Colbert Super PAC continues to face legal hassles

It’s been interesting to watch comedian Stephen Colbert’s stunt regarding his efforts to establish a PAC that can accept unlimited corporate contributions. While originally intended to highlight so-called ‘reformers’ objections to the Citizens United decision, I think it’s actually providing his viewers with an inside look at just how convoluted, complex, and stifling our current system of campaign finance regulations are.

I’m not alone in this view. Our friends at the Institute for Justice wrote an op-ed for the Wall Street Journal, ‘Stephen Colbert’s Free Speech Problem,” that explains:

Comedy Central funnyman Stephen Colbert, like most of his friends and allies on the left, thinks that last year’s Supreme Court ruling in Citizens United v. FEC is, literally, ridiculous. To make his case that the ruling invites “unlimited corporate money” to dominate politics, Mr. Colbert decided to set up a political action committee (PAC) of his own. So far, though, the joke’s been on him.

The hilarity began last month, when Mr. Colbert began to have difficulty setting up his PAC, which is a group that can raise money to run political ads or make contributions to candidates. So he called in Trevor Potter, a former Federal Elections Commission (FEC) chairman who is now a high-powered Washington lawyer.

Mr. Potter delivered some unfunny news: Mr. Colbert couldn’t set up his PAC because his show airs on Comedy Central, which is owned by Viacom, and corporations like Viacom cannot make contributions to PACs that give money to candidates. As Mr. Potter pointed out, Mr. Colbert’s on-air discussions of the candidates he supports might count as an illegal “in-kind” contribution from Viacom to Mr. Colbert’s PAC.

Since Mr. Potter delivered his news, Colbert’s PAC has turned into a ‘Super PAC,’ one that doesn’t contribute directly to candidates but makes independent expenditures and accepts unlimited funds. But his travails continue, as now Viacom’s lawyer’s are telling him that because of the difficulty in valuing any in-kind contribution made by them by allowing their employees and assets to be used promoting the PAC, they would really, really prefer he not set up a PAC.

Now Colbert is possibly in more trouble with the law. In May, when he came to Washington DC to request an opinion from the FEC regarding the valuation of a Viacom in-kind contribution (with cameras in tow, of course), he waded into a throng of fans shaking hands and collecting cash. You can watch the video here.

Collecting that cash may pose problems for Mr. Colbert, though, and now his lawyers are having to explain. Talking Points Memo reports:

Stephen Colbert: Cash For Handshakes Outside FEC Went To Me, Not Colbert Super PAC

Stephen Colbert is assuring the Federal Election Commission (FEC) that the dollar bills he collected in exchange for handshakes outside of their building last month went to him and not the “super PAC” he’s hoping to form.

“Colbert Super PAC is not yet a legal entity and no individual is accepting contributions on its behalf. Funds collected by Mr. Colbert from the crowd outside the Commission after he filed his Advisory Opinion Request were not contributions to the PAC; they were $1 bills received by Mr. Colbert personally as payment for shaking his hand,” three lawyers working for Colbert wrote.

The report doesn’t specify what laws or regulations Mr. Colbert would have been in violation of if the cash were intended as contributions, although I spotted this as a possible violation if they were in fact contributions and he hadn’t yet deposited them into an account (CFR 103.3(a) requires they be deposited in an account within 10 days of being received).

I was actually interviewed for an upcoming episode of the Colbert Report on his Super PAC (expected to be aired before the end of this month), one of the more bizarre experiences I’ve had since I’ve been at CCP. I’d intended to bring this up but hadn’t, apparently the eagle-eyed folks at the FEC also caught this or some other potential violation connected to Colbert’s cash-for-handshakes foray.

One of the points I made several times during the interview (about an hour and a half, which I expect to be reduced to about 4 minutes of pure mockery) is that campaign finance laws are complex, convoluted, and burdensome. I’m not sure he believed me. Now that he’s had to rely on three attorneys to explain to the FEC that the $31 cash he collected (plus some watches and a baby, if his skit is to be taken seriously. Accepting the watches as “contributions” instead of gifts would pose additional legal problems, and it should go without saying that the baby as a “contribution” opens up a whole other set of issues) was not intended for the PAC but for personal use, perhaps he’ll begin to see the light?

The Center for Competitive Politics is now the Institute for Free Speech.