Draft Final Audit Report of the 

Audit Division on the 

Association for Emergency 

Responders and Firefighters, 

PAC1

(January 1, 2017 - December 31, 2018)

Why the Audit 

Was Done

Federal law permits the 

Commission to conduct 

audits and field 

investigations of any 

political committee that 

is required to file reports 

under the Federal 

Election Campaign Act 

(the Act). The 

Commission generally 

conducts such audits 

when a committee 

appears not to have met 

the threshold 

requirements for 

substantial compliance 

with the Act.2

 The audit 

determines whether the 

committee complied with 

the limitations, 

About the Committee (p. 3)

The Association for Emergency Responders and Firefighters is a 

non-connected, independent expenditure-only committee 

headquartered in Milwaukee, Wisconsin. For more information, 

see the chart on the Committee Organization p. 3.

Financial Activity (p. 3)

• Receipts

o Contributions from Individuals

o Transfers from Affiliated/Other 

Party Committees

Total Receipts

$ 3,072,808

59,119

$ 3,131,927

• Disbursements

o Operating Expenditures

o Transfers to Affiliated/Other 

Party Committees

o Contribution Refunds

o Independent Expenditures

Total Disbursements

$ 2,949,339

113,000

495

03

$ 3,062,834

1

 The committee’s name during the audit period was Association for Emergency Responders and 

Firefighters and was subsequently changed to Association for Emergency Responders and Firefighters, 

PAC on September 23, 2021. 2

 52 U.S.C. §30111(b). 3

 The Association for Emergency Responders and Firefighters made no independent expenditures during 

the 2017-2018 election cycle.
prohibitions and 

disclosure requirements 

of the Act.

Future Action

The Commission may 

initiate an enforcement 

action, at a later time, 

with respect to any of the 

matters discussed in this 

report.

Findings and Recommendations (p. 4)

• Increased Activity (Corrected) (Finding 1)

• Recordkeeping for Disbursements and Use of Designated 

Depository (Finding 2)
Draft Final Audit Report of the 

Audit Division on the

Association for Emergency 

Responders and Firefighters, PAC

(January 1, 2017 – December 31, 2018)
Table of Contents

Page

Part I. Background

Authority for Audit 1

Scope of Audit 1

Limitations 1

Part II. Overview of Committee

Committee Organization 3

Overview of Financial Activity 3

Part III. Summaries

Findings and Recommendations 4

Part IV. Findings and Recommendations

Finding 1. Increased Activity (Corrected) 5

Finding 2. Recordkeeping for Disbursements and Use of Designated 

 Depository 7
1 

Part I

Background 

Authority for Audit

This report is based on an audit of the Association for Emergency Responders and Firefighters, 

PAC (AERF), undertaken by the Audit Division of the Federal Election Commission (the 

Commission) in accordance with the Federal Election Campaign Act of 1971, as amended (the 

Act). The Audit Division conducted the audit pursuant to 52 U.S.C. §30111(b), which permits 

the Commission to conduct audits and field investigations of any political committee that is 

required to file a report under 52 U.S.C. §30104. Prior to conducting any audit under this 

subsection, the Commission must perform an internal review of reports filed by selected 

committees to determine if the reports filed by a particular committee meet the threshold 

requirements for substantial compliance with the Act. 52 U.S.C. §30111(b). 

Scope of Audit

Following Commission-approved procedures, the Audit staff evaluated various risk factors and 

as a result, this audit examined: 

1. the disclosure of individual contributors’ occupation and name of employer; 

2. the disclosure of disbursements; 

3. the consistency between reported figures and bank records; 

4. the completeness of records; 

5. the disclosure of independent expenditures; and 

6. other committee operations necessary to the review.

