CRR 1104 3697

FEDERAL

FIECTION

COMMISSION

THIS

IS

71E

K3INI3

T

11JR

DATE

F

Ll.f_)

COE:

RA

NO.

a'9TU

2%

4a-63

0 1

REPORTS

ANALYSIS

REFERRAL

TO

OFFICE

OF

GENERAL

COUNSEL

DATE:ocroher

14

1992

ANALYST:

Robin

Kelly

I.

COMMITTEE:

II.

RELEVANT

STATUTE:

The

Committee

to

Elect

Don

Nelms

C0024

3699)

Roy

J.

Shorter,

Treasurer

4000

Frontage

Road

Fayette%'ille,

AR

72703

2

U.S.C.

§434(a)(6)

11

CFR

§104.5(f)

III.

BACKGROUND:

Failure

to

File

Forty-Eight

Hour

Notifications

The

Committee

to

failed

to

file

the

Notifications

("48-Hour

loans

totalling

525,000

Election.

Elect

Don

Nelms

("the

Committee")

required Forty-Eight

(48)

Hour

Notices")

for

two

(2)

contributions/

received

prior

to the

1992

Primary

The

candidate

was

involved

in

the

1992

Primary

Election

held

on

May

26,

1992.

Prior

Notice

was

sent

to

the

Committee

on

April

20,

1992

Attachment

2).

The

Notice

includes

a

section

titled

"49-Hour

Notice

on

Contributions".

This

section

reads

"Notices

are

required

if

the

committee

receives

contributions

(including

contributions

and

loans

from

the

candidate's

personal

funds;

and

endorsements

or

guarantees

of

bank

loans)

of

$1,00

or

more,

during

the

period

of

May

7

through

May

23.

The

notices

must

reach

the

appropriate

federal

and

state

filing

offices within

48

hours

of

the

committee's

receir:

-f

the

contribution(s)."

Schedules

A

and

C

of

the

12

Day

Pre-Runoff

Report

indicate

that

the

Committee

failed

to

file two

(2)

48-Hour

Notices

for

contrihutions

received

during

the

aforementioned

period

(Attachment

3.

The

following

is

a

list

of the

contributions

fcr

wnirh

n-

48-Hour

Notices

were filed:

Contributor

Name

Date

Don

Nelms

Don

Nelms

05/

07/92

05/15/92

Amount

$10,000

$15,000

92L-24

COMMITTEE

TO

EL

DON

NELMS

REPORTS

ANALYSIS

C

REFERRAL

PAGE

2

On

September

11,

1992,

an

Informational

Notice

("IN")

was

sent

to

the

Committee (Attachment

4).

The

IN

notes

that

the

Committee

may

have

failed

to

file one

or

more

of the

required

48-Hour

Notices

for

"last

minute"

contributions

of

$1,000

or

more.

The

notice

requests

the

Committee

to

review

their

procedures

for

checking contributions

received during

the

aforementioned

time

period.

In

addition,

the

notice

states

that

although

the

Commission

may

take

legal

steps,

any

response

would

be

takei

into

consideration.

On

September

1-,

1992,

Roy

Shorter

called

and

asked

the

Reports

Analysis

Division

("RAD")

analyst

how

to

respond

to

tho

notice

he

had

received

(Attachment

5).

He

said

he

didn't

realize

before

the

Primary

that loans

were

considered

contributions.

The

analyst

told

him

to

write

a

letter

explaining

the

situation.

On

September

21,

1992,

the

treasurer,

Roy

Shorter,

responded

in

a

letter

(Attachment

6).

He

stated

that

at the

time

of

filing

he

didn't

realize

that

loans

made

by

the

candidate

were

considered contributions

and

subject

to

the

48-hour

special

notice

filing.

Mr.

Shorter

also

points

out

that

the

Campaign

Guide

for

Congressional

Candidates

(July

1988)

Page

24,

does

not

define

a

"last

minute"

contribution

to

include

loans

from

the

candidate's personal

funds. He

said

it

was

not

until

he

received

a

copy

of

"recurring

problems"

letter,

on or

about

June

1st

(addressed

to

the

candidate

from

Joan D.

Aikens, Chairman)

that

he

realized

the

48-hour

reporting

rule

included

candidate

loans.

Thereafter

he

stated

that

he

has

promptly

reported

all

"last

minute"

contributions.

FEDERAL

ELECTION

COMMISSION

1991-1992

FNDIDTE

INDEX

OF

SUPPORTING

DOCUMENTS

-(El

k~I~ IJE E'CJt4N

OACHMENT

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as

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-

$1.952

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owed

b-

the

Comm'ttee

as

of

6/30/92

$210,104

Debts

owed

to

the

Committee

as

of

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-$0

4..

0. j."

[wkl

14OCTO

-

PR

ARY

ELECTION

ATTACHMENT

#2

PAGH"

I

OF

2

REPORT

NOTICE

FEDERAL ELECTION

COMMISSION

ARKANSAS

Congressional

Committees

April

20,

1992

FOR

COMMITTEES

INVOLVED

ONLY

IN

THE

PRIMARY

(05/26):

REPORT

Pre-Primary

48

Hour

Notices

July Quarterly

REPORTING

PERIOD

REG./CERT.

RAI

LING

DATE'*

0

5 1

/,9

2

----

See

Below----

3S

T

,

93:

C

-

15/9

2

WHO

MUST

FILE

Princi:al

camcaian

c:n.-:ttees

of

o=roressional

candidates

einelud:nc

unopposed

candidates,

-,'no

seeK

r

m.nation

in

the

primary

must

file

the

above

reports

and

rt:-es.

.f

t.1e

car-aian

has

more

than

one

authorized

committee,

:!e

principal campaign

committee

must

also

file

t4

c.-nsolidated

recor:

n

.

r48

HOUR

NOTICES

ON

CONTRIBUTIONS

::ot:oes

are

reauire- i

:ne

z:z:t:ee

receives

contributions

(including contributions

and

loans

from

the

candidate's

personal

funds;

and

endorsements

or

cuarantees

of

bank

loans?

cf

S1,:00

or

ore,

dring

the

per::d

of

a"

thrcuqh

May

23.

