The Associated Press reported on Sunday that the DNC plans to sue the FEC to force an investigation into McCain's unilateral withdrawal from the public financing system.
A lawsuit against the Federal Election Commission, to be filed Monday in U.S. District Court, questions the agency's ability to enforce the law and review McCain's decision to opt out of the system. The Republican presidential candidate, who had been entitled to $5.8 million in federal funds for the primary campaign, decided earlier this year to give up that money so he could avoid strict spending limits between now and the GOP's national convention in September.
McCain has already spent over the public campaign funds limit for the primary season. The fear is that with so many empty seats on the FEC, there will not be a quorum of commissioners who could take any action in enforcing the violations. This lawsuit is designed to force FEC action on the complaint filed by the DNC on February 25. You may also recall the complaint filed March 25 by Jane Hamsher of FDL, which was earlier reported here on DKos
Here is the video of Jane delivering the complaint to the FEC, along with her commentary of the violation.
In a letter to the FEC, McCain stated that public funds had "not been pledged as security for private financing." However, these loan documents show otherwise. The DNC noted back in February that McCain securitized a loan with the promise of public financing.
In order to receive matching funds, John McCain signed a binding agreement with the FEC to accept spending limits and to abide by the conditions of receiving those funds. The FEC makes clear that any request to withdraw from the agreement must be granted by the FEC. In other words, McCain can't just unilaterally withdraw. FEC Chairman David Mason made this clear in a letter to McCain advising him that the law requires the FEC to approve his request to withdraw from his contract.
According to past Commission rulings, the McCain campaign would not be allowed to withdraw from matching funds because it has already violated a key condition for being let out of the program - pledging matching funds as collateral for a private loan. McCain obtained a $4 million line of credit -- drew $2,971,697 from it - and documents make clear that the promise of public financing was used to secure his loan.
The New York Times reported the specifics of the potential violation.
Mr. McCain had applied for public financing for the primary for his campaign when his campaign was struggling but he decided to bypass the system after his fundraising improved. The public financing system gives candidates access to millions of dollars in matching money from a taxpayer fund but forces them to abide by strict spending caps before the party conventions. Mr. McCain has by now exceeded the $54 million cap that he would have been bound by under public financing
We are already living through an Administration that believes that it can unilaterally disregard regard the law, including the recent refusal to enforce Congressional contempt citations. Can we afford to have a presidential candidate who also chooses to ignore the law?
McCain pretends to be a champion of clean campaign financing, but once again his actions do not match his words.
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UPDATE: h/t Lujane for adding this in the comments:
as quoted from CNN in February:
Dean told reporters McCain has already used the prospect of nearly $6 million in federal matching funds -- which he now says he won't claim -- as collateral for a January campaign loan and to obtain automatic ballot access in every state (bolding Lujane).
which is
a benefit to McCain that Dean estimated at between $2 million and $3 million.