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Failed 2010 gubernatorial candidate may face campaign finance charges

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March 15, 2011

Ross Miller, who has opened a campaign finance investigation into Rory Reid's 2010 campaign

By Eileen McGuire-Mahony

Carson City, NEVADA: A 12 point loss in the governor's race the same year his father came back from a one-time yawning deficit may not be the last of Rory Reid's humiliations. Pending the outcome of an investigation launched by the Nevada Secretary of State, Reid could be in hot water over campaign finance.[1]

In last year's gubernatorial race, Reid, along with his treasurer, David Cohen, his campaign finance manager, Joanne Paul, and his legal counsel, Paul Larsen set up a total of 91 political action committees. 90 of those PACs became interim depositories for $750,000 that ultimately ended up in Economic Leadership, Reid's key PAC. That sum exceeds the $10,000 limit of what a single candidate may legally collect via PACs for one race some 75 times. Usually, donations received by the mini-PACs spent only days in those account before being passed on to Economic Leadership.[2]

Secretary of State Ross Miller, a fellow Democrat, has now opened an investigation into whether any actual violation of campaign finance law occurred. All 90 mini-PACs were registered to Miss Paul's home address and, through 90 separate bank accounts, pooled money into Reid's central committee for raising funds. Theoretically, this is legitimate so long as each PAC conducts independent fundraising and later donates the money in turn to another PAC. If, however, Miller concludes that Reid's campaign used the mini-PACs for dedicated fundraising all along, there could be problems.

Last Friday, Miller sent a letter to Reid's lawfirm, Lional Sawyer & Collins, requesting correspondence and financial documentation related to all 91 PACs. That letter warned Reid the information supplied could be used in civil, administrative, and even criminal matters.[3]

Paul Larsen, still acting as Reid's attorney, told media he understood campaign finance law to be a tool for tracking money and that, as the campaign had documented and filed everything, there was no bad act.[4] Larsen said he felt then, and now, comfortable in advising Reid that the set-up was above board. Rory Reid himself echoed the argument, saying everying had been "transparent."[5]

Reid topped nominal party opposition in a June 2010 primary but, come November, fell to Brian Sandoval, today Nevada's Governor, in the GOP wave that marked the midterms.