The House Ethics Committee has closed an inquiry into Massachusetts Democrat Lori Trahan, over allegations that her campaign accepted contributions in excess of federal limits and failed to make appropriate disclosures. The panel voted unanimously to dismiss the inquiry, and released a full report Thursday.
“The Committee did not find that Representative Trahan acted in violation of House Rules, laws, regulations, or other standards of conduct,” the report states.
The matter began with complaints to the Office of Congressional Ethics about late injections of hundreds of thousands of dollars to Trahan’s primary campaign in 2018, prompting questions about where the funds originated. Trahan went on to narrowly prevail in a crowded 10-person Democratic race; she loaned her campaign $300,000 from a joint checking account she shares with her husband, David, en route to her win.
Federal law places no limit on the amount candidates can contribute to their own campaign accounts. But spouses are bound by the same individual contribution limit — $2,700 during the 2018 cycle — as other donors.
The House Ethics report, dated July 15, states that the couple’s prenuptial agreement is what made clear to the committee the appropriate origin of the significant last-minute loan.
The report digs into the details of the prenuptial agreement, which went into effect in November 2007 and stipulated that “all wages, salary and income” between the couple are defined as marital property and each Trahan has “equal rights in regard to the management of and disposition of all marital property.”
“Based on the prenuptial agreement, the Committee found that Representative Trahan’s loans to the Campaign were from her personal funds, not excessive contributions from her
husband,” the Ethics Committee wrote.
On the related allegations that Trahan filed improper or incomplete financial disclosures, the committee reported no wrongdoing.
“The Committee also found no evidence that Representative Trahan’s omissions of required information or errors on her Financial Disclosure Statements and FEC reports were knowing and willful, and accordingly, did not merit further action,” the report says.
The House Ethics panel said Trahan’s filing errors and omissions were common and not malicious.
The report said that between 20 percent and 30 percent of all financial disclosure statements reviewed by the panel each year contain errors or require a corrected statement, and went on to say that errors are often illuminated by media reports or outside groups, as was the case with Trahan.
“The Committee found no evidence that Representative Trahan’s omissions on her Financial Disclosure Statements were knowing or willful. To the contrary, her amendments show her good faith effort to comply with the disclosure requirements,” the report states.
The committee did direct Trahan and her campaign to be in touch with the Federal Election Commission to ensure accurate disclosures going forward, especially in areas in which FEC guidance is lacking, such as revolving lines of credit.
“The respected House Ethics Committee — made up of Democrats and Republicans — investigated this matter thoroughly and has now unanimously confirmed what I’ve always maintained: that my campaign acted ethically and that these baseless accusations were just politics. Serving the people of the Third Congressional District continues to be the greatest honor of my life, and I will continue to focus on addressing the needs of the people I represent,” Trahan said in a statement Thursday after the release of the report.
The committee did raise concerns about money from David Trahan’s funds that was subsequently reported as a series of personal loans from the joint checking account the couple share. On two occasions, Trahan dated the checks on the last day of the fundraising quarter and reported them to the FEC as personal loans obtained on that date.
In those two instances, the joint checking account had insufficient funds to cover the amounts and shortly after the date appearing on the checks, David Trahan transferred money into the joint checking account.
The committee wrote that the dates of receipt and deposit of the funds raise questions about whether the candidate intentionally reported the loans ahead of the transfers with the goal of increasing her cash-on-hand numbers at the close of the quarterly reporting periods, a major benchmark of the health of a campaign.
“Even though such conduct may be permissible under FEC regulations, the Committee cautions Representative Trahan that, as a Member of the House, she is expected to act in a manner that reflects creditably upon the House and should ensure accuracy and transparency in her campaign activities,” the committee wrote.
In April 2019, the Foundation for Accountability and Civic Trust filed a complaint with OCE, an independent agency that investigates alleged misconduct by members of Congress, questioning the source of the funds.
In September, OCE sent a confidential report to the House Ethics Committee. That report urged the panel to open a probe “because there is substantial reason to believe that Rep. Trahan’s campaign committee accepted personal loans and contributions that exceeded campaign contribution limits” and that she “failed to disclose required information in her congressional candidate financial disclosure reports or FEC campaign committee filings.”
In November 2019, the House Ethics Committee announced it would extend its inquiry into Trahan, which it eventually closed this week.
Chris Marquette contributed to this report.