The

notices

must

reach

the

approptia'e

:eoera

and

state

fillng

offices within

48

hours

of

the

committee's

re::

-

-,

tne

contribution(s).

LABEL

Aff:x

the

peei-off

3=oel

f ...

ne

envelope

t:

Line

I

cf

the

report.

:orrec::ons

snculd

:e

oe

on

:ne

..

3bel.

:OMPLIANCE

TREASURERS APE

FE$?2.:E

.CR

rZ:.:

ALL

PEPOPTS

AND

48

HORP

NOTICE$

::

:E.

FAILUFE

7-

7 " -

*"E!-

TO

EN70

:P.ZEENT

ACTION.

:OMiTTrES

USING

'N^N-FZ: FCRS

FOR

FEPORTS

CR

F:'ING

ILLEGIBLE

REPORTS

OR

NOTICES

WILL

BE

PE?::REO

T

FEF:LE.

*Reports

sent

zv

rez:s:ered

or

cert:fied

mail

must

be

postmarked

by

the

mailin

date;

:ne:,ise.

:nev

nust

be

received

by

the

filing

date.

-'The

rer:od

teoins

wizn

tne

c-ose

of

the

last

report

filed

by

the

:ommit:ee.

:!

:ne

-:n::ee

nas

f:led

no

:he

perico

begins

.:ith

tne

date

: h e

committee's

first

activity.

FOR

INFORMATION,

Call:

800/424-9530

or

202/219-3420

SEE

OPPOSITE

SIDE

FOR

RUNOFF

INFORMATION

FILING

DATE

14, 9"

C4

C" 2 - - 6.

0

ATTACHMENT

42

PAG

F

2

0)F

2

FOR

COMMITTEES

INVOLVED

IN

BOTH THE

PRIMARY

(05/26)

AND

RUNOFF

(06/09):

REG./CERT.

MAILING

FILING

REPORT

REPORTING

PERIOD

DATE*

DATE

Pre-Primary

04/01/92

-

05/06/92"

b 0

/l/92

05/

47"

48

Hour

Notices

----

See

Below----

Pre-Runoff

05/07/92

-

05/20/92

05/28/92***

05/28/92

48

Hour

Notices

----

See

Below----

July

Quarterly

05/21/92

-

06/30/92

07/15/92

48

BOUR

NOTICES

ON

CONTRIBUTIONS

Notices

are

required

if

the

committee

receives

contributions

(including

contributions

and loans from

the

candidate's

personal

funds; and

endorsements

or

guarantees

of

bank loans)

of

$1,000

or

more,

during

the

period:

Primary

5/07

-

5/23

Runoff

5/21

-

6/06

The

notices

must

reach

the

appropriate

federal

and

state

filing

offices

within

48

hours

of the

committee's

receipt

of the

contribution(s).

*Reports

sent by

registered

or

certified

mail

must

be

postmarked

by

the

mailing

date;

otherwise,

they

must

be

received

by

the

filing

date.

**The

period

begins

with

the

close

of

the

last

report

filed

by

the

committee.

If

the

committee

has

filed

no

the

period

begins with

the

date

of

the

committee's

first

activity.

***The

mailing

date

is

the

same

as

the

filing date because

the

computed mailing

date

would

fall

one

day

before

the

primary

was

held.

FOR

INFORMATION,

Call:

800/424-9530

or

202/219-3420

ARKANSAS

RUNOFF

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a - -

ATTACHMENT

#4

EtIt

At

I

C

IION

COMMISSION

Roy

3.

Shorter,

Treasurer

SU

IM

Committee

to

glect

Don

Weis

4C00

Frontage

Road

Iayettevilll,

AR

72703

IdentifiCatiOn

"umber:

C00263699

Veference:

12

Day

Ipre-Runoff

Report

(5/7/92-5/20/92)

Dear

Mr.

Shortert

This letter

is

prompted

by

the

Commission*s

preliminary

review

of

the

report(s)

referenced

above. The

review

raised

questions concerning certain

information

contained

in the

report(s). An

itemization

follows:

-Schedule

A

of

your report

indicates

that

your

committee

may

have

failed

to file

one

or

more

of

the

required

48

hour

notices

regarding

*last

minute'

contributions

received

by your

couittee

after

the

close

of

books

for

the

12

Day

Pre-Primary

report.

A

principal

campaign

committee

must

notify

the

Commission,

in

writing,

within

48

hours

of

any

contribution

of

$1,000

or

more

received

betveen

two

and

twenty

days before

an

election.

These

Ncontributions

are

then

reported

on the

required

to be

filed

by

the

committee.

To

ensure

that

the

Commission

is

notified

of

last

minute

contributions

of

$1,000

or

more

to

yov

.

-campaign,

it

is

recommended

that

you

review

your

procedures

for

checking

contributions

received

during

the

aforementioned

time

period.

Although

the

Commission

may

take

legal

actions

&a

response

you

wish

to

make

concerning

this

matter

iI1be

taken

into

consideration.

(11 CrR

1104.5(f))

Any

amendment

or

clarification

should

be

filed

with

the Clerk

of

the

House

of

Representatives.

1036

Longworth

souse

Office

Building,

Washington,

DC 20515.

If

you

need

assistance,

please

feel

free

to

contact

me

on

our

toll-free

number,

(S00)

424-9530.

My

local

number

is

(202)

219-3550.

Sincerely,

"/. K-

Robin

Kelly

Reports

Analyst

Reports

Analysis

Division

ATTACHMENT

#5

MEMORANDUM

TO

FILES:

TELECON

,

VISIT

NAME

OF

COM4ITTEE:

Committee

to

Elect

Don

Nelms

-

C00263699

SUBJECT:-

Failure

to

File

Required

48-Hour

Notices

FEC

REP:

Robin

Kelly,

PAD

Analyst

COMMITTEE

REP:

Roy

Shorter, Treasurer

(501)

521-3613

*r.

