RNC Taps Big Donors to Pay Trump-Russia Legal Costs

By Kenneth P. Doyle

The Republican National Committee tapped a special account funded by major donors to pay more than $742,000 in legal costs last month, according to a new disclosure report filed with the Federal Election Commission.

Legal costs included direct payments totaling $231,250 to lawyers representing President Donald Trump in the investigation of possible ties between his presidential campaign and Russia. The RNC paid $100,000 to lawyer John Dowd; it paid $131,250 to the Constitutional Litigation and Advocacy Group, the firm of Trump’s lawyer Jay Sekulow.

Contributors to the RNC special legal account can give up to $101,700 annually, about three times the amount that can be given to the general campaign fund of a national party committees. More than a dozen contributors gave the maximum to the RNC’s Legal Proceedings Account in July and August, according to the most recent disclosure reports filed with the FEC.

The RNC hasn’t said whether the contributors to the legal account were told that money from the account was being used to pay bills related to the Trump-Russia investigation. Use of money from a candidate’s own campaign account to pay legal costs is not unusual, but use of a party account to pay a candidate’s lawyers was unusual, if not unprecedented, experts said.

The RNC did not immediately return a request for comment from Bloomberg BNA.

Big GOP Contributors

The biggest recent contributors to the RNC legal account included major GOP donors like Bernard Marcus, co-founder of the Home Depot retail chain; Charles Schwab, chief executive of investment firm Charles Schwab Corp.; and Richard Uihlein, chief executive of shipping supplies company Uline Inc.

Also giving the maximum was Lianbo Wang, whose employer wasn’t identified in the RNC report but who has been listed as the marketing chief of the real estate development company China City America.

It’s unclear whether Trump’s primary campaign committee—or Trump himself—have paid any of his legal costs related to the Russia investigation. The Trump committee, Donald J. Trump for President Inc., reported major legal spending this year, including over $700,000 paid to the law firm Jones Day, which represents the campaign committee.

Though the RNC’s payments to Trump’s lawyers were unusual, it has a large amount of money due largely to Trump’s popularity with base Republican supporters. A Sept. 19 statement from the RNC said it raised a total of $93.3 million, so far, in 2017—more than twice as much as its counterpart, the Democratic National Committee. The RNC said it had $45.8 million in cash on hand and no debts.

RNC Finance Chairman Steve Wynn, the chief executive of hotel and casino company Wynn Resorts Limited, said in the statement he was “convinced this unprecedented amount of support in a non-presidential year reflects one thing and one thing only: Citizens in every state have donated to the Republican Party because they want even more of the economic and political leadership offered by our Party and the Trump Administration.”

Other Legal Payments

The RNC’s disclosure reports don’t specify the total amount collected by the party committee’s special legal account, but the most recent report showed the account was tapped for major expenditures last month. In addition to the amounts paid to Trump lawyers Dowd and Sekulow, the legal account transferred $241,399 to the RNC for unspecified legal costs.

The Washington Post reported recently that the RNC had paid nearly $200,000 for lawyers that helped the president’s son, Donald Trump Jr., prepare for testimony before the Senate Intelligence Committee. Trump Jr. was questioned about a meeting he and others involved in the Trump campaign held last year with a Russian lawyer said to have damaging information on Democratic presidential candidate Hillary Clinton.

In addition, the RNC’s largest single legal payment last month, $270,030, went to King & Spalding, an Atlanta-based major law firm. Bobby Burchfield, a partner in the Washington office of the firm, was named by Trump earlier this year as a special ethics advisor to the president’s businesses.

Trump is the first president in decades not to sell his assets or put them in a blind trust while in office—a situation that critics say provides a channel for possible outside efforts to influence the president through payments that could benefit him personally.

Congress Approved Special Party Accounts

The RNC’s Legal Proceedings Account was created after Congress amended campaign finance laws in 2014, allowing the national political party committees to raise large contributions for special accounts. The controversial provision was tacked on to a major appropriations bill funding the federal government, with no prior public discussion or debate.

In addition to new accounts financing party conventions and party headquarters, the law also authorized each party committee to create a new account for legal costs. The only costs specifically mentioned in the law were those related election recounts; however, the provision also said the money raised for this account could also pay for other legal costs.

The FEC said soon after the 2014 law was passed that it would write a new regulation to govern the special accounts, but the agency hasn’t yet followed through on that promise. The result is that there are no specific rules for these funds, other than informal guidance from the FEC that the contributions to the accounts must be included in a party committee’s disclosure report.

Republican and Democratic commissioners on the FEC frequently have disagreed about how to proceed with rulemaking efforts on a variety of issues; The six-member commission has been unable to muster enough votes to adopt any major new rules in recent years.

To contact the reporter on this story: Kenneth P. Doyle in Washington at kdoyle@bna.com

To contact the editor responsible for this story: Paul Hendrie at pHendrie@bna.com

Copyright © 2017 The Bureau of National Affairs, Inc. All Rights Reserved.