David G. Reichert: Alleged violation of RCW 42.17A.235 & .240 & WAC 390-16-034 by failing to timely & accurately report contributions & by failing to collect required contributor information, and .405 by accepting over-limit contributions. (EY24 OCT24)

Case

#160779

Respondent

Dave G Reichert

Complainant

Marque Jones; Dmitri Iglitzin and Marina Multhaup on behalf of Washingtonians for Ethical Government

Description

Allegation: Violation of RCW 42.17A.235 & .240 & WAC 390-16-034 by failing to timely & accurately report contributions & by failing to collect required contributor information, and .405 by accepting over-limit contributions.

Re: Complaint filed by Dmitri Iglitzin and Marina Multhaup on behalf of Wasingtonians for Ethical Government:

The PDC has dismissed this matter in accordance with RCW 42.17A.755(1) and will not be conducting a more formal investigation into these allegations or taking further enforcement action in this matter. A complaint was filed by Marina Multhaup and Dmitri Iglitzin on behalf of Washingtonians for Ethical Government alleging that, in part, Dave Reichert may have violated RCW 42.17A.235 and RCW 42.17A.405(14) by failing to accurately report his contributors and by accepting contributions which exceed the limits for individuals per election.

Applicable Laws & Rules

RCW 42.17A.235 and .240 require candidates and political committees to file timely, accurate reports of contributions and expenditures including the name and address of each person who has made one or more contributions during the period.

RCW 42.17A.435 states, “No contribution shall be made and no expenditure shall be incurred, directly or indirectly, in a fictitious name, anonymously, or by one person through an agent, relative, or other person in such a manner as to conceal the identity of the source of the contribution or in any other manner so as to effect concealment.”

Relevant facts include the following:

Dave Reichert was a 2024 candidate for Governor who appeared on the general election ballot.

Dave Reichert, Case 160779

Drew Stokesbary, Legal Counsel for the Reichert campaign, stated that as of November 4, 2024, the Reichert Campaign had raised over $6.5 million from nearly 30,000 unique contributors in nearly 60,000 separate transactions. The Reichert campaign stated that through their finance team, treasurer and legal counsel, they had systems in place to ensure their compliance obligations were met in full.
Concerning the allegation that the Reichert campaign accepted contributions from Lawrence Patrick Hughes in the name of his wife, Mary Ellen Hughes, after she had passed away, the campaign stated they did not know that Mrs. Hughes was deceased until October 30, 2024, which was after the complaint was filed.
The Reichert campaign received two contribution checks written on accounts with the names of Lawrence P. Hughes and Mary Ellen Hughes. The campaign stated that the first check, in the amount of $4,800, was received on December 13, 2023, and included the names of Lawrence P. Hughes and Mary Ellen Hughes. The campaign attributed equal parts of the contribution to each of the two individuals named on the check.
The second check, in the amount of $2,400, was received on May 1, 2024, and also included the names of Lawrence P. Hughes and Mary Ellen Hughes, as well as that of a third individual, Christine D. Hendley. This contribution was originally attributed only to Mary Ellen Hughes.
The Reichert campaign stated that neither check included nor was accompanied by any notation indicating that Mary Ellen Hughes was deceased or that the contribution was only from Lawrence Hughes. The Reichert campaign stated that upon receiving the complaint they promptly reviewed their records, identified the two checks, and sought written guidance from PDC staff regarding how to correct the campaign’s prior filings.
The Reichert campaign stated they believed that had they been aware of the passing of Mary Ellen Hughes at the time the contributions were received, they could have allocated the $4,800 contribution, received December 13, 2023, entirely to Mr. Hughes ($2,400 for the primary election and $2,400 for the general election) and the $2,400 contribution received May 1, 2024 to Christine Hendley, whose name appeared on the check as an account owner, and who signed the check.
The Reichert campaign sought PDC staff guidance, asking if, in the staff’s view, this allocation would have been permissible at the time the contributions were received, and if so, whether the campaign was permitted to amend its C-3 reports to allocate the two checks in the manner described.
PDC staff stated that, in its view, the contribution allocations described by the Reichert campaign would have been permissible at the time the contributions were received, and said the campaign could amend its C-3 reports to allocate the contributions as described. The Reichert campaign then amended its reports as described, reattributing the contributions originally attributed to Mary Ellen Hughes, as follows: (1) The December 13, 2023 contribution was attributed entirely to Lawrence P. Hughes, with $2,400 designated for the primary election and $2,400 designated for the general election; and (2) the May 1, 2024, contribution was attributed to Christine D. Hendley and designated for the primary election.
However, PDC staff learned that Mr. Hughes initially intended for both contribution checks, totaling $7,200, to the Dave Reichert campaign, to be from him and that Ms. Hendley’s name was placed on the checks only to fulfill a ministerial role as family assistant, without an ownership interest in the funds in the account.
PDC staff notified the Reichert campaign that both contribution checks were from Mr. Hughes and the Reichert campaign immediately amended its C-3 report to show Mr. Hughes as the contributor and removed Ms. Hendley as the contributor. Also, on January 31, 2025, the Reichert campaign refunded $2,400 to Mr. Hughes for the over-limit contribution.

