Democrats Say Harman Challenger Broke Rules
The state Democratic Party charged Wednesday that Rancho Palos Verdes Councilwoman Susan Brooks violated federal election rules by taking out a $50,000 unsecured loan to help finance her campaign to unseat Rep. Jane Harman (D-Marina del Rey) in the November election.
In a complaint delivered to the Federal Election Commission, party officials said that the Bank of California granted loans to Brooks that were backed only by her “history of excellent business relationship.”
The complaint was expected to further a war of words between the candidates, who are running in a district that is split almost evenly between Democrats and Republicans. The district stretches from Marina del Rey to San Pedro.
In a statement, Brooks called the charges “completely baseless” and a “political ploy.”
The FEC in general requires that campaign loans be secured, either with sufficient collateral or with a special campaign account set up to repay the loan. However, there is also a provision, an FEC spokesman said, that allows the commission to consider “the totality of the circumstances” in individual cases that could make a loan without collateral legal.
In Brooks’ case, an FEC spokesman said the complaint would be reviewed by the commission and if found valid could lead to imposition of fines, but it was not known if that might happen before the Nov. 8 election.
State Democratic Party Chairman Bill Press said in a statement, “Susan Brooks has taken out illegal loans, and the Federal Election Commission should take immediate action to rectify the situation.” If a candidate cannot repay a loan, party officials said, the bank’s money instead becomes a contribution and only a corporation’s political action committee can contribute to a campaign, with donations limited to $5,000 per election.
FEC spokesman Ian Stirton said he could not comment on Press’ complaint. But he said that in general, banks can give loans to candidates as long as there are “no special exceptions.”
Loans have to be given “in the same way as any other loan,” he said. “It cannot be a handshake.”
Brooks’ campaign manager, David Bohline, said that the method of guaranteeing the loan was sufficient and “is considered a traditional and accepted method by the FEC.” Campaign officials said the loan was discussed with the legal department at the National Republican Congressional Committee.
Bank of California spokesman John Kaufman said he could not comment on Brooks’ loan, but admitted it was “rare” for the bank to loan money to a political candidate or a campaign. The bank would loan only to credit-worthy individuals, he said.
According to finance reports, Brooks’ campaign received three loans from the Bank of California of $20,000, $14,500 and $15,500 from May 27 to June 3. The loans were made, according to bank documents, on a “history of excellent business relationship.”
“I have put all of my personal assets on the line, and have placed myself deeply in debt because I truly believe in the principles and message of this campaign,” Brooks said in a statement.
Brooks campaign officials point to another FEC provision that allows loans to be secured through a guarantor or co-signer.
“Susan guaranteed it,” said her husband, Jim Brooks, a campaign adviser. The loan, he said, actually was a “line of credit” his wife drew upon in the final days of her successful primary race against former Palos Verdes Estates Councilman Ron Florance.
Brooks’ campaign filed a complaint of its own with the FEC in June, claiming that Harman and Hughes Aircraft Co. improperly raised funds for Harman’s campaign. Harman and Hughes deny the charges, and the FEC has yet to rule on the matter.