GOP committee hit with campaign money-laundering penalty

The Stanislaus Republican Central Committee has agreed to pay a $10,000 fine for laundering money to an unsuccessful candidate for state controller six years ago.

It’s the third time since 2008 that the committee has gotten in trouble with a state enforcement agency for deception in campaign finances.

The most recent penalty – the maximum allowed under law – is considered tentative until formally accepted March 17 by the California Fair Political Practices Commission, although Stanislaus players signed off on terms, the FPPC reported Monday.

Jim DeMartini, the local GOP committee chairman and a county supervisor, said the committee did no wrong but chose to pay the $10,000 fine rather than wage an expensive court battle.

“The FPPC is just extorting the money out of us,” DeMartini said. “We’ll hold our nose and pay it.”

Tony Strickland of Moorpark, who served 10 years in the state Legislature and was running for controller in 2010, by fall of that year had received the maximum amount of money allowed by law from Turlock businessman Matt Swanson and from William Templeton of Dallas, who “had significant business interests in oil and gas production and real estate” in Southern California, according to enforcement documents. But Strickland’s campaign got an extra $5,000 from Swanson and $15,000 from Templeton by funneling the money through the Stanislaus committee, the documents say.

The committee and its treasurer, Gary McKinsey, violated law by failing to disclose the true source and by submitting false information to keep people in the dark, the documents say.

“Failing to disclose intermediary and original contributor information is one of the most serious violations of the (Political Reform) Act because such conduct circumvents campaign contribution limits, violates disclosure requirements and deceives the voting public,” the decision reads.

Swanson’s contributions to Turlock City Council members have made recent headlines in an unrelated matter. His son-in-law, Peter Cipponeri, proposes to oust the Turlock Certified Farmers Market, run by a nonprofit board, and replace it with Cipponeri’s fledgling for-profit management company.

Through his businesses, Associated Feed and Prospector LLC, Swanson contributed $12,000 in two years to Turlock Mayor Gary Soiseth, amounting to a fourth of the mayor’s campaign money, and Swanson has spread another $10,000 total in recent years to the four other council members, a Modesto Bee review found.

Bidding for farmers market management could be settled as soon as Tuesday’s council meeting, scheduled to begin at 6 p.m. in the chamber at 156 S. Broadway Ave., Turlock.

The Bee in 2013 outlined the Stanislaus committee’s involvement in statewide GOP campaigns by taking $1.7 million from big spenders in 2011 and 2012 and funneling most to superheated races, including Strickland’s. FPPC enforcers at the time confirmed an investigation into the local group’s pooling and distributing cash.

The local central committee got a slap on the wrist in 2009, but no fine, for helping a San Diego politician, Joel Anderson, launder money to his own campaign. In 2014 the committee shared a $40,000 fine with Sen. Tom Berryhill, his brother and the GOP committee in San Joaquin County; Berryhill had skirted contribution limits by illegally shifting $40,000 from his campaign to help his brother, Bill, win a close Assembly race in 2008, an administrative law judge concluded after a six-day trial.

Parties paid the Berryhill fine without admitting wrongdoing, but the case was cited in the recent decision as evidence of the local GOP committee’s “concurrent enforcement history for similar conduct.”

“We dispute it, but we don’t really have the money to fight in court,” DeMartini said Tuesday. “The FPPC has a war against central committees. We’ve had to deal with these people before, several times.”

This story was originally published March 8, 2016 at 7:09 PM with the headline "GOP committee hit with campaign money-laundering penalty."