Limitations

AERF did not comply with the provisions of §104.14(b)(1), which require committees to 

maintain sufficiently detailed records in order to verify the filed reports. AERF reported 159 

disbursements totaling $2,240,253 as payments to vendors. However, the Audit staff found that 

AERF’s bank statements reflected 66 ACH transfers4 for this same amount to an entity annotated 

as “Er Responders.” The bank statements described each transaction as “ACH Settlement 

Vendor Pay Er Responders.” This entity appears to be the Association for Emergency 

Responders and Firefighters, LLC.5

 AERF provided vendor statements showing that all billed 

amounts were paid, presumably suggesting that “Er Responders” used the funds wired from 

4

 In its response to the exit conference and the Interim Audit Report, AERF referred to these transactions as “ACH 

wire transfers.” The Audit staff likewise referred to the transactions as wire transfers in the Interim Audit Report; 

however, these outgoing electronic payments are labeled as “ACH” transactions on AERF’s bank statements. To 

conform to the terminology in the bank statements, the Audit staff will refer to these as “ACH” transactions in this 

and the subsequent audit reports. 5

 Based on the results of the Office of General Counsel’s Business Entity Search on

 https://esos.nv.gov/EntitySearch/OnlineEntitySearch. In its response to the exit conference, AERF objected to 

“each of the findings that state AERF LLC was the payee of certain disbursements.” See Finding 2.
2

AERF to pay the vendors. AERF has not provided any AERF or “Er Responders” bank records 

to support that the funds were used to pay the vendors disclosed on AERF’s disclosure reports. 

(See Finding 2A). 

Further, AERF may have violated 52 U.S.C. § 30102(h) and 11 C.F.R. § 103.3(a), which require 

committees to make all disbursements, except those for petty cash, through checks drawn on a 

designated depository account. AERF routed its funds through the “Er Responders” bank 

account before purportedly disbursing these funds to the vendors. The Audit staff, in absence of 

the “Er Responders” bank statements, was unable to identify the composition of the funds in that 

bank account. As a result, AERF may have impermissibly commingled its funds with the 

personal funds of an individual or with corporate funds. (See Finding 2B).
3

Part II

Overview of Committee

Committee Organization

Overview of Financial Activity

(Audited Amounts)

Cash on hand @ January 1, 2017 $ 156

Receipts

o Contributions from Individuals 3,072,808

o Transfers from Affiliated/Other Party 

Committees 59,119

Total Receipts $ 3,131,927

Disbursements

o Operating Expenditures 2,949,339

o Transfers to Affiliated/Other Party 

Committees 113,000

o Contribution Refunds 495

o Independent Expenditures 0

Total Disbursements $ 3,062,834

Cash on hand @ December 31, 2018 $ 69,249

Important Dates

• Date of Registration July 27, 2016

• Audit Coverage January 1, 2017 - December 31, 2018

Headquarters Milwaukee, Wisconsin

Bank Information

• Bank Depositories One

• Bank Accounts One checking account

Treasurer

• Treasurer When Audit Was Conducted Robert Piaro

• Treasurer During Period Covered by Audit Robert Piaro (8/16/17 - Present) 

Thomas Heitman (7/27/16 - 8/15/17)

Management Information

• Attended FEC Campaign Finance Seminar No

• Who Handled Accounting and 

Recordkeeping Tasks

Paid Staff 
4

Part III

Summaries

Findings and Recommendations

Finding 1. Increased Activity (Corrected)

A comparison of AERF’s bank activity with its originally filed reports revealed that 

disbursements were understated by $769,804 for calendar years 2017 and 2018. In 

response to the Interim Audit Report recommendation, AERF reiterated its earlier 

response to the exit conference and stated that it “continues to follow and refine the 

processes and procedures implemented in response to the Audit staff’s Preliminary 

Findings and Recommendations.” (For more detail, see p. 5.)

Finding 2. Recordkeeping for Disbursements and Use of 

Depository

During audit fieldwork, the Audit staff identified payments totaling $2,240,253 which 

AERF made to “Er Responders,” however, AERF reported these disbursements as 

payments to vendors on its disclosure reports. AERF did not provide any “Er 

Responders” bank statements to demonstrate that these payments were subsequently 

transmitted to the disclosed vendors. In response to the Interim Audit Report 

recommendation, AERF acknowledged the existence of the Association for Emergency 

Responders and Firefighters, LLC, but denied that this entity was the payee of any of the 

payments from AERF. AERF submitted the redacted bank statements obtained from four 

of its vendors which reflected 86 payments totaling $1,261,088, for the period January 1, 

2018 through August 9, 2018. However, the payments outlined on the redacted bank 

statements are not supporting and verifiable evidence that the disclosed vendors were 

paid with the funds transferred from AERF’s bank account. AERF provided no

additional documentation for the remaining 73 vendor payments totaling $979,165. (For 

more detail, see p. 7.)
5 

Part IV

Finding and Recommendation

Finding 1. Increased Activity (Corrected)6

Summary 

A comparison of AERF’s bank activity with its originally filed reports revealed that 

disbursements were understated by $769,804 for calendar years 2017 and 2018. In 

response to the Interim Audit Report recommendation, AERF reiterated its earlier 

response to the exit conference and stated that it “continues to follow and refine the 

processes and procedures implemented in response to the Audit staff’s Preliminary 

Findings and Recommendations.” 

