F. Harvey Whittemore was convicted of funneling $145,000 to Senator Reid’s 2010 reelection campaign by distributing the money to relatives and employees who subsequently used the funds to make contributions to Reid within the allowable $4,600 per person limit.
The three-judge panel of the San Francisco-based Ninth US Circuit Court of Appeals unanimously affirmed Mr. Whittemore’s conviction. A jury found him guilty in 2013 of making excessive campaign contributions, making contributions in the name of another, and of making a false statement to a federal agency.
He was sentenced to two years in prison.
Reid, who was then Senate leader, was not charged in the case.
According to the appeals court decision, Whittemore sent the money to 17 individuals. Those who were single received $5,000, and those who were married received $10,000, for a possible double contribution.
Each contributor was allowed to keep the remaining $400, according to federal prosecutors.
Whittemore’s lawyers had argued that his actions did not violate federal campaign finance laws because he was merely making $5,000 and $10,000 gifts to each of the individuals. It was up to them to decide on their own whether to contribute to Reid’s campaign.
At his two-week trial, a federal judge refused to instruct the jury on Whittemore’s theory of defense.
If upheld as legal, Whittemore’s theory would have opened a massive hole in campaign finance restrictions.
On appeal, his lawyers argued that under Nevada law Whittemore’s gifts became the property of the recipients and, thus, could not violate federal campaign finance statutes.
The appeals court said Whittemore’s theory was “not supported by law.” The court added that the jury had received enough evidence to gauge whether Whittemore possessed the requisite level of intent to violate federal law.
According to court documents, the campaign contribution effort began in February 2007 when Whittemore pledged to raise $150,000 for Reid’s reelection by March 31.
After two follow-up calls from Reid’s campaign asking for the money, Whittemore transferred $145,000 to his relatives and employees. All of them used the money to make contributions to Reid, according to the appeals court.
Some of the recipients testified at trial that they could not have made such large contributions without the transfer from Whittemore.
The recipients testified that Whittemore told them the funds were “bonuses” or “gifts.” But they said he also encouraged them to make contributions to the Reid campaign, the appeals court said.
One employee told the jury that he thought he might lose his job if he didn’t write a check to the Reid campaign.
Shortly after the contributions were made, Whittemore’s assistant sent a spreadsheet to the Reid campaign listing each of the donors.
Of 33 individual names listed as contributors, 13 were identified as employees of Whittemore’s firm, Wingfield Nevada Group. Two others were identified as employees of a Wingfield subsidiary.
Two weeks later, and two days before the Reid campaign was required to file a quarterly fundraising report with the Federal Election Commission, Whittemore sent the Reid campaign a new list of contributors, according to the appeals court.
The same 33 donors were listed, but now only four of the donors were identified as Wingfield employees. Instead, several were identified as employees of Wingfield subsidiaries, with company names that did not suggest a tie to Wingfield and Whittemore, according to the court.
Whittemore’s lawyers also argued in their appeal that after the Supreme Court’s decision in the Citizens United case, contribution limits were no longer enforceable. They said the limits violated Whittemore’s free speech and association rights under the First Amendment.
The appeals court brushed that argument aside, noting that rather than eviscerating campaign contribution limits at issue in Whittemore’s case, the Supreme Court’s decision reinforced them.
The case is US v. Whittemore (13-10515).