FEDERAL ELECTION COMMISSION 

WASHINGTON, D.C. 20463 

July 22, 2009 

MEMORANDUM 

To:	 Judith Ingram 

Press Officer 

From:	 Joseph F. StOljiAzfJt Assistant Staff,' ctor
 

Audit Divisio
 

Subject:	 Public Issuance of the Audit Report on Friends of Weiner 

Attached please find a copy of the audit report on Friends of Weiner, which was 

approved by the Commission on June 24,2009. 

All parties involved have received informational copies of the report. The report 

may be released to the public on July 22,2009. 

Attachment as stated 

cc:	 Office of General Counsel 

Office of Public Disclosure 

Reports Analysis Division 

FEC Library 

lTD Web 
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.' The audit 

determines whether the 

committee complied with 

the limitations, 

prohibitions and 

disclosure requirements 

ofthe Act. 

Future Action 

The Commission may 

initiate an enforcement 

action, at a later time, 

with respect to any ofthe 

matters discussed in this 

report. 

Report of the 

Audit Division on 

Friends of Weiner 

January 1,2003 - December 31,2004 

About the Campaign (p.2) 

Friends of Weiner is the principal campaign committee for 

Anthony Weiner, Democratic candidate for the U.S. House of 

Representatives from the state of New York, 9th Congressional 

District and is headquartered in Forest Hills, New York. For 

more information see the Campaign Organization Chart, p. 2. 

Financial Activity (p. 2) 

•	 Receipts 

o	 From Individuals $ 426,484 

o	 From Political Committees 114,417 

o	 Offsets to Expenditures 733 

o	 Other Receipts 142,799 

o	 Total Receipts $ 684,433 

•	 Disbursements 

o	 Operating Expenditure $ 493,008 

o	 Contribution Refunds 495,747 

o	 Other Disbursements 426,574 

o	 Total Disbursements $ 1,415,329 

Findings and Recommendations (p. 3) 

•	 Receipt of Contributions that Exceed Limits (Finding I) 

•	 Failure to Disclose Debts and Obligations (Finding 2) 

•	 Disclosure of Contributions from Political Committees 

(Finding 3) 

•	 Disclosure of Occupation/Name of Employer (Finding 4) 

•	 Misstatement of Financial Activity (Finding 5) 

•	 Untimely Deposit ofContributions (Finding 6) 

•	 Disclosure ofAllocable Activity (Finding 7) 

I 2 U.S.C. §438(b). 
Table of Contents 

Page 

Part I. Background 

Authority for Audit
 

Scope ofAudit
 

Part II. Overview of Campaign
 

Campaign Organization 2
 

Overview of Financial Activity 2
 

Part III. Summaries 

Findings and Recommendations 3
 

Part IV. Findings and Recommendations
 

Finding 1. Receipt of Contributions that Exceed Limits 5
 

Finding 2. Failure to Disclose Debts and Obligations 9
 

Finding 3. Disclosure of Contributions from Political Committees 11
 

Finding 4. Disclosure of OccupationIName of Employer 13
 

Finding 5. Misstatement ofFinancial Activity 14
 

Finding 6. Untimely Deposit of Contributions 18
 

Finding 7. Disclosure of Allocable Activity 19
 
Part I 

Background 

Authority for Audit 

This report is based on an audit of Friends of Weiner (FOW), 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 committee that is required to file a report under 2 U.S.C. §434. Prior to conducting 

any audit under this subsection, the Commission must perform an internal review of reports filed 

by selected committees to determine ifthe reports filed by a particular committee meet the 

threshold requirements for substantial compliance with the Act. 2 U.S.C. §438(b). 

Scope of Audit 

This audit examined: 

I. The receipt of excessive contributions and loans. 

2. The receipt of contributions from prohibited sources. 

3. The disclosure of contributions received. 

4. The disclosure of disbursements, debts and obligations. 

5. The consistency between reported figures and bank records. 

6. The completeness ofrecords. 

7. Other committee operations necessary to the review. 

Scope Limitation 

Although it met the recordkeeping requirements of2 U.S.C. §432(c), FOW did not maintain 

externally generated documentation such as invoices, bills, or receipts for about 30% of its 

disbursements. The lack ofthese records limited our testing for the proper reporting of debts and 

obligations, personal use of campaign funds and the adequacy of disclosure information such as 

payee, address and purpose of disbursements. In addition, the records made available did not 

allow for a determination ofwhat portion, ifany, could have been attributable to the Candidate's 

concurrent mayoral campaign. 
2 

Part II 

Overview of Campaign 

Campaign Organization 

Important Dates Friends of Weiner 

• Date of Registration May 28,1997 

• Audit Coverage January 1,2003 - December 31,2004 

Headquarters Forest Hills, New York 

Bank Information 

• Bank Depositories Four 

• Bank Accounts Three checking accounts and two 

investment accounts 

Treasurer 

• Treasurer When Audit Was Conducted Ms. Francis Weiner (10/14/05-10/15/06) 

Mr. Nelson Braff(l0/16/06 to present) 

• Treasurer During Period Covered by Audit Mr. Ira Spodek 

Management Information 

• Attended FEC Campaign Finance Seminar No 

• Used Commonly Available Campaign 

Management Software Package 

Yes 

•	 Who Handled Accounting, Recordkeeping Campaign staff 

Tasks and Other Day-to-Day Operations 

Overview of Financial Activity 

(Audited Amounts) 

Cash on hand (jiJ January 1,2003 

Receipts 

0 From Individuals 

0 From Political Committees 

0 Offsets to Expenditures 

0	 Other Receipts 

Total Receipts 

Disbursements 

0 Operating Expenditures 

0 Contribution Refunds 

0 Other Disbursements 

Total Disbursements ...