Legal Standard 

A. Reporting Requirements. All political committees other than authorized

committees of a candidate shall file either:

• Quarterly reports in a calendar year in which a regularly scheduled general 

election is held, which shall be filed no later than the 15th day after the last day of 

each calendar quarter: except that the report for the quarter ending on December 

31 of such calendar year shall be filed no later than January 31 of the following 

calendar year;

• A pre-election report, which shall be filed no later than the 12th day before (or 

posted by any of the following: registered mail, certified mail, priority mail 

having a delivery confirmation, or express mail having a delivery confirmation, or 

delivered to an overnight delivery service with an on-line tracking system, if 

posted or delivered no later than the 15th day before) any election in which the 

committee makes a contribution to or expenditure on behalf of a candidate in such 

election, and which shall be complete as of the 20th day before the election; 

• A post-general election report, which shall be filed no later than the 30th day after 

the general election and which shall be complete as of the 20th day after such 

general election; and 

• In any other calendar year, a report covering the period beginning January 1 and 

ending June 30, which shall be filed no later than July 31 and a report covering 

the period beginning July 1 and ending December 31, which shall be filed no later 

than January 31 of the following calendar year. 52 U.S.C. § 30104(a)(4)(A); or 

• Monthly reports. 52 U.S.C. § 30104(a)(4)(B).

B. Contents of Reports. Each report must disclose:

• The amount of cash on hand at the beginning and end of the reporting period; 

• The total amount of receipts for the reporting period and for the calendar year; 

6 This finding was presented to AERF as “Increased Financial Activity” during the exit conference;

 however, the Commission has since voted to change the title of such findings to “Increased Activity 

 (Corrected).”
6

• The total amount of disbursements for the reporting period and for the calendar 

year; and

• Certain transactions that require itemization on Schedule A (Itemized Receipts) or 

Schedule B (Itemized Disbursements). 52 U.S.C. §30104 (b)(1),(2),(3),(4) and 

(5).

Facts and Analysis

A. Facts

During audit fieldwork, in addition to examining AERF’s most recent reports filed prior 

to the audit notification, the Audit staff also compared AERF’s originally filed reports 

with its bank records. The purpose of this additional reconciliation was to identify the 

degree to which AERF had misstated its original filings.

The Audit staff calculated that AERF understated its disbursements by $769,804 on the 

original reports filed for the two-year period ending December 31, 2018. This 

understatement was primarily due to AERF’s failure to disclose disbursements totaling 

$628,383 on its originally filed 2018 April Quarterly and July Quarterly Reports.

B. Interim Audit Report & Audit Division Recommendation

The Audit staff discussed this matter with AERF representatives during the exit 

conference and provided the relevant schedule. In response to the exit conference, AERF

stated that it has previously filed the necessary amended disclosure reports to correct the 

reporting errors. AERF explained that its original 2018 April Quarterly Report failed to 

disclose the payroll entries totaling $83,367 and its 2018 July Quarterly Report was 

inadvertently uploaded without the corresponding disbursements totaling $628,383. 

AERF stated that it has implemented “processes and procedures to avoid similar errors in 

the future.”

The Interim Audit Report recommended that AERF provide any additional comments it 

deems relevant to this matter.

