https://www.politico.com/magazine/story/2017/11/02/clinton-brazile-hacks-2016-215774
Inside Hillary Clinton’s Secret Takeover of the DNC
When I was asked to run the Democratic Party after the Russians hacked our emails, I stumbled onto a shocking truth about the Clinton campaign.
By DONNA BRAZILE November 02, 2017
....I had promised Bernie when I took the helm of the Democratic National Committee after the convention that
I would get to the bottom of whether Hillary Clinton’s team had rigged the nomination process, as a cache of emails stolen by Russian hackers and posted online had suggested....
So I followed the money. My predecessor, Florida Rep. Debbie Wasserman Schultz, had not been the most active chair in fundraising at a time when President Barack Obama’s neglect had left the party in significant debt.
As Hillary’s campaign gained momentum, she resolved the party’s debt and put it on a starvation diet. It had become dependent on her campaign for survival, for which she expected to wield control of its operations.....
The Saturday morning after the convention in July, I called Gary Gensler, the chief financial officer of Hillary’s campaign. He wasted no words. He told me the Democratic Party was broke and $2 million in debt. “What?” I screamed. “I am an officer of the party and they’ve been telling us everything is fine and they were raising money with no problems.”
That wasn’t true, he said. Officials from Hillary’s campaign had taken a look at the DNC’s books.
Obama left the party $24 million in debt—$15 million in bank debt and more than $8 million owed to vendors after the 2012 campaign—and had been paying that off very slowly. Obama’s campaign was not scheduled to pay it off until 2016. Hillary for America (the campaign) and the Hillary Victory Fund (its joint fundraising vehicle with the DNC) had taken care of 80 percent of the remaining debt in 2016, about $10 million, and had placed the party on an allowance.
.....The campaign had the DNC on life support, giving it money every month to meet its basic expenses, while the campaign was using the party as a fund-raising clearinghouse. Under FEC law, an individual can contribute a maximum of $2,700 directly to a presidential campaign. But the limits are much higher for contributions to state parties and a party’s national committee.
Individuals who had maxed out their $2,700 contribution limit to the campaign could write an additional check for $353,400 to the Hillary Victory Fund—that figure represented $10,000 to each of the 32 states’ parties who were part of the Victory Fund agreement—$320,000—and $33,400 to the DNC.
The money would be deposited in the states first, and transferred to the DNC shortly after that. Money in the battleground states usually stayed in that state, but all the other states funneled that money directly to the DNC, which quickly transferred the money to Brooklyn.
“Wait,” I said. “That victory fund was supposed to be for whoever was the nominee, and the state party races. You’re telling me that Hillary has been controlling it since before she got the nomination?” Gary said the campaign had to do it or the party would collapse. “That was the deal that Robby struck with Debbie,” he explained, referring to campaign manager Robby Mook. “It was to sustain the DNC. We sent the party nearly $20 million from September until the convention, and more to prepare for the election.”
“What’s the burn rate, Gary?” I asked. “How much money do we need every month to fund the party?” The burn rate was $3.5 million to $4 million a month, he said. I gasped. I had a pretty good sense of the DNC’s operations after having served as interim chair five years earlier. Back then the monthly expenses were half that. What had happened? The party chair usually shrinks the staff between presidential election campaigns, but Debbie had chosen not to do that. She had stuck lots of consultants on the DNC payroll, and Obama’s consultants were being financed by the DNC, too....
Right around the time of the convention, the leaked emails revealed Hillary’s campaign was grabbing money from the state parties for its own purposes, leaving the states with very little to support down-ballot races. ....
Yet the states kept less than half of 1 percent of the $82 million they had amassed from the extravagant fund-raisers Hillary’s campaign was holding, just as Gary had described to me when he and I talked in August. When the Politico story described this arrangement as “essentially … money laundering” for the Clinton campaign, Hillary’s people were outraged at being accused of doing something shady. Bernie’s people were angry for their own reasons, saying this was part of a calculated strategy to throw the nomination to Hillary....
When I got back from a vacation in Martha’s Vineyard, I at last found the document that described it all: the
Joint Fund-Raising Agreement between the DNC, the Hillary Victory Fund, and Hillary for America.The agreement—signed by Amy Dacey, the former CEO of the DNC, and Robby Mook with a copy to Marc Elias—
specified that in exchange for raising money and investing in the DNC, Hillary would control the party’s finances, strategy, and all the money raised. Her campaign had the right of refusal of who would be the party communications director, and it would make final decisions on all the other staff. The DNC also was required to consult with the campaign about all other staffing, budgeting, data, analytics, and mailings."
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