Salon reports that a leadership PAC affiliated with Sen. Ted Cruz (R-TX) “paid hundreds of thousands of dollars to a mystery company that had previously bought copies of Cruz’s book, according to recent filings with the Federal Election Commission.”
The expenses raise questions about whether the controversial conservative senator (and Cancún frequent-flyer) used those political campaigns, and Donald Trump’s attempt to subvert the democratic process, to raise money for himself. That could push the FEC to issue a ruling on a pending issue that could have consequences for former President Donald Trump’s fundraising.
Over the course of 2020, the Cruz-affiliated Jobs, Freedom, and Security PAC paid $1.2 million — nearly 80% of its operating budget — to a company called Reagan Investments LLC for “sponsorship advertising.” The only other committee to register any disbursements to that company was Trump Make America Great Again, for a fundraising promotion for Cruz’s books in December, according to The New York Times. However, the Trump group clearly marked the payment for “collateral: books”; campaign finance experts told Salon that the PAC’s payment classifications — all of them for “sponsorship advertising” — were unusual and opaque.
On Jan. 4, 2021, the day Cruz traveled to Georgia before the runoff elections, his leadership PAC reported a $240,000 expense for “sponsorship advertising” to Reagan Investments, which appears to correlate with another series of small-dollar donations that poured into the PAC over the next few days. It isn’t clear how much of the funds raised, if any, went to Republican runoff campaigns: Cruz’s PAC only spent a few thousand dollars in support of former Sen. Kelly Loeffler. In fact, most of the contributions rolled in after the runoffs were over and as the events surrounding the Jan. 6 insurrection were playing out, while Cruz joined a handful of Republican Senators to object to the counting of Electoral College votes.
According to Salon, legal experts said “if the money was for promotional book sales, as the filings may suggest, then the leadership PAC could be using Reagan Investments as a pass-through to allow Cruz to keep the royalties, which are generally between 10% and 15% for hardcover books, and about half that for paperbacks.”
“Political candidates are not allowed to do that through their campaign committees,” Salon noted.
But the experts also said that the vague “sponsored advertising” classification makes it difficult to reach a conclusion without further clarification.
Image credit: Screengrab / Senator Ted Cruz / YouTube