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Obama, Romney set to take donations via text

Small contributions to be charged to cellphone bills

- The Washington Times - Thursday, August 23, 2012

The Obama campaign will begin accepting donations by text message in coming days, and the Romney campaign is expected to follow suit, as both candidates are ready to embrace a new fundraising method that could empower small donors, but also comes with some new legal and ethical concerns.

Obama officials announced Thursday that they will soon begin accepting $10 donations by text, becoming the first political campaign to do so since the Federal Election Commission gave its blessing to the practice in June.

The agency, which opted not to allow text donations in 2010, is now moving ahead with the technology, but will require a system of safeguards that it hopes will weed out the kinds of fraudulent and illegal donations that have occurred as a side effect from the rise of online fundraising.

"The FEC is being very careful about disclosure and eligibility concerns, but they are really making an effort to act quickly and stay on top of new technology," said Derek Lawlor, a lawyer with the Covington and Burling LLP law firm, which advises super PACs and other clients on campaign-finance issues. "I'd say the safeguard processes that they have are pretty extensive."

FEC guidelines would allow contributors to send a maximum of $10 per text and would bar them from sending more than $50 a month or $200 in a campaign cycle to a single candidate.

Contributors must also be 18 or older, hold U.S. citizenship and cannot donate on behalf of corporations.

The Obama campaign will let donors send $10 by texting the word "GIVE" to 62262. The numbers' corresponding letters spell out "OBAMA."

An official with the Romney campaign said it will soon launch its own text-to-donate operation, in which contributors will likely send messages to 466488, which spells out "GOMITT."

Donors will be charged in their monthly phone bills.

"Accepting small donations by text message will help us engage even more grass-roots supporters who want to play a role by donating whatever they can afford to the campaign," Obama campaign manager Jim Messina said in a statement Thursday.

While text contributions could lead to a rise in small donations, they will also force campaigns to increase their efforts to verify donors' identities and enforce maximum-contribution laws.

Online donor fraud has been a thorn in the side of many political campaigns, including Mr. Obama's 2008 campaign, which turned in a record haul from online donations.

Critics accused the campaign of doing too little to verify the contributions after reports surfaced that some were given using fake names or prepaid credit cards, or came on behalf of foreign donors.

Obama officials defended their verification process, pointing out that the FEC requires campaigns to identify and refund illegal contributions, but does not require them to reject the money upfront. The campaign has maintained that it screened all contributions after receiving them and refunded those that they found were given improperly.

Responsibility for vetting text donations will fall on the political campaigns and the third-party aggregators that they hire to collect contributions and donor information from phone-service providers.

Phone companies have expressed concerns about being held liable if their cell users exceed the maximum donation amounts or donate illegally, but will not be subject to any penalties, according to advisory legal opinions issued by the FEC.

The phone-service providers will be able to choose for which campaigns it wants to allow text donations, based on whether they consider an arrangement to be commercially viable. The providers and third-party aggregators would be entitled to a portion of each donation.

While no donor system is entirely foolproof, Mr. Lawlor said, he expects that the rules in place are relatively uncontroversial and will minimize fraud.

"It's good to see people from different parties and from reform groups supporting this and thinking it's a good idea," he said. "I think a lot of the processes are going to prevent any of the concerns that are out there."

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