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June 27, 2005

Fingering Frist

Those little $1.44 million loans—they always come back to bite you:

Earlier today, Citizens for Responsibility and Ethics in Washington (CREW) filed a complaint with the Federal Election Commission (FEC) against Senate Majority Leader Bill Frist and his 2000 Senate campaign committee, Frist 2000, Inc.
The complaint alleges that the Frist 2000, Inc. failed to disclose a $1.44 million loan taken out jointly by Frist 2000, Inc. and by Frist’s 1994 campaign committee, Bill Frist for Senate, Inc., making it appear that Frist 2000, Inc. had significantly more money that it actually had.
In June 2000, Senator Frist took $1 million of the money that had been contributed to his 2000 Senate campaign and invested it in the stock market, where it promptly began losing money. In November 2000, Senator Frist sought to collect $1.2 million he had lent his 1994 Senate campaign committee. As a result of the stock market losses, however, Frist 2000, Inc. did not have enough money to repay the loan. Senator Frist solved this problem by having the 1994 and the 2000 campaign committees jointly take out a $1.44 million bank loan at a cost of $10,000 a month interest. Frist 2000, Inc. did not report this debt on its FEC disclosure forms.

The Federal Election Campaign Act (FECA) requires full disclosure of all loans taken out by campaign committees; Frist 2000 failed to do this (although his dormant 1994 campaign did file). The loan papers were all signed by Frist himself.

Melanie Sloan, CREW’s executive director, said “it appears that Senator Frist deliberately broke the law by failing to disclose the $1.44 million loan in Frist 2000, Inc.’s FEC filings. Senator Frist was clearly trying to hide the fact that his 2000 campaign was over a million dollars in debt. Given the large sum of money involved and the fact that the violation appears to have been knowing and willful, the FEC should refer this matter to the Department of Justice for possible criminal prosecution.”

Will be interesting to see what happens next…

Posted by Stephen at 11:46 AM in Politics | Permalink | TrackBack (0)

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