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In wake of scandal, campaign finance changes considered

Henry Vandermeir/California Democratic CouncilKinde Durkee, shown teaching a workshop in 2008, has been charged with mail fraud in federal court.

Various interest groups jockeyed at a California Fair Political Practices Commission hearing last week as commissioners debate changing campaign finance rules in response to the Kinde Durkee embezzlement scandal, but the agency first must determine whether the changes would require new legislation.

FPPC Chairwoman Ann Ravel suggested the agency institute stricter training requirements for campaign treasurers and post results of investigations of treasurers on its website.

The commission was soliciting public comment from people affected by the alleged embezzlement. The commission will seek additional public comment at its Oct. 13 meeting, which will be held at the Los Angeles County Board of Supervisors office, to reach more people affected by Durkee’s arrest.

Several Democratic organizations – including the Democratic Foundation of Orange County, a political action committee, and the California Democratic Party – encouraged the commission to consider allowing donors who had previously contributed the legal maximum to candidates who used Durkee as their treasurer to donate again.

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Durkee’s company, Durkee & Associates, used First California Bank for most of its campaign accounts. For many organizations, only Durkee could access the funds directly. After Durkee was arrested and charged with mail fraud in federal court Sept. 2, First California Bank froze all accounts Durkee used. The elected officials and nonprofit organizations that used Durkee to manage their funds cannot access the funds until all of the money is accounted for.

If candidates cannot access their funds, or if the funds no longer exist, it puts them at a disadvantage heading into the 2012 election cycle through no fault of their own, advocates argued.

“All we’re asking the Commission to do is to put the victimized political leaders and committees back into a situation that allows them to seek what the law allows them to have,” wrote Dan Jacobson, chairman of the Democratic Foundation of Orange County, in a letter [PDF] submitted to the commission.

Good-government group Common Cause disagreed, writing to the commission that exceptions should be made only on a case-by-case basis to candidates who demonstrate a reasonable hardship. The organization “strongly opposes any attempt to permit contributors to give over the maximum contribution limit for any reason. Ultimately, candidates are responsible for the funds they raise and the maintenance of those funds. Loss (sic) funds, regardless of fault, are not a convincing reason to allow for increased corruption by moneyed interest,” the group wrote [PDF].

Others argued that the commission should relax rules regarding candidates’ legal defense funds. First California Bank has asked a judge to determine how to return the affected funds to their proper owners, but that process will mean that candidates pay more in legal fees, attorneys argued.

Attorneys like Karen Getman, who represents Assemblyman Jose Solorio, D-Anaheim, who was named in the indictment of Durkee and who is believed to be missing $700,000, argued that elected officials should be able to use the funds for legal expenses relating to recovering money from Durkee. Current law allows their use only for “defense against a civil or criminal proceeding, or for defense against a government agency’s administrative enforcement proceeding arising directly out of the conduct of an election campaign, the electoral process, or the performance of the officer’s governmental activities and duties.”

The FPPC has advised candidates about filing forms designating a new campaign treasurer and the deadlines for doing so (within 10 days of the treasurer’s appointment). It also has told candidates that they can open a new campaign committee if their old committee’s bank accounts cannot be accessed.


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