C. Committee Response to Interim Audit Report

In response to the Interim Audit Report recommendation, AERF reiterated its earlier 

response to the exit conference and stated that it “continues to follow and refine the 

processes and procedures implemented in response to the Audit staff’s Preliminary 

Findings and Recommendations.” To avoid similar errors in the future, AERF has 

implemented several processes and procedures to alleviate many of the errors that 

occurred in 2017 and 2018, including improved communication and document sharing 

with its accounting firm and adding a function to its filing software to detect 

discrepancies between the software reports and the bank statements. 
7 

Finding 2. Recordkeeping for Disbursements and Use of 

Designated Depository

Summary 

During audit fieldwork, the Audit staff identified payments totaling $2,240,253 which 

AERF made to “Er Responders,” however, AERF reported these disbursements as 

payments to vendors on its disclosure reports. AERF did not provide any “Er 

Responders” bank statements to demonstrate that these payments were subsequently 

transmitted to the disclosed vendors. In response to the Interim Audit Report 

recommendation, AERF acknowledged the existence of the Association for Emergency 

Responders and Firefighters, LLC, but denied that this entity was the payee of any of the 

payments from AERF. AERF submitted the redacted bank statements obtained from four 

of its vendors which reflected 86 payments totaling $1,261,088, for the period January 1, 

2018 through August 9, 2018. However, the payments outlined on the redacted bank 

statements are not supporting and verifiable evidence that the disclosed vendors were 

paid with the funds transferred from AERF’s bank account. AERF provided no 

additional documentation for the remaining 73 vendor payments totaling $979,165. 

Legal Standard 

A. Formal Requirements Regarding Reports and Statements. Each Political 

Committee shall maintain records with respect to the matters required to be reported 

which shall provide in sufficient detail the necessary information and data from which the 

filed reports may be verified, explained, clarified, and checked for accuracy and 

completeness. 11 CFR §104.14(b)(1). 

B. Required Records for Disbursements. For each disbursement, the treasurer of a 

political committee must keep records on the:

• Amount; 

• Date;

• Name and address of the payee7

; 

• Purpose (a brief description of why the disbursement was made—see below); and

• If the disbursement was made on behalf of a candidate, the candidate’s name and 

the office sought by the candidate. 

• If the disbursement was in excess of $200, the records must include a receipt or 

invoice from the payee, or a cancelled check or share draft to the payee. If the 

disbursement was by credit card, the record must include the monthly statement 

or customer receipt and the cancelled check used to pay the credit card bill. 52 

U.S.C. §30102(c)(5) and 11 CFR §102.9(b). 

C. Required Supporting Evidence. For any single disbursement that exceeds $200, the 

treasurer must also keep a receipt, an invoice, or a canceled check. 52 U.S.C. §30102 

(c)(5).

7

 The payee is usually the person providing the goods or services to the committee. In the case of travel 

advances, however, the payee is the person receiving the advance. 11 CFR §102.9(b)(2).
8 

D. Preserving Records and Copies of Reports. The treasurer of a political committee 

must preserve all records and copies of reports for 3 years after the report is filed. 52 

U.S.C. §30102 (d). 

E. Depositories. Each political committee shall designate one or more state banks, 

federally chartered depository institutions (including a national bank), or depository 

institutions, the deposits or accounts of which are insured by the Federal Deposit 

Insurance Corporation, Federal Savings and Loan Insurance Corporation, or the 

National Credit Union Administration, as its campaign depository or depositories. 

Each political committee shall maintain at least one checking account or transaction 

account at one of its depositories. 52 U.S.C. §30102(h)(1) and 11 CFR §103.2. 

F. Disbursements from the Depository. A committee shall make all disbursements by 

check or similar drafts drawn on an account at its designated campaign depository, 

except for expenditures of $100 or less made from a petty cash fund maintained 

pursuant to 11 CFR §102.11. Funds may be transferred from the depository for 

investment purposes, but shall be returned to the depository before such funds are 

used to make expenditures. 11 CFR §103.3(a). 

Facts and Analysis 

A. Recordkeeping for Disbursements

 

1. Facts

The Audit staff reviewed 159 payments totaling $2,240,253 that AERF disclosed as 

payments to vendors. According to AERF’s bank statements, however, AERF made 

66 ACH transfers (ACH settlements) totaling $2,240,253 to “Er Responders.” This 

appears to be the Association for Emergency Responders and Firefighters, LLC.4 

AERF reported the disbursements as payments to vendors other than “Er Responders” 

on its disclosure reports but did not provide “Er Responders” bank statements to 

demonstrate that the funds transferred from AERF to “Er Responders” were used to 

pay the vendors disclosed on the reports. As a result, the Audit staff was unable to 

verify the accuracy and completeness of the reported activity. (See Limitations, p.1.) 

2. Interim Audit Report & Audit Division Recommendation

The Audit staff discussed this matter with AERF representatives during the exit 

conference and provided relevant schedules. In response to the exit conference, 

AERF denied it violated the applicable regulations and stated that it properly 

disclosed disbursements to its vendors. 

