For immediate release
April 1, 2021—By a split vote of two Commissioners approving, three Commissioners voting against, and one Commissioner abstaining, the Federal Election Commission recently failed to approve or deny ALUMinate’s request to flag certain indicators based on the historical contributions made by individuals to political candidates and political action committees (Advisory Opinion 2021-01).
We proposed to use the data to supplement the existing information (which can number over 500 different fields) we provide to our university, college, and nonprofit clients in very limited ways. The FEC staff submitted two Advisory Opinion drafts for consideration by the Commission, one in favor of approving our request, and another finding that our proposed actions would constitute a prohibited “commercial use” involved in solicitation, presumably in the solicitation of charitable contributions by our clients. The affirmative vote by a majority of the six Commissioners is required to accept one of the competing Advisory Opinion drafts, hence no decision was rendered. It was interesting that the abstaining Commissioner acknowledged that the Commission has issued many Advisory Opinions blessing the commercial use of FEC data, but he indicated he is troubled by any use of the data because it ostensibly infringes on the personal privacy of political donors and serves no public interest, despite records being public information for anyone to see.
In our January 12, 2021 request, we asked the FEC to allow us to:
- Flag (in the form of check marks in .CSV spreadsheets delivered to clients) individuals contained in our clients’ databases who have made “meaningful” political contributions and those individuals who made a “meaningful” contribution for the first time.
- Flag individuals who serve in suspected leadership positions based on their occupations and political giving patterns. These individuals might be excellent candidates for board roles, advisory councils, student mentoring and the like.
- Flag certain suspected interests of individuals based on their contribution histories. For example, individuals who give to certain PACs, like those sponsored by the Sierra Club or the Environmental Defense Fund, potentially have a strong interest in social issues involving the environment and might be candidates to make charitable contributions to fund similar client programs.
Nearly 50 years ago, Congress enacted legislation requiring the FEC to publish the name, address, occupation, and employer of individuals contributing to political candidates and organizations. Out of concern for the privacy of these individuals, Senator Henry Bellmon proposed an amendment to the proposed statute prohibiting any information copied from FEC reports from being “sold or used by any person for the purposes of soliciting contributions or for commercial purposes.” Senator Bellmon was concerned that “list brokers” would use the data to make all sorts of solicitations to these “public-spirited citizens” for “cars, credit cards, magazine subscriptions, cheap vacations, and the like.” Subsequently, in 1980, the Commission issued regulations interpreting “soliciting contributions” to include “charitable contributions,” despite there being no legislative record, discussion, or indication that charitable contributions were intended to be swept into the same bucket as political contributions. That said, regulations have the force of law unless overturned by a court or subsequent ruling making.
Prior Advisory Opinions clearly have allowed FEC contribution data to be used for commercial purposes. In a recent Opinion (AO 2017-08), the Commission approved Point Bridge Capital to mine individual contributor data to analyze which public companies, and their officers and employees, were significant contributors to the Republican Party and Republican political officeholders and candidates. Point Bridge then developed an index and ETF (essentially a mutual fund) based on the most supportive companies and offered the fund to investors who presumably were of similar political persuasion. They disclose the names of the companies in the index making it easy for anyone to identify the individual contributors by simply putting the company name into the search field in the FEC’s own website: (https://www.fec.gov/data/receipts/individual-contributions/).
There are numerous other Advisory Opinions approving the “indirect” use of contributor data for commercial purposes and, by extension, “solicitation.” How the three disapproving Commissioners concluded our request to be more egregious than these situations is a mystery. They seemed to be troubled that we would be flagging specific individuals even though we would not return to our clients any personal or individual information gleaned from the FEC data, that the only individuals we would be flagging are already known to our clients and included in their databases, and that, at best, the flags offered only inferences and conjecture as to their meaning.
It will be interesting to see what comes of this “no-decision” ruling. As Tyler Hagenbuch of Perkins Coie stated in his letter encouraging the Commission to reject Draft A denying our request, the “draft is a dramatic contraction of permissible uses of FEC data; is out of line with the Commission’s own precedent; and would considerably increase the significant confusion the regulated community already faces around this rule.”
In fact, the legislative intent that underpins the prohibition of “commercial use” seems no longer relevant in this age of “data everywhere.” Google, Facebook, Fastpeoplesearch.com, automated marketing, targeted selling, and numerous repositories of publicly available information, all render as absurd the idea that the limited amount of personal data included in FEC filings is a threat to personal privacy. Furthermore, protections provided by GDPR, California Consumer Privacy Act, New York SHIELD Act, and a plethora of other data privacy and secrecy laws and regulations put the control of personal data squarely in the hands of “public-spirited citizens.” However, in the absence of a decision by the Commission to our request, uncertainty as to what constitutes acceptable uses of FEC data will continue until the “no commercial use” exception is tested again in future advisory opinion requests or the courts.
For questions or comments about this press release, please contact Dr. Caitlin Scarano at Caitlin@aluminateus.com