Cash on hand @ December 31, 2004 

$ 1,219,194 

- $ 426,484 

114,417 

733 

142,799 

$ 684,433 

$ 493,008 

495,747 

426,574 

$ 1,415,329 

$ 488,298 
3 

Part III 

Summaries 

Findings and Recommendations 

Finding 1. Receipt of Contributions that Exceed Limits 

The interim audit report concluded FOW received 41 excessive contributions from 26 

individuals totaling $63,200; most of these excessive contributions resulted from 

improper redesignations to the general election. Ofthese excessive contributions: 

$28,000 could be resolved by presumptive redesignation/reattribution letters. FOW has 

now provided such letters for contributions totaling $26,000. Ofthe remaining excessive 

contributions $25,200 has been refunded, although no documentation ofthe negotiation 

ofthe refund checks has been provided; three contributions totaling $4,000 although 

recorded by FOW were apparently not received: and, $8,000 appears resolvable only by 

refund. (For more detail see p. 5) 

Finding 2. Failure to Disclose Debts and Obligations 

FOW did not report debts owed to seven vendors totaling $17,984. In response to the 

interim audit report, FOW only disputed the amount of debt to be reported for one 

vendor; no amended reports were filed as part of its response. (For more detail, see p. 9) 

Finding 3. Disclosure of Contributions from Political 

Committees 

FOW did not adequately disclose 21 contributions from political committees totaling 

$26,025. In response to the interim audit report, FOW acknowledged minor errors 

disclosing these contributions and states that an amendment will be filed. To date, these 

disclosure errors have not been corrected. (For more detail see p. 11) 

Finding 4. Disclosure of Occupation/Name of Employer 

Based on a sample, FOW did not adequately disclose occupation and/or name of 

employer for about 30% of contributions from individuals tested. Amended reports filed 

subsequent to completion of audit fieldwork materially corrected these errors. In 

response to the interim audit report, FOW submitted additional comments disputing the 

validity ofthe Audit staff's sample and its results. (For more detail, see p. 13) 

Finding 5. Misstatement of Financial Activity 

A comparison ofFOW reported activity to bank records revealed a misstatement of 

receipts, disbursements and cash on hand in both 2003 and 2004. For 2003, FOW 

overstated beginning cash on hand by $77,831; overstated receipts by $23,687; 

understated disbursements by $91,018 and overstated ending cash on hand by $192,537. 

In 2004, FOW understated receipts by $8,128 and disbursements by $96,874. 

Additionally, ending cash on hand for 2004 was overstated by $281,283. Amended 

reports filed subsequent to the completion of audit fieldwork materially corrected the 
4 

reported activity. In response to the interim audit report, FOW acknowledged that the 

misstatement resulted primarily from the reporting of an investment account. (For more 

detail, see p. 14) 

Finding 6. Untimely Deposit of Contributions 

Based on a review of all contributions from political committees and a sample review of 

contributions from individuals, FOW failed to deposit contributions in a timely manner. 

The Audit staff determined that contributions from political committees of $76,500 and 

projected contributions from individuals of at least $330,000 were not deposited timely. 

FOW acknowledged the problem but did not explain how the errors had occurred. FOW 

has also stated it has since retained a professional consultant to administer its financial 

and reporting activities and that procedures have been put in place to correct the error. In 

response the interim audit report, FOW stated the audit results were "exaggerated," 

reiterated its retention of a consultant to correct problems with receipt processing and 

presented mitigating arguments. (For more detail, see p. 18) 

Finding 7. Disclosure of Allocable Activity 

The Audit staff identified expenditures made by both FOW ($155,956) and the 

Candidate's concurrent mayoral campaign ($52,988) during 2004 that did not appear to 

be properly allocated nor disclosed as allocable expenditures. In the interim audit report, 

the Audit staff used contributions received by each entity to develop an allocation ratio of 

5.99% FOW and 94.01 % for the Candidate's mayoral campaign. Based on that ratio, the 

Audit staff concluded that FOW's allocable share ofthese expenditures was $12,516 and 

the Candidate's mayoral campaign share was $196,428. In its response to the interim 

audit report, FOW restated earlier arguments it has offered and asserted these 

expenditures do not require allocation. The response did not contain work papers or 

analyses to support its arguments, nor did FOW file amended reports to disclose these 

transactions. In this audit report, the Commission concludes that there were expenses in 

the amount of$208,944 from which both FOW and the Candidate's mayoral campaign 

appear to have derived some benefit, which mayor may not have required allocation. 

However, FOW did not provide documentation upon which the Audit staff could allocate. 

these expenses between FOW and the Candidate's mayoral campaign. 

(For more detail, see p. 19) 
5 

Part IV
 

Findings and Recommendations
 

IFinding 1. Receipt of Contributions That Exceed Limits 

Summary 

The interim audit report concluded FOW received 41 excessive contributions from 26 

individuals totaling $63,200, most ofthese excessive contributions resulted from 

improper redesignations to the general election. Of these excessive contributions: 

$28,000 could be resolved by presumptive redesignationlreattribution letters. FOW has 

now provided such letters for contributions totaling $26,000. Of the remaining excessive 

contributions $25,200 has been refunded, although no documentation of the negotiation 

of the refund checks has been provided; three contributions totaling $4,000 although 

recorded by FOW were apparently not received: and, $8,000 appears resolvable only by 

refund. 

Legal Standard 

A. Authorized Committee Limits. An authorized committee may not receive more 

than a total of $2,000 per election from anyone person. Increased contribution limits are 

provided for candidates facing self-financed candidates once the self-financed candidates 

make expenditures from their personal funds that exceed a specific amount. 2 U.S.c. 

§44Ia(a)( 1)(A) and 11 CFR §§110.1(a) and (b) and II 0.9(a). 

B. Handling Contributions That Appear Excessive. If a committee receives a
 

contribution that appears to be excessive, the committee must either:
 

•	 Return the questionable contribution to the donor; or 

•	 Deposit the contribution into its federal account and keep enough money on 

account to cover all potential refunds until the legality ofthe contribution is 

established. II CFR §103.3(b)(3) and (4). 

The excessive portion may also be redesignated to another election or reattributed to
 

another contributor as explained below.
 

C. Redesignation of Excessive Contributions. The committee may ask the contributor 

to redesignate the excess portion of the contribution for use in another election. 

•	 The committee must, within 60 days of receipt of the contribution, obtain and 

retain a signed redesignation letter which informs the contributor that a refund of 

the excessive portion may be requested; or 

•	 Refund the excessive amount. II CFR §110.I(b)(5), 110.1(1)(2)and
 

§103.3(b)(3).
 

Notwithstanding the above, when an authorized political committee receives an excessive 

contribution from an individual or a non-multi-candidate committee, the committee may 
6 

presumptively redesignate the excessive portion to the general election if the 

contribution: 

•	 Is made before that candidate's primary election; 

•	 Is not designated in writing for a particular election; 

•	 Would be excessive if treated as a primary election contribution; and 

•	 As redesignated, does not cause the contributor to exceed any other contribution 

limit. 

Also, the committee may presumptively redesignate the excessive portion of a general 

election contribution back to the primary election ifthe amount redesignated does not 

exceed the committee's primary net debt position. 

