FEDERAL ELECTION COMMISSION 

WASHINGTON, D.C. 20463 

October 22,2010 

MEMORANDUM 

To: 

Through: 

From: 

The Commission 

Alec Palmer 

Acting Staff Director 

Patricia Carmona 

Chief Compliance Officer 

Joseph F. Stoltz 

Assistant Staff Dkector 

Audit Division 

By: 

Subject: 

Thomas J. Nurthen 

Audit Manager 

Brenda E. Wheeler 

Lead Auditor 

Audit Division Recommendation Memorandum on Hillary Clinton for 

President (A08-05) 

Pursuant to Commission Directive No. 70 (FEC Directive on Processing Audit 

Reports), the Audit Division recommends the Commission approve the finding as 

presented in the attached Draft Final Audit Report (DFAR). The Committee declined our 

offer for a hearing and did not provide a written response to the DFAR. The Office of 

General Counsel has reviewed this memorandum and concurs with the recommendation. 

If this memorandum is approved, a Proposed Final Audit Report will be prepared 

within 30 days of the Commission's vote. Should an objection be received. Directive No. 

70 states that the Audit Division Recommendation Memorandum will be placed on the 

next regularly scheduled open session agenda. 

Documents related to this audit report can be viewed in Voting Ballot Matters. 

Should you have any questions, please contact Brenda E. Wheeler or Thomas J. Nurthen 

at 694-1200. 

Attachments: 

Draft Final Audit Report on Hillary Clinton for President 

cc: Office of General Counsel 
Draft Final Audit Report of the 

Audit Division on Hillary Clinton 

for President 

January 1. 2007 - December 31, 2008 

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. 

J

etermine: 

ommi 

the lirifital 

prohibitions 

disclosure requ 

bf die 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. 

About the Campaign 

Hillary Clinton for President 

committee for Hillary Clint^ 

Party's nomination for the 

States. HCFP is headqi^Kei 

the principal campaign 

te for the Democratic 

of the United 

,D.C. For more 

information, see thq^Krt on the Campa 

Financial 

• Receipts 

itributions fron?^BKviduals 

OI^H^litical Commi 

Fr^afl^^fi d CommitT 

Canamate 

Offsetlto^irpeiid'HIIIIP & 

Other l^Keipts 

Total Releipts 

iemen^ 

expenditures 

Transfers to Affiliates 

ltribution Refimds 

ler Disbursements 

Total Disbursements 

;anization, p.2. 

$217,686,817 

1,610,538 

10,000,000 

13,750,000 

9,678,788 

$252,726,143 

$ 223,080,262 

6,466,215 

21,935^595 

75,403 

$ 251,557,475 

ding and Recommendation (p. 3) 

Receipt of Contributions that Exceed Limits 

2 U.S.C. §438(b). 
Draft Final Audit Report of the 

Audit Division on 

Hillary Clinton for President 

January 1, 2007 - December 31, 2008 
Table of Contents 

Page 

Part I. Background 

Authority for Audit 1 

Scope of Audit 1 

Part II. Overview of Campaign 

Campaign Organization 

Overview of Financial Activity 

Part III. Summary 

Finding and Recommendation 

Part IV. Finding and ReconuriB^atioi 

Receipt of Contributions that Exceed Limits 
Parti 

Background 

Authority for Audit 

This report is based on an audit of Hillary Clinton for President, 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 2 U.S.C. §438(b). which permits the Commission to 

conduct audits and field investigations of any political committ^BbLis required to file a 

report under 2 U.S.C. §434. Prior to conducting any audit ux^f this subsection, the 

Commission must perform an intemal review of reports fi^^D^belected committees to 

determine if the reports filed by a particular committee riKt then^g^old requirements 

for substantial compliance with the Act. 2 U.S.C. §4flQ[^A 

risk 

2. 

3. 

4. 

5. 

6. 

7. 

Scope of Audit 

Following Commission approved proceduresT thi 

factors and as a result, this audit examined 

1. The receipt of excessive contribu^iDns and loans. 

The receipt of contributions from^^hiliited sources 

The disclosure of contributions rec 

The disclosure of debts and obligatio^ 

The consistency between reported fig 

The completeness 

Other committee^eratioilBfcessary to 
Part II 

Overview of Campaign 

Campaign Organization 

Important Dates Hillary Clinton for President 

• Date of Registration January 22. 2007 

• Audit Coverage January 1. 2007j^^mber 31, 2008 

Headquarters Washingtc|#D^^k 

Bank Information 

• Bank Depositories 

• Bank Accounts 4 ^fe|t V 

Treasurer 

• Treasurer When Audit Was ConductS&|||. Shelly S?fttekwa 

Management Information 

Attended FEC Campai e Seminar 

Used Commonly A^feble uaaaaign 

Management Softy^l^^ckage 

Who Handled AccouiilIHlimd 

Recordkeepj] 

es 

>aid Staff 

Ove] ^w wrinancial Activity 

(Audited Amounts) 

