Law Firm Accused Of Massive Straw-Donor Scheme

Hillary Clinton’s campaign is returning thousands of dollars in donations linked to what may be one of the largest straw-donor schemes ever uncovered.

A small law firm that has given money to Sen. Elizabeth Warren, Sen. Harry Reid, President Obama and many others is accused of improperly funneling millions of dollars into Democratic Party coffers. The program was exposed by the Center for Responsive Politics and the same team of Boston Globe investigative reporters featured in the movie “Spotlight.”

The Thornton Law Firm has just 10 partners, but dollar for dollar, it’s one of the nation’s biggest political donors, reports CBS News correspondent Tony Dokoupil.

But according to the firm’s own documents – leaked by a whistleblower — days or even hours after making these donations, partners received bonuses matching the amount they gave.

“Once the law firm knew that we had these records, they didn’t deny that this was the case,” said Scott Allen, Boston Globe’s Spotlight editor.

“If you give a donation and then somebody else reimburses you for that contribution, that is a clear violation of the spirit and the letter of the law at the state and federal levels,” Allen added.

Federal law limits partnerships, like the Thornton Law Firm, to a maximum donation of $2,700 per candidate. But campaign finance watchdogs say the firm used its individual partners as straw donors, allowing it to funnel money to campaigns well above that legal limit.

“Straw donor reimbursement systems are something both the FEC and the Department of Justice take very seriously, and people have gone to jail for this,” Center for Responsive Politics editorial director Viveca Novak said.

The Spotlight team and the Center for Responsive Politics looked at donations from three of the firm’s partners from 2010 to 2014. The trio and one of their wives gave $1.6 million, mostly to Democrats. Over the same period, they received $1.4 million back in bonuses.

A Thornton spokesman said the bonuses are legal because they came out of each partner’s ownership stake in the firm. In other words, they were paid with their own money.

In a statement, the firm said:

“We would like to make it clear that the Thornton law firm has complied with all applicable laws and regulations regarding campaign contributions. Ten years ago, it hired an outside law firm to review how it wanted to handle donations to politicians. It was given a legal opinion on how it should structure its program and then it hired an outside accountant to review and implement the program. It was a voluntary program which only involved equity partners and their own personal after-tax money to make donations.”

Through its employees, the firm gave to Democrats running in some of this year’s most hotly contested races — ones that could determine control of the U.S. Senate.

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Massachusetts Republicans are calling for an investigation.

“In the end, it’s about restoring integrity to a process that folks are already extremely wary of,” Massachusetts Republican Party chair Kirsten Hughes said.

Allen said he’s not “confident at all” that this is an isolated program at Thornton.

“We’ve had a number of parties coming forward to us saying, ‘Hey, they do this at our place too.’ So the issue is always, can you prove it?” Allen said.

CBS News has learned the non-partisan Campaign Legal Center will file a complaint with the Federal Elections Commission Wednesday.

Sen. Elizabeth Warren, who has received nearly $130,000 from the firm since 2007, told the Boston Globe she will not return any money unless investigators find the donations were illegal.

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