Campaign finance and fraud allegations

Political campaigns are active at all times but with 2020 being an election year for the nation’s highest office, the topic of campaign finance guidelines and allegations of fraud related to campaign funds is even more important to understand. Running a political campaign requires an incredible amount of money, especially at the federal level. Teams and committees must be well-versed in the processes designed to manage campaign funds. With many very nuanced rules, it can be all too easy to make an error that could end up leading to serious allegations.

Being accused of embezzling campaign money has led more than one person to spend time in prison. An NBC Washington report recently provided details on the sentencing of a couple from Virginia for their alleged role in embezzling more than $650,000 from various funds, including one for a State Senator’s campaign. One person was ordered to spend five years in prison and the other seven years.

The Federal Election Commission provides guidance on processes put in place designed to prevent campaign funds from being misappropriated or embezzled. Many of these processes require specific internal controls to be implemented and followed exactly as stipulated per the Federal Election Campaign Act.

One internal control requires all checks and receipts to be reviewed by a person who does not have any authority or control over the committee’s accounting efforts. Another control mandates that any payment exceeding a certain threshold to be approved in writing by at least two persons with predesignated authorization to do so. All bank activities must be reviewed, identified and approved on a regular basis.