The committee is required to notify the contributor in writing of the redesignation within 

60 days of the treasurer's receipt of the contribution and must offer the contributor the 

option to receive a refund instead. For this action to be valid, the committee must retain 

copies of the notices sent. Presumptive redesignations apply only within the same 

election cycle. 11 CFR §110.I(b)(5)(ii)(B) & (C) and (I)(4)(ii). 

D. Reattribution of Excessive Contributions. When an authorized committee receives 

an excessive contribution, the committee may ask the contributor ifthe contribution was 

intended to be a joint contribution from more than one person. 

•	 The committee must, within 60 days of receipt ofthe contribution, obtain and 

retain a reattribution letter signed by all contributors; or 

•	 Refund the excessive contribution. 11 CFR §§110.1(k)(3), 110.1(1)(3) and
 

103.3(b)(3).
 

Notwithstanding the above, any excessive contribution that was made on a written 

instrument that is imprinted with the names of more than one individual may be attributed 

among the individuals listed unless instructed otherwise by the contributor(s). The 

committee must inform each contributor: 

•	 How the contribution was attributed; and 

•	 The contributor may instead request a refund of the excessive amount. 11 CFR 

§110.1(k)(3)(ii)(B). 

For this action to be valid, the committee must retain copies ofthe notices sent. II CFR 

§II 0.1(1)(4)(ii). 

E. Contribution Defined. A gift, subscription, loan (except when made in accordance 

with II CFR §§100.72 and 100.73), advance, or deposit of money or anything of value 

made by any person for the purpose of influencing any election for Federal office is a 

contribution. 11 CFR §100.52(a). 

F. Refund or Disgorge Questionable Contributions. Ifthe identity ofthe original 

contributor is known, the committee should either refund the funds to the source of the 

original contribution or pay the funds to the U.S. Treasury. AO 1996-5. 
7 

Facts and Analysis 

The interim audit report concluded that FOW received 41 excessive contributions from 

26 individuals that exceeded their primary election limits by $63,200. Evidence that 

FOW sought and received signed redesignation or reattribution letters was not provided 

nor was evidence provided that the contributors were notified that their contributions 

were presumptively redesignated and/or reattributed and offered a refund. Of these 

excessive contributions: 

•	 For 21 contributions totaling $30,200 received before the primary election 

(with no specific designation by the contributor), FOW redesignated them to 

the general election without notifying the contributor; 

•	 For 17 contributions totaling $28,000, FOW improperly reattributed the 

contribution to someone other than the actual contributor; and 

•	 For the remaining three contributions totaling $5,000, FOW neither 

redesignated nor reattributed any portion ofthe contribution. These three 

were properly designated to the primary election; however, in doing so, the 

primary election contribution limit was exceeded. 

It is noted that FOW maintained a sufficient balance in its bank account to refund the 

excessive contributions. 

The Audit staffs review ofthese excessive contributions determined that: 

•	 FOW could resolve 18 ofthe above excessive contributions, totaling $28,000, 

by sending notification to the contributor to inform them ofthe 

redesignationlreattribution and offer a refund, 

•	 For 11 excessive contributions ($13,500), refund checks have been issued but 

they were not timely, and 

•	 The remaining 12 excessive contributions ($21,700), absent a demonstration 

that the contributions are not excessive, appear resolvable only through 

refund. 

With respect to the apparent excessive contributions from individuals, the Audit staff 

presented these matters to FOW representatives during an exit conference, along with a 

schedule of apparent excessive contributions. Subsequent to the exit conference, an 

FOW representative provided a written response that no contributions were excessive; 

however, the representative failed to provide any documentation to support the statement. 

FOW later provided copies ofredesignation letters, dated April 23, 2007, which 

adequately addressed 15 excessive contributions totaling $23,000. 

Interim Audit Report Recommendation 

The Audit staff recommended that FOW: 

•	 Send notices to those contributors that were eligible for presumptive redesignation 

and/or reattribution ($5,000) to inform those contributors how the contribution was 

designated and/or attributed and offer a refund ofthe excessive portion. Absent a 

request for a refund by the contributors, these notices would obviate the need for a 

refund or payment to the U.S. Treasury. For notices sent to contributors, FOW 

should have provided a copy of each notice and evidence that it was sent. Such 
8 

notice must demonstrate that both the contributor and the individual to whom the 

contribution was reattributed were notified; and 

•	 Provide evidence demonstrating that the 12 contributions totaling $21,700 were not 

excessive. Such evidence should have included, but not been limited to, 

documentation that the contributions were reattributed or redesignated in a timely 

manner or that the excessive contributions were timely refunded; or 

•	 Absent such evidence, refund $21,700 to the contributors and provide evidence of all 

such refunds (copies ofthe front and back of negotiated refund checks);or pay the 

amount to the U.S. Treasury and 

•	 If funds were not available to make the necessary refunds, disclose the contributions 

requiring refunds on Schedule D (Debts and Obligations) until funds became 

available to make such refunds. 

•	 In addition, the Audit staff recommended FOW provide evidence that the 11 

excessive contributions which had been untimely refunded ($13,500) were in fact 

refunded (copies ofthe front and back of negotiated refund checks). 

Committee Response and Audit Staff Analysis 

FOW's response explains that it has reviewed the 41 potentially excessive contributions 

and it believes that it has taken the necessary steps to resolve each item. The response 

states that three excessive contributions, totaling $4,000, are erroneously included by the 

Audit staff. These contributions are included in FOW's contribution database but no 

record of a bank deposit was found. FOW suggests that they appeared on the database as 

the result of a data processing mistake, an incorrectly dated check from a prior cycle, or a 

pledged record marked as cash instead of a pledge. In addition, the response noted that 

detailed bank records were provided during fieldwork demonstrating that no checks from 

the individuals were deposited on the recorded dates. The response further concludes that 

the contributions in question could not have been received via credit card since FOW had 

stopped accepting credit card contributions prior to these dates. The Audit staff accepts 

that these contributions were not deposited by FOW. 

