Docs reveal 'more red flags' from group 'funneling millions of dollars to conservative causes': report

16 May 2024

A Republican donor group was the subject of a complaint filed last week by the Campaign Legal Center alleging that it's "a shell entity specifically created to pump big donors’ money into politics while masking their identities," according to The Daily Beast.

The news outlet reports that Ardleigh Impact Corporation — a "mysterious nonprofit registered with the state of Delaware" has been "funneling millions of dollars to conservative causes."

The Washington, DC group Citizens for Responsibility and Ethics' Vice President for Research and Data, Robert Maguire, told the Beast, "Everything about how this corporation was organized seems fishy. Formed in Delaware, a state where people intentionally incorporate corporations because there is no disclosure requirement for… who is behind it, where the money might be coming from."

He added, "Then the fact that this corporation apparently, just months after incorporating, had enough money to pour millions into PACs, also raises more red flags. All while it has no apparent public facing materials or business operations. It really checks all the boxes when it comes to the kind of questionable shell companies we have seen in campaign finance data."

The Beast notes that "the only publicly available evidence of the nonprofit’s existence were the donations documented in FEC reports and its articles of incorporation, which it had unsurprisingly registered with the notoriously opaque state of Delaware."

Having obtained the incorporation documents, the Beast reports:

First, the incorporation records identify the group’s organizers as experienced political operatives, including, apparently, the professional strategist who ran Dr. Mehmet Oz’s failed Senate campaign in 2022. They also show that Ardleigh Impact Corp. is not organized as a private company, but a 501(c)(4) nonprofit—a 'dark money' group. However, additional business filings show that Ardleigh Impact Corp. has an apparent twin entity—a private limited liability corporation called 'Ardleigh Impact LLC,' also registered in Delaware.

The new information increases the likelihood that Ardleigh Impact Corp. is, as the complaint alleges, specifically designed to function at least in part as a vehicle for anonymously funding political activity. However, the fact that Ardleigh Impact Corp. is a dark money nonprofit—and therefore permitted to participate in limited election activity—would also seem to rule out claims that it is a 'shell company,' potentially deflating one of the complaint’s arguments while simultaneously introducing new questions about transparency.

Common Cause Director of Legislative Affairs Aaron Scherb said, "501(c)(4s) are social welfare organizations that increasingly have been misused to spend money for political purposes. Under the IRS tax code, they don't have to disclose their donors. And so that's why they've become a popular vehicle for people who are trying to use dark money to influence political outcomes.”

CLC's director of reform, Saurav Ghosh, told the news outlet "that Ardleigh’s nonprofit status 'does not change the fact that it appears to have been used as a straw donor to funnel over $2.5 million to multiple super PACs.'"

Ghosh emphasized, "As our complaint makes clear, there is no indication that Ardleigh engaged in any activity from which it could finance these contributions without others giving it money for that purpose. And the apparent involvement of a well-known political operative only further supports the conclusion that Ardleigh was unlawfully used to conceal the true contributors’ identities from required public disclosure."

The Beast notes: "Tax regulations do not require nonprofits like Ardleigh Impact Corp. to disclose their donors, making it highly unlikely that the public will ever learn who funds the entity. By extension, that means the public will also likely never know the ultimate source of the millions of dollars that Ardleigh has already poured into those GOP groups—hence the 'dark' in 'dark money.'"

The Daily Beast's full report is available at this link (subscription required).

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