Sunday, October 26, 2008

Obama Funding Scam Gets MSM Scrutiny, Finally

I noted last night, in "Obama's Criminal Fundraising Machine," the paucity of mainstream press coverage of Barack Obama's campaign finance irregularities.

There is a
big page-one Washinton Post story out today, so maybe we'll see a little more attention to this in the days ahead:

Sen. Barack Obama's record-breaking $150 million fundraising performance in September has for the first time prompted questions about whether presidential candidates should be permitted to collect huge sums of money through faceless credit card transactions over the Internet.

Lawyers for both the Republican and Democratic parties have asked the Federal Election Commission to examine the issue, pointing to dozens of examples of what they say are lax screening procedures by the presidential campaigns that permitted donors using false names or stolen credit cards to make contributions.

"There is so much money coming in and yet very little ability to say with certainty that you know who is giving it," said Sean Cairncross, the Republican National Committee's chief counsel.

While the potentially fraudulent or excessive contributions represent about 1 percent of Obama's staggering haul, the security challenge is one of several major campaign-finance-related questions raised by the Democrat's fundraising juggernaut.

Concerns about anonymous donations seeping into the campaign began to surface last month, mainly on conservative blogs. Some bloggers described their own attempts to display the flaws in Obama's fundraising program, donating under such obviously phony names as Osama bin Laden and Saddam Hussein, and reported that the credit card transactions were permitted.

Obama officials said it should be obvious that it is as much in their campaign's interest as it is in the public's interest for fake contributions to be turned back, and said they have taken pains to establish a barrier to prevent them. Over the course of the campaign, they said, a number of additional safeguards have been added to bulk up the security of their system.

In a paper outlining those safeguards, provided to The Washington Post, the campaign said it runs twice-daily sweeps of new donations, looking for irregularities. Flagged contributions are manually reviewed by a team of lawyers, then cleared or refunded. Reports of misused credit cards lead to immediate refunds.

In September, according to the campaign, $1.8 million in online contributions was flagged, and $353,000 was refunded. Of the contributions flagged because a foreign address or bank account was involved, 94.1 percent were found to be proper. One-tenth of one percent were marked for refund, and 5.77 percent are still being vetted.

But clearly invented names have been used often enough to provoke an outcry from Republican critics. Donors to the Obama campaign using false names such as Doodad Pro and Good Will gave $17,375 through 1,000 separate donations, with no sign that they immediately tripped alarms at the campaign. Of more concern, Cairncross said, are reports that the campaign permitted money from 123 foreign nationals to enter its accounts.
The article minimizes the significance of the improper donations, as just "1 percent" of Obama's haul. The problem is that no one knows for sure how much of the Obama war chest was generated by Democratic money bundlers, wealthy individuals using infinite aliases, or corrupt foreign funnelling Third World money into an American presidential election.

Captain Ed notes:

[Stanley] Mosk never thinks to ask the one question that has already occurred to conservative bloggers. What makes the Obama campaign different from online retail operations? After all, we have spent almost 15 years buying and selling products and services on the Internet, and retailers know how to protect themselves and their customers. They employ a system that compares the billing information on the order to the information in the credit-card system — and when they don’t match, the sale gets denied. Credit-card companies have gone an extra step in recent years by adding a security code to protect against fraudulent use.

The McCain campaign apparently uses these systems to prevent fraud. Why doesn’t Team Obama? That’s the pertinent question. Systems have existed for years to prevent exactly the kind of fraud that has occurred in Obama’s fundraising. Why did Team Obama deliberately avoid using them?

The Obama team's running an underground finance operation, as I reported in my Pajamas Media piece, "
Obama’s Fundraising Fraud."

The Obama campaign finance scandal is one of the stories that wouldn't have seen the light of day without the conservative blogsphere breaking it wide open.


UPDATE: See also, Bradley Smith, "
Obama's Huge Haul Should End This Fight," who notes:

Obama's epic fundraising should put to rest all the shibboleths about campaign finance reform - that it is needed to prevent corruption, that it equalizes the playing field, or that tax subsidies are needed to prevent corruption.
I touched on this in my piece, "Obama’s Fundraising Fraud."