Shorter

called

to

discuss

the

notice

he

had

received

regarding

the

48-Hour

Notices.

He

said

he

realized

that

he

had

missed reporting

two,

but

only after

the

fact.

He

said

he

would

send

in

a

letter

explaining

the

situation.

DATE

9/17/92

oCrAl

AD

UAll

ATTACHMENT It

SEP

17

99

September

17.

1990

Robin Kelly.

Reports Analyst

Federa)

Election

Commission

099

1

Streett

N1

eebilngtoa

DC

0453

Dear

No.

Kelly:

Tbl

letter follows

up

our

telepbome convereatio

earlier

this

morning

regarding

your

review

of

our

*lost

lmute

contributions

reported

om

the

13

Day

Pro-Rmaoff

Report

(3/?/92-5/10/92)

filed

o

or

before

5/38/98.

At

the

time

of

filing.

I

was

mot

aware

that loess

1

ezcess

of

$1.000 (made

by

the

candidate

from

personal

foods)

were

als.

considered

to

be

contributions

subject

to

the

43-hour

special

notice fillig

requirement.

The

Campaign

0uI:

for

Coagreosomal

Candidates

(July

19O0).

om

page

34.

does

mot

defime

a

*last

mimoto"

coatributiom

to

Include

loans from

the

camdidate'

persomol

ftods.

Im

odditiem.

whon

thm loose

are

reported

orn

eodule

A

1toalqed

Rceipts

(FEC

Form

5)

as

denoted

Is

the

oaL'o

o

page

40.

they

are

reported

as

*Loans"

Made

or

Guarasteod

by

the

Camdidate.

mot

"Cemtributiomeo.

9t

was

met

ntil

I

received

a

copy

of

the

orOelrrLSE

proble"s

letter.

om

or

about

Jose

39t

(addressed

to

the

candidate.

oudated-opy

enclosed)

from

Jons

a.

Alkomo,

Chairma.

that

I

reallsed

the

46-bour

reporting

rol

seladed

coadideto

leas.

Promptly.

thoreafter.

I

haoe

reported

all

oubooquost

"lost

mlmuto

°

costributioms

(imcludlmg

candidate

lase

from

persomal

ftads)

witbia

45-boure

of

reeolt

by

special

sotieo.

Those

receipts

were

also

reflected

on

the

July

10

quarterly

Report

(5/21/0-6/30/03).

If

you hove

Gmy

questiome regardiag

this

matter.

plo6oo

do

sot

hesitate

to

coutact

me

at:

The

Committee

to

Blet

Dom

Klms.

4000

frontage

d.

Fayetteville.

AR

11Y0Y

,

or

ell

atl

at

(601)

531-5011.

Thask

you

for

your

*oasideratlom.

__

Respeotfully,

Boy

J.

Shorter.

Treasurer

?he

Committee

to

slect

son

Rolo0

to

lumbers

COMO

$

DEMOCRAT

*

US CONGRESS

* 3RD DISTRICT

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4

U-.

-~

4 3

r

I

V

1

I1

1011

6

.

17

-

77--

FEDERAL ELECTION

COMMISSION

999

E

Street, N.W.

Washington,

D.C.

20463

NSIDVE

FIRST

GENERAL COUNSEL'S

REPORT

RAD

Referral

#

92L-24

STAFF

MEMBER:

Holly

Baker

SOURCE:

I N T E R N A L L Y G E N E R A T E D

RESPONDENTS:

The

Committee

to

Elect

Don

Nelms

and

Roy

J.

Shorter,

as

treasurer

RELEVANT

STATUTES:

2

U.S.C.

S

434(a)(61

2

U.S.C.

S 431

8H(A

I.

GENERATION

OF

MATTER

The

Office

of

the

General Counsel received

a

referral

from

the

Reports

Analysis

Division

("RAD",

on

October

14,

1991.

Attachment

1.

The

basis

for the

attached

referral

is

the

failure

of

The

Committee

to

Elect Don

Nelms

and

Roy

J.

Shorter,

as

treasurer ("Committee")

to

file two

forty-eight

hour

notifications

'"48

Hour

Notices")

for

contributions

totaling

$25,000.

Don

Nelms

lost

the

1992

Primary

Election

Runoff

in

the

3rd

Congressional

District

in

the

State

cf

Arkansas

with

42

percent

of

the

vote.

II.

FACTUAL

AND

LEGAL

ANALYSIS

bel

III

Comn

Based

on

the

Factual

and Legal

Analysis,

see

Attachment

this

Office

recommends

the

Commission

find

r-asen

to

ieve

the

Respondents

violated

2

U.S.C.

§

434

a .

DISCUSSION

OF

CONCILIATION

AND CIVIL PENALTY

The

Office

of

the

General Counsel

recommends

that

the

mission

find

reason

to

believe

that

the

Committee

violated

-2-

2

U.S.C.

5

434(a)(6).

In

addition,

this

Office

recommends

that

the

Commission

offer

to

enter

into

conciliation

with

the

Respondents

prior

to

a

finding

of

probable

cause

to

believe.

IV.

RECOMMENDATIONS

1.

Open

a

MUR.

2.

Find

reason

to

believe

that

The

Committee

to

Elect

Don

Nelms

and Roy

J.

Shorter,

as

treasurer,

violated

2

U.S.C.

5

434(a)(6),

and

enter

into

conciliation

prior

to

a

finding

of

probable

cause

to

believe.

3.

Approve

the

attached

Factual

and Legal

Analysis,

proposed conciliation

agreement

and

the

appropriate

letter.

Lawrence

M.

Noble

General

Counsel

BY:

Dat34

bate

Lois

G./Lerner

Associadte

General

Counsel

Attachments:

1.

Referral Materials

2.

Factual

and Legal

Analysis

3.

Proposed

Conciliation

Agreement

ELECTION

COMMISSION

In

the

Matter

of

The

Committee

to

Elect

Don

Nelms

and

Roy

J.

Shorter,

as

treasurer.

