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With Roger Sollenberger, Political Reporter

Pay Dirt is a weekly foray into the pigpen of political funding. Subscribehere to get it in your inbox every Thursday.

 

The Big Dig this week… How the Jan. 6 Committee Exposed Trump’s ‘Big Lie’ as a ‘Big Rip-Off’

When the Jan. 6 Committee released its final report last month, it referred multiple criminal charges to the Justice Department, but one key focus of that investigation was relegated to an appendix: The possible fraud case related to the hundreds of millions of dollars that Donald Trump and his allies raised off “the Big Lie.”

 

While it’s unclear why the committee tucked this part of the investigation into an appendix, it’s not for lack of smoke. The DOJ reportedly folded the investigation into its larger Jan. 6 probe months ago, with CNN reporting in December that special counsel Jack Smith would be continuing that work.

 

But the strength of the case, which The Daily Beast laid out in July, is also clear from the report itself. While not directly alleging criminal activity, the appendix—titled “The Big Rip-Off: Follow The Money”—lays out in great detail what was already a compelling constellation of facts about what campaign officials knew about those fundraising efforts. And the report also lays out how that money was eventually spent.

The grift that keeps giving

 

Jordan Libowitz, communications director for government watchdog Citizens for Responsibility and Ethics in Washington, was stunned at the overall amount raised—about $250 million, all told.

 

“It really stands out how lucrative it was for team Trump to deny the election loss,” Libowitz said. “That’s really counterintuitive, because why would you give money for an election that was over? It only makes sense if you truly believe this will change the outcome of the election. He was essentially grifting his donors.”

 

Congressional investigators agreed, concluding that Trump’s “Big Lie” about a stolen election “served a dual purpose.” While Trump and his allies peddled inaccurate claims to convince supporters to back their attempts to reverse the election defeat, the report says, they exploited those same claims to raise money, “misleading donors into thinking their donations could alter the election results.”

 

But the vast majority of that fundraising did not go to those efforts. Instead, the report says, it went “to fund the former President’s other endeavors and to enrich his associates,” a switcheroo the report refers to as “the Big Rip-off.”

 

T-MAGIC

 

Investigators also implicated top campaign staff and the Republican National Committee, which partnered with the Trump campaign on these fundraising efforts, saying “the RNC knew” Trump’s claims had no basis in fact, and that no amount of money would change the election’s outcome.

 

The Trump-RNC fundraising hub was a joint vehicle called “Trump Make America Great Again Committee”—referred to internally as TMAGAC (pronounced “T-Magic”). The RNC and Trump campaign were so tightly knit in 2020 that they shared staff and office space in Arlington, Virginia. By the end of the year, the report says, the operation employed 20 or 30 people across multiple teams, for copywriting, text messages, analytics, advertising, and graphics.

 

The Trump machine blasted out hundreds of different fundraising appeals in the months between the election and Jan. 6, sometimes hitting up supporters more than two dozen times a day. According to the report, the copywriters drew inspiration from the real world, “watching the messaging coming out of [the RNC] and the campaign and from the President himself and what his family was talking about.”

 

Low approval rating

 

Those claims quickly grew problematic, even within Trumpworld.

 

The TMAGAC fundraising copy could not go out without approval from legal, communications, and research teams. But those groups passed the buck about who was ultimately responsible.

 

According to committee transcripts, top officials internally expressed concerns about Trump’s claims of a stolen election, which they knew to be inaccurate. In response, investigators found, the TMAGAC team—which had approval processes in place—began to make something of an effort to curb the incendiary language in their emails. But no one seemed to want to take responsibility before the committee.

 

Instead, the report states that the evidence shows that the RNC and TMAGAC team “walked as close to the line as they dared,” making changes to minimize the RNC’s legal exposure “while still spreading and relying on President Trump’s known lies and misrepresentations.”

 

The fine print

 

In the three days after the election, the Trump campaign and RNC racked up more than $100 million, claiming to raise the money for something they called the “Official Election Defense Fund.” The small problem? Witnesses told investigators that the “Official Election Defense Fund” did not exist; it was just “a marketing tactic.”

 

As it turns out, the report says, the “Trump campaign was raising too much money to spend solely on their legal efforts to overturn the results of the 2020 election.” Yet, they continued to raise more. And since federal law limited campaign spending to recount efforts, debt retirement, and other election expenses, they created Trump’s “Save America” leadership PAC and linked it to TMAGAC’s fundraising efforts—and began directing most of the money its way. (Trump son-in-law and then senior adviser Jared Kushner “had the most interest in the digital program,” the report says.)

