THIS STORY HAS BEEN FORMATTED FOR EASY PRINTING

$1m mystery donor to PAC for Romney ID’s himself

Watchdog groups file complaints

By Donovan Slack
Globe Staff / August 6, 2011

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WASHINGTON - Hours after two nonpartisan campaign-finance watchdogs filed complaints yesterday with federal election officials and the US attorney general, a mysterious $1 million donor to a political action committee supporting presidential candidate Mitt Romney came forward and identified himself.

The contributor, Edward Conard, is a former executive with Bain Capital, which was cofounded by Romney, and said last night that he did not intend to circumvent election laws when he created a company, W Spann LLC, which paid the contribution without Conard’s name attached.

“I did so after consulting prominent legal counsel regarding the transaction, and based on my understanding that the contribution would comply with applicable laws,’’ he told Politico in a statement last night.

The Campaign Legal Center and Democracy 21, nonprofit organizations based in Washington, D.C., alleged in the complaints filed earlier yesterday that the contributor may have illegally sought to hide his identity by setting up a shell company, which formed and dissolved within weeks of making the contribution. Registration records for the company do not list its owners.

“This case deserves a good, hard look from the Federal Election Commission and the Department of Justice,’’ Paul S. Ryan, associate legal counsel for the Campaign Legal Center, said in an interview. “If violations are found, they should be prosecuted vigorously in order to deter future straw-contributor schemes that make a mockery of our campaign finance disclosure laws.’’

Federal law prohibits giving money in others’ names to political candidates or committees, and violators could face civil and criminal penalties for knowingly participating in such a scheme - either as the original contributor, the person or entity acting as a go-between, or the campaign or committee receiving the money.

The two groups also urged the commission and federal prosecutors to determine if W Spann should have registered as a political committee, which would require disclosure of the people behind it. Any entity whose major purpose is influencing elections and that spends more than $1,000 to do so must register with the commission.

“As far as we know the only thing we know this corporation has done is give money to a PAC,’’ said Fred Wertheimer, founder and president of Democracy 21 and - from 1981 to 1995 - president of Common Cause, a nonpartisan organization that has advocated campaign finance reform.

W Spann was formed by Boston lawyer Cameron Casey of Ropes & Gray and was registered in Delaware on March 15. On April 28, the company gave $1 million to Restore Our Future, a political action committee run by former Romney campaign advisers. On July 12, W Spann dissolved.

A spokeswoman for the commission confirmed receiving the complaint yesterday but said that, as a matter of policy, the agency could not confirm whether it will investigate. A spokeswoman for the Department of Justice declined to comment.

Casey has referred questions to Ropes & Gray, which declined to comment yesterday. She did not return a message. The firm said Thursday that it does not comment on confidential client matters.

Restore Our Future referred questions to the defunct company.

“The complaint is against W Spann and not Restore Our Future, and as such, we have no comment,’’ committee spokeswoman Brittany Gross said in an e-mail. “If you do have questions regarding this complaint, we urge you to contact W Spann.’’

Conard said last night he has asked the committee to amend its filing.

“To address questions raised by the media concerning the contribution, I will request that Restore Our Future PAC amend its public report to disclose me as the donor associated with this contribution,’’ he said. He did not give any further explanation about why he set up the company and kept his name anonymous initially.

The Globe could not reach Conard for comment.

Restore Our Future was formed in October last year “to support Romney in his effort to become America’s next president,’’ according to a press release. The founders all worked for the Romney presidential campaign in 2008; Carl Forti was national political director, Charlie Spies was chief financial officer and counsel; and Larry McCarthy was a member of the media team.

The committee is a Super PAC, meaning it can take unlimited amounts from corporations, unions, and individuals and spend unlimited amounts to influence campaigns. It must spend that money independently, meaning the group cannot coordinate with a candidate’s campaign.

It also must disclose the names of its donors.

The committee reported raising $12 million during the first six months of this year. Two other little-known companies also contributed $1 million each - Eli Publishing and F8 LLC. Those companies listed the owners’ names on registration documents: Nu Skin cofounder Steven J. Lund owns Eli and former Nu Skin executive Jeremy S. Blickenstaff owns F8.

Lund and Blickenstaff did not return messages seeking comment yesterday.

A Fox News affiliate in Salt Lake City reported that Lund said he set up the publishing company several years ago to publish a book and used it to give money to Restore Our Future because it offered accounting advantages that he wouldn’t get by cutting a personal check.

The Campaign Legal Center, formed in 2002, represented Senator John McCain, a Republican, and Russ Feingold, a former Democratic senator, against an unsuccessful challenge to their landmark campaign finance law at the Supreme Court.

The center’s president is a former commissioner and chairman of the commission and was general counsel to McCain’s presidential campaigns in 2000 and 2008, and its executive director represented Democratic members of the Texas congressional delegation during redistricting.

Democracy 21 was formed in 1997 and advocates against “the undue influence of big money in American politics and to ensure the integrity and fairness of government decisions and elections.’’

The Federal Election Campaign Act states specifically that “No person shall make a contribution in the name of another person or knowingly permit his name to be used to effect such a contribution and no person shall knowingly accept a contribution made by one person in the name of another person.’’

Violations of that section of campaign finance law are the most frequently prosecuted. Just this year, a contributor to former presidential candidate John Edwards and a contributor to Vice President Joe Biden’s 2008 presidential bid pleaded guilty to funneling campaign contributions illegally through straw contributors.

If investigators find evidence of a violation in the W Spann case, it could be the first in which a company was found to be a straw contributor.

“We haven’t seen this before but that’s only because until a year ago it was illegal for corporations to make any political contributions,’’ Ryan said, noting that a Supreme Court decision last year paved the way for corporate involvement.

The other cases involved using other people as middlemen.

For example, Los Angeles lawyer Pierce O’Donnell asked people to give money to Edwards’s 2004 presidential campaign, and he then reimbursed them, effectively masking his identity as the contributor. O’Donnell agreed this week to serve six months in federal prison and pay a $20,000 fine.

One of Romney’s opponents for the Republican nomination, Jon Huntsman, a former Utah governor, called for accountability in campaign fund-raising during a campaign stop in New Hampshire yesterday, an apparent jab at Romney and Restore Our Future.

And the Democratic National Committee delivered a scathing rebuke of the mysterious contribution and sought to tie it to Romney.

“There’s no way to tell where the money came from or who was responsible,’’ Patrick Gaspard, executive director of the national committee, wrote in an e-mail.

Conard has been a longtime Romney supporter and gave $100,000 during the past two years to Free and Strong America committees that were affiliated with the former Massachusetts governor.

A spokeswoman for Romney did not respond to messages seeking comment.

Donovan Slack can be reached at dslack@globe.com. Follow her on Twitter @DonovanSlack.

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