Relying on Herman Cain’s Chief Of Staff Mark Block to investigate his own financial dealings is “like asking Willie Sutton to hire an independent counsel,” a former Cain regional field staffer told TPM in an interview this week.
The staffer, who worked with Block and implemented his campaign strategy, said the famous smoker is not to be trusted to get to the bottom of whether, as documents appear to show, his company Prosperity USA footed the bill “for tens of thousands of dollars in expenses for such items as iPads, chartered flights and travel to Iowa and Las Vegas” to get the Cain campaign off the ground.
“I would have absolutely no confidence in him hiring an independent counsel,” the ex-staffer — who is not affiliated with any other campaign — said. “I think that needs the government to look into what happened there.”
“Would I trust Mark Block?” the ex-staffer asked. “Resoundingly no.”
The former Cain field staffer said the Block story hurts because it means donors were lied to.
“These donors, [they] wanted their money used the way it was promised to them, not diverted to some other projects,” the ex-staffer said. In the end, the former Cain supporter — who told TPM that respect for the candidate has turned into disillusionment — said it was hard to understand why Cain’s still raising money with Block at the helm of the campaign.
“To keep giving money — the last people who drank Kool-Aid didn’t fare so well,” the staffer said.
Records show that the largest asset Prosperity USA had was the nearly $40,000 that “FOH” — Friends of Herman Cain — owed the organization, including “nearly $15,000 for an ‘Atlanta invoice,’ about $17,000 for chartered flight service and $5,000 for travel and meetings in Iowa, Las Vegas, Houston, Dallas and Louisiana.” Documents also said the Cain campaign was billed $3,700 for iPads purchased on Jan. 4.’”
In DC Wednesday, Block himself declined to talk about the story, saying only that he’s “retained independent counsel to look at the Milwaukee Journal Sentinel story and report back to us.”
That’s the most Block was going to say. On Fox Monday, Cain claimed total ignorance.
“I’m not aware of this report, my staff has not had time to go through it,” he said. “I didn’t even know about the report until you brought it up on the show.”
The overwhelming view of the campaign finance community is that the transactions are most likely illegal and at the very least should be investigated by the Federal Election Commission (FEC) and the Internal Revenue Service (IRS). Here’s a roundup of viewpoints solicited by TPM and expressed to other media outlets.
Democracy 21 President Fred Wertheimer: “As a 501(c)3 tax exempt organization, Prosperity USA is barred from making any contributions and or expenditures in connection with political activities, so this would appear to be a clear violation of the tax laws. Secondly, if Prosperity USA is providing any funds to directly benefit the Cain campaign, those would appear to be corporate contributions to or expenditures on behalf of the campaign, and would clearly violate the campaign finance laws. Other than that, they’re in good shape.”
Wertheimer said the transactions should be looked at by both the IRS and the FEC. “We have three FEC commissioners who seem to be uninterested in enforcing the campaign finance laws. But the bottom line here is that based on what we know this appears as clear violations of the tax laws and the campaign finance laws, assuming the Prosperity funds went to benefit the Cain campaign. The FEC and the IRS both have an obligation to investigate this.”
Trevor Potter of the Campaign Legal Center: “While it is illegal for a federal candidate to use corporate resources to pay for a federal campaign, candidates may enter into ‘normal course of business’ arrangements with corporate vendors. The article refers to tax status problems for the corporation, but I cannot tell if it is/was a 501 c3 prohibited from engaging in political activity, or what. Certainly the allegations of absent or errneous reporting would be taken seriously by the FEC, if true.”
The Campaign Legal Center’s Paul S. Ryan: “It certainly looks like some laws were probably broken,” Ryan says. “It is hard to say, because this is such a mess. The attorneys who were in charge of this did not have a good grip on campaign finance law.”
Former FEC General Counsel Lawrence H. Norton: “If they are supporting his campaign, whether directly or indirectly, they are violating the law.”
Campaign finance expert Larry Noble: “It does appear to be problematic if all these transactions occurred and none of it is showing up in [Cain’s] reports. It’s illegal not to report something, and the contribution could be illegal.”