 

Notably, while the leadership PAC allowed Trump to keep the money and apply it to a wide range of expenses, it was not permitted to spend more than $5,000 on recount and election-related costs—the very thing they were asking supporters to fund.

 

Ultimately, Save America spent exactly zero dollars on those things. However, it wasn’t just prohibited from funding Trump’s post-election efforts—it also can’t bankroll his 2024 bid. But in recent months, Save America has transferred tens of millions of dollars to a new super PAC tied to Trump.

 

Campaign finance experts previously told The Daily Beast that this appears to be a way to skirt the laws that would otherwise prohibit Trump from putting that money into his 2024 comeback.

 

Read the full story here. 

 

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From Roger’s Notebook...

Mothers of Convention. While the new GOP-written House rules are still being unpacked—with potentially three pages of concessions still unknown to the public—one unique provision hasn’t caught much attention. That would be an item that could “revive some old state calls for a constitutional convention” to essentially allow state legislatures to amend the U.S. Constitution, as political science expert Rick Hasen pointed out.

 

The new rule would allow the chair of the House Judiciary Committee—Rep. Jim Jordan (R-OH)—to review and publicly tally state calls for a convention, which could force Congress to act on the controversial idea. The move would invoke a never before used section of Article V, which requires petitions from two-thirds of state legislatures (34 states), a total which Rep. Jodey Arrington (R-TX)—who pushed legislation last summer to tally the number—told The New York Times this summer might be closer than is generally realized. (38 states are required to ratify amendments.)

 

While Arrington and other conservatives maintain they want to use a convention to focus on amendments that would limit the federal government’s size and spending, both liberal and conservative critics are concerned about the possibility of sweeping changes. As former Sen. Russ Feingold (D-WI) told The Times, given the recent surge of anti-democratic conservative ideology, a convention could “gut our Constitution” and jeopardize democracy. Read more about the possibilities here.

 

Sixpence all the richer. Former Vice President Mike Pence may have used his leadership PAC to buy up about $100,000 worth of copies of his bestselling memoir, “So Help Me God,” FEC records show. (Forbes reported the item earlier this week.) While it’s not clear if Pence specifically bought his own book, his Great America Committee spent $91,000 on “collateral materials” from Books On Call on Nov. 9, six days before publication. The autobiography debuted in second place on the The New York Times bestseller list. And because Pence doesn’t currently hold office, if his PAC did buy the book, he could legally pocket the royalties.

 

Noem on the range. South Dakota Republican Gov. Kristi Noem, who has been said to harbor vice presidential aspirations, has filed to terminate her Noem Victory Fund joint fundraising committee, per FEC records. The filing shows she first transferred about $580,000 to the group’s affiliates, including about $200,000 to Rep. Lee Schoenbeck’s South Dakota Strong leadership PAC, and around $235,000 to Noem’s gubernatorial campaign and leadership PAC combined. (The National Republican Congressional Committee was slinging copies of Noem’s memoir last year.)

 

Ripley’s Believe It or Not. Embattled Rep. George Santos received yet another notice from the FEC last week, this one flagging some outsized contributions to one of his two joint fundraising vehicles, Devolder Santos Nassau Victory Committee. The letter notified the committee that it had racked up same-day $25,000 donations from three donors, all exceeding the maximum allowed combined amount, with one donor adding another $1,000 that day. The group’s participants include the Santos campaign, his leadership PAC, and the Nassau County Republican Committee’s federal account.

 

This week, the head of the Nassau GOP called on Santos to resign, citing the lies he told voters, political allies, opponents, and the press, calling him “a stain on the House of Representatives.”

 

Santos was also hit with an FEC complaint this week from watchdog group Campaign Legal Center. The complaint cites a litany of “wildly implausible” irregularities and apparent violations, including questions about the true source of the $705,000 he loaned his campaign.

 

More From The Beast’s Politics Desk

Walker, Warnock

Trump’s 2024 sleepy campaign has been gaming out a vice-presidential pick—and the frontrunners are all women. Jake Lahut and Zach Petrizzo show you the shortlist.

 

George Santos accepted support from an Italian caught piloting a yacht full of Chinese migrants—and from his prominent restaurant-owning family. Will Bredderman has the scoop on this wild drama.

 

Former Trump Organization chief financial officer Allen Weisselberg was sentenced to five months in jail on Tuesday. But not just any jail—he’s serving on Rikers Island. And as Jose Pagliery explains, that’s not great for a septuagenarian white-collar criminal.

 

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