RAD

Referral

492L-24

CERTIFICATION

I,

Marjorie

W.

Emmons,

Secretary

of

the

Federal

Election

Commission,

do

hereby

certify

that

on

November

5,

1992,

the

Commission

decided

by

a

vote

of

5-0

to

take

the

following

actions

in

RAD

Referral

#92L-24:

1.

Open

a

MUR.

2.

Find

reason

to

believe

that The

Committee

to

Elect

Don

Nelms

and

Roy

J.

Shorter,

as

treasurer, violated

2

U.S.C.

5

434(a)(6),

and

enter

into

conciliation

prior

to

a

finding

of

probable

cause

to

believe.

3.

Approve

the

Factual

and Legal

Analysis,

proposed

conciliation

agreement

and

the

appropriate

letter,

as

recommended

in

the

General Counsel's

Report

dated

October

30,

1992.

Commissioners

Aikens,

Elliott,

McDonald,

McGarry

and

Potter

voted

affirmatively

for

the

decision;

Commissioner

Thomas

did

not cast

a

vote.

Attest:

Date

S~e

r

rjor

e W.

mmons

secretary

of

the

Commission

Received

in

the

Secretariat:

Fri.,

Oct.

30,

1992

2:54

p.m.

Circulated

to

the

Commission:

Mon.,

Nov. 2,

1992

11:00

a.m.

Deadline

for

vote:

Thurs.,

Nov.

5,

1992

4:00

p.m.

BEFORE

THE

FEDERAL

ELECTION

COMMISSION

4

t

November

12,

1992

Roy

J.

Shorter,

Treasurer

The

Committee

to

Elect

Don

Nelms

4000

Frontage

Road

Fayetteville,

AR

72703

RE:

MUR

3697

The

Committee

to

Elect

Don

Nelms

and

Roy

J.

Shorter,

as

treasurer

Dear

Mr.

Shorter:

On

November

5,

1992,

the

Federal

Election Commission

found

that

there

is

reason

to

believe

that

The

Committee

to

Elect

Don

Nelms

("Committee")

and you,

as

treasurer, violated

2

U.S.C.

5 434(a)(6), a

provision

of

the

Federal

Election

Campaign

Act

of

1971,

as

amended

("the

Act").

The

Factual

and Legal

Analysis,

which

formed

a basis

for

the

Commission's

finding,

is

attached

for

your

information.

Under

the

Act,

you

have

an

opportunity

to

demonstrate

that

no

action

should

be

taken

against

the

Committee

and you,

as

treasurer.

You

may

submit

any

factual

or

legal

materials

that you

believe

are

relevant

to

the

Commission's

consideration

of

this

matter.

Please submit

such

materials

to

the

General

Counsel's

Office

within

15

days

of

your

receipt

of

this

letter.

Where

appropriate, statements

should

be

submitted

under oath.

In

the

absence

of

any

additional

information

demonstrating

that

no

further

action should

be

taken against

the

Committee

and

you,

as

treasurer,

the

Commission

may

find

probable

cause

to

believe

that

a

violation

has

occurred

and

proceed

with

conc~liation.

In

order

to

expedite

the

resolution

of

this

matter,

the

Commission

has

also

decided

to

offer

to

enter

into

negotiations

directed

towards

reaching

a

conciliation

agreement

in

settlement

cf

this

matter

prior

to

a

finding

of

probable

cause

to

believe.

Enclosed

is

a

conciliation

agreement

that

the

Commission

has

approved.

Roy

J.

Shorter

page

2

If

you

are

interested

in

expediting

the

resolution

of

this

matter

by

pursuing

preprobable

cause

conciliation

and if

you

agree

with

the

provisions

of

the

enclosed

agreement,

please

sign

and

return

the

agreement,

along

with

the civil

penalty,

to

the

Commission.

In

light

of

the

fact

that

conciliation

negotiations,

prior

to

a

finding

of

probable

cause

to

believe,

are

limited

to

a

maximum

of

30

days,

you

should

respond

to

this

notification

as

soon

as

possible.

Requests

for

extensions

cf

time

will

not

be

routinely

granted.

Requests

must

be

made

in

writing

at

least

five

days

prior

to

the

due date

of

the

response

and

specific

good

cause

must

be

demonstrated.

In

addition,

the

Office

of

the

General

Counsel

ordinarily

will

not

give

extensions

beyond

20

days.

If

you intend

to

be

represented

by

counsel

in

this

matter,

please advise

the

Commission

by

completing

the

enclosed

form

stating

the

name,

address,

and

telephone

number

of

such

counsel,

and

authorizing

such

counsel

to

receive

any

notifications

and

other

communications

from

the

Commission.

This

matter

will

remain

confidential

in

accordance

with

2 U.S.C.

S5

437g(a)(4)(B)

and

437g(a)(12)(A),

unless

you

notify

the

Commission

in

writing

that

you

wish

the

investigation

to

be

made

public.

For

your

information,

we

have

attached

a

brief

description

of

the

Commission's

procedures

for

handling

possible violations

of

the

Act.

If

you have any

questions,

please contact Holly

Baker,

the

staff

member

assigned

to

this

matter,

at

202)

219-3400.

Sincerely,

Joan

D.

Aikens

Chairman

Enclosures

Factual

and

Legal

Analys:s

Procedures

Desionaticn

cf

Counsel

F-rm

Conciliaticn

Agreement

RESPONDENTS:

The

and

FEDERAL

ELECTION COMMISSION

FACTUAL

&

LEGAL ANALYSIS

MUR

3697

Committee

to

Elect

Don

Nelms

Roy

J.

Shorter,

as

treasurer

This

matter

was

generated

based

on

information

ascertained

by

the

Federal

Election

Commission

("the

Commission")

in

the

normal course

of

carrying

out

its

supervisory

responsibilities.

See

2

U.S.C.

5

437g(a)(2).

The

Federal

Election

Campaign

Act

of

1971,

as

amended

("the

Act"),

requires

principal

campaign

committees

of

candidates

for

federal

office

to

notify

in

writing

either

Secretary

of the

Representatives

Secretary

of

Sta

more, received

b

after

the

20th

d

election.

