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Legal Weed, Campaign Secrets And Saudi Golf

Welcome to the Checks & Imbalances newsletter. Today we look at how political committees can make secret payments.

“Five hours north on Route 101 from San Francisco to Humboldt County, through a few cool redwood groves, Johnny Casali turns on a wood chipper and empties 55 pounds of pot into the chute,” reports Will Yakowicz:

Casali grew cannabis illegally under the California sun for four decades. Now a state-licensed grower, he’s destroying what used to be his cash crop.

“It doesn’t matter how good your product is; there’s so much supply in California that it’s a race to the bottom,” says Casali, founder of the Garberville-based Huckleberry Hill Farms, which produces about 500 pounds of craft cannabis a year from the two small greenhouses in his backyard in America’s weed country . “It feels like I’m a lettuce farmer right now—I’m working on the smallest of small margins.”

Cannabis legalization was supposed to make a slew of entrepreneurs rich—including “legacy” operators, a coy euphemism for what used to be called drug traffickers, dealers and illegal growers. It was supposed to take something widely used and erase the criminal element from it. But of course, America’s politicians are blowing it. Thanks to overregulation, overtaxation and state-by-state inconsistencies, the biggest no-brainer in the history of capitalism—legalizing the world’s most popular illicit drug—is turning into a massive market failure.

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In Case You Missed It

Jordan’s Campaign Avoids Disclosing How Much It Paid Big Lie-Peddling Attorney

Attorney Cleta Mitchell, a peddler of the Big Lie whom the Jan. 6 committee has subpoenaed, represented Rep. Jim Jordan’s (R-Ohio) campaign in a recent Federal Election Commission investigation. The FEC, however, has no record of payments from the campaign to her or her firm.

That’s because, rather than paying Mitchell, the campaign paid its treasurer, Thomas Datwyler of 9Seven Consulting, who in turn compensated Mitchell, according to a campaign spokesperson. The workaround allowed the campaign to keep its payment to Mitchell out of public filings.

“Our treasurer, who is responsible for our accounting and compliance, employs several attorneys in various capacities that do legal work on our behalf,” said Kevin Eichinger in a statement. “He pays her, along with his other staff. There’s no story here.”

Such an arrangement could be legal, according to an attorney specializing in campaign-finance law. “Campaign committees are only required to report the initial recipient of campaign funds,” said Brett Kappel of Harmon, Curran, Spielberg & Eisenberg. “They do not have to report the identity of any subvendors that are the ultimate recipient of campaign funds. There is an exception to that rule in cases where the initial recipient is merely a conduit that is being used to prevent the disclosure of the identity of the ultimate recipient of campaign funds.”

After receiving Mitchell’s legal services, Jordan’s campaign settled the inquiry investigation in June by paying a $60,000 civil penalty and promising to stop violating campaign-finance law.

Watch: How Much Has Trump Made From Mar-A-Lago?

FEC Asks Cruz-Aligned PAC For Details About Vague $35,000 Expenditure

The FEC asked Truth and Courage, a super PAC aligned with Sen. Ted Cruz (R-Texas), to provide details about his $35,000 payment in May to Alamo Marketing for “event entertainment services.”

It’s no wonder the agency has questions about the payment, given that Alamo Marketing seems to have appeared out of nowhere. No other political committees in the FEC’s database have reported paying the company. The firm’s address is a UPS store in San Antonio. There is no company with that name and address registered as a taxable entity in Texas. And searches on Google and Lexis Nexis for a company with that address returned zero results.

Truth and Courage, whose treasurer did not respond to a request for comment, has until Sept. 12 to respond to the FEC.

Majors, Monopolies, Megabucks And Donald Trump: Inside The Business Of The New Saudi Golf League

“With limited revenue, astronomical signing bonuses and enormous purses, LIV Golf has run up quite a tab. But the real surprise is that Saudi Arabia’s nascent golf super league isn’t just “sports washing.” It could turn a profit—and soon,” reports Justin Birnbaum:

Hundreds of fans roar as former President Donald Trump approaches the first tee at his country club in New Jersey for LIV Golf’s Bedminster Invitational. Dressed in a white polo and a red “Make America Great Again” hat, he waves, takes pictures and signs autographs, even pointing to the crowd when one fan asks if he plans to run in 2024. The excitement is palpable as the leading group , which includes the former world no. 1 golfer Dustin Johnson, prepares to tee off on the tournament’s final day. Outside, there’s a much different tone. Protesters have sweltered in 80-degree July heat for days, just to register their discontent with the money behind LIV.

“I’ve known these people for a long time in Saudi Arabia, and they have been friends of mine for a long time,” Trump had told reporters earlier that week. “They’ve invested in many American companies. They own large percentages of many, many American companies, and frankly, what they are doing for golf is so great, what they are doing for the players is so great. The salaries are going to go way up.”