Cash on hand ©^^jgrv lJo&7 $0 

0 Contributions fiifl9|U|tf^iduaIs 217,686,817 

0 Other Political Coflliittees 1,610,538 

0 From Affiliated Committees 10,000,000 

0 Candidate Loans 13,750,000 

0 Offsets to Expenditures & Other Receipts 9,678,788 

Total Receipts $252,726,143 

0 Operating Expenditures 223,080,262 

0 Transfers to Affiliates 6.466,215 

0 Contribution Refunds 21,935,595 

0 Other Disbursements 75,403 

Total Disbursements $251,557,475 

Cash on hand @ December 31,2008 $ 1,168,668 
Part III 

Summary 

Finding and Recommendation 

Receipt of Contributions that Exceed Limits 

The Audit staffs review of contributions from other political conunittees indicated that 

HCFP failed to timely resolve excessive contributions totalingJ^^IQ. The 

contributions were either designated to the general election b|^ ^ contributing committee 

or presumptively redesignated by HCFP. HCFP has pro^roo^^nentation that the 

contributions have been refimded. In response to the inteKn audnB^ort 

recommendation, HCFP's legal counsel notes that t|»!^|^ihit is a tin|^ ^ of total 

receipts and went on to explain that the excessive^ntributions were dxA^three minor 

database errors inadvertently overlooked by H|fiL Wheill^e contributi^^^p^ brought 

to HCFP's attention, they took appropriate steps iHnjimjp^inds. (For n^re detail, see 

p. 4) 
Part IV 

Finding and Recommendation 

Receipt of Contributions that Exceed Limits 

Summary 

The Audit staffs review of contributions from other political committees indicated that 

HCFP failed to timely resolve excessive contributions totaling $2J^0. The 

contributions were either designated to the general election bylJ^RoKtributing committee 

or presumptively redesignated by HCFP. HCFP has provido^Kcumentation that the 

contributions have been refimded. In response to the into^aB^^port 

recommendation, HCFP's legal counsel notes that the^^Lnt is^^^art of total 

receipts and went on to explain that the excessive^^mi^tibns wer^w^to three minor 

database errors inadvertently overlooked by HCQ^When the contribu^^^were brought 

to HCFP's attention, they took appropriate steifl^etum the funds. 

Legal standard 

A. Authorized Committee Limits. 

than a total of $2,300 per election froi 

multicandidate political committee. 2 

§§110.1(a) and (b), 110.2(b), and 110.9. 

authorized comfflfctfee may not receive more 

LC person orJa^Oner election from a 

.5(a)(l)(ASfcf2)(A), and (f); 11 CFR 

B. Handling Contril 

contribution that apjjtts to be" 

• Retum thd^u^nnable 

Deposit the chec! 

lou 

itten 

t Appear w^cessive. 4R a committee receives a 

ssive, the^mmittee must either: 

eck to the d^n^or 

and: 

ey m UAWftount to cover all potential refunds; 

d explaining why the contribution may be illegal; 

n Schedule A if the contribution has to be 

its U^lity is established; 

tion or a redesignation of the excessive portion, following 

provided in the Commission regulations; and 

tee does not receive a prbjper realtribution or redesignation 

wimTyoays after receiving the excessive contribution, refimd the 

exce^^ portion to the donor. 11 CFR §§103.3(b)(3), (4) and (5) and 

110.1(k)(3)(ii)(B). 

C. General Election Contributions. If a candidate is not a candidate in the general 

election, any contributions made for the general election shall be refunded to the 

contributors or redesignated in accordance with 11 CFR §§110.1(b)(5) or 110.2(b)(5), as 

appropriate. 11 CFR § 102.9(e)(3). 
Facts and Analysis 

A review of contributions from other political committees revealed HCFP received 

excessive contributions from ten political committees totaling $21,400 which were 

unresolved. The contributions were either designated to the general election by the 

contributing committee or presumptively redesignated to the general election by HCFP. 

Since the Candidate did not run in the general election, these contributions were required 

to be refimded. At all times, HCFP maintained sufficient fiinds to make the necessary 

refimds. 

The Audit staff discussed this matter at the exit conference and 

representatives with a schedule of the apparent excessive cont 

the exit conference, HCFP provided the Audit staff with coi 

$21,400. The refimd checks have been negotiated and ixwSd tc 

account. 

jded HCFP 

Itioira. In response to 

refund checks totaling 

ippropriate bank 

Interim Audit Report Recommenda 

The Audit staff recommended that HCFP pn 

with respect to this matter. In response, HCFP's 

tiny part of total receipts and went on to explain 

to three minor database errors inadvd^te|tly overlooked 

contributions were brought to HCFP's^fcakm. they 

fiinds. 

ommittee^^^ponse 

it deeme^Blessary 

otes that th^mount is a 

cessive contributions were due 

When the 

^ate steps to retum the