Attachment as stated

December 14, 1979

PUBLIC ISSU&~CE OF AUDIT REPORT - NATIONAL COMMITTEE FOR AN EFFECTIVE CONGRESS

FRED EILAND

PRESS OFFICE

BOB COSTA ;(?j<!.-

JUDY HAWKINS

\\ "'"INC I ON, Dr .!1I4h\

II DERAL ELECTION COMMISSION

cc: FEe Library

RAD

Public Record

Informational copies of this report have been received

by all parties involved and this report may be released to

the public.

Attached please find a copy of the final audit report

for the National Committee for an Effective Congress which

was approved by the Commission on November 29, 1979.

SUBJECT:

FROM:

THROUGH:

MEMORANDUM

TO:

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FEDERAL ELECTION COMMISSION

\\' 1\"Ill NC; lIlN, Il (" ~1I4h I

REPORT OF THE AUDIT DIVISION"

ON THE

NATIONAL COMMITTEE FOR AN EFFECTIVE CONGRESS

I. Background

A. Overview

This repor.t covers an audit of the National Committee

For An Effective Congress ("the Committee"), undertaken by the

Audit Division of the Federal Election Commission in accordance

with the Commission's audit policy to determine whether there

has been compliance with the provisions of the Federal Election

Campaign Act of 1971, as amended ("the Act"). The audit was

conducted pursuant to 2 U.S.C. 438(a) (8) which directs the

Commission to make from time to time audits and field investigations with respect to reports and statements filed under the

provisions of this chapter.

The Committee registered with the Office of the Clerk

of the U.S. House of Representatives on April 17, 1972, an~

maintains its headquarters in New York, New York.

"The audit covered the period' January 1, 1977 through

April 30, 1979, the final coverage date of the latest report

filed by the Committee at the time of the audit. During

the period audited the Committee reported $36,177.45 in beginning

cash, total receipts of $1,169,696.55, total expenditures

of $1,181,679.95, and ending cash of $24,194.05.

This audit report is based on documents and working

'papers supporting 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

Commissioners and appropriate staff for review•
Recomr:\endation

1\. Itemization of Contributions

II. 1\udit Findin'ls and Reconunendations

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B. Key Personnel

The 1\udit staff recommends that no further action be taken

on these matters.

The Conuni ttee filed amended reports on .Tune 14, 1979,

itemizing the 86 contributions and disclosing the required

contributor information [or the 143 contributors mentioned

above.

C. Scope

Our review of the Committee's receipt records

revealed the following: (a) at least 86 contributions each

in excess of or aggregating in excess of $100, totaling $9,675

were not itemized. These contributions represent approximately

24'~ of the number and 7'?, of the total dollar value of contri11utions requiring itemization: and (b) the occupation and/or

11rincipal place of business was not disclosed for 143 individuals

who made contributions, each in excess of or aggregating in

excess of $100. These contributions represent approximately

53'?> of the number and 420:.'; of the total dollar value of contributions requiring itemization on the reports filed by the

Committee. Committee officials stated that the itemization

errors were due to computer problems which they are in the process

of correcting.

Section 434(h) (2) of Title 2, United States Code

states, in part, that each report shall disclose the full

name and mailing address (occupation and princip;ll place

of business, if any) of each person who has made one or more

contributions to or for such committee wi thin th(l calend~r

year in an aggregate amount or value in excess of $100,

together with the amount and date of such contributions.

The audit included such tests as verification of tot~l

reported receipts ~nd expenditures and individual transactions:

review of required supporting documentation and analysis of

Commi.ttee debts alltl obliCJations: and, such other audit procc'dures

as deemed necessary under the circumstanceR.

The principal officers of the Committee for the period

covered by the audit were Russell D. Hemenway, National Director,

ilnd Eileen K. Fischer, Treasurer.

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Recommendation

The Audit staff recommends that no further action be taken

on this matter.

(2) an individual who is not a citizen of the United

States and who is not ,lawfully admitted for permanent residence

as defined by Section 101(a) (20) of the Immigration and Nationality

Ac t ( 8. U. S • C• 1101 (a) (20» •

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Debts and Obligations not Continuously Reported

Contributions by Foreign Nationals

C.

n.

A review of the Committee's debt and obligation

schedules revealed that the Committee did nOt disclose the

disposition of two (2) debts totaling $2,100 owed to the

Committee and three (3) debts totaling $466.97 owed by the

Committee. The two (2) debts owed to the Committee were written

off because the entities are now defunct. The debts reported'

as owed by the Committee were in actuality never incurred as

contracts for the related services/goods were cancelled •

A review of the. bank r.ecords revealed charges for

foreign currency rate exchanges. Further review disclosed·

11 contributions from five (5) . individuals, totaling $325.00

whi,?h wgrc originally expressed -in Canadian dollars. .

The Committee has provided for our review the' .

following: (a) a statement front two (2) contributors indicating

their United States citizenship (75.00), (b) a- statement that

one (1) contributor is deceased (90.00) and (c) cupies uf letters

and refund checks to two (2) contributors (160.00).

Section 434(b) (12) of Title 2, United States Code

states, in part, that each report shall disclose the amount

and nature of debts and obligations owed by or to the committee

and a continuous reporting of these debts and obligations until

such debts and obligations are extinguished, toqether with a

statement as to the circumstances and conditions under \..hich

any such debt or obligation is extinguished and the consideration

therefor.

,Section 44le of Title 2, United States Code states,

in p,lI-l, that it shall be unlawful for a foreign national, .

dirf'l:t Iy or through any other person to make any contribution,

in connection with an election to any political office. The

term "foreign national" means; (1) a foreign principal as defined

by Section l(b) of the Foreign Agents Registration Act of 1938

(22 U.S.C. 611(b» except that the term shall not include an

individual who is a citizen of the United States;' or

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The Committee filed amended reports on June 14, 1979

disclosing the circumstances/conditions under which the debts

were extinguished.

Recommendation

The Audit staff recommends that no further action be taken

on this matter.
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