A 90-minute recording released over the weekend shows President Donald Trump giving the inside scoop on policy and rollbacks of regulations to mega-rich donors attending a fundraising dinner for his preferred super PAC.
Most of those attending the April 2018 private dinner gave six- or seven-figure sums to America First Action, a super PAC backing Trump. The recording illustrates how donors gain access to candidates by bankrolling an outside group supporting them. It appears to undermine key promises from Supreme Court justices in Citizens United v. FEC that independent spending would not be a corrupting influence on candidates, that corporate spending would be coupled with disclosure and that foreign money would not infiltrate elections.
Conversations at the dinner, recorded by Soviet-born businessman Igor Fruman, reveal that Trump listened to private business concerns of major donors to the only “official” pro-Trump super PAC. In the recording, Trump and donors discuss topics including steel imports from foreign countries, oil opportunities in West Texas and trade negotiations with China, which Trump referred to as off-the-record information.
“I don’t think anybody donates money [to super PACs] without thinking that they’re probably going to get something eventually for that investment,” said Melissa Smith, an associate professor of communications at Mississippi University for Women. “We’re talking millions of dollars here and you’re giving that for a reason. I think we’re pretty naive if nobody thinks that happens.”
Fruman and his business partner, Lev Parnas, made a $325,000 contribution to America First Action in May 2018 through an obscure limited liability company called Global Energy Producers. Their link to the shell company was revealed months later in an investigation by the Daily Beast. Following a complaint from the Campaign Legal Center, the two were charged last year with routing foreign money to the pro-Trump super PAC. They pleaded not guilty.
The recording was released by Parnas’ lawyer Joseph Bondy on Saturday “given its importance to our national interest,” Bondy said in a tweet. Trump has said he doesn’t know Parnas or Fruman, a claim undermined by video and audio evidence, including another recording released by Bondy Thursday.
Parnas and Fruman weren’t the only donors in attendance who gave money to the super PAC through an LLC. A voice believed to belong to invitee Wayne Hoovestol, the owner of trucking companies in the Midwest, was heard discussing the need for a new highway to be used by self-driving trucks. Hoovestol never gave to America First Action. But OpenSecrets revealed that an obscure LLC with apparent links to Hoovestol gave $250,000 to the pro-Trump super PAC. The contribution was made the same day as the dinner, according to FEC filings.
America First Action spent $29 million boosting Republican candidates during the 2018 midterms. When the super PAC aired attack ads against key Democrats in May 2018, voters did not know who was behind the shell companies listed as contributors to the group. But Trump was aware of the individuals behind the LLCs, illustrating how “dark money” is often a mystery to the public but not to candidates benefitting from it.
Voters already have a tough time discerning who is funding political ads and where they are coming from, Smith said.
“Most people don’t know anything about campaign finance,” said Smith. “In general, they aren’t following the money, and it’s not easy to follow the money.”
LLCs gave record amounts to outside groups in the two most recent election cycles, totaling $35 million in 2016 and $17 million in 2018. Watchdogs are concerned these opaque corporations can be used as vehicles to unlawfully import foreign money into U.S. elections, as Parnas and Fruman are accused of doing on behalf of a Ukrainian businessman.
The potential for foreign money extends beyond shell companies. U.S.-based subsidiaries of foreign corporations give to outside groups. So do U.S. companies controlled by foreign nationals.
Wheatland Tube, a subsidiary of steel company Zekelman Industries, gave $1.75 million to America First Action, with its first $1 million gift coming just before the dinner. The contribution was reportedly approved by the Canadian CEO Barry Zekelman, who was lobbying the Trump administration over its steel tariffs.
A voice on tape presumed to belong to Zekelman complains about the prevalence of foreign steel shipped from China to other Asian countries and regulations that limit hours truck drivers can be on the road. He also strongly encouraged Trump to apply the same quota deal with South Korea to other countries that import steel to the U.S., where South Korea agreed to cut U.S. steel imports by 30 percent.
“If you use that number for most of the bad players, what I call the dirty dozen, if you will, that would solve everything,” Zekelman said to Trump.
The list of attendees was not disclosed for the intimate dinner, but the New York Times reported the names of some attendees and OpenSecrets identified other pro-Trump donors at the table from the recording. Others in attendance included Donald Trump Jr., Stanley Gale of Gale International, Jack Nicklaus III and natural gas tycoon Karen Buchwald Wright and husband Thomas Rastin.
At one point, Trump asks donors specifically how their businesses are doing and, at times, interrupts them by explaining what regulations his administration has rolled back to help that particular industry.
Buchwald Wright, owner of Ariel Corp, and Rastin gave America First Action a total of $750,000 in six installments in 2018. They also gave $13,500 directly to Trump’s campaign.
Donors involved in the natural gas compression industry, which Buchwald Wright and Rastin are part of, also had a candid dialogue with Trump about what changes are best for their bottom line, like relying less on renewable energy sources, lowering emission regulations and the need for new refineries. In response, Trump told them his administration is planning to roll back emission standards.
This was not the first time big-dollar donors gained special access to the Trump administration. In December 2016, Politico reported that the Trump administration gave more access to donors after his election and before his inauguration in recent modern presidential history. In June 2017, another group of donors including Ken Griffin and Doug DeVos were invited to a White House briefing.
The majority in Citizens United argued that independent spending to support or oppose candidates could not corrupt officeholders like direct campaign contributions could. But outside groups such as America First Action act effectively as arms of the candidates’ campaigns that can accept unlimited contributions, allowing donors to buy more influence by giving in larger amounts.
America First Action also operates a sister dark money arm, a politically-active nonprofit called America First Policies that does not disclose its donors. That’s another channel through which foreign actors and other special interests could attempt to gain access to Trump — without disclosing their contributions to the public.
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