How are Trump’s legal bills and the 2024 campaigns being funded? There’s a lot we don’t know

By CNN Newsource

Published June 5, 2024 2:18 PM

Analysis by Zachary B. Wolf, CNN

(CNN) — The way American campaigns are financed can be impenetrable even to people who pay close attention to politics.

Campaigns can only get so much money directly from donors. More money flows to organizations that can’t technically coordinate with campaigns but sure seem to come close. Separate organizations can also try to influence elections by pushing for issues, but they sure seem to try to benefit candidates.

Add into that complicated mess the fact that former President Donald Trump has been paying his copious legal bills through the campaign finance system.

To better understand what we know about how and by whom campaigns are being funded in 2024, I went to Fredreka Schouten, who covers this complicated issue for CNN. Our conversation, conducted by email, is below.

WOLF: What are the broad strokes of what we know about how Trump is financing his legal defense?

SCHOUTEN: During the course of this campaign, the former president has asked his political donors to help pay his soaring legal bills.

The primary vehicle has been a leadership PAC called Save America that Trump established after he lost the White House in November 2020. Trump seeded the PAC largely with money he raised in the aftermath of his loss when he asked for donors’ help in fighting what he claimed was widespread fraud in the 2020 election.

(Save America also transferred some of that money – $60 million – to the pro-Trump super PAC, MAGA Inc., that could directly spend money to help his campaign. More on that later.)

As a presidential candidate in the 2024 election, Trump has consistently diverted a share of new political donations to Save America, and – by extension – to his legal expenses.

For instance, a joint fundraising agreement among Trump, the Republican National Committee and a couple dozen state GOP committees sends donations to Save America before the national party and state committees get their cut, underscoring how much Trump prioritizes paying lawyers.

Since the start of 2021, Save America has paid nearly $80 million in legal bills for Trump and others in his orbit.

In April 2024 alone, as Trump’s criminal hush money trial in New York got under way, the PAC racked up about $4.4 million in legal expenses between bills paid and outstanding debts, recent filings how. A big recipient: The law firm of Todd Blanche, the lead attorney representing Trump as he battled criminal charges in a Manhattan courtroom that centered on whether he falsified business records to conceal an election-eve payment to porn star Stormy Daniels in 2016.

Trump was convicted on May 30 and has vowed to appeal.

WOLF: Can he simply use campaign dollars for court bills? Does the law allow that?

SCHOUTEN: Federal campaign finance law is riddled with all sorts of loopholes.

Technically, candidates cannot use money donated to their campaigns for personal expenses – whether that’s to pay a criminal defense lawyer in a personal matter or to buy groceries.

But the agency that enforces federal election law treats leadership PACs such as Save America differently than candidates’ main campaign accounts. Leadership PACs started off as committees created by current and former members of Congress to help boost their profiles and support other candidates. They cannot be used to directly support a presidential campaign.

But over the years, they really have become slush funds – helping underwrite travel, polling, meals and other expenses politicians incur.

Keep in mind that Trump’s allies maintain that applying donors’ money to legal expenses is a legitimate use because they characterize all his legal troubles – whether in civil or criminal cases – as part of an extensive “political witch hunt” organized by his enemies to derail his campaign.

WOLF: How has the drain of his legal problems affected Trump’s campaign war chest?

SCHOUTEN: Well, the bills grew so high that Save America has clawed back tens of millions of dollars from the super PAC, MAGA Inc., to help keep it afloat. So, as a practical matter, a super PAC focused on helping Trump get elected ended up diverting money to help pay legal bills during the early months of the presidential campaign.

But one thing has become clear: Trump’s team has used his legal difficulties as an engine to generate donations. We’ve seen fundraising spikes during big court appearances but none so big as the nearly $53 million that Trump’s political operation said it brought in in the 24 hours after the New York conviction last month.

That single-day haul accounts for more than one-third of the whopping $141 million that the Trump campaign said it raised with the Republican National Committee in May.

And MAGA Inc. just announced a May fundraising bonanza, saying it brought in nearly $70 million last month.

WOLF: What are the important details we don’t know about how Trump is financing his legal defense?

SCHOUTEN: We really don’t have the full picture of legal expenses from campaign finance reports.

Senior advisers have told CNN that Trump is paying some of his legal expenses out of pocket, for instance. And we don’t know how much the Trump Organization, his real estate and branding company, might be underwriting.

During the New York criminal trial, for example, Rhona Graff, the president’s former longtime assistant at the Trump Organization, testified that the company was paying her legal bills.

WOLF: A complaint has been filed against Trump for hiding payments to lawyers. What’s that about, and what could come of it?

SCHOUTEN: The Campaign Legal Center watchdog group filed the complaint with federal election regulators against Trump’s campaign and related committees, alleging they have concealed details on millions of dollars in legal payments by routing the money through a vendor.

The complaint centers on more than $7 million paid by Trump-aligned committees to Red Curve Solutions, LLC as “reimbursements” for legal expenses – although the company is not a law firm and largely provides services to help campaigns comply with federal election reporting requirements. Bradley Crate, the treasurer of Trump’s campaign, oversees Red Curve.

In its complaint with the Federal Election Commission, the Campaign Legal Center said the payments suggest that Red Curve “routinely advanced money or paid for the cost of legal services provided by other vendors” and was later reimbursed, which would violate disclosure requirements of federal campaign finance law.

Neither Crate nor the Trump campaign have responded to CNN’s inquiries about the complaint.

Don’t expect action from the FEC anytime soon.

The commission – evenly divided along partisan lines – often deadlocks on enforcement decisions or takes action years after a complaint is first lodged.

WOLF: What is Joe Biden’s team doing differently to test the campaign finance rules this year?

SCHOUTEN: I don’t know that he’s doing anything differently, but he’s relying on tactics we’ve seen most politicians use in the big-money era – even if they have decried the rise of so-called “dark money” groups that keep their donors’ identities private.

The main super PAC supporting Biden’s bid, Future Forward, gets a big chunk of its funding from a nonprofit arm that doesn’t disclose its donors to the public.

Our CNN Investigates colleague Casey Tolan earlier this year pored over tax records to report about a couple with ties to artificial intelligence investments and cryptocurrency trading emerging as some of the biggest donors to Future Forward’s dark-money arm.

WOLF: Is most of the election spending coming this year from campaigns, super PACs or issue organizations?

SCHOUTEN: So far this year, outside groups – including super PACs and issue organizations – are leading the spending in advertising in the presidential race, according to a tally of AdImpact data by our CNN colleague David Wright, who keeps close tabs on political ads.

That’s not surprising. Candidates face strict limits on the size and source of donations they receive, but super PACs and other outside groups can raise unlimited sums from a wide array of sources.

If you include future reservations, the pro-Biden super PAC currently leads presidential spending with some $130 million in ads reserved for the fall. But there’s no guarantee it won’t be overtaken by Republican groups as the general election campaign heats up.

Article Topic Follows: CNN-Opinion

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