A divided Federal Election Commission has dismissed a complaint against rapper Pras Michel, a co-founder of the Fugees who funded a pro-Barack Obama super PAC in 2012.
A complaint filed last year by two campaign finance reform advocacy groups alleged that Michel had violated federal law by giving money to super PAC Black Men Vote through his company — known as SPM Holdings LLC — without disclosing that he was the source of the funds.
The super PAC spent $1.3 million during the 2012 election supporting Obama’s re-election. Since then, limited liability companies have increasingly been used to bankroll a range of liberal and conservative super PACs.
The FEC’s recent move, announced last week along with decisions in three other years-old cases involving super PAC donations from limited liability companies, shows how divided its six commissioners are on whether certain corporate vehicles are skirting political disclosure requirements.
The FEC’s three Democratic-appointed commissioners argued that Michel should be sanctioned for using his limited liability company to inject $875,000 into Black Men Vote during the fall of 2012 without identifying himself as the true source of the money.
The FEC’s Republican commissioners acknowledged that, “under certain circumstances,” LLC contributions to super PACs may violate the federal prohibition on giving money in the name of another donor.
But, they concluded, this case was not one of them.
Part of the reason why not? The FEC’s office of general counsel concluded that SPM Holdings LLC was “an active business entity” and “not merely a ministerial conduit or vehicle for transferring Michel’s contributions.”