FACT WIN: FEC Finds Violation Against Shadowy Pop-up Group that Spent Millions on Election Ads
Updated: May 12
“News for Democracy” Group Found Violating Federal Law After Having No Website, Contact Pages, or Emails, Yet Spending Millions in Ads on Facebook
Washington, D.C.— May 8th, 2023—The Federal Election Commission has acted on a complaint filed by the Foundation for Accountability and Civic Trust against News for Democracy and imposed a $25,000 civil penalty against them.
On October 25th, 2018, the non-partisan ethics watchdog, the Foundation for Accountability and Civic Trust (FACT), filed a complaint requesting the Federal Election Commission (FEC) investigate the organization News for Democracy for failing to register with the FEC and file required reports despite spending millions of dollars on digital ads in the 2018 election cycle.
News for Democracy was a secretive organization that spent over $5 million on political advertising on Facebook, which made them a major player in the 2018 election on par with Super PACs, candidates, and other political entities. In fact, over a two-week period in September, News for Democracy was the “second-largest political ad buy[er] on Facebook ... trailing only Beto O’Rourke’s Texas Senate campaign.”
Despite this high level of influence and large expenditure, it was difficult if not impossible to find out who was behind these ads. This is partly due to the organization having no website, no contact page, and no email address--incredibly, they did not even make any standard filings with the FEC that would identify any actual individuals involved. In short, News for Democracy was the definition of a "shadow group" and there is no evidence that they undertook any activity aside from running political ads.
On April 4th, 2023, the FEC found that News for Democracy was in violation of two federal laws: (1) 52 USC section 30104(c)(1) requiring it to report independent expenditures; and 52 USC30120(a) requiring it to include appropriate disclaimers on the ads. Both of these laws are extremely important because they alert the public to the fact that these ads are not "news" and enable citizens to evaluate the veracity of the ads based upon who is paying for them. Thus, a $25,000 civil penalty was imposed against News for Democracy.
“What News for Democracy did was utterly shocking and scandalous. The organization was created right before an election, proceeded to spend millions of dollars on ads without the public knowing who was behind them, violated federal law in doing so, and then disappeared. This type of shadow group is a worst case scenario for democracy and everything that federal election law is designed to prevent. It is unfortunate they ran these ads, but ultimately we are pleased the FEC held them partially accountable and enforced a civil penalty in this case," said Kendra Arnold, Executive Director of FACT.
For more context and information read:
the FEC holding here;
the FEC's counsel's report here;
the 2018 piece written by the Atlantic that is quoted above here.
FACT is a nonprofit organization promoting accountability, ethics, and transparency in government and civic arenas. For more on FACT, visit: http://www.factdc.org/