ 5:15.3 Definitions and Additional Provisions .................. 5-35§ 5:15.4 Look-Back for New Covered Associates ................ 5-35§ 5:15.5 Exemptions............................................................ 5-35§ 5:15.6 Additional Prohibitions ......................................... 5-36§ 5:15.7 Indirect Violations................................................. 5-37§ 5:15.8 Recordkeeping........................................................ 5-37

§ 5:16 MSRB Amendments to Rule G-37;Applying the Rule to Municipal Advisors,with Certain Changes Applicable to Broker-Dealers .... 5-37

§ 5:16.1 Municipal Advisors and Covered AdvisoryActivity .................................................................. 5-38

§ 5:16.2 Prohibitions on Political Activity .......................... 5-38§ 5:16.3 Definitions ............................................................ 5-39

[A] Covered Contributions .......................................... 5-39[B] Covered Officials ................................................... 5-39[C] Covered Donors .................................................... 5-39

§ 5:16.4 Look-Back for New MAPs ..................................... 5-41§ 5:16.5 Exemptions............................................................ 5-42§ 5:16.6 Indirect Violations................................................. 5-42§ 5:16.7 Impact on Broker-Dealers Engaging in

Municipal Securities Business (e.g., MunicipalBond Underwriting)............................................... 5-42

§ 5:16.8 Required Disclosure to MSRB ............................... 5-43§ 5:16.9 Recordkeeping Requirement .................................. 5-44

§ 5:17 FINRA’s Pay-to-Pay Rules ............................................. 5-45§ 5:17.1 Changes from the 2014 Proposed Rules................ 5-45§ 5:17.2 Covered Business................................................... 5-46§ 5:17.3 Prohibitions on Making Political Contributions..... 5-47§ 5:17.4 Definitions ............................................................ 5-47

[A] Covered Contributions .......................................... 5-47[B] Covered Officials ................................................... 5-47[C] Covered Associates ................................................ 5-47

§ 5:17.5 Look-Back for New Covered Associates ................ 5-48§ 5:17.6 Exemptions............................................................ 5-48§ 5:17.7 Ban on Soliciting Political Contributions.............. 5-49§ 5:17.8 Indirect Violations................................................. 5-49§ 5:17.9 Recordkeeping Requirements................................. 5-49

Appendix 5A MSRB Rule G-37......................................... App. 5A-1Appendix 5B MSRB Rule G-38......................................... App. 5B-1

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Chapter 6 Federal Lobbying and Gift Laws

§ 6:1 Introduction.................................................................... 6-3§ 6:2 Summary of the LDA ..................................................... 6-3§ 6:3 LDA Definitions ............................................................. 6-4

§ 6:3.1 What Is a Lobbyist?................................................. 6-4§ 6:3.2 What Is Lobbying Activity? ..................................... 6-4§ 6:3.3 What Is a Lobbying Contact? .................................. 6-4§ 6:3.4 Who Are Covered Executive Branch Officials?........ 6-6§ 6:3.5 Proposed Amendments to the

LDA Under the STOCK Act.................................... 6-6§ 6:4 Registration and Reporting Requirements

Under the LDA............................................................... 6-7§ 6:4.1 Registration ............................................................. 6-7§ 6:4.2 Quarterly Lobbying Activity Reports (“LD-2”)......... 6-9

[A] Lobbying Expenditures ............................................ 6-9Chart 6-1 Comparison of Definitions.................................... 6-12

[B] Lobbying Issues ..................................................... 6-13[C] Updates ................................................................. 6-13

§ 6:4.3 Semi-Annual Fundraising, Donation andExpenditure Report (“Form LD-203”).................... 6-13

[A] LD-203 Certification of Knowledge of, andCompliance with, Congressional Gift Rules ......... 6-16

[B] Liability for Violating the House and SenateGift Rules Under HLOGA..................................... 6-17

§ 6:5 Audit and Review of Reports ........................................ 6-17§ 6:5.1 Random Audits by the Government

Accountability Office (GAO) ................................. 6-17§ 6:5.2 Reporting Review, Enforcement, and Penalties...... 6-17