The response also addresses each of the other contributions as discussed below': 

1.	 Excessive Contributions Resolvable by Sending Untimely Presumptive 

Reattribution/Redesignation Letter 

FOW's response lists $29,000 as contributions addressed by untimely presumptive 

reattributions or redesignations; $1,000 more than the interim audit report figure. The 

difference is explained by FOW omitting an item from its list for which a letter was 

previously provided and its inclusion of items for which refunds had already been 

issued (See refunds below). Additionally, the amounts of some excessive 

contributions differed from those provided by the Audit staff. As was noted in the 

interim audit report, untimely presumptive reattribution or redesignation letters had 

been provided in response to the exit conference. With its response FOW provided 

The response states that two contributions are from different individuals with the same name and should 

not be aggregated causing an apparent excessive contribution. Those contributions were not included 

among the contributions addressed in the interim audit report. 

2 
9 

two more untimely presumptive redesignation letters dated March 8, 2008, covering 

an additional $3,000. Finally, FOW provided a presumptive reattribution letter for a 

$2,000 excessive contribution made by credit card. The contribution could have been 

presumptively redesignated to the general election, but because there is no indication 

the credit card account is a joint account, the presumptive reattribution is not proper. 

This contribution is considered unresolved. 

2. Excessive Contributions Resolved by Untimely Refunds 

The interim audit report noted that there were 11 excessive contributions ($13,500), 

for which refund checks have been issued but not timely. FOW's response provides 

no evidence that the refunds have been negotiated. Rather, FOW's response notes 

that presumptive redesignation/reattribution letters were sent for many of these on 

April 23, 2007, long after the refunds were made. It appears that all ofthese 

excessive contributions could have been permissibly resolved, albeit untimely, with 

these letters, however, it is assumed that the refund checks were issued for cause and 

the presumptive reattribution or redesignation letters are not considered. FOW's 

response includes evidence that three additional refunds were made on March 19, 

2008, totaling $11,700. Again no evidence has been provided that the refund checks 

were negotiated. 

3. Excessive Contributions Resolvable Only by Refund 

Finally, with respect to the remaining $8,000 in excessive contributions, FOW 

provided copies of (non-presumptive) redesignationlreattribution letters it had sent. 

However, for these excessive contributions, this was not an option. Such letters are 

not an acceptable method of resolution at this time and, as such, they should have 

been refunded. 

In conclusion, after consideration of FaW' s response to the interim audit report, the 

Audit staff determined that the $63,200 of excessive contributions questioned in the 

interim audit report fall into the following categories: 

• Resolved by Untimely Presumptive Reattribution/Redesignation Letters $ 26,000 

• Refunded Untimely But Without Negotiated Refund Checks	 25,200 

• Contributions Requiring Refund	 8,000 

•	 Contributions Shown Not to Be Excessive 4,000 

Total $ 63,200 

IFinding 2. Failure to Disclose Debts and Obligations 

Summary 

FOW did not report debts owed to seven vendors totaling $17,984. In response to the 

interim audit report, FOW only disputed the amount of debt to be reported for one 

vendor; no amended reports were filed as part of its response. 
10 

Legal Standard 

A. Continuous Reporting Required. A political committee must disclose the amount 

and nature of outstanding debts and obligations until those debts are extinguished. 2 

U.S.C §434(b)(8) and II CFR §§104.3(d) andI04.II(a). 

B. Itemizing Debts and Obligations. 

•	 A debt of $500 or less must be reported once it has been outstanding 60 days from 

the date incurred (the date of the transaction); the committee reports it on the next 

regularly scheduled report. 

•	 A debt exceeding $500 must be disclosed in the report that covers the date on 

which the debt was incurred. II CFR §I04.11(b). 

Facts and Analysis 

Reports filed by FOW during the audit period did not disclose any debts and obligations 

owed. The Audit staff identified debts owed to seven vendors totaling $17,984 which 

FOW failed to disclose. 

One of these debts involved unpaid balances on the FOW's Citi Advantage credit card, 

which the Audit staff calculated to be $16,627. This amount is based on available 

statements. The Audit staff had requested that statements be produced for the period so 

that the Audit staff could accurately determine the reportable debt. The remaining debts 

involved lesser amounts which had remained outstanding in excess of 60 days. 

The Audit staff presented this matter at an exit conference. FOW representatives 

indicated amended reports would be filed as necessary. 

Interim Audit Report Recommendation and Committee Response 

The Audit staff recommended that FOW demonstrate the debts were not reportable (i.e. ­

provide copies of statements for Citi Advantage) or amend its reports to disclose the 

debts. 

In its response, FOW acknowledged that it did not on all occasions pay the full amount 

due on the credit card; however, it does dispute the aggregate amount ($16,627) of debt 

addressed in the interim audit report. It believed the amount to be overstated as charges 

were incurred and paid for by the two other committees maintained by the Candidate. 

Further, the outstanding balance at the end of 2003 was paid by Friends of Weiner '04, an 

affiliated committee, and the debt should properly be attributed to that committee. The 

response stated that, although FOW made regular payments on the credit card, it did on 

the closing dates of two reports have an unpaid balance of approximately $4,000 or an 

aggregate of about $8,000 in debt for the two reports. FOW's response stated that 

unfortunately it cannot provide a precise amount because the bank statements are 

unavailable; however, it noted that the Audit staffs schedules support these figures. The 

delay in payment resulted from the need to properly assign charges to the respective 

committees. 
11 

FOW's response does not contest any ofthe other debts addressed in this finding; nor 

were any amended reports filed. 

With respect to the credit card debt, FOW indicated it does not have the documentation to 

support any of its assertions, nor has it provided any analyses in support of its arguments. 

The payment made by Friends of Weiner '04 does not mitigate FOW's need to report this 

debt; available credit card statements indicate the holder to be "Friends of 

Weiner/Anthony D. Weiner." The Audit staffs position remains unchanged; FOW has 

failed to report debts to seven vendors totaling $17,984. 

Finding 3. Disclosure of Contributions from Political 

Committees 

Summary 

FOW did not adequately disclose 21 contributions from political committees totaling 

$26,025. In response to the interim audit report, FOW acknowledged minor errors 

disclosing these contributions and states that an amended report will be filed. To date, 

these disclosure errors have not been corrected. 

Legal Standard 

A. When to Itemize. Authorized candidate committees must itemize any contribution 

from a political committee which makes a contribution to the reporting committee during 

the reporting period, together with the date and amount of any such contribution. 2 

U.S.C. §434(b)(3)(B). 

B. Election Cycle. The election cycle begins on the first day following the date of the 

previous general election and ends on the date of the next general election. 11 CFR 

§100.3(b). 

