Coffman Files FEC Complaint Over 501(c)4 Hit Piece

It’s beginning to look like this year’s contentious primary contests are battling it out in court instead of at the ballot box. Republican Mike Coffman today filed a complaint with the FEC alleging Protect Colorado Jobs, a 501 c 4 non-profit, laundered corporate money to pay for an attack mailer last week.

Politicker CO reports:

The complaint alleges that the group, Protect Colorado Jobs, broke federal law when one of its officers, Denver consultant Curt Cerveny, arranged for and produced a mailer sent to every registered Republican in the 6th District late last month.

The Coffman campaign cited federal election law stating that it’s illegal for federal political campaigns to launder campaign funds through a non-profit corporation to evade contribution limits. …

The $15,000 mailer was paid for by two supporters of Coffman primary opponent Wil Armstrong, a source previously told PolitickerCO.com. However, Armstrong’s campaign has repeatedly denied having any knowledge about or involvement with the piece.

Armstrong manager Jack Stansbery declined to comment on the complaint Thursday.

Protect Colorado Jobs said Cerveny raised the money for the piece and produced it without their knowledge. Cerveny resigned from the group soon after his role in the piece was made public.

Protect Colorado Jobs immediately disavowed the mailer last week and forced Cerveny to resign as chairman, claiming he’d acted on his own without the organization’s blessing (the “rogue chairman” defense).

The Coffman campaign’s press release and gist of the complaint follow.

Here’s the Coffman release on its FEC complaint, as posted by Politicker CO:

Complaint with Federal Elections Commission

Highlands Ranch, CO – Secretary of State Mike Coffman, who is a candidate for Congress in the 6th District, has filed a complaint with the Federal Elections Commission (FEC), today, alleging that “Protect Colorado Jobs” a nonprofit 501(C) 4 committee violated federal campaign finance laws.

It is illegal under federal campaign finance laws for political campaigns for federal office to launder campaign funds through a nonprofit corporation in order to evade contribution limits.  The complaint will enable the Federal Election Commission to subpoena the bank records of “Protect Colorado Jobs” to see where the money came from to pay for the mailing against Coffman.

According to the complaint, Cerveny used the nonprofit 501(C) 4 committee, “Protect Colorado Jobs,” as a cover to pay for and send out a mass mailing against Coffman.  Curt Cerveny, was the treasurer for a nonprofit 501(C) 4 committee called, “Protect Colorado Jobs.”  John Berry, the attorney for “Protect Colorado Jobs” has publicly apologized to Coffman stating that the mailing was inaccurate and that Cerveny did not have the authority to do the mailing.  Cerveny has since resigned from the committee.

“Protect Colorado Jobs” has not come clean on who prepared the mailing, how it was paid for, and on whose behalf it was sent out.  Until they do, this mailing is their responsibility and they should bear whatever penalties are associated with having violated federal campaign finance laws,” said Coffman’s campaign manager Dustin Zvonek.

In a statement released earlier through the Coffman campaign, Congressman Tom Tancredo condemned the mailing as an underhanded attack against Coffman.  He said in a statement released thought the Coffman campaign “I will speak out against what I consider to be underhanded attacks on any candidate by individuals hiding behind the shield of an organization from which, they hope to obtain “cover.”  Apparently such an attack was launched against Mike Coffman.

And here’s the footnoted meat of the FEC complaint, also posted by Politicker CO:

Recital of Facts:

During the last week of July, 2008, approximately three weeks before the Republican primary for the 6th Congressional District, PCJ used corporate funds 1 to pay for an attack mailing against Coffman. 2  The attack piece was mailed to every Republican voter who requested a primary absentee ballot. 3  Cerveny signed PCJ’s corporate check to pay for the mailing .4

1 Information and belief based on statements from John Berry and Andrew Zuppa

2 Copy of mailing is attached as “Exhibit A”

3 Information and belief based on a sampling of Coffman supporters who received the mailing

4 Information and belief based on statements from John Berry and Andrew Zuppa

6 Community Comments, Facebook Comments

  1. CSU Ram Fan says:

    I could care less about their attacks on Coffman but there have been a ton of stories this cycle about 501(c)4s attacking the Senate candidates, congressional candidates and even ballot issues. It’s ridiculous that they don’t have to divulge who their donors are… it’s a big bad loophole if I’ve ever seen one.

  2. Danny the Red (hair) says:

    rogue chairman? give me a break.

    These 501(4)(c)s need more regulaion and consequences (jail) for their officers.

  3. Western Way says:

    they will come clean with this, because this could hurt there chances in the fall.  The 6th is extremely important to any ballot measure like this and they can’t afford to piss of 30,000 Conservative voters

  4. Western Way says:

    and here’s another (John Ingold reporting, 8/7/2008):

    On the campaign trail for the Republican nomination in the 6th Congressional District, Wil Armstrong often talks up his business experience.

    He brands himself as the “career businessman” in the race and talks about founding software company Blueberry Systems, based in Greenwood Village.

    But, up until the past month, Blueberry Systems’ website didn’t mention Armstrong as a founder.

    Instead, a page of executive biographies The Denver Post printed out on July 14 listed Bill Armstrong, Wil’s father and a former U.S. senator from Colorado, as founder. Wil was described as the company’s chief executive officer.

    Later that month, Wil Armstrong told The Post that he and his dad were co-founders of the company, along with a man named Lloyd Booth, who is also listed as a company executive on the website.

    The website now reflects that position, having been changed to describe Wil as “a founder and Chief Executive Officer.”

    The rest of Wil Armstrong’s bio on the page has remained consistent, noting his role as a vice chairman of Cherry Creek Mortgage Company, a firm his dad is chairman of. Wil Armstrong also served on the board of directors for Colorado Community Bank and was previously a director of Heritage Bank. He served for several years as a director for the Colorado Mortgage Lenders Association, including one year as its chairman.

    So his business bonafides are intact. Why the mid-campaign online bio change?

    “He says it’s likely that Lloyd just updated/corrected the site,” Armstrong’s campaign manager, Jack Stansbery, wrote in an e-mail. “The three of them founded the company.”

    A quick search of Secretary of State records provides no help. Blueberry Systems’ founder on the company’s articles of organization is listed as William Armstrong, a name that both Wil and his father officially share.

    http://www.politicswest.com/27

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