§ 6:6 Restrictions on Certain Lobbyist Communications ..... 6-18§ 6:6.1 The Ban................................................................. 6-19§ 6:6.2 Reporting ............................................................... 6-20§ 6:6.3 Other Lobbyist Restrictions................................... 6-20

§ 6:7 Interaction of House of Representatives EthicsRules and HLOGA........................................................ 6-21

§ 6:7.1 FECA Change—Recipient CampaignsRequired to Disclose Lobbyist-BundledPolitical Contributions .......................................... 6-21

§ 6:7.2 “Sense of the Congress” Regarding LobbyistSelf-Regulatory Organizations ............................... 6-22

§ 6:8 Gifts and Travel ............................................................ 6-22§ 6:8.1 Donor Liability ...................................................... 6-23§ 6:8.2 Senate Ban on Gifts .............................................. 6-23§ 6:8.3 Senate Valuation of Event Tickets ......................... 6-23

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§ 6:8.4 Senate Additional Restrictions onFact-Finding Trips.................................................. 6-23

[A] For Lobbyists ......................................................... 6-23[B] For Lobbyist Employers ......................................... 6-24

§ 6:8.5 Senate Requirement to Pre-Approve All ExemptFact-Finding Trips.................................................. 6-24

[A] Pre-Approval .......................................................... 6-24[B] Certification Requirement ..................................... 6-24[C] Post-Trip Disclosure by Members and Staff .......... 6-24

§ 6:8.6 House Travel Rules................................................ 6-25§ 6:8.7 Additional Travel Disclosure ................................. 6-26§ 6:8.8 Flights on Private Aircraft ..................................... 6-26

[A] Restrictions on Use of Campaign Funds............... 6-26[B] Non-Campaign Flights on Private Aircraft............ 6-26

§ 6:8.9 Senate Exemption for Constituent Events ............ 6-27§ 6:9 House and Senate Restrictions on Attending

Events During a National Party Convention................ 6-27§ 6:9.1 Issues Specific to Events During National Party

Conventions .......................................................... 6-27§ 6:9.2 Honorary Convention Event Ban—House

Guidance ............................................................... 6-28§ 6:9.3 Honorary Convention Event Ban—Senate

Guidance ............................................................... 6-29§ 6:9.4 FECA Regulation of Corporate Contributions

to the National Party Convention Committees .... 6-30§ 6:9.5 LDA Reporting and Convention Events ................ 6-30

§ 6:10 Other Ethical Standards................................................ 6-31§ 6:10.1 Expansion of the Length and Scope of the

“Cooling-Off” Periods............................................ 6-31[A] House .................................................................... 6-31[B] Senate .................................................................... 6-31[C] Executive Branch ................................................... 6-31

§ 6:10.2 Notice and Publication of Restrictions .................. 6-31§ 6:10.3 Ending Senate Floor and Other Privileges ............. 6-32

§ 6:11 Application of Federal Gift Rules to Members ofCongress and Staff ........................................................ 6-32

§ 6:11.1 What Is a Gift?...................................................... 6-33§ 6:11.2 What Is Not Considered a Gift? ........................... 6-33§ 6:11.3 Limitations on the Receipt of Gifts....................... 6-36

[A] From a Person Who Is Not a Lobbyist oran Agent of a Foreign Principal ............................. 6-36

[B] From a Person Who Is a Lobbyist oran Agent of a Foreign Principal ............................. 6-36

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§ 6:12 Application of Federal Gift Rules to theExecutive Branch .......................................................... 6-37

§ 6:12.1 General Rule.......................................................... 6-37§ 6:12.2 Exceptions ............................................................. 6-37§ 6:12.3 President Obama’s Executive Order Gift Rule....... 6-40

[A] General Rule.......................................................... 6-40[B] Disallowed OGE Gift Rule Exemptions ................ 6-40[C] OGE Gift Rule Exemptions Retained .................... 6-41[D] Additional OGE Guidance .................................... 6-42[E] Extension of the Executive Order .......................... 6-42

§ 6:13 Other Laws ................................................................... 6-43§ 6:14 Additional Information: Relevant Governmental

Websites ........................................................................ 6-44Appendix 6A House Ethics Guidance on Conventions.......App. 6A-1Appendix 6B Senate Ethics Guidance on Conventions ......App. 6B-1

