Joint Fundraising Alleged In Probe Of Campaign Activity
An affidavit filed recently in Oklahoma County District Court contains claims that members of a high-profile political consulting firm and an independent "dark money" group improperly joined forces to demand donations to candidates and to the dark money group.
The search-warrant affidavit was filed last week by the chief investigator for the Oklahoma County District Attorney’s Office as part of the office’s investigation into alleged campaign law violations.
The reference to the fundraising was the first description to emerge in the investigation of specific campaign activities alleged to involve illegal campaign coordination. Under federal and state laws, candidates and those running their campaigns cannot coordinate with independent expenditure groups.
According to the affidavit, individuals reported that employees of the political consulting firm, AH Strategies, and a co-founder of the “dark money” nonprofit, Oklahomans for a Conservative Future, approached people and "demanded" they donate money to both the dark money group and candidates being promoted by the consulting firm. The affidavit suggested “coordination and collusion” could be involved to promote the same candidates.
When the affidavit was filed Thursday, District Attorney David Prater said that his office’s inquiry had now become a criminal investigation. Illegal coordination would violate federal laws in congressional races and state laws in state and local races.
Fount Holland, owner of AH Strategies, denied in a written statement to Oklahoma Watch that his firm carried out any improper coordination with Oklahomans for a Conservative Future.
'There was absolutely and unequivocally no coordination.'
“There was absolutely and unequivocally no coordination,” Holland wrote.
A co-founder of the dark-money group, Xavier Neira, was alleged in the affidavit to have teamed with AH Strategies to contact people demanding donations. Neira, a construction company executive, could not be reached for comment.
The affidavit does not mention any candidates by name. But Prater’s office said in June that it was looking into complaints involving Oklahomans for a Conservative Future and the campaign of former House Speaker T.W. Shannon, of Lawton, who ran in the Republican primary for U.S. Senate and lost to U.S. Rep. James Lankford. AH Strategies ran Shannon’s campaign. Neira was a member of Shannon’s exploratory committee.
Oklahomans for a Conservative Future was formed a few days after Shannon announced his candidacy in late January and spent nearly $1.3 million before the June 24 primary, records show. It took out several ads supporting Shannon or attacking Lankford, who was supported by a similar group that did not spend as much money.
Prater also said he is investigating possible collusion between the campaign for Joy Hofmeister, of Tulsa, who won the GOP primary for state schools superintendent, and a separate dark money political group. AH Strategies also ran Hofmeister’s campaign. Hofmeister denied that her campaign engaged in any illegal coordination.
The term “dark money” is used because such organizations do not have to reveal their donors and can spend unlimited amounts in political campaigns.
Prater’s office would not be able to pursue illegal-coordination charges related to Shannon’s campaign because enforcement of campaign laws in federal races falls to the Federal Election Commission or the U.S. Department of Justice. Prater could refer any findings to a federal agency.
OETA reporter Bob Sands explores the growing use of "dark money" groups in Oklahoma campaigns and the implications for the political system.
However, the affidavit, filed by Gary Eastridge, Prater’s chief investigator, also says state laws may have been broken. The laws cited in the affidavit prohibit the use of an intermediary or conduit to steer donations in order to avoid campaign contribution limits. The laws also prohibit corporations from donating to candidate committees and ban the use of a computer to violate any state law. Prater could refer findings about state races to the Oklahoma Ethics Commission as well as file criminal charges.
The affidavit, submitted to a judge on July 18, lays out in more detail how the inquiry into campaign activities began.
The document says that the district attorney’s fact-finding effort began after an Oklahoma City police officer in May arrested Chad Alexander, a lobbyist and political consultant, in his car after seeing him purchase cocaine during surveillance of a known drug trafficker at a restaurant. The officer later got a warrant and seized Alexander’s two cell phones. In looking for evidence related to drugs, the officer came upon text messages related to Alexander’s interaction with political candidates and organizations. A broader search warrant was obtained to inspect more messages on Alexander’s laptop, based on statements made by those contacting the District Attorney’s Office and alleging improper campaign actions by Alexander and others.
Alexander’s attorney could not be reached for comment.
Alexander and Neira co-founded Oklahomans for a Conservative Future, and Alexander ran the organization, although he stepped down after his arrest. He is a former partner of AH Strategies. The vice president of his consulting firm, Stephanie Milligan, ran the dark-money group that bought attack ads against Hofmeister’s key opponent, State Superintendent Janet Barresi, according to records and interviews by Oklahoma Watch.
After the arrest, the affidavit says, the DA’s Office was contacted by “multiple persons regarding the alleged criminal violations by Chad Alexander … These persons are all involved in political, campaign, lobbying and/or fundraising activities, but do not wish to be named for fear of political and/or financial reprisal … All are gainfully employed, upstanding citizens with no criminal record.
“…Some of these persons have alleged that they were approached by Xavier Neira, a co-incorporator of Oklahomans For a Conservative Future with Alexander, and AH (Strategies) personnel who demanded they donate both to the Super-Pac (Oklahomans for a Conservative Future) and to the candidates being promoted by AH Strategies.”
While the affidavit calls the dark money group a “Super PAC,” Oklahomans for a Conservative Future is actually a 501(c)(4) “social welfare” nonprofit organization. Unlike a Super PAC, it does not have to disclose its donors.