C. Definition of Itemization. Itemization of contributions received means that the 

recipient committee discloses, on a separate schedule, the following information: 

•	 The amount ofthe contribution; 

•	 The date of receipt (the date the committee received the contribution); 

•	 The full name and address of the contributor; 

•	 In the case of contributions from individual contributors, the contributor's
 

occupation and the name of his or her employer; and
 

•	 The election cycle-to-date total of all contributions from the same contributor. 11 

CFR §§IOO.I2 and I04.3(a)(4) and 2 U.S.C. §434(b)(3)(A) and (B). 

Facts and Analysis 

Of the 98 contributions from political committees disclosed by FOW, 21 items, totaling 

$26,025, were inadequately disclosed. These errors related to name, address and 

aggregate election cycle to date. The following table details the disclosure errors by 

number and dollar value. 
12 

Disclosure Error Type # Errors $ Errors 

Name Only 2 $3,000 

Address Only 14 $13,025 

Name & Address 4 $9,000 

Aggregate election cycle to date 1 $1,000 

Totals 21 $26,025 

Of the errors noted, 18 related to address or name and address. During fieldwork, Audit 

staff questioned the addresses used for reporting some of these contributions as the report 

detail did not match the source documents. A FOW representative stated that the 

reporting software contained such detail and that the software was updated annually. 

Review of address errors indicates either the software detail was incorrect or was not 

used. Research by the Audit staff could not link the address disclosed to the political 

committee. The source documentation maintained by FOW reflected the names and 

addresses for the political committees based on the statements of organization filed with 

the Commission. It did not appear that FOW's software was updated annually as stated; 

in some instances, the correct disclosure information had been in use for far longer than 

one year. 

FOW filed amended reports during the audit fieldwork period which adequately corrected 

only one item. The Audit staff addressed this matter at an exit conference and provided a 

schedule detailing the errors. FOW representatives indicated amended reports would be 

filed as necessary. 

Interim Audit Report Recommendation and Committee Response 

The Audit staff recommended that FOW amend its reports to correctly disclose the 

remaining transactions. 

FOW's response asserted that each identified error was minor and that most involved a 

discrepancy between the reported address and the address that the contributing committee 

used on its FEC Form 1 (Statement of Organization). The response noted that 

Commission regulations require use of the mailing address. The response noted that for a 

number of reasons a committee's address may be different from the address filed on FEC 

Form 1; "the committee may have moved, may use the address of the person completing 

the reports, may use a local address or the address of a connected organization." To 

resolve this FOW indicated it would file an amended report in the form of a 

miscellaneous submission to update the names and addresses ofthe political committees 

as shown on FEC Form 1. The response then detailed for each item what address was 

used. 

To date, no amended reports or miscellaneous submission have been filed. 
13 

IFinding 4. Disclosure of Occupation/Name of Employer 

Summary 

Based on a sample, FOW did not adequately disclose occupation and/or name of 

employer for about 30% of contributions from individuals tested. Amended reports filed 

subsequent to completion of audit fieldwork materially corrected these errors. In 

response to the interim audit report, FOW submitted additional comments disputing the 

validity ofthe Audit staff's sample and its results. 

Legal Standard 

A. Recordkeeping Requirements for Receipts. Political committees must keep
 

records of:
 

•	 All contributions received by or on behalf ofthe committee; 

•	 The name and address of any person who makes a contribution in excess of $50, 

together with the date and amount of the contribution; and 

•	 The occupation and name of employer of any individual whose contributions 

aggregate more than $200 during a calendar year, together with the date and 

amount of any such contributions. 2 U.S.c. §432(c). 

B. Preserving Documents. Committees must preserve these records for 3 years after a
 

report is filed. 2 U.S.c. §432(d).
 

C. Best Efforts Ensures Compliance. When the treasurer of a political committee
 

shows that the committee used best efforts (see below) to obtain, maintain, and submit
 

the information required by the Act, the committee's reports and records will be
 

considered in compliance with the Act. 2 U.S.C. §432(h)(2)(i).
 

D. Definition of Best Efforts. The treasurer and the committee will be considered to
 

have used "best efforts" with respect to contributions if the committee satisfied all of the
 

following criteria:
 

•	 All written solicitations for contributions included: 

o	 -A clear request for the contributor's full name, mailing address, occupation, 

and name of employer; and 

o	 The statement that such reporting is required by Federal law. 

•	 Within 30 days after the receipt of the contribution, the treasurer made at least one 

effort to obtain the missing information, in either a written request or a 

documented oral request. 

•	 The treasurer reported any contributor information that, although not initially 

provided by the contributor, was obtained in a follow-up communication or was 

contained in the committee's records or in prior reports that the committee filed 

during the same two-year election cycle. 11 CFR §104.7(b). 
14 

Facts and Analysis 

Available solicitation response devices indicate FOW requested occupation/name of 

employer information from contributors initially. FOW, however, failed to disclose 

occupation and/or employer or provide evidence that "best efforts" to obtain and submit 

the information had been exercised for 30% of itemized contributions for individuals for 

the sample tested. Although its disclosure reports noted in many instances "information 

requested," FOW did not provide any evidence that at least one additional effort to 

obtain, maintain and submit the missing information, in either a written request or a 

documented oral request had been made. 

The Audit staff presented this matter to the FOW representative during an exit 

conference. The representative stated that she was aware of this issue and they had been 

researching this matter. Subsequent to the exit conference, the representative provided a 

narrative that stated various follow up efforts to collect the missing information were 

made but are sparsely documented. Amended reports filed by the FOW contain 

additional information received in response to follow up and other efforts. 

Amended reports filed by FOW subsequent to the audit notification letter materially
 

corrected the disclosure of occupation/name of employer.
 

Interim Audit Report Recommendation and Committee Response 

The Audit staff recommended that FOW submit any additional comments it may have 

related to this matter. 

In its response, FOW submitted comments disputing this finding. FOW noted that based 

on a review of reports, it believed that employer occupation information was missing for 

less than 10% of contributions. However, FOW provided no documentation to support 

its review; nor does it address which set of reports it reviewed. The response noted that 

the interim audit report indicated amended reports filed subsequent to audit notification 

materially corrected this disclosure problem. 

The response further stated that the Audit staff's 30% error rate was based on a sample 

which was not provided for FOW to review and it believes the sample for whatever 

reason failed to accurately reflect the information contained in reports. Again, FOW 

provided no evidence to support its assertion. 

I Finding 5. Misstatement of Financial Activity 

Summary 

A comparison of FOW reported activity to bank records revealed a misstatement of 

receipts, disbursements and cash on hand in both 2003 and 2004. For 2003, FOW 

overstated beginning cash on hand by $77,831; overstated receipts by $23,687; 

understated disbursements by $91,018 and overstated ending cash on hand by $192,537. 

