Foreigners and foreign governments are prohibited from spending money to influence U.S. elections, but thanks to the "Citizens United" decree, foreign-owned corporations have found a way.
by MICHAEL BECKEL, The Center for Public Integrity
A million-dollar donation by a foreign-owned corporation to a Republican super PAC has raised legal concerns and opened up the controversial Citizens United Supreme Court decision to new criticism.
Restore Our Future, the super PAC supporting Republican Mitt Romney’s run for president, received a $1 million donation in mid-August from reinsurance company OdysseyRe of Connecticut, a “wholly-owned subsidiary” of Canadian insurance and investment management giant Fairfax Financial Holdings Limited.
Fairfax Financial’s founder is Indian-born V. Prem Watsa. Watsa serves as CEO and chairman and owns or controls 45 percent of the company’s shares. He is also the chairman of the board of OdysseyRe, the American subsidiary.
The law says that any foreign national is prohibited from “directly or indirectly” contributing money to influence U.S. elections. That means no campaign donations, no donations to super PACs and no funding of political advertisements.
But campaign finance law is not as clear for U.S. subsidiaries of foreign companies as it is for individuals.
Most of the regulations on political spending by subsidiaries of foreign companies were written before corporations were legally allowed to fund political advertisements or donate to super PACs. And Republican members of the Federal Election Commission have thwarted the implementation of new rules regarding the practice.
Sen. Sheldon Whitehouse, D-R.I., is among those concerned about foreign-controlled corporations "exploiting loopholes in existing law" to influence U.S. elections. He calls the practice a “direct threat to our democracy.”
“You can bet that wholly owned subsidiaries of foreign commercial entities have an agenda when they spend millions to sway the outcome of an election,” Whitehouse told the Center for Public Integrity in a statement. “And you can bet that agenda is not promoting the interests of middle-class American voters.” [MORE]
Via Eric Byler