JEFFERSON CITY — A proposed change in Missouri ethics laws will allow some businesses to write checks directly to candidates for office.
Just six years after former Gov. Eric Greitens was investigated for using “shell companies” to finance his campaign, the legislation would allow limited liability companies with specific tax status to donate money to politicians.
Under the plan, the companies would have to be in business for at least one year and would have to register with the Missouri Ethics Commission if they want to contribute to candidates.
While those provisions could provide safeguards against election-time hijinks, the law contains no language on how exactly regulators would ensure the companies are real and not just legal vessels for moving dark money into political accounts.
People are also reading…
The sponsor, Sen. Andrew Koenig, R-Manchester, acknowledged there are potential ways to game the system.
“Obviously, it’s not going to catch everyone out there,” Koenig said Wednesday. “But, it will create some transparency.”
The provision is included in a House bill that now awaits action by Gov. Mike Parson. A spokeswoman did not respond to a request for comment.
The overall legislation passed out of the Senate on a 27-6 vote and won approval in the House 129-13.
The proposed new state law will align Missouri campaign finance rules more closely with the Federal Election Commission, which allows certain limited liability companies to contribute to candidates for federal office.
Under FEC rules, an LLC must, at the time it makes a contribution, notify the recipient committee that it is eligible to make the contribution and if it comes from a partnership, how much should be attributed to each donor.
“This requirement will prevent the recipient committee from inadvertently accepting an illegal contribution,” the FEC says.
Koenig said the Missouri Ethics Commission has allowed some LLCs to contribute, but it was based on an interpretation of law, not an actual, specific law.
“I think this puts in some transparency and makes businesses stipulate that they aren’t breaking the law,” Koenig said.
In 2018, a House committee investigating Greitens released two emails suggesting that the Greitens campaign worked to conceal the identity of donors during his 2016 bid for office.
At issue were two companies — White Impala LLC and ELX83 LLC — that were formed in December 2015 and subsequently donated a combined $30,000 to Greitens for Missouri at the time.
“By all appearances, these two entities were created to channel contributions to the Greitens campaign from an anonymous donor or donors,” reads a memorandum attached to one of the emails that was part of an opposition research paper heading into the 2016 gubernatorial election. “Missouri law explicitly prohibits campaign contributions made ‘in such a manner as to conceal the identity of the actual source of the contribution.’
“The use of this arrangement to hide donors certainly runs counter to Greitens’s repeated attacks on ‘corruption’ and ‘insider political games’ in Missouri,” the memo states.
Greitens, who resigned two weeks later, is among 21 Republicans seeking the party’s nomination for the seat held by U.S. Sen. Roy Blunt, who is retiring.
In February 2020, Missouri ethics regulators fined his state campaign account $178,000 over violations dating to Greitens’ 2016 campaign.
The Missouri Ethics Commission said the fine was linked to two dark money groups that were raising and spending money to further Greitens’ political career.
Former Attorney General Josh Hawley, who is now a senator, also determined that Greitens may have committed a felony by taking his former charity’s donor list and using it for political fundraising without the charity’s permission. Greitens was charged with felony tampering with computer data, but the charges were dropped after he resigned.
The legislation is House Bill 2400.
Originally posted at 1:48 p.m. Wednesday, May 25.