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• FEDERAL ELECTION COMMISSION

WASHINGTON. 0 C. 204&3

ASS-SO

May 1, 1986

MEMORANDUM

Attached please find a copy of the final report of the

Garden State Political Action Committee which was approved by the Commission on April 14, 1986.

Informational copies of the report have been received by all parties involved and the report may be released to the

publlc.

'1'0:

PROM:

SUBJECT:

FRED EILAND

PRESS OFFICER -$;

ROBERT J. COSTA

ASSISTANT STAFF DI CTOR

AUDIT DIVISION

PUBLIC ISSUANCE OF FINAL AUDIT REPORT - GARDEN STATE POLITICAL ACTION COMMITTEE

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Attachment as stated

cc: FEe Library

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\o....p·ublic Record

Office of General Counsel
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FEDERAL ELECTION COMMISSION

WASHINeYON. D.C. 20463

A8S-50

BBPORT OF TBB AUDIT DIVISION

ON

GARDBN STA'l'B POLITICAL ACTION COMMIT'l'BB

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I. Background

A. Overview

~his report is based on an audit of the Garden State

Political Action Committee (Wthe CommitteeW) undertaken by the

Audit Divi8ion of the Pederal Election Commission in accordance

with the Commissionts audit policy to determine Whether there has

been compliance with the provisions of the Pederal Election

Campaign Act of 1971, a8 amended (Wthe ActW). The audit was

conducted pursuant to Section 438(b) of Title 2 of the United

States Code which states, in part, that the Commission may conduct audits and field investigations of any political committee required to file a report under section 434 of this

title. Prior to conducting any audit under this subsection, the

Commission shall 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.

The Committee registered with the Peaeral Election

Commission on August 5, 1983, and maintains its headquarters in

Roseland, New Jersey.

The audit covered the period January 1, 19S3 through December 31, 1984. The Committee reported a beginning cash

balance on January 1, 1983 of $-0-, total receipts for the period of $50,741.00, total disbursements for the period of $46,966.00

'and an ending cash balance on December 31, 1984 of $3,775.00.

This report is based on documents and workpapers 8upporting each of its factual statements. They form part of the

record upon~Which the Commission based its decisions on the

matters in this report and were available to the Commissioners

and appropriate staff for review•
• B. Key Personnel

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The Treasurer of the Committee during the period covered by the audit was Mr. Boward J. Menaker.

c. Scope

The audit included such tests as verification of total

reported receipts and disbursements and individual transactions,

review of required supporting documentation, analysis of

Committee debts and obligations, and such other audit procedures

as deemed necessary under the circumstances. Bowever, the

receipt records made available for the Audit staff's review were

not maintained in a manner which allowed testing for correct

aggregate contribution totals, proper itemization and contribution

limitations.

II. Pindings and Recommendations

Sections 432(c)(1)(2)(3) and (d) of Title 2 of the

United States Code state, in part, that the treasurer of a

political committee shall keep an account of all contributions

received by or on behalf of such political committee, the name

and address of "any person who makes any contribution in excess of

$50, together ~ith the date and amount of such contribution by

any person, the identification of any person who makes a

contribution or contributions aggregating more than $200 during a

calendar year, together with the date and amount of any such

contribution, and shall preserve all records required to be kept by this section and copies of all reports required to be filed by this subchapter for 3 years after the report is filed.

Section 431(13) (A) of Title 2 of the United States Code

states that the term identification means, in the case of an

individual, the name, the mailing address, and the occupation of

such individual, as well as the name of his or her employer.

The Committee's contribution records consisted of the

following: (1) contributor cards containing a deposit date,

contributor's name, address and amount of contribution, along with an occupation and name of employer where necessarYJ (2) a

receipts ledger containing the contributor's name, amount,

deposit date and city where contributor resides, and (3) deposit tickets for each deposit made •

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A. Contribution Records
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When the activity per the receipts ledger and the

contribution cards .as compared to the adjusted bank activity for

receipts, it .as determined that the receipt record. were

incomplete.

A review of the available records revealed that ~equate contributor information was not maintained for

$19,489.00, or 39' of the total amount of contributions received.

The Treasurer stated that he was aware that records were not

maintained for several contributions.

In the interim report the Audit staff recommended that

the Committee obtain for review copies of all missing and/or

incomplete contribution records.

In response to the audit report, the Committee provided

adequate documentation supporting the majority of the $19,489.00

in receipts.

Recommendation

The Audit staff recommends no further action on this matter.

B. Limitation on Contributions

Sections 441a(a) (1) (A) and (2) (A) of ~it1e 2 of the

United States Code, state that no person shall make contributions

to any candidate and his authorized political committees with

respect to any election for Pederal office which, in the

aggregate exceed $1,000, and no mu1ticandidate political committee shall make contributions to any candidate and his

authorized political committee with respect to any election for

Federal office which, in the aggregate, exceed $5,000.

Section 44l(a) (4) of Title 2 of the United States Code

states, ,in part, that the term Wmulticandidate political committeeWmeans a political committee which has been registered under section 433 of this title for a period of not less than 6

months, which has received contributions from more than 50

persons, and, except for any State political party organization, has made contributions to 5 or more candidates for Federal

office.

According to records on file at the Commis.ion, the

Committee met all of the requirements for multicandidate

political committee status on February 29, 1984. Therefore, the

Committee was limited to contributions not to exceed $1,000 per election to authorized candidate committees under 2 U.S.C. S

441a(a) (1) for the period from the Committee's inception to

February 28, 1984.
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A review of tbe Committee's disbursements disclo••d a

$5,000 contribution to a Pederal candidate on May 1, 1983, Which

vas 9 months prior to the Committee attaining multicandidate

political committee status. On March 28, 1984, the Commieeion's

Reports Analysis Division notified the Committee that the

contribution was $4,000 in excess of the limit. ~he Committee

re.ponded on April 19, 1984, that it baa received a refund from

the candidate. The Committee bank record. indicated the $4,000 refune! wa. received on February 20, 1984 and the Commit,tee reported the receipt of the refund on its 1984 April 15 Quarterly

report.

The Committee's Treasurer statea that he was not aware

of the limitation on contributions at the time the contribution

was made.

In the interim report the Audit staff recommended that

the Committee explain the circumstances surrounding the $5,000

contribution.

On January 27,1986, the Treasurer responded in a letter

that he was not aware that the contribution had exceeded the

limitation. Upon notification of the excessive amount, the

Committee was immediately refunded the excessive portion.

Recommendation

Since the excessive portion of the contribution has been

refunded, the Audit staff recommends no further action on this

matter •