2 U.S

notification

to

the

contribution

office

sought,

t

contribution,

an

The

notificaticn

to

all

other

rep

Senate,

the

Clerk

of

the

U.S.

House

of

or

the

Commission,

as

appropriate,

and

the

te,

of

each

contribution

totaling

$1,000

or

y

any

authorized

committee

of

the

candidate

ay but

more

than

48

hours

before

any

.

434(auf$

,A.

The

Act further

requires

be

made

within

48

hours

after

the

receipt

of

and

to

include

the

name

of

the

candidate

and

he

date

of

receipt,

the

amount

of the

d

the

ldentificaticn

cf

the

contributor.

Id.

cf

these

contr:butions

shall

be

in

addition

orting

requirements.

2

U.S.C.

5

434a)y6':

B,.

Accordinz

§

100.7i

l ( ,B

o 2

U.S.'.

,a

loan

.s

431,8),A)

and

11

C.F.p.

contribution

at

the

time

it

is

the

1-

0 S

-2-

made

and

is

a

contribution

to

the

extent

that

it

remains

unpaid.

Furthermore,

each

guarantor

or

endorser

of

a

loan

shall

be

deemed

to

have

contributed

that

portion

of the

total

amount

of

the

loan

for

which

the

guarantor

or

endorser

agreed

to

be

liable

until

the

loan

is

repaid.

2

u.s.c.

5

431(8)(B)(vii)(1)

and

I-I

C.F.R.

5

100.7,,a)(l)(i)(C).

The

Primary

Election

In

the

state

of

Arkansas

was

held

(n May

26,

1992.

Pursuant

to

the Act,

the

Respondents

were

required

to

notify

the

Commission,

in

writing,

of

all

contributions

of

$1,000

or

more

received

from

May

-

to

May

23,

1992,

within

48

hours

of

their receipt.

A

review

of

the

Committee's

1992

12

Day

Pre-Runoff

Report

identified

two

contributions

received

on

May

7

and

May

15,

1992,

of

$1,000

or

more

(in

the

form

of

loans

from

the

candidate)

totaling

$25,000.

The

contributions

were reported

on

Schedules

A

and

C,

with

the

candidate,

Don

Nelms, listed

as

making

a

$10,000

loan

and

a

$15,000

loan

to

the

Committee.

The

Committee

did

not

submit

two

48

Hour

Notices

for

these

contributions.

Therefore,

there

is

reason

to

believe

that

The

Committee

to

Elect

Don

Nelms

and

Roy

J.

Shorter,

as

treasurer,

violated

2

U.S.C.

5

434ta,,%' by

failing

to

report

campaiqn contributions

cf

$>,OO

or

more,

received

after

the

20th

day,

but

more

than

48

hours

before

the

primary

election,

within

48

hours

of

rece.p:

of

the

contr:butions.

-

-1A

M

-

R,\t

I I (I

T1

)N

December

10,

1992

CERTIFIED

MAI..

RETURN

RECEIPT REQUESTED

Poy

J. Shorter,

Treasurer

The

Committee

to

Elect

Don

Nelms

4000

Frontage

Road

Fayetteville,

AF

72703

RE:

MUR

3697

Cmte

to

Elect

Don

Nelms

Dear

Mr.

Shorter:

On

November

12,

1992,

you

were

notified

that

the

Federal

Election

Commission

determined

to

enter

into

negotiations

directed

toward

reaching

a

conciliation

agreement

in

settlement

of

this

matter

prior

to

a

finding

of

probable

cause

to

believe.

On that

same

date

you

were

sent

a

conciliation agreement offered

by

the

Commission

in

settlement

of

this

matter.

Please

note

that

conciliation

negotiations

entered

into

prior

to

a

finding

of

probable

cause

to

believe

are

limited

t.o

a

maximum

of

30

days.

To

date,

you have

not

responded

to

the

proposed

agreement.

The

30

day

period

for

negotiations

will

soon expire.

Unless

we

receive

a

response

from

you

within

five

days,

this

Office

will

consider

these

negotiations

terminated

and

will

proceed

to

the

next stage

of

the

enforcement

process.

Should

you have

any

questions,

please contact

me

at

202,

219-3400.

Sin

ce

re

ly,

Holly

Baker

Attorney

THE

CONIITIiEE

TO

ELECT

DON

NELMS

4000

Frontage

Road

Fayetteville.

Arkansas

72703

December

16,

1992

Holly

Baker. Attorney

General

Counsel's

Ofiice

Federal

Election

Commission

999

E

Street

NVN"

Washington.

DC

2043

Dear %ls.

Baker:

I

respectfully

request

that

no

action

be

taken

against

the

Committee

or

m.self.

as

tresurer.

as

there

was

no

willful

neglect

on

the

part

of

the

committee or

myself.

At

all

times.

we

made

an

honest

attempt

to

complt

with

all

reporting

and

special

notice

requirements.

and

with

this

one

exception.

compliance

%as full

and

complete.

The

issue

appears

to

center

upon

the

confusion

over

definitional terms

of

a

candidate

"loan"

versus

a

candidate "contribution"

as

it

relates

to

the

48-hour

notice

requirement.

For

FEC

quarterly

and pre-election

reporting

purposes,

a

"candidate

loan"

is

distinguished

from

a

"candidate

contribution"

and

must

be

reported separatel..

However.

for

48-hour

special

notice

reporting

purposes.

a

"candidate

loan"

is

not

distinguished

from

a

"candidate

contribution"

and

reported

the

same.

This

created

the

problem

with

our

reporting

the first

two

candidate

loans.

None

of those

assisting

the

candidate

in

the

financial

reporting

had

in

that

function. including

myself.

Our

entire

knowledge

of

the

requirements

came

from

a

detailed

review

of

the

FEC

materials

furnished

us

and

selected

conversations

with

FEC.