According to AERF: 

• The vendors’ statements presented in response to the exit conference 

demonstrate payment from AERF “to all vendors throughout all of 2018.” 

• Three vendors changed their names and addresses in August 2018 but “the 

payments from AERF to the vendors from August 2018 through December 

2018 correlate to the vendor’s invoice number.” 
9

• AERF stated it made a single ACH wire transfer to pay for all three vendors, 

as opposed to three separate wire transfers, “because the single wire was a 

more cost effective and efficient way to transfer funds.” To support this 

assertion, AERF submitted an attachment detailing the invoices and payment 

amounts for three vendors.

• Lastly, AERF acknowledged the existence of the Association for Emergency 

Responders and Firefighters, LLC, however, it “object[s] to each of the 

findings that state AERF LLC was the payee of certain disbursements; these 

payments were properly made to the vendors as payees.”

The Audit staff maintained that:

• AERF did not provide sufficient and verifiable records to demonstrate that the 

vendors disclosed on the reports were paid by way of the disbursements discussed 

in this finding. AERF’s bank statements indicate that the recipient of the ACH

transfers was a single entity titled “Er Responders.” This entity appears to be the 

Association for Emergency Responders and Firefighters, LLC.4

 AERF only 

provided vendor statements to support that all billed amounts presented were paid. 

AERF provided no verifiable documentation to demonstrate whether “Er 

Responders” subsequently made the payments to the disclosed vendors.

• Changes to the new names and addresses of vendors should have been reflected in 

AERF’s disclosure reports. Unless such changes are disclosed, the public record 

is not accurate.

• The Association for Emergency Responders and Firefighters, LLC registered with 

the Nevada Secretary of State on November 20, 2017, 16 months after AERF 

registered with the Commission. In addition, while the Nevada Secretary of State 

disclosed the LLC’s current status as “Revoked,

4

” AERF’s Treasurer, was listed 

as one of the managers of the LLC, along with two family members and, 

according to the public record, this entity was formed as a domestic limited 

liability company. 

The Interim Audit Report recommended that AERF provide supporting and verifiable 

evidence, such as bank statements, that the disclosed vendors were paid with the 

funds transferred from AERF’s bank account to “Er Responders.”

3. Committee Response to the Interim Audit Report

In response to the Interim Audit Report recommendation, AERF acknowledged the 

existence of the Association for Emergency Responders and Firefighters, LLC. 

However, AERF denied that this entity was the payee of any of the ACH transfer

payments from AERF. AERF stated that, for each of the ACH wire transfers made 

from its designated depository, PNC, its banking institution labeled the transfers

“ACH Settlement Vendor Pay Er Responders.” AERF further stated that “...this 

label was created solely by the PNC, and does not reflect payment to the Association 

for Emergency Responders and Firefighters, LLC, nor to any entity or entities other 

than the intended vendors.”
10

According to AERF, “[the] labeling of the wire transfers occurred as part of the 

process by which funds were transferred directly from AERF’s designated depository

to the vendors in question8

.” Further, AERF stated that, “For each payment to a 

vendor, only one transfer occurred – the payment from AERF to the vendor, though it 

may have appeared that two transfers were being made – one from AERF’s 

designated depository to “Er Responders”... and one from “Er Responders” to each 

of the vendors....” AERF stated that the Audit staff’s claim of the transfers being 

made via the LLC was “baseless” and that such transaction labeling was its bank’s 

“internal recordkeeping practice. Because this labeling process is controlled by the 

bank, AERF’s ability to more clearly demonstrate the direct flow of funds from its 

depository to the vendors is limited.” To support its assertion, AERF resubmitted 

vendor statements showing that all billed amounts were paid.9 In addition, AERF 

submitted redacted bank statements obtained from its vendors which reflected 86

payments from “Er Responders” totaling $1,261,088, for the period January 1, 2018 

through August 9, 2018. AERF did not provide any additional documentation for the 

remaining 73 vendor payments totaling $979,165. 

AERF objected to the Audit staff’s “continued unsupported contention that the wire 

transfers in question went to the Association for Emergency Responders and 

Firefighters, LLC.” According to AERF, the Audit staff has not provided “any 

factual evidence or rationale” to demonstrate its conclusion. AERF stated that “the 

Audit Division should withdraw its finding related to recordkeeping for 

disbursements and use of designated depository.” 