In 2004, FOW understated receipts by $8,128 and disbursements by $96,874. 
15 

Additionally, ending cash on hand for 2004 was overstated by $281,283. Amended
 

reports filed subsequent to the completion of audit fieldwork materially corrected the
 

reported activity. In response to the interim audit report, FOW acknowledged that the
 

misstatement resulted primarily from the reporting of an investment account.
 

Legal Standard
 

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 election cycle; 

•	 The total amount of disbursements for the reporting period and for the election cycle; 

and 

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

Schedule B (Itemized Disbursements). 2 U.S.c. §434(b)(l), (2), (3), (4) and (5). 

Reporting Investments. Each committee must report invested amounts in its cash on 

hand balance. A committee must also report investment income (interest, dividends or 

capital gains/losses) on Schedule A. 11 CFR § 104.3(a)(l) & (4)(vi). 

Facts and Analysis 

The Audit staff reconciled FOW reported financial activity to its bank records for 2003 

and 2004. The following charts outline the discrepancies. Succeeding paragraphs 

address the reasons for the misstatements for both 2003 and 2004. 

2003 Activity 

Reported Bank Records Discrepancy 

Opening Cash Balance 

atJanuary 1,2003 

$1,297,025 $1,219,194 $77,831 

Overstated 

Receipts $562,582 $538,895 $23,687 

Overstated 

Disbursements $93,138 $184,156 $91,018 

Understated 

Ending Cash Balance 

at December 31, 2003 

$1,766,469 $1,573,933 $192,537 

Overstated 

The $77,831 overstatement-of the beginning cash balance on January 1,2003 could not 

be explained. 

The understatement of receipts in 2003 was the net result of the following: 

•	 Realized Investment income/gains overreported'' $ 4,963 

•	 Reported by FOW deposited Weiner'04 (affiliate) 4,000 

•	 Reported receipts not supported by a deposit or credit 15,563 

•	 Receipts supported by a deposit or credit not reported + 4,300 

3 When FOW did report investment income and gains, it was on line 15 (Other Receipts) and based on 

statement values or an estimate. FOW did not routinely report realized investment losses during the audit 

cycle. 
16 

•	 Contributions reported with incorrect amounts 1,000 

•	 Reported receipts not adjusted for a returned deposit 200 

•	 Unexplained difference 2,261 

•	 Net Understatement of Receipts $ 23,687 

The understatement of disbursements was the net result of the following: 

•	 Realized Investment losses/fees not reported + $74,166 

•	 Operating expenditures not reported, which + 13,731 

includes a $12,000 tax payment 

•	 Unreported credit card processing fees + 1,956 

•	 Disbursement reported not supported by a check 2,178 

or debit + 3,343 

•	 Unexplained difference 

•	 Net Understatement of Disbursements $91,018 

As a result of the misstatements detailed above, the ending cash on hand for 2003 was 

overstated by $192,537. 

2004 Activity 

Reported Bank Records Discrepancy 

Opening Cash Balance @ 

January 1, 2004 

$1,766,469 $1,573,933 $192,537 

Overstated 

Receipts $137,410 $145,538 $8,128 

Understated 

Disbursements $1,134,298 $1,231,173 $96,874 

Understated 

EndingCash Balance@ 

December31, 2004 

$769,581 $488,298 $281,283 

Overstated 

Beginning cash balance on January 1,2004, was overstated as the result ofthe 

discrepancies for 2003 discussed above, 

The understatement of receipts was the net result of the following: 

•	 Realized Investment income/gains not reported + $ 38,035 

•	 Contributions reported not supported by a deposit or credit 32,450 

•	 Contributions from political committees not reported + 1,500 

•	 Bank credit not reported + 471 

•	 Math discrepancy relative to amount disclosed on detailed 100 

summary 

•	 Unexplained difference + 672 

•	 Net Understatement of Receipts $ 8,128 
17 

The net understatement of disbursements was the result of the following: 

•	 Realized Investment losses/fees not reported + $ 41,3684 

•	 Operating expenditures not reported including $47,000 fine + 60,077 

•	 Miscellaneous reporting errors 279 

•	 Disbursement reported not supported by a check or debit 26,535 

•	 Unreported refund + 2,500 

•	 Unexplained difference + 19,743 

•	 Net Understatement of Disbursements $ 96,874 

As a result of the misstatements detailed above, the ending cash on hand at December 31, 

2004 was overstated by $281,283. 

Amended Report Filings 

A second bank reconciliation was prepared based on the amended reports filed 

subsequent to the completion of audit fieldwork in July 2006. Although FOW's 

calculations of realized gains and/or losses could not be verified by the Audit staff, the 

reconciliation showed that these amended reports materially corrected the misstatements 

detailed above. 

The Audit staff presented this matter to FOW representatives during an exit conference 

along with schedules detailing the discrepancies. 

Interim Audit Report Recommendation and Committee Response 

The Audit staff recommended that FOW: 

•	 File amended reports to correct the remaining misstatements; and, 

•	 Amend the cash balance of its most recent report with an explanation that it resulted 

from audit adjustments from a prior period. 

Initially, the Audit staff recommended that all investment gains and losses should be 

reported regardless of whether they had been realized, thus reflecting the investment's 

market value at the close ofthe reporting period. FOW argued that only realized gains or 

losses needed to be reported and provided a worksheet that calculates those gains and 

losses. The Audit staff accepts that reporting realized gains and losses is acceptable, but 

notes that it cannot verify FOW's calculations. 

FOW's response noted that amended reports were filed in July 2006 to correct cash on 

hand, receipts and disbursements for the 2004 and 2006 election cycle reports. As stated 

above, amended reports filed by FOW have materially corrected the misstatements noted 

above. 

4 One large investment loss was reported by FOW in 2004 on line 17 ($56,038) (Operating Expenditures). 

Amendments filed in 2006 reported losses on line 21(Other Disbursements) and fees on line 17 (Operating 

Expenditures). Market losses for securities held were not reported by FOW until the asset was sold. 
18 

IFinding 6. Untimely Deposit of Contributions 

Summary 

Based on a review of all contributions from political committees and a sample review of 

contributions from individuals, FOW failed to deposit contributions in a timely manner. 

The Audit staff determined that contributions from political committees of $76,500 and 

projected contributions from individuals of at least $330,000 were not deposited timely. 