Chapter 7 The Foreign Agents Registration Act (FARA)

§ 7:1 Introduction.................................................................... 7-1§ 7:2 FARA Requirements ....................................................... 7-2

§ 7:2.1 Triggering of the Law............................................... 7-2§ 7:2.2 Exemptions.............................................................. 7-3§ 7:2.3 Contents of the FARA Registration Statement ....... 7-4§ 7:2.4 Requirements After Initial Registration................... 7-4

§ 7:3 FARA Penalties and Enforcement................................... 7-4§ 7:4 Related Website............................................................... 7-5

Chapter 8 The Federal Election Commission:Processes and Enforcement

§ 8:1 Introduction.................................................................... 8-2§ 8:2 Advisory Opinions .......................................................... 8-3

§ 8:2.1 Timetable for Issuance of Advisory Opinions ......... 8-3§ 8:2.2 Withdrawal of the AOR........................................... 8-4

§ 8:3 FEC Educational Outreach ............................................. 8-4§ 8:4 FEC Enforcement: Summary of Features........................ 8-4

§ 8:4.1 Generation of Cases ................................................ 8-5§ 8:5 Bringing a Complaint-Generated Case........................... 8-5

§ 8:5.1 Complaint Requisites and Notifications ................. 8-5§ 8:5.2 Time to Respond ..................................................... 8-6§ 8:5.3 Response Issues ....................................................... 8-6

[A] Designation of Counsel........................................... 8-6[B] Response Strategies ................................................. 8-6

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§ 8:5.4 The First Stage: Determining Whether toOpen an Investigation—“Reason to Believe”........... 8-6

§ 8:5.5 The Second Stage: The Investigation ...................... 8-7§ 8:5.6 FEC Administrative Subpoenas ............................... 8-8

[A] Specific Concerns About Subpoenas Issued toFinancial Institutions .............................................. 8-8

§ 8:5.7 Enforcement Depositions ........................................ 8-9§ 8:5.8 Investigators .......................................................... 8-10

[A] FEC Contact with Corporate Employees............... 8-10§ 8:5.9 Stage Three: Early Resolution of Complaint

(Pre-Probable Cause Conciliation) ......................... 8-11[A] Mechanics of a Negotiation with the FEC ............ 8-12[B] What Happens Next? ............................................ 8-12

§ 8:5.10 Stage Four, if Negotiation Fails:“Probable Cause to Believe” .................................. 8-13

[A] General Counsel’s and Respondent’s Briefs .......... 8-13[B] Information Exchange at This Stage ..................... 8-13

§ 8:5.11 Oral Hearing Before the FEC ................................ 8-13§ 8:5.12 Closing Steps......................................................... 8-14

§ 8:6 FEC Alternative Approaches to Enforcement Cases ..... 8-14§ 8:6.1 Alternative Dispute Resolution Program............... 8-14§ 8:6.2 Self-Reporting of FECA Violations

(Sua Sponte Policy) ................................................ 8-15[A] Fast-Track Resolution ............................................ 8-15[B] Form of Fast-Track Resolution .............................. 8-15

§ 8:7 Other Enforcement Issues ............................................ 8-16§ 8:7.1 Complainant’s Role............................................... 8-16§ 8:7.2 Confidentiality and Closed Enforcement

Matters .................................................................. 8-16§ 8:7.3 Statute of Limitations ........................................... 8-16

§ 8:8 Criminal Prosecution by the Department of Justice..... 8-17§ 8:8.1 Civil Versus Criminal Jurisdiction; Violations ...... 8-17§ 8:8.2 Criminal FECA Violations..................................... 8-18§ 8:8.3 FEC/DOJ Memorandum of Understanding and

Current Trend ....................................................... 8-18§ 8:9 Other Regulators........................................................... 8-19

§ 8:9.1 Contact List for Regulatory Bodies........................ 8-20Appendix 8A Safe Harbor and Sua Sponte

Submission Policies Under the FEC............ App. 8A-1

Appendix A McCutcheon v. FEC ...................................... App. A-1

Index ................................................................................................. I-1

xxxii