Based on the documentation provided, the Audit staff maintains that AERF has not 

provided sufficient and verifiable documentation to support the 66 ACH transfers totaling 

$2,240,253 made from its account. Specifically, the Audit staff notes the following:

• AERF did not provide any documentation such as debit memoranda or similar 

electronic receipts (discussed below), to demonstrate that the payments 

originating from its account were made directly to its vendors.

• Resubmitted vendor statements reflecting that all billed amounts presented were 

paid, do not provide the source(s) of the funds paid to the vendors. 

• According to AERF’s bank statements, there were 66 ACH transfers totaling 

$2,240,253. These ACH transfers were reported on AERF’s disclosure reports as 

159 vendor payments of the same total amount. AERF’s assertion that “for each 

payment to a vendor, only one transfer occurred” is only partially supported by its

bank statements. As outlined in the chart below, AERF’s ACH transfers

contained one, two or three vendor payments per transfer as follows:

8

 The Audit staff notes that, irrespective of how the transactions are labeled, to utilize the ACH process to 

transfer funds, AERF (not the bank) would have entered in the payee(s) information, including the 

payees’ names; bank account numbers; desired amounts to be transferred and the transfer date(s). 9

 AERF submitted this documentation previously, in its response to the exit conference.
11

# of Payments Per AERF Bank Statements

Included Per ACH

Transfer

# of ACH

Transfers Amount Paid 

One 19 722,401

Two 1 16,520

Three 46 1,501,332

Totals Per Bank 66 $ 2,240,253

In 19 instances, the amounts transferred from AERF’s account represented a 

single payment to one of AERF’s vendors. In the remaining 47 instances, the 

transferred amounts contained more than one payment and were disbursed to 

more than one vendor. For those ACH transfers, AERF’s response did not 

address the discrepancy between AERF’s amounts reported per disclosed 

transaction and the actual amount and number of ACH transfers from its bank 

account, for which the banking institution lacks discretion apart from AERF’s 

orders. 

• AERF obtained and provided the redacted bank statements of four of its vendors 

reflecting 86 vendor payments totaling $1,261,088. The Audit staff notes that all 

four vendors utilized the same financial institution and that, per the bank

statements, all four vendors used the same physical address. As for the 86

payments to vendors, the description of each transaction was “Er Responders Des: 

Cash Disb. ID:” followed by the respective vendor’s name. AERF did not explain 

why these payments to vendors were described on the redacted bank statements as 

cash disbursements. The chart below summarizes the number of payments 

substantiated by the redacted vendor bank statements. Between January 1, 2018, 

and August 9, 2018,10 it appears as if the vendors received payments as follows: 

 

# of Payments 

Included Per ACH 

Transfer

Per AERF Bank 

Statements Per Redacted Vendor Bank 

Statements 

# of ACH Transfers

# of Vendor Payments

Amount

Reported

One 6 6 163,268

Two 1 2 16,520

Three 26 78 1,081,300

Totals Per Vendors 33 8611 $ 1,261,088

10 The redacted vendor bank statements for August 2018 did not indicate any activity beyond August 9, 

2018. The September and October 2018 redacted vendor bank statements submitted by AERF were 

blank. 11 According to AERF’s bank statements, AERF made 33 ACH transfers for 86 vendor payments totaling 

$1,261,088. AERF did not provide any documentation for the remaining 33 ACH transfers which 

presumably paid 73 vendor payments totaling $979,165. 
12

As such, AERF demonstrated, albeit circumstantially, that these 86 payments 

appear to have reached its vendors as AERF reported, however, AERF did not 

provide any documentation to substantiate that these payments to vendors 

originated from its own banking institution. Similarly, the vendors’ redacted bank 

statements appear to show payments from “Er Responders” but do not appear to 

reflect that the payments came directly from AERF’s bank account. 

