Governor Newsom Only Fined $13k by FPPC for Failing to Report $12M Behested Payment From T-Mobile
CA Governor Gavin Newsom failed to report eighteen behested payments from 2019 to 2024 which were triggered by a Franchise Tax Board audit regarding his candidate-controlled committee
Today, November 21, 2024, the Fair Political Practices Commission (FPPC) approved a decision, stipulation and order regarding the matters of California Governor Gavin Newsom at the Commission Meeting. Newsom failed to report eighteen behested payments to the FPPC between 2019 - 2024.
The Commission’s consent calendar summarized the matter as follows:
In the Matter of Newsom for Governor 2018 and Gavin Newsom; FPPC Nos. 21/299 and 21/644.
Staff: Marissa Corona, Senior Commission Counsel. Respondents were represented by Tom Willis of Olson Remcho LLP. This matter arose from an audit performed by the Franchise Tax Board’s Political Reform Audit Program. Gavin Newsom was a successful candidate for Governor of California in the November 6, 2018 General Election. Newsom for Governor 2018 was Newsom’s candidate-controlled committee. The Committee and Newsom failed to timely report subvendor payments on a pre-election campaign statement, in violation of Government Code Sections 84303, and 84211, subdivision (k) (1 count). Between 2019 and 2024, Newsom failed to timely file behested payment reports from various payors, in violation of Government Code Section 84224 (7 counts). Total Proposed Penalty $13,000.
The stipulation’s introduction stated:
Respondent Gavin Newsom (“Newsom”) is the Governor of the State of California. Newsom was elected as Governor in the November 6, 2018 General Election. Case number 2021-00299 originated from seventeen filing officer referrals alleging Newsom failed to timely file eighteen behested payment reports for payments of more than $5,000. Case number 2021-00644 originated from a Franchise Tax Board (“FTB”) audit regarding Newsom’s candidate-controlled committee Newsom for California Governor 2018 (“the Committee). Newsom served as the Committee treasurer. Newsom violated the Political Reform Act (the “Act”)1 by failing to timely file certain behested payment reports for payments of more than $5,000 between 2019 and 2024. The Committee and Newsom violated the Act by failing to timely disclose sub-vendor payments. Respondents cooperated with the Enforcement Division by entering into a tolling agreement with respect to the statute of limitations.
The summary of facts stated:
Newsom was elected Governor of California in 2018 and is currently in office. Between 2019 and 2024, various payors made eighteen payments of $5,000 or more to entities at Newsom’s behest. For each of these payments, Newsom failed to timely file a corresponding behested payment report with the Governor’s Office within 30 days and thereafter with the Fair Political Practices Commission. However, all eighteen behested payment reports were filed prior to Enforcement Division contact. Below is a chart summarizing the late behested payment reports:
Subvendor Payments
The Committee was the subject of a FTB Audit for the period of January 1, 2015 through December 31, 2018. The audit report found the committee substantially complied with the disclosure and recordkeeping provisions of the Act. However, the report also found the Committee failed to report $1,123,180 in subvendor payments on the preelection campaign statement covering the period of July 1, 2018 through September 22, 2018. The Committee amended the statement on November 6, 2018, the date of the election, to disclose $1,108,771 in subvendor payments. The Committee also amended the statement on July 31, 2019 to disclose $14,409 in subvendor payments, the remaining subvendor payments that had not been previously disclosed.
What is a behested payment?
Under California's transparency laws, an elected official who fundraises or otherwise solicits payments from one individual or organization to be given to another individual or organization may be required to report the payment. Generally, a payment is considered "behested" and subject to reporting if it is made:
At the request, suggestion, or solicitation of, or made in cooperation, consultation, coordination or concert with the public official; and
For a legislative, governmental or charitable purpose.
Behested payments subject to reporting do not include gifts made principally for personal purposes, or contributions made for election-related activity to the elected official. While state law limits the amount of gifts and campaign contributions an official may receive, there are no limits on behested payments. However, a reportable behested payment that also results in any personal benefit to the official may be considered a gift to the official even when the payment is not made principally for personal purposes. To the extent a behested payment results in a personal benefit, the payment may require additional reporting as a gift and be subject to the gift limit. State law requires the reporting of behested payments if they total $5,000 or more per calendar year from a single source.
Officials must report the behested payments within 30 days of the date on which the payment meets or exceeds $5,000 from a single source.
‘And the devil who had deceived them was thrown into the lake of fire and sulfur where the beast and the false prophet were, and they will be tormented day and night forever and ever.’ -Revelation 20:10