- The Washington Times - Friday, February 17, 2012

When Newt Gingrich’s presidential campaign disclosed in October that it planned to pay the candidate $70,000, the transfer was unusual for a campaign committee. But weeks ago, the former House speaker revised his bill for the third quarter: He actually expected to personally receive $115,000 to reimburse himself for expenses during that period.

The campaign would not explain how the candidate forgot about and then found $45,000 in receipts. Far beyond that payment, the destinations of dollars donated to Mr. Gingrich’s campaign are being obscured by the unprecedented use of a clearly prohibited tactic, The Washington Times found — one that has accompanied the flow of the better part of $1 million in unexplained cash to Mr. Gingrich, family members and top staffers.

The money was reportedly to reimburse Mr. Gingrich and employees for unspecified expenses in what amounted to petty cash exceeding their entire salaries, The Times’ analysis of federal records showed. But the campaign would not say what those expenses were. The Federal Election Commission (FEC) requires the ultimate recipient of campaign dollars to be spelled out [-] even, it specifies, if a staffer originally fronts the money.

Mr. Gingrich was footing various expenses and getting reimbursed rather than having the campaign pay bills like other political committees do because no bank would give the Gingrich campaign a credit card, said spokesman R.C. Hammond.

The only way the petty-cash technique to avoid disclosure would be permitted, election lawyers said, is if receipts were spread across so many companies that not a single one received more than $200.

“That’s an enormous amount of money, and not $200 wound up in the same place? I find that extraordinarily hard to believe,” said Brett Kappel, an election lawyer for Arent Fox LLC, a law firm and lobbying group based in Washington.

Mr. Hammond did not contest the improbability of that, instead offering a novel reason for shirking FEC orders: The campaign chose to disregard the rules, he said, because there were not criminal penalties for doing so.

“I’ve never seen a major presidential campaign run this way — but I’ve only been doing this for 21 years,” Mr. Kappel said of the failure to disclose how money is spent. “This is the kind of issue where you get audited.”

In fact, the FEC flagged the issue on Sept. 22, reminding Gingrich officials that they may not merely report that significant amounts of money were paid to reimburse middlemen for other, untold expenditures. If staff foot a travel bill and are reimbursed, the underlying bills must be disclosed, unless the cumulative total spent by the campaign at each store, hotel, restaurant or other vendor remains less than $200 — a procedure clearly and extensively laid out in FEC materials.

FEC official Chris Jones wrote that as soon as the $200 threshold is crossed, reimbursement reports “must include the complete name and address of the original vendor, as well as the date, amount and detailed purpose of the advance” and ordered the Gingrich campaign to amend its report by itemizing payments or making a note on each certifying that it did not pass the threshold.

He added that some of the campaign’s non-reimbursement payments were too vague, pointing to ones that simply said they were for “operations services.”

“Failure to adequately respond by [Oct. 27] could result in an audit or enforcement action,” he wrote.

Curt reaction

When the Gingrich campaign responded — a month late, on Nov. 29, and without making any changes — its reaction was curt.

“The committee has reviewed all reimbursements to individuals for travel and subsistence and confirms that no further itemization is required,” treasurer Lisa Lisker wrote.

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