We

fully

understand

the

importance

of

proper

campaign

reporting

and

certainly

appreciate

the

complexity

of

federal

campaign

law

and

regulations.

However.

an

honest

mistake

was

made

and

once

the

definition

of

a

candidate contribution

was

clarified

to

include

a

candidate

loan.

the

mistake

was

immediatel.y

corrected.

Xll

subsequent candidate

loans

were

reported

promptly and

correctly.

Attached

is

an

affidavit.

under oath.

setting

out those

facts

which

I

believe

should

be

considered

by

you.

and

which

I

believe

support

our

position

that

the

Commission should

take

no

action

against

our

Committee

or

m,,self.

In

the

event

the

affida'it

and

this

letter

are

not

sufficient

to

satis

your

inquiri

into

our

actions.

and

satisy

you

as

to

our

good

intentions,

we

would

like

to

remain

in

contact

for

further

discussion.

Should

you

need

additional

information,

please

contact

me

at

15

O11

521-3813.

Respectfully.

Roy

J.

Shorter.

Treasurer

The

Committee

to

Elect

Don Nelms

Enclosures:

1)

Reporting

Problems

Letter

from

Joan

Aikens.

undated

2)

12-Day

Pre-Election

Report

Letter

front

Clerk

of

L

S

House of

Representaties.

dated

5

92

3)

Letter

from

our

('ommittev

to

Robin

Kelly.

dated

9

17,92

AFFDAVIT

STATE

OF

ARKANSAS

ss.

COUNTY

OF

WASHINGTON

)

I,

Roy

J. Shorter,

the

undersigned,

under

oath,

do

of

My

own

personal

knowledge

make

the

following

statements

and

declare

them

to

be

true.

1. 1

first

became

aware

ot

the

Federal

Election

Commission's

pre-probable

cause

letter

(dated

November

12,

1992)

together

with

enclosures,

and

your

certifiled

letter

dated

December

10

,

1992,

December

14,

1992.

Although

appropriately

addressed,

our

campaign

otfice

has

effectively

closed.

The

normal

business

office

of

our

chairman accumulates

the mail and

notifies

me

when

I

should come

and

pick

it

up.

I

was

not

contacted

until

December

14,

1992

that

mail

had

accumulated.

Upon

retrieving

the

mail

your

correspondence

was

read.

At

that

time

I

promptly

called

Ms.

Holly

Baker

with

the

General

Counsel,

FEC.

2.

At

the

time

of

the

two

candidate

loans

in

question,

my

only

source

of

guidance

for

the

48-hour

notice

reporting

requirement

was your

Campaign Guide

(July

1988),

page

24,

"Last-Minute

Contributions",

which

did

not

specify

that

"candidate

loans" are

also

included under

that

requirement.

The

heading

of

the

section

does

not

mention

"Candidate

Loans",

nor

is it

mentioned

in

the

body

of

the

requirement.

There

was

simply

nothing

to

place

me

on

notice

that

"Candidate

Loans"

might

be

included.

3.

In

reading

the

Campaign

Guide,

I was aware

that

candidate

loans

were treated

differently

than

contributions

for

reporting

purposes

and that

a

loan

was

in

fact

distinguished

from

a

contribution.

Page

11

states

that

"personal

funds

loaned

to

the

campaign

are

reported

as

loans

from

the

candidate

from

the

outset",

and

"personal

funds

donated

to

the

campaign

are

reported

as

contributions

from

the

candidate."

Examples

on

page

40

indicate

that

loans

made

by

the

candidate

are

to

be

reported

under itemized

receipts

as

"Loans

Made

by

the

Candidate"

and

contributions

from

the

candidate

are

reported under

itemized receipts

as

"Contributions

from

the

Candidate".

4.

At

that

time,

I

understood

that

once a

candidate

loan

was

designated

as

a

"loan",

subject

to

repayment

to

the

candidate,

it

would

not

be

considered

a

contribution,

unless

the

candidate

specifically.

forgave

the

debt.

Then,

and

only

at

the

time

of

forgiveness

of

the

debt,

would

the

loan

be

converted

to

a

contribution,

and

reported

as

such.

To

this

day,

all

loans

previously reported

are

still

subject

to

repayment

and

are

shown

on

the

books

as

a debt

owed

the

candidate

by

the

Committee.

5.

In

my

efforts

to

properly

comply with

all

reporting

requirements,

I

contacted

an

FEC

specialist

in

March, 1992,

to

determine

proper

reporting

procedures

for

out-of-pocket

expenses

paid

by

the

Candidate.

Following

that

conversation,

I

understood

that

out-of-pocket

expenses

were

deemed

in-kind

contributions

from

the

candidate

and

were

not

to

be

reported

as

loans,

and

that

any

candidate

contributions

could

not

be

converted

to

a

loan

at

a

later

date.

At no

time

during

this

conversation

was

I

advised

of

the

inclusion

of

"Candidate

Loans"

for the

purpose

of

the

48

hour

requirement.

6.

in

addition,

at

the

time

of

the

first

two

candidate

loans

subject

to

48-hour

notice,

which

are

in

question,

I

also

had

received

two letters

from

the

office

of

the

Clerk,

US

House

of

Representatives:

A)

letter

undated,

regarding

April

15,

1992

quarterly

reporting

and,

B)

letter dated May

5,

1992,

regarding

12-day

pre-election

reporting.

The

second

letter

addressed

the

issue

of

the

48-hour

notice,

but

only

referred

to "contributions",

similar

to

that

in

the

Campaign

Guide

(July

1988)

on

page

24.

A

copy

of

that

letter

is

attached,

marked

Exhibit

1.

7.

My

first

notice

of

the

similar

treatment

of

candidate

loans

and

contributions

for

the

48

hour

rule

was

upon

my

receipt

of

an

undated

letter

(addressed

to the

candidate)

from Joan

Aikens,

addressing

reporting

problems.

A

copy

of

that

letter

is

attached,

marked

Exhibit

2.

8.

Thereafter,

all

candidate

loans

of

$1,000

or

more,

falling

within

the

20

day

period

prior

to

the election,

were promptly

reported.

