Problems related to foreign donors go beyond the Obama campaign and may extend to Vermont’s Congressional delegation

by Robert Maynard

CBS local Washington D.C web outlet is now referring to the Obama campaign’s entanglement with foreign donors as “Foreign-Donor-Gate” and GOP Chairman Reince Priebus is asking for an FBI investigation into this matter.  With all the focus on the Obama campaign’s turning to foreign donors to boost its fundraising totals, not enough attention is given to the fact that the report from the Government Accountability Institute, entitled “America the Vulnerable: Are Foreign and Fraudulent Online Campaign Contributions Influencing U.S. Elections?“, points to a problem that goes well beyond the Obama campaign.  According to their research, 47.3% of Congressional Campaigns may have issues as well, including all three members of Vermont’s delegation to Washington DC.

Here is an excerpt from the report’s summary:

The Government Accountability Institute (GAI or “the Institute”) conducted an extensive eight month investigation into the potential for foreign and fraudulent online campaign donations to influence House, Senate, and presidential elections. The findings are alarming. As FBI surveillance tapes have previously shown, foreign governments understand and are eager to exploit the weaknesses of American campaigns. This, combined with the Internet’s ability to disintermediate campaign contributions on a mass scale, as well as outmoded and lax Federal Election Commission rules, make U.S. elections vulnerable to foreign influence.

The Government Accountability Institute’s September 26th report, America the Vulnerable: Are Foreign and Fraudulent Online Contributions Influencing U.S. Elections?, is the first extensive analysis of the Internet’s role in facilitating illegal fraudulent contributions and campaign donation solicitations to foreign nationals.

Key findings include:

• Nearly Half of Congress Vulnerable to Fraudulent and Foreign Donations: Of the 446 House and Senate members who have an online donation page, 47.3% do not require the three or four digit credit card security number (officially called the Card Verification Value, or the CVV) for Internet contributions. The CVV is an industry standard anti-fraud credit card security feature used by over 90% of all e-commerce operations and nineteen of the twenty largest charities in the United States. By not protecting themselves with industry-standard security, larger campaigns pay millions of dollars in extra card processing fees that could otherwise be avoided with the use of the CVV

* The other industry-standard anti-fraud security feature is the software used to check a donor’s address against the address on file for the credit card. It is unknown whether federal campaigns protect themselves with this cross-referencing software (officially called the Address Verification System, or AVS). Unlike the CVV, it is difficult to tell if and to what degree a website uses the AVS.

To help people keep track of which members of Congress are vulnerable, the Institute created an interactive map here.  There is a higher cost in transaction fees associated with going the less secure route, so one would think that political campaigns would have an interest in making their web based financial financial transactions more secure, unless they are intentionally seeking out foreign donations.  As mentioned above, all three members of Vermont Congressional delegation to Washington D.C. are among those who are considered vulnerable.  This is a matter that concerned Vermonters may want to confront them with.  Here are a few suggestions from the report to help address the problem:

• Integrate safeguards to limit the solicitation of money from foreigners by requiring donors with foreign IP addresses to provide proof of U.S. citizenship before they can proceed to the donate page

• Immediately require campaigns to use industry-standard anti-fraud security technologies

including, but not limited to, the Card Verification Value (CVV) and a rigorous Address Verification System (AVS)

• Immediately require all campaigns to retain and disclose identifying information on all

online campaign contributions, including those falling under the $200 nondisclosure threshold currently allowed under federal law

• The Federal Election Commission (FEC) should enforce existing law concerning the solicitation and acceptance of foreign contributions to U.S. federal campaigns

Perhaps out Congressional delegation can be persuaded to become part of the solution, rather than remain part of the problem.