FOW acknowledged the problem but did not explain how the errors had occurred. FOW 

has also stated it has since retained a professional consultant to administer its financial 

and reporting activities and that procedures have been put in place to correct the error. In 

response the interim audit report, FOW stated the audit results were "exaggerated," 

reiterated its retention of a consultant to correct problems with receipt processing and 

presented mitigating arguments. 

Legal Standard 

A. Deposit of Receipts. The treasurer of a political committee must deposit 

contributions (or return them to the contributors without being deposited) within 10 days 

of the treasurer's receipt. 11 CFR §I03.3(a). 

B. Receipt of Contributions. Every person who receives a contribution for an 

authorized political committee shall, no later than 10 days after receipt, forward such 

contribution to the treasurer. II CFR §102.8(a). 

Facts and Analysis 

The Audit staff reviewed all contributions from political committees and determined that 

55 of98 such contributions, totaling $76,500, were not deposited in a timely manner. 

In addition, a sample of contributions from individuals indicated 71 of96 items tested 

were not deposited timely, a 74 percent error rate. FOW took between 14 and 80 days (in 

one case, 265 days) to deposit these receipts. The Audit staff projected that contributions 

from individuals of at least $330,000 had not been deposited timely. 

This matter was presented at the exit conference to FOW representatives who 

acknowledged the problem but did not explain how the errors had occurred. FOW has 

also stated it has since retained a professional consultant to administer its financial and 

reporting activities and that procedures have been put in place to correct the error. 

Interim Audit Report Recommendation and Committee Response 

The Audit staff recommended that FOW submit a description ofthe new procedures 

implemented to ensure compliance and provide any other comments it may have relative 

to this matter. 

FOW's response began by noting it finds the interim audit reports statements to be 

"exaggerated." It first questioned the use of265 days as the "outer limit" and the use of 

the date of on the check as the date of receipt on that one check. FOW stated this is the 

only check in that timeframe and after reviewing its records notes it was not received 

until several months after it was dated and was deposited timely. The response 
19 

speculated that the check may have been misdated by the contributor and concluded by 

stating that using the date on a check instead of the date of record that a contribution was 

received, as in this case, is often inaccurate. 

FOW has provided no documentation to support its assertion that the one check it details 

was deposited timely. Further, FO W records, with the exception of some contributions 

from other political committees, did not allow for confirmation of date of receipt; 

however, even utilizing that date, as FOW suggests, would have resulted in a material 

problem. 

The response notes that there were 88 contributions from political committees totaling 

$114,000, " ...more than half (totaling $56,000) of which were deposited timely, within 

I0 days of receipt, and all but 9 were deposited within 30 days." Although an apparent 

attempt to mitigate the problem, it supports the Audit staffs conclusion that a material 

portion of contributions from other political committees were not timely deposited within 

10 days. 

Next, the response acknowledged that, as a result oftechnical issues in the processing of 

credit card receipts, such contributions "...were not actually deposited into the bank 

account for three months." FOW stated that 68 contributions totaling $62,040 were 

affected and, as a result, FOW ceased to accept contributions via credit card. 

FOW stated that, with the exception of credit card receipts, FOW deposited contributions 

in question within 60 days, the average number of days being 24, and suggested that this 

average number of days would provide a more accurate picture of its operations. 

In summation, the response noted FOW's hiring of a firm that specializes in federal 

election compliance services to process all contributions and ensure receipts are 

deposited in a timely manner. This firm has implemented and oversees procedures to 

collect, record, photocopy and deposit contributions on a weekly schedule to ensure 

timely deposit. 

IFinding 7. Disclosure of Allocable Activity 

Summary 

The Audit staff identified expenditures made by both FOW ($155,956) and the 

Candidate's concurrent mayoral campaign ($52,988) during 2004 that did not appear to 

be properly allocated nor disclosed as allocable expenditures. In the interim audit report, 

the Audit staff used contributions received by each entity to develop an allocation ratio of 

5.99% FOW and 94.01 % for the Candidate's mayoral campaign. Based on that ratio, the 

Audit staff concluded that FOW's allocable share ofthese expenditures was $12,516 and 

the Candidate's mayoral campaign share was $196,428. In its response to the interim 

audit report, FOW restated earlier arguments it has offered and asserted these 

expenditures do not require allocation. The response did not contain work papers or 

analyses to support its arguments, nor did FOW file amended reports to disclose these 

transactions. In this audit report, the Commission concludes that there were expenses in 

the amount of$208,944 from which both FOW and the Candidate's mayoral campaign 
20 

appear to have derived some benefit, which mayor may not have required allocation. 

However, FOW did not provide documentation upon which the Audit staff could allocate 

these expenses between FOW and the Candidate's mayoral campaign. 

Legal Standard 

A. Use of contributed amounts for certain purposes. A contribution accepted by a 

candidate may be used for, among other things, any other lawful purpose unless 

prohibited by this section. For purposes of this section, no contribution shall be 

converted to personal use. 2 U.S.c. §439a. 

B. Allocation of expenses between candidates. 

•	 If an individual is a candidate for a Federal office and a State office, he or she 

must designate separate principal campaign committees. The campaigns may 

share personnel and facilities, as long as expenditures are allocated between the 

campaigns, and the payment made from each campaign account reflects the 

allocation. 11 CFR §11O.8(d) (1) and (3). 

•	 Expenditures made on behalf of more than one clearly identified Federal and nonFederal candidate shall be attributed to each candidate according to the benefit 

reasonably expected to be derived. 11 CFR § I06.l(a). 

Facts and Analysis 

The Audit staffs review of disbursements raised concerns about FOW's payment of 

expenses which appear to relate to the Candidate's concurrent Mayoral campaign. The 

Candidate was unopposed in the September 14th primary and had little in the way of 

opposition in the general election, which he won with 71% of the vote. The Audit staff 

noted the following indicators ofthe interrelationships between FOW and Anthony 

Weiner for New York (the Candidate's Mayoral committee): 

•	 FOW purchased and paid for $1,397 of campaign related supplies on its 

Citi Advantage credit card which appear to have been also reported as 

disbursements by the Mayoral committee. Amended reports filed by 

FOW also included memo entries for these disbursements. The Mayoral 

committee did not reimburse FOW for the purchases. Although other 

questionable charges were identified, available records were insufficient to 

determine ifthey may have benefited the mayoral campaign. 

•	 The same "Disbursements Form" appears to have been used by both 

committees as the form provides space to indicate which committee it 

applies to. 