A

candidate

loan

on

June

3

was

reported

June

4

and

a

candidate

loan

on

June

4

was

reported

June

5.

9. 1

subsequently received

a

copy

of

your

quarterly

Report

Notice

dated

June

19,,

1992,

which

also

clarified

last

minute

contributions

to

include

loans from

the

candidate's

personal

funds.

10.

1

have

filed

all

required

FEC

Quarterly

and

Pre-Election

Reports timely

and

accurately

and

properly

separated

candidate

loans

from

candidate

contributions,

as

required

on

FEC

Form

3,

page

two,

and

Schedules

A

and

C.

11.

I

explained

to

Robin

Kelly

of

the

Commission

on

September

17,

1992,

by

letter,

that

I

was

not

aware

that

"candidate

loans

made

from

personal

funds"

were

also

considered

"contributions"n

for

the

48

hour reporting

rule,

further

advising

her that the

Joan

Aikens

letter

was

my first

knowledge

of

this

inclusion.

A

copy

of

that

letter

is

attached,

marked

Exhibit

3.

12.

I

have

not

previously served

as

treasurer,

nor

been

associated

in

any

position, with

political campaigns

until

I

accepted

this

position

with

the

Committee

to

Elect

Don

Nelms.

This

was

also

the

first

political office sought

by

the

candidate

and

therefore

his

first

experience

with

the

campaign

process.

With

the

exception

of

the

first

two

48

hour

notices

now

in

question,

all

subsequent

48

hour

notices were

timely

filed

and

all

other

reporting requirements

set

forth

by the

FEC

were timely

and

completely

met.

Further

the

affiant sayeth

not.

Dated

this

1(

day

of

December,

1992.

Roy

J.

Shorter

WITNESS

my

hand

and

seal

as

notary

public

on

the

day

above

written.

.xpie.

Notary

/Oubl

id

My

Commission

-

Expires:

-/-J

3MOR

ft.

2ubem

ON*a

I.

3''s

sncrmw

8J

1w

m

Iim

Oeffice

of

the

Clerk

b

oule

of

Reprentattbe

*asinuton,

IBC

20515-G01

May

5,

1992

TO:

Individuals SeeKing

Election

to

the

U.S.

House

of

Representatives

and

Political

Committees

Supporting

Such

Individuals

Involved

in

the

Primary

Election

to

be

Held

on

May

26,

1992,

in

Arkansas,

Idaho

and

Kentucky

FROM:

DONNALD

K.

ANDERSON,

Clerk

U.S.

House

of

Representatives

/

SUBJECT:

12-Day

Pre-Election

Report

of

Receipts

and

Disburseamuts

This

notice

is

being

sent

to

ensure

that

you

are

aware

of

the

due

date

for the

12-Day

Pre-Election

Report

-f

Receipts

and

Disbursements

for

the

primary

election

in

which

you

are

involved.

Cnly

those

individuals who

meet

the

following

definition

of

candidate

are

required

to

designate

a

principal

campaign

committee

and

have that

committee

register

and

file

reports

under

the

Federal Election

Campaign

Act,

as

amended.

If

you

do not

meet

this

definition,

no

such

designation

or

comiittee

filing

is

necessary.

defines

a

to

file

a

Report

is

election;

certified

Title

2

U.S.C.

S431

of

the

Federal

Election Campaign

Act,

as

amended,

"candidate"

as:

...

an

individual

who seeks

nomination

for

election,

or

election,

to

Federal

office

...

an

individual

shall

be

deemed

to

seek

nomination

for

election,

or

election

--

(A)

if

such

individual

has

received

contributions

aggregating

in

excess

of

S5,CC0

or

has

made

expenditures

aggregating

in

excess

of

S5,-

C:

cr

(B)

if

such

individual

has

qiven

his

or

her

consent

to

another person

to

receive

contributions

or

make

expenditures

on

behalf

of

such

individual

and

if

such

person

has

received

such

contributions

aggregating

in

excess

of

$5,000

or

has

made

expenditures

aggregating

in

excess

of

$5,000.

Political committees

supporting candidates

as

defined

above

are

required

Pre-Election

Report

of

Receipts

and

Disbursements

on

FEC

Form

3.

This

due

in

my

office

by

the

close

of

business

on

the

12th

day

preceding

the

however,

this

Report

will

be

considered

timely

filed

if

it

is

mailed

or

registered

by

midnight

of

the

15th

day

preceding

the

election.

The

OVER

-~r

(1

of

Report

should

cover

the

period

of

time

from

the

close

of

books

of

the last

Report

(or the

day

on

which

any

financial

activity

commenced)

through

the

20th

day

preceding

the

election.

The

following

dates

are

provided

for

your

convenience:

Type

of

Report

Filing

Date

Mailing

Date

If

Sent

Closing

Date

Registered/Certified

Pre-Election

May

14,

1992

May

!i, 1992

May

6,

1992

Contributions

of

$i,?0

or

more

received after

the 20th

day,

but

more

Xthan

48

hours

before

the

election,

rust

be

reported

within

48

hours

of

their receipt.

This

notification

shall

be

in

writing

and

shall

:nciuce

the

name

ot

the

candidate

and

office

sought

ty

the

candidate,

the

identification

of

the

contributor,

and

the

-

date

of

receipt

and

a.ount

of

the

ccntribution.

.........

If

additional committees

are

authorized

by

the

candidate,

their

Pre-Election

Reports should

be

filed

with

the

principal

campaign committee

which

shall

compile

and

file such

reports

with

the

Clerk

of

the

House

of

Representatives.

If

you

have

any

questions

regarding

this

matter

or

need

any

additional

forms,

please

do not

hesitate

to

contact

-y

staff

in

the

Office

of

Records

and

Registration,

1036

Longworth

House

Office

Building,

Washington,

DC

20515-6612,

202)

225-1300.

'-

or-

r-- /

F

/ ~*

,,1

-- E

ERAL

C

(

0

N,

Dear

:an-_43ae:

_.ems

:na--

--

-E

.aw

#Z'a- e..er • a -s

oe

-: -

nez::.

