NYC’s campaign-finance tangle
Minor violations, major punishments
Imagine my surprise when a call to the newsroom turned out to be from the federal prison at Fort Dix, N.J. On the other end was Albert Baldeo, a former Democratic district leader from Queens serving an 18-month sentence for obstruction of justice related to his run for City Council in 2010.
“I never had a parking ticket before. Now I’m in federal prison, my life and career ruined,” Baldeo told me. He says he has lost 40 pounds since entering Fort Dix.
Baldeo’s tumble began two years ago. After losing a race against Ruben Wills to fill a vacant Council seat, Baldeo was charged with funneling money to his own campaign through friends and allies acting as so-called straw donors.
According to the indictment by the office of Manhattan U.S. Attorney Preet Bharara, Baldeo was trying to illegally disguise his own cash as legitimate donations in order to get a six-to-one match from the city’s Campaign Finance Board.
The board never paid out the matching funds, and at trial Baldeo was found not guilty of the straw-donor scheme. But Baldeo, a lawyer, had also told six of his acquaintances they had the legal right not to cooperate with the FBI or federal prosecutors. That led to charges of obstruction of justice, of which the jury found Baldeo guilty.
“This whole thing is wrong. Judicial and prosecutorial hypocrisy,” says Baldeo, citing a 1995 Supreme Court case, United States vs. Aguilar, in which the high court held that stalling or even misleading prosecutors doesn’t necessarily constitute the crime of obstruction. Baldeo lost an appeal in August and is now seeking a review by the full 2nd Circuit U.S. Court of Appeals in what is, legally speaking, a long shot.
Regardless of the ultimate outcome, Baldeo’s case highlights the unsettling frequency with which candidates and their supporters get caught up in the ambiguities of the city’s campaign finance program and the arbitrariness of how violations get investigated and punished.
Every election cycle, candidates from around the city commit literally hundreds of innocent and not-so-innocent goofs in the documentation and reporting of donations and expenses — but the consequences can vary wildly.
Sometimes violators get an opportunity to amend their filings or are asked to return or forgo matching funds for any questionable or unexplained donations. Other times, campaigns get fined massive amounts — and in still other cases, candidates or campaign volunteers can be criminally prosecuted. There’s virtually no way to predict what will happen.
In 2013, during the closing weeks of the Democratic primary for mayor, the campaign of then-city Controller John Liu was handed the political equivalent of a death penalty by the Campaign Finance Board, which refused to approve even a penny of matching expenses for the Liu campaign because two people — an outside fund-raiser and Liu’s 25-year-old treasurer — were convicted of lining up a small number of phony donations from straw donors. Liu, who was never charged personally, has taken the agency to court over the decision.
On Staten Island last year, after a fiveyear investigation, two workers from the 2009 campaign of City Councilwoman Debi Rose were arrested and indicted by a special prosecutor on trumped-up charges of — wait for it — getting $5,000 to work on the campaign but not submitting paperwork to justify the expenses.
And this month, the Advance Group, a consulting organization, was hit with a total of $25,000 in combined fines by the finance board and the state attorney general for allegedly coordinating the advertising for an independent advocacy group, NYCLASS, with two City Council campaigns also represented by Advance.
I say “allegedly” because the Advance Group, after years of back-and-forth with the board and the attorney general, agreed to pay the fines without admitting wrongdoing. Many smaller players don’t have the legal or financial resources for that.
Baldeo, for one, wishes he’d never gone near the matching funds program. “They suck you in, then they go for the kill,” he said. “And then they ask for more money for enforcement.”
The Campaign Finance Board and its good-government boosters need to overhaul the program before the 2017 citywide elections get underway. That means shortening the time frame for investigation, publishing a clear schedule of possible penalties and clarifying the criteria for deciding when and why cases get referred for criminal prosecution.
By treating even minor lapses like major crimes, the board risks scaring away honest grass-roots candidates — the very people it is supposed to be helping take the plunge into public service.