A super PAC spending millions of dollars to bash Ted Cruz’s Republican rivals is shielding the names of many of its top donors and strategists, accepting and directing donations through a particularly high number of hard-to-trace companies, new documents reveal.
Stand for Truth, Inc., an emerging player in the orbit of often clashing constellation of pro-Cruz super PACs, recently pledged to air more than $4 million in television ads to back Cruz in Iowa and South Carolina. Super PACs can accept unlimited contributions but are required to disclose their financial backers.
The twist here is that Stand for Truth has accepted more than $1 million in donations from corporations or limited liability companies, whose funders are difficult to uncover, meaning the original source of the campaign cash is hidden. While corporations can make donations to super PACs, an LLC allows individual donors to steer cash through easy-to-register, self-owned organizations.
“LLCs seem to be a new vehicle for laundering money into elections,” said Paul Ryan, a campaign finance reformer worried about donors essentially using them as shell companies to transfer cash anonymously. “It’s really hard to find out about LLCs. That’s one of the reasons they’ve become popular.”
Stand for Truth has largely operated quietly, not responding to questions about new television advertisements from media and discarding with the in-the-news public profile maintained by many powerful groups in favor of a sparse website.
No leadership beyond the treasurer who filed its federal elections forms, a former counsel to Mitch McConnell named Eric Lycan, has publicly identified itself. Lycan has not responded to repeated requests for comment from CNN about the group’s activities, and he declined to talk by phone this week. He did say in an email on Friday that the group was run by “consultants from across the country committed to electing a courageous conservative as our next President.”
The main hand behind the super PAC is Josh Robinson, a former political director of the Republican Governors Association who now heads RedPrint Strategy, Lycan confirmed. Another name behind the group, Lycan said, is a Texas strategist named Keats Norfleet, who did not respond to requests for comment.
Overall, Stand for Truth raised nearly $2.5 million last year in the brief time it had before the December 31 filing deadline. On Thursday, it purchased an additional $800,000 in negative advertisements attacking Marco Rubio in South Carolina.
There is no evidence that routing the LLCs was a coordinated attempt to avoid disclosures, but the amount of cash donated is substantial.
Of the 29 individual contributions made to the group between Nov. 20 and Dec. 31, more than half of the gifts were not immediately connectable to an individual donor, the FEC report shows. On December 21, for instance, five seemingly identical donations in equal increments of $50,000 came from five different LLCs — “LL Baltimore, LLC”; “LL Fort Wayne, LLC”; “LL Peoria, LLC”; “”LL West Allis, LLC’ and “PF Fort Myers LLC.”
Many of the individuals plotting the group’s plans remain unknown as well. The individuals receiving payment from Stand for Truth are all being paid through similar entities, with all but one company receiving payment using a limited liability companies or a limited liability partnership to accept the funds.
Finding the LLC backers
It is not uncommon for vendors to receive payments from campaigns through groups like these, and some of those firms are easily identifiable, such Lycan’s Kentucky-based law firm, Dinsmore and Shohl.
But LLCs are more difficult to crack. The Texas-based “Stalwart Advisory LLC” and Robinson’s “One Harbor LLC” that the group used as consultants are not visible to the public without sleuthing through Texas public records. Stalwart Advisory does not appear in any state’s corporate records, according to OpenCorporates.com, which tracks these filings, nor does One Harbor’s ties to Robinson.
Lycan, asked why so much of the group’s intake and outflow of cash were conducted through these LLC’s declined to directly answer.
“Stand for Truth reports the information for each donor from whom a contribution is received, in accordance with applicable law,” he wrote in an email.
Donors are increasingly using LLCs like these to give to political groups ever since the Citizens United decision made it easier for non-individuals to cut checks. But the prevalence of these opaque companies on Stand for Truth’s report is widespread, campaign finance observers say.
“The super PAC probably gets more corporate funding than most do by a pretty big margin, but still the bigger donors are individuals,” said David Keating of the Center for Competitive Politics, a group advocating for looser restrictions on donations. “This isn’t Exxon Mobil corporate funding.”
Stand for Truth, meant to add to menu of choices for high-dollar donors, has so far focused on negative television advertisements aimed at both Rubio and Donald Trump. A leading force behind the group, Lycan confirmed, is Hal Lambert, a Dallas money-manager who was a co-chair of the official campaign’s finance committee until he started the outside group and is a close ally of Willie Langston, the Houston campaign’s finance chair.
And largely funding the group is Adam and Tara Ross, a Dallas couple close to Ted and Heidi Cruz who together gave $1 million of the $2.5 million raised. Adam Ross is influential in Jewish Republican fundraising circles and is said to be close with Peter Thiel, the Silicon Valley billionaire who has remained on the sidelines this year despite being wooed by much of the GOP field.
The super PACs supporting Cruz that have been blessed by the candidate himself, a network titled Keep the Promise, has not used virtually any of these LLCs. The $40 million raised by Keep the Promise almost entirely comes from three families that each gave more than $10 million to support Cruz through their own independent groups — with their names attached.