Florida governor, former white-collar criminal, and U.S. Senate candidate Rick Scott seems to have tiptoed extremely, oh-so-perilously close to breaking federal anti-corruption laws. Depending upon which government ethics experts you contact, he might have outright broken Securities and Exchange Commission (SEC) rules. That's the takeaway from a new investigative report from veteran journalist David Sirota and the campaign-finance-tracking nonprofit MapLight.
In short, Sirota found that a few rich investors donated big money to a political action committee Scott was chairing right after the governor directed hundreds of millions of dollars in state funding in their direction. That sort of transaction is likely illegal thanks to a 2010 federal rule.
Two private equity companies — New Mountain Capital and Energy Capital Partners — received $250 million in new investment commitments from Florida's state pension system in 2014 and 2015. Scott is one of three state executives who oversee the pension system. Energy Capital Partners just bought a firm that owns a state-regulated natural-gas power plant near Tampa, too.
In return, the CEOs of both investment firms donated a combined $55,000 to Scott's New Republican political action committee during this election cycle. Scott began chairing the PAC in May 2017, though his campaign says he stepped down from that position in February 2018.
Importantly, a 2010 SEC rule is designed to prevent these kinds of seemingly quid pro quo political transactions from taking place. The rule prevents firms that receive state pension investments from donating to pension board administrations, where Scott remains as of today.
But things get slightly more complicated from there: The rule allows investors to donate to "third-party" groups as long as those groups aren't technically affiliated with any actual candidates. But the SEC also stipulates it's not legal for anyone to donate to a third-party group or PAC if that donation is obviously designed to skirt the basic anti-corruption provision — and it sure seems like that's what happened in this case with Scott.
At least one government ethics expert with the group Public Citizen told Sirota and Perez that this instance appears to be a "very clear case of close coordination and circumvention of the pay-to-play rule," but it's basically up to the SEC to decide whether to take action.
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Regardless, Scott and his campaign ought to explain to the public just what happened here. Spokespeople for Scott's campaign and the New Republican PAC did not immediately respond to calls and messages from New Times today.
But Scott's New Republican has already been in the news this
Though it's certainly true that PACs for both mainstream Republicans and Democrats are often closely affiliated with candidates' campaigns (even though this is technically not allowed), activists with End Citizens United say Scott's campaign blatantly and overtly coordinated with New Republican by sharing a mailing address, conducting a pro-Scott poll in March (before he announced his candidacy), and regularly meeting with him until March in order to "run around election law."
Ryan Patmintra, the communications director for Scott's Senate campaign, previously told the Tampa Bay Times that any election complaints filed against Scott or New Republican are "baseless."