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Monday, November 5, 2012

Arizona Group Says It Was Middle Man for Donations to California Ballot Measures

LOS ANGELES - After weeks fighting in court to keep the source of its funds secret, the Arizona nonprofit group that last month made an anonymous $11 million donation to two California ballot measure campaigns revealed the source of the money Monday morning. Sort of.

The group, Americans for Responsible Leadership, sent a letter to California's elections watchdog agency declaring that it had been an intermediary, while another nonprofit group had been the original source. But the identities of the original donors remained secret.

Kamala Harris, the California attorney general, said her department would continue to investigate the case to determine whether the group had violated state law. Civil or criminal penalties could potentially follow, she said.

“It is very troubling that $11 million would be poured into California anonymously weeks before an election to influence the outcome of a very important race, and it is troubling that we had to take a case up to the California Supreme Court to get some element of disclosure,” Ms. Harris said.

In a letter sent to the Fair Political Practices Commission on Monday, lawyers for Americans for Responsible Leadership said they had reached a settlement with the agency but did not admit any wrongdoing.

Americans for Responsible Leadership burst suddenly from obscurity to become a great source of intrigue and controversy in California political circles, after the group's donation last month. The $11 million went to a conservative political committee that is working to defeat one ballot proposition (a temporary tax increase to finance public education, supported by Gov. Jerry Brown) and pass another (a measure that would curb the ability of labor unions to donate to political campaigns).

Mr. Brown criticized the group for keeping its donors secret, and the Fair Political Practices Commission soon requested that Americans for Respon sible Leadership submit to an audit.

The Arizona group, however, refused to turn over its documents, and the fight moved to the courtroom. Last week a judge ordered Americans for Responsible Leadership to comply with the audit request. Several appeals followed, though. And in a rare weekend decision, the Supreme Court of California on Sunday night ordered the group to turn over its records to the Fair Political Practices Commission immediately.

Although lawyers for Americans for Responsible Leadership could have appealed that ruling to the United States Supreme Court, they relented on Monday morning, sending a letter to the Fair Political Practices Commission that identified Americans for Job Security as the source of the $11 million donation, which came to the Arizona group through another intermediary, the Center to Protect Patient Rights.

Derek Cressman, a vice president of Common Cause, the watchdog group that filed the initial complaint in this case with the Fair Political Practices Commission, said Monday's disclosure showed the kind of lengths that many powerful interests now went to in order to conceal their spending.

“In the wake of Citizens United, this nonprofit shell game is becoming the preferred modus operandi of big moneyed players,” Mr. Cressman said. “This is the new dirty politics.”