The Federal Election Commission fined three nonprofit groups formerly connected with the political network overseen by the brothers Charles G. Koch and David H. Koch, according to documents released by a liberal watchdog group on Wednesday, a rare intervention by the commission into the world of outside spending.
Millions of dollars worth of those contributions were provided by an Arizona-based organization that, at the time, was a central hub of financing in the Koch network of donors and political groups. The Koch network has since cut ties with the groups, replacing them with political organizations more closely controlled by its own operatives.
The F.E.C.’s investigation provides a look — although a partial and dated one — into the interlocking networks of political non-profits on the right, through which vast sums of money flow each election cycle with little disclosure. Such groups are not required to disclose their donors and typically trade large tranches of cash during each election cycle, intentionally making it difficult for even tax or election authorities to judge which donor from which dollar is used for any particular activity.A spokesman for Freedom Partners, the group that now serves as the nerve center for the network, said that Koch organizations had not been involved with nor directed the particular spending at issue in the F.E.C.’s investigation.
“These complaints have nothing to do with our organization,” said James Davis, a spokesman for Freedom Partners.
The F.E.C. found that Sean Noble, a political consultant then working with the Kochs, had closely directed the spending of the grants by the other organizations, even picking the races where ads were to be run. That violated federal rules requiring organizations to identity the source of any money earmarked for a political expenditure, the commission determined. The groups consented to pay a total of more than $200,000 in fines to settle the investigation, but without conceding they had violated the laws.
Those findings were contained in “conciliation agreements” released by the F.E.C. to Citizens for Responsibility And Ethics in Washington, a watchdog group that filed a complaint against the Koch-linked nonprofits in 2014. More detailed paperwork involving the agreements has not yet been released by the agency.
“These rules provide some of the only windows into the funding of dark money groups, but the F.E.C. almost never penalizes groups that break them,” said Noah Bookbinder, the group’s executive director. “It is hard to overstate how significant this is.”