Continuing Irresolutions

Updates on Checks & Imbalances’ previous reporting

Last month, the bipartisan House Committee on Ethics disclosed that it voted unanimously to dismiss referrals alleging that Reps. Pat Fallon, Chris Jacobs and Thomas Suozzi had broken the law by failing to report their securities transactions within 45 days. The nonpartisan Office of Congressional Ethics had referred the lawmakers to the panel, separately, having found “substantial reason to believe” Fallon and Suozzi violated ethics laws, while Jacobs “may have” done likewise.

Fallon (R-Texas) failed to file timely disclosures for 122 transactions valued at more than $9 million between January and December 2021, according to a disclosure. Last September, Suozzi, a New York Democrat on the House Ways and Means Committee, reported more than $6 million of trades dating back to January 2017. Also in September, Rep. Jacobs (RN.Y.) disclosed 13 securities trades, totaling more than $356,000, made between Jan. 19 and July 16.

“The committee concluded that there was not clear evidence that the errors and omissions in the members’ periodic transaction reports were knowing or willful and that the members were generally unclear on the requirements relating to [the] filings,” committee Chair Ted Deutch (D-Fla) and then-Ranking Member Jackie Walorski (R-Ind.) said in a statement last month.

*****

Former Director of National Intelligence and Congressman John Ratcliffe (R-Texas) continued to pay his wife to manage the books for his largely dormant campaign last quarter. From March 2021, when she became its treasurer, through June 2022, the campaign paid Michele Ratcliffe $39,000 for “compliance service,” according to a filing it submitted to the Federal Election Commission.

Payments to Mrs. Ratcliffe, a partner at the Rockwall, Texas law firm of Lamberth Ratcliffe Covington, made up 59% of the campaign’s spending in the second three months of the year.

Tracking Trump

Forbes continues to update “Tracking Trump: A Rundown Of All The Lawsuits And Investigations Involving The Former President.”

“Former President Donald Trump will host a fundraiser at his Bedminster Golf Club in New Jersey for Texas Attorney General Ken Paxton, who is battling a liberal Democratic challenger in the November general election,” the Washington Examiner reported on Monday. Paxton’s campaign already funneled $50,000 in campaign funds to Trump via Mar-a-Lago.

  • “Judge Will Consider Thursday Whether To Release More Detailed Mar-A-Lago Search Documents” (Forbes)
  • “Trump Claims FBI Took His Passports In Mar-A-Lago Raid” (Forbes)
  • “Trump Executive Nears Plea Deal With Manhattan Prosecutors” (The New York Times)
  • “Trump’s Site Is Being Weaponized Against the FBI — and Their Families” (Rolling Stone)
  • “Trump’s Truth Social company ordered to turn over Devin Nunes information” (Reuters)
  • “The long list of episodes that stoked security concerns at Trump’s Mar-a-Lago” (The Miami Herald)
  • “Inside Trump Promises To Match Donor Contributions By Eyebrow-Raising Amounts” (Talking Points Memo)
  • “Mike Pence is heading to the Hamptons and being hosted by the Manhattan GOP for a fundraising event there. Who’s one of the hosts? Andrea Catsimatidis, the chairwoman of the Manhattan GOP and daughter of billionaire John Catsimatidis. Catsimatidis backed Trump” (Twitter/Brian Schwartz of CNBC)
  • “Trump PAC Pushing Baseless Voter Fraud Claims Reportedly Paid $60K to Designer Known for Styling First Ladies” (People)

Editor’s Picks

  • “Former Member of Congress Charged with Multiple Fraud Schemes” (Department of Justice)
  • “Rand Paul’s latest fundraising email has the following subject line: ‘the FBI probably planted evidence.’ (The message itself doesn’t say that.)” (Twitter/Derek WIllis of Merrill College)
  • “Biden senior advisor Anita Dunn has to divest investment portfolio worth between $16.8 million and $48.2 million to avoid conflicts” (CNBC)
  • “Why Abortion Has Become a Centerpiece of Democratic TV Ads in 2022” (The New York Times)
  • “Anti-Trump GOP group spends big to shrink its base” (Politico)
  • “Senate GOP Campaign Arm Slashes TV Ad Buys in Three States” (The New York Times)
  • “More formula providers lobby up” (Politico)
  • “FBI confirms review of delegate’s ethics probe” (The Guam Daily Post)
  • “Gov. Ron DeSantis is headlining a fundraising dinner for Rep. Lee Zeldin’s governor’s bid in New York in late August. $25,000 per plate for VIP dinner.” (Twitter/Shane Goldmacher of the New York Times)
  • “Rep. Curtis hires Alpine Group lobbyist” (LegiStorm)

In Closing

“Ask him a question, he glances off, he obfuscates, he dances”

—Lin-Manuel Miranda, “The Election of 1800”

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