•	 The forwarding of mail from FOW's PO Box to the Mayoral committee's 

PO Box or the Mayoral street address. 

•	 Assorted vendor documents were addressed to Friends of Weiner at the 

Mayoral committee's street address 
21 

•	 Copier lease costs were paid by both during late 2004. The Mayoral 

committee paid Marlin Leasing for July 2004. FOW then made payments 

through October, 2004; after which the Mayoral committee again made 

payments to Marlin Leasing. 

•	 Phone charges for service which appears to have been located at the 

Mayoral campaign office (opened February 2004) at 139 s" Avenue, 3rd 

Floor, Manhattan, NY 10010, were paid by FOW. A review of 

disbursements to Verizon made by both committees' shows payments 

made in a manner similar to that described for the copier above. 

The Audit staff identified allocable costs totaling $155,956 made by FOW during 2004; 

and, by utilizing reports filed with the State ofNew York, $52,988 in such expenditures 

made by the Mayoral committee during 2004. Although requested by the Audit staff, 

FOW did not provide sufficient information to determine the actual benefit derived to 

each of these committees; as such, in the interim audit report the Audit staff allocated 

these expenditures based on the funds received method. During 2004, FOW received 

contributions totaling $83,252 and the Mayoral committee raised contributions totaling 

$1,307,208. These figures result in an allocation ratio of 5.99% for FOW and 94.01% for 

the Mayoral committee. 

Therefore, in the interim audit report, the Audit staff concluded that $155,956 in allocable 

expenditures made by FOW should be allocated $9,342 to FOW and $146,614 to the 

Mayoral committee. The $52,988 in such expenditures paid by the Mayoral committee 

would be allocated $3,174 to FOW and $49,814 to itself. FOW did not disclose the 

allocable nature of such expenditures it made; nor did it disclose allocable expenditures 

made by the Mayoral committee. 

This matter was presented at a meeting with FOW representatives held 

subsequent to the exit conference, FOW's representative indicated that, although difficult 

to separate such costs with concurrent campaigns, 2 U.S.c. §439a provides that 

campaign funds may be used by the candidate for any other lawful purpose. 

In a narrative response submitted subsequent to this meeting which contests the 

Audit staffs categorization ofthese expenses, an FOW representative stated: 

•	 At best only minimal congressional work would have been done at the Mayoral 

committee office; 

•	 Salaries and fees were split between the Mayoral committee and FOW based on 

an estimate of time that would be spent on each campaign; 

•	 With respect to the copier lease, it was housed at the Mayoral committee offices 

and payments by FOW were not for the lease but likely for copies made. 
22 

Interim Audit Report Recommendation and Committee Response 

The Audit staff recommended that FOW submit information supporting a different 

allocation formulaS and provide any other comments it may have relative to this matter. 

Further, it was recommended that FOW amend its reports to acknowledge these allocable 

expen ditures. 

In its response to the interim audit report, FOW restated earlier arguments that it has 

offered. The response also disputes the use of a funds received method to allocate 

expenditures. 

The response again points out that federal campaign funds may be used for any lawful 

purpose. FOW maintained the expenditures from the congressional campaign accounts 

($155,956) were for "re-election activities" and there is no prohibition ifthere were some 

"spillover" benefit to a campaign for a different office. Furthermore, FOW noted 

Commission regulations do not require or provide a method for identifying and disclosing 

such indirect benefit as an allocable expense. 

FOW's response disputed that the $52,988 disbursed from the mayoral campaign should 

be allocated to the congressional committee. With respect to $19,227 in office rent, 

telephone, equipment and supplies, the response noted that the congressional campaign's 

main office was in the Candidate's home. FOW continued that although a lease was 

signed by the congressional campaign for other office space, because the Candidate was 

unopposed and most administrative and operational activity was for the mayoral race, the 

rent was [not] allocated and was paid by the mayoral campaign. The response contended 

that only de minimis congressional activity was conducted from the rented office, but the 

payment records indicate that there was an effort to allocate payments between the 

campaigns based on current activity and use. The response also noted that since the 

Candidate was frequently in Washington, DC, the rented office address was used for 

mail, delivery and shipping purposes since it was staffed and not vacant. 

Further, the response represented that $33,761 in consulting fees and reimbursements to 

individuals, payments to the primary fundraiser, Dolev Azaria, were allocated and paid 

from each committee. The response questioned why the Audit staff listed her fees paid 

by one committee as allocable to the other campaign. Likewise, the response noted that 

Jason Bayne provided administrative and data processing for both campaigns, and was 

paid from the campaign to which the expenses related. 

FOW believes it has properly assigned and paid these administrative expenses pursuant to 

the "benefits derived" method, which FOW accomplished by making separate payments 

to staff and vendors. FOW's response stated, "The Committee's method for determining 

The New York City Campaign Finance Board covered this issue in its report noting that the 

Candidate's mayoral campaign failed to keep the required records to document an allocation and accepted a 

payment in the amount of $57,235 from the Candidate's mayoral campaign representing a reallocation of 

costs from FOW; noting this payment did not represent an admission ofguilt nor did it represent a civil 

penalty for that failure. 
23 

the proper amount to be paid from each committee was the correct method under the 

Commission's regulations." 

The Audit staff notes that, although requested previously, including in the interim audit 

report, FOW has yet to provide to the Audit staffwith an analysis or other documentation 

to support its determination ofthe actual benefit derived to each ofthe committees or to 

support its assertion ofthe de minimus nature of congressional activity in mayoral 

offices. Additionally, the Audit staff does not dispute the lawful nature ofthese 

expenditures, but merely seeks the correct disclosure of such activity. In response to the 

Audit staffs questioned use ofthe funds received method to allocate such costs, the 

interim report itself notes that this method was used in the absence of information and 

documentation that could lead to a usage based allocation. This conclusion is supported 

by the audit conducted by the New York City Campaign Finance Board. Additionally, it 

should be noted no amended reports disclosing these disbursements have been filed by 

FOW. 

In this audit report, the Commission concludes that there were expenses in the amount of 

$208,944 from which both FOW and the Candidate's mayoral campaign appear to have 

derived some benefit, which mayor may not have required allocation. However, FOW 

did not provide documentation upon which the Audit staff could allocate these expenses 

between FOW and the Candidate's mayoral campaign. If any amount was not properly 

allocated, the failure to allocate would have resulted in a failure to amend reports 

properly disclosing such allocable expenses.