Q: Is it legal for candidates to raise funds overseas for a presidential race?
A: Yes, but they can’t legally accept donations from individuals who are neither U.S. citizens nor permanent U.S. residents.
U.S. political candidates may legally take donations from American citizens or from permanent residents of the United States wherever they happen to live, even if the money is raised overseas.
We received a few questions on this topic as a result of a trip Sen. John McCain took to the United Kingdom this month. It has been reported that McCain was scheduled to attend a fundraiser in London, which led some readers to believe non-U.S. citizens were donating to his campaign. However, donations made during the $1,000-a-plate luncheon are subject to the same FEC rules as fundraisers in the United States.
Many readers also will recall the "Chinese money" scandal that erupted during Bill Clinton’s 1996 reelection campaign. The Democratic National Committee returned $3 million in illegal or otherwise questionable contributions after much of it was discovered to be from foreign nationals. The affair prompted televised Senate hearings. A special Department of Justice Campaign Finance Task Force eventually resulted in a variety of criminal charges against 27 persons, most of whom were found guilty, the last one in 2003. The Federal Election Commission also fined the DNC $115,000, part of a total of $719,500 in civil penalties, mostly assessed to donors.
According to the Federal Election Commission, political candidates are not allowed to receive campaign donations from foreign nationals. Foreign nationals include: foreign governments, political parties, corporations, associations, partnerships, persons with foreign citizenship, and non-permanent resident immigrants. Permanent residents, or "green card" holders, may donate to political candidates.
Foreign nationals are allowed to undertake some political actions in the U.S., as long as those actions are not "connected with any election to political office at the federal, state, or local levels." For example, an FEC advisory opinion (the FEC’s interpretation of the Federal Election Campaign Act, which it is charged with administering), established that foreign nationals may underwrite issue-oriented ads as long as they do not mention "candidates, political offices, political parties, incumbent federal officeholders or any past or future election."
-Emi Kolawole and Brooks Jackson
Foreign Nationals. Jan. 2003. U.S. Federal Election Commission. 22 Mar. 2008.
1997 Special Investigation in Connection with 1996 Federal Election Campaigns. Senate Committee on Homeland Security & Governmental Affairs. 24 Mar. 2008.
ERNEST G. GREEN PLEADS GUILTY TO TAX VIOLATIONS. 21 Dec. 2001. U.S. Department of Justice. 24 Mar. 2008.
FORMER DEMOCRAT FUNDRAISER MARK B. JIMENEZ PLEADS GUILTY TO FEDERAL TAX EVASION AND ELECTION FINANCING CHARGES. 1 Aug. 2003. U.S. Department of Justice. 24 Mar. 2008.
Record. Nov. 2002. U.S. Federal Election Commission. 24 Mar. 2008.
Edsall, Thomas B and Edward Walsh. "FEC Issues Record Fines in Democrats’ Scandals; Commission Faults Players in 1996 Foreign Fundraising." The Washington Post. 21 Sep. 2002: A05.