• AERF did not provide the vendor bank statements for the remaining 73 vendor 

payments totaling $979,165. The chart below summarizes the number of 

payments which were not substantiated by the vendor bank statements as follows:

# of Payments 

Included Per ACH 

Transfer

Per AERF Bank 

Statements and 

Vendor Sheets No Documentation Provided

# of ACH 

Transfers # of Vendor Payments

Amount

Reported

One 13 13 559,133 

Three 20 60 420,032 

Totals Per Bank 33 73 $ 979,165 

The Audit staff recommends that AERF provide sufficient supporting and verifiable 

evidence to demonstrate that the 66 ACH transfers resulted in the 159 vendor 

payments AERF reported on its disclosure reports. Since it appears that AERF 

initiated the ACH transfers using its banking institution’s online banking portal, 

AERF can provide, for example, a debit memorandum or any similar electronic 

transaction receipt generated during the process for each ACH transfer. Such 

documentation would include the detail necessary to verify that the vendor payments 

reported on AERF’s disclosure reports were accurate and paid via the committee’s 

depository, in accordance with 11 CFR §104.14(b)(1). 

o Generally, to electronically initiate an ACH transfer, the 

requestor/sender would access their online bank account and initiate an 

ACH transfer. For successful processing, the following information 

would be entered; the ACH transfer date, the recipient’s name; the 

recipient’s bank routing number and account number; and the amount 

to be transferred. In AERF’s case, this information would be required 

for all recipients (vendors) since the ACH transfers included up to 

three invoiced payments. 

o Similarly, upon completion of each ACH transfer, AERF’s banking 

institution would issue a debit memorandum or similar electronic 
13

receipt, reflecting such details as dates, amounts, the collecting bank’s 

routing and account numbers, along with the name on the account. 

The Audit staff further recommends that, in addition to the aforementioned transfer 

documentation, AERF may also provide a written explanation from a bank official

regarding how the transactions appear on its monthly bank statements and exactly 

how the funds were transferred.

AERF obtained and provided some vendor bank statements and was able to show that 

86 payments totaling $1,261,088, made via 33 ACH transfers, reached its vendors. 

However, with regard to recordkeeping requirements, AERF did not materially 

comply with the Audit staff’s recommendation because it did not provide sufficient 

and verifiable evidence such as, debit memorandum or similar electronic receipt for 

each ACH transfer to demonstrate that the vendor payments originated from AERF’s

bank account. AERF also did not provide any documentation for the remaining 73 

vendors payments totaling $979,165, which were disbursed via 33 ACH transfers. 

 

The Audit staff maintains that AERF did not provide sufficient supporting and 

verifiable evidence that the disclosed vendor payments totaling $2,240,253, were 

made with the funds transferred from AERF’s bank account. 

B. Use of the Designated Depository

1. Facts

The Audit staff identified 159 payments totaling $2,240,253 disclosed as payments to 

vendors which, according to AERF bank statements, were instead ACH transfers to 

“Er Responders.” It appears AERF involved this entity in its financial operations and 

failed to use its designated depository to make payments directly to its vendors. 

 

AERF provided vendor statements to support that all billed amounts presented were 

paid to the vendors, however, the Audit staff was unable to verify that the funds 

AERF transferred to “Er Responders” were subsequently transmitted to AERF’s 

disclosed vendors. 

2. Interim Audit Report & Audit Division Recommendation

The Audit staff discussed this matter with AERF representatives during the exit 

conference. In its written response to the exit conference, AERF did not address 

AERF’s failure to use its designated depository to make payments to its vendors. 

The Interim Audit Report recommended that AERF provide bank statements to 

support that the disclosed vendors were paid with the funds transferred from AERF’s 

bank account to “Er Responders” with the description of “ACH Settlement Vendor 

Pay Er Responders.” The Interim Audit Report further recommended that AERF 

explain why its designated depository was apparently not used to make the direct 

payments to the disclosed vendors. 
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3. Committee Response to the Interim Audit Report

In response to the Interim Audit Report recommendation, AERF disagreed with the 

Audit staff’s conclusion and maintained that the ACH transfers were made from its 

designated depository, as discussed in Part A above. The Audit staff maintains that 

AERF did not provide sufficient supporting and verifiable evidence to support that 

the disclosed vendors were paid with the funds transferred from the AERF’s bank 

account. 

To demonstrate that the vendor payments originated from its bank account, the Audit 

staff recommends AERF provide sufficient supporting and verifiable evidence such 

as, debit memorandum or similar electronic receipt for each payment to demonstrate 

that the 66 ACH transfers initiated by AERF resulted in the 159 vendor payments 

reported on its disclosure reports.