Re: Complaint filed by Marque Jones:

The PDC has dismissed this matter in accordance with RCW 42.17A.755(1) and will not be conducting a more formal investigation into these allegations or taking further enforcement action in this matter. However, PDC staff expects the Reichert campaign to continue filing amended reports to reflect the missing employer and occupation information that has been obtained by the campaign.

A complaint was filed by Marque Jones, alleging, in part, that the 2024 Dave Reichert campaign for Governor (Campaign) may have violated RCW 42.17A.235 and .240 and WAC 390-16-034 by:

Failing to timely and accurately report the names and addresses of contributors giving over $100 in the aggregate during the campaign; and
Failing to collect the required employer and occupation information for contributors giving over $250 in the aggregate during the campaign;

In addition, PDC staff reviewed whether the Campaign may have violated RCW 42.17A.405(14) by accepting contributions in excess of the contribution limits set forth in RCW 42.17A.405.

Relevant Facts are as follows:

Dave Reichert was a 2024 candidate for Governor who appeared on the general election ballot.
Drew Stokesbary, Legal Counsel for the Reichert campaign, stated that as of November 4, 2024, the Reichert Campaign had raised over $6.5 million from nearly 30,000 unique contributors in nearly 60,000 separate transactions. The Campaign stated that through its finance team, treasurer and legal counsel, the Campaign had systems in place to ensure its compliance obligations were met in full.

Timely and Accurate Reporting of Small Contributions

The complaint alleged “that information provided by the Reichert campaign, compared to the Bob Ferguson campaign, was insufficient.” PDC staff noted to the Respondent that this allegation “appears to be motivated by the fact that, according to the PDC database, on 10/18/2024, the Campaign had accepted $1,348,652.11 in contributions from 33,683 donors.”
The Campaign stated that its small contribution reporting was accurate throughout the 2024 election cycle, noting that the campaign tracked all small contributors and maintained a separate and private list of the name, address and amount of each contributor in accordance with RCW 41.17A.240(2)(c). The Campaign noted that if a contributor exceeded $100 in aggregate contributions, that contributor’s contributions were itemized on subsequent C-3 reports where the contributor is identified by his or her name and address.
Even with the large volume of small contributions, PDC staff found no evidence to support the allegation that the Reichert campaign failed to properly account for and report its small contributions.

Employer and Occupation Information

The complaint also alleged that the Campaign may have failed to collect the required employer and occupation information and had not reported all employer and occupation information for contributors giving more than $250 in the aggregate during the campaign.
The Campaign stated that since its launch in June 2023, any written fundraising solicitation has included a form requesting the contributor’s occupation and employer and such employer’s city and state. The Campaign noted that despite this request, many contributors submitting contributions to the campaign did supply this information, as requested, when returning the campaign’s fundraising forms. Contributors giving online were required to submit the required employer and occupation information as part of the donation process.
The Campaign stated that it established internal policies and procedures to attempt to collect the required employer and occupation information, employing a “best efforts” standard similar to what is required by the Federal Election Commission (FEC). The Campaign stated that it promptly followed up with an email or letter when the required information was not submitted with the contribution and entered “Information Requested” on the C-3 Report. The Campaign said it also sent periodic notices to such contributors, reminding them that the campaign was required to report their employer and occupation.
The Campaign stated that until mid-2024, they believed their “best efforts” policy was sufficient. In mid-2024, the Campaign learned that the PDC Commissioners had adopted a motion instructing PDC staff to provide written guidance on the agency’s website regarding political committees’ employer and occupation reporting obligations.
The Campaign stated that thereafter, they revised their internal procedures to significantly increase their efforts to obtain employer and occupation information within ten business days of receiving contributions for which employer and occupation information was required. The Campaign stated it believes it has fully complied with PDC staff’s updated guidance. The Campaign stated it is not aware of any contributions received since August 2024 where required employer and occupation information has not been timely reported.
The Campaign stated it has also increased its efforts to collect employer and occupation information from previously reported contributions and believes it has collected employer and occupation information for all prior contributors whose aggregate contributions to the Campaign exceed $250.
The Campaign changed treasurers during the campaign, initially using the PDC’s ORCA filing system, and later using Aristotle campaign reporting software. The campaign has amended C-3 reports originally filed using Aristotle software and is working with PDC staff to amend C-3 reports initially filed using ORCA. The Campaign stated it will continue to file amended C-3 reports to include all missing employer and occupation information it has been able to obtain.

Over-Limit Contributions

PDC staff reviewed whether the Campaign had accepted contributions in excess of contribution limits, identifying 16 contributors where it appeared the Campaign may have accepted contributions in excess of the $2,400 per election limit. For 13 of the 16 contributors, the contributions were not over-limit because the Campaign either returned the over-limit portion within 10 days of receipt or attributed the apparent over-limit portion of the contribution to the correct spouse. For the three remaining contributors, where the over-limit contribution was not returned within 10 days, the campaign caught two of the errors within the same calendar month and issued a refund and later issued a refund to the third contributor.

Disposition

Case Closed with No Evidence of Violations

Date Opened

October 18, 2024

Areas of Law

RCW 42.17A.235, RCW 42.17A.240, RCW 42.17A.405, WAC 390-16-034