:3.-1a

Iz2

nece::2

z

*-n -

r

-

e

-n_,-

-_.-n.-_

n " e

Z-"Sl.

'

n. s: _

u3 n' l --

n :an

3e..nz

"a 'z " .--c "- ns " r,,.z

e_7'.,

.a r

.s

7

7e

a

st

3n

ie

re

r,

n

PS C t U...

:rder

-o

ne

'.'ou

avo:

a

:9'

:ooms

r:n

.r

e.'v

s

e.e:::ns

?ROBLEM

ONE:

Correctina

Contributions

That

Appear

Excessive

eiec

:.

:v

2 e

0Le

-

:neso

'.-e

"c.ace

S

:nec -- a

several

serious

-ave

encountered

with

.ears.

a- n ....

r::no

regulations

and

Teem

v'ery

complex. Accurate

n-.

expenc:tures

is,

nowever,

-_?-

-ne

:eoerai

election

laws.

-ase

-e-n

FeE.C,

which

is

-n.. .

nai:v

of

thousands

of

an-:ate

cr

campaign

wants.

ne

-

ion

sDecific

rules

in

".ne

more

common

recurring

-s

:ne

amoun

-2.

*--

:-e

"nd::duai

may

e r 0orC

"-

-: :'. .

iuse

----

e'eSS

cex"ces

cu::

o~n

mus:

n

:e

exces

rece:

_:

:ne

-r-1,31"

3ecr

'

su!I

e

en:

contribute

.'.

':

:ntr-:ution

beyond

that

is

'S..

2..eans

"na':

any

-neck

from

an

S..

"

usoec:.

To

avoid

beina

>2..

_- 3: e.

_.

".ne

excessive

.... -'

oactr:buted

to

a

:eces:::::

...

2v:2.

e

-:n:r ut

tro a

uture

-:ut=n

7

ed-es-

=nat'cns

must

ODe

signed

.emse.s.

e

:.eoroziem

:s

fixed,

:he

--.

:nc

du

repor

the

..: e

Joncr

:s

being

contacted

'v . -

Z.':=es

n23ve

:und

::

heloful

•-

:-

separate

account

res:.."e.

"=ess

:ne

:amain

receives

3

--

**--

-

*

-*..

.....

e

,ont

r

outors,

i

-.

:as

a:

.

the

a.

me>:.

"< -

.

ave

Sen:

".'our

treasurer

a

..... ess "-

more

oeta,

_? X C

PROBLEM

TWO:

Candidate

Self-Support

As

the

candidate,

you

are

not

bound

by the

$1,000

contribution

limit.

Any

personal

funds

you

give

to

your

campaign,

however,

must

be

reported

as

a

contribution regardless

of

whether

you

donate

the

funds

as

a

direct

contribution

or

as

a

loan.

If

you

loan

money

to

your

campaign,

special

reporting

is

required

to

-distinguish

-uture

repayments

:r.cm

wnat

otherdlse

would

look

like

personal

enrichment.

we

also

want

to

note

that

"z

you

maxe

a

direct

contribution

to

your

campaign,

you cannot

!ater

call the

alft

a

loan

and

ask the

Committee

to

pay

it

bacx

to

Pcu.

:hus,

-f

you

hope eventually

to

receive

repayment,

make

clear

fr.m

the

beginning

that

the

icnatlon

is

a

loan.

You

must also

be

sure

that

:e

money

ana

assets

you

contribute

or

joan

to

your

campaign

Zeicng

to

you

oersonailv,

and

not

to

your

spouse,

parents,

:_

or

:r:encs,

or to

any other

Inalvidual.

PROBLEM

TSREE:

48-Hour

Reporting

After

your

:ommirtee

nas

fiac

a

day

pre-eleccion

report,

your

campaign

must

file

a

speciai

notice

disclosing

every

contribution

of

$1,000

or

more

received

shortly

before

the

election.

The

notice

must

reacn

the

appropriate

filing

offices

.it..n

48

hours

of

recez

the

ccntrbution.

This

rule

comes

into

play

beginning

wi:n

z-e zUt-oaf

date

for

the

ore-election

.eport

(20

days before

the

eec:on)

and

remains

in

effect

until

48

hours

before

the

eiectIcn. last-minute

contributions

must

also

be

reported

in

:ne

-

-ecor:

after

the

election.

Rememer,

the

48-2our

:eoort-nc

-

so

applies

to

last-minute

.t.r

ibutlons

and

1cans

r.. c

,t

your

campaign,

as

well

as

to

-cans

from

-ndIviduais

and

:o=-itees,

and

endorsements

and

guarantees

cf

banx

:cans.

:he

aetails

cn :nese

t-ree

-Atzrs,

ana

vrtuaili

everything

else

you

neea

to

know

to

stay

"ithn

:he

federai

ejection

laws,

are

set

out

in

your

Camoaln

,qide.

:f

'cu

would

like

extra

cocies

cf

this

guide

for

/our

zampalan

worKers,

call

us

on

1-600-424-9530.

Add.t

.naf'

',

we

are

happy

to

send

a

free

suoscrOticn

to

our

montnv

'ewsietter,

the

Record,

to

anyone

you

designate.

(A

free

suis......

ns

automatically

sent

to

tour

treasurer.;

?lease

also

feei free

to

call

us

at

the

above

numner,

or

have your

t-reasurer

ana/or

campaign accountant

do

so,

f

you

have

any spec.fic

questlons

aDout these

or

other matters.

As

this

letter

should

indicate,

the

Commission

takes

these

reporting

obligatlons

seriously.

,

Sincerely,

Joan

C.

Aikens,

Chairman

.. -

Federai

Election

Commission

September

17,

1992

Robin

Kelly,

Reports Analyst

Federal

Election

Commission

999

E

Streett

NW

Washington

DC

20463

Dear

Ms.

Kelly:

is

letter

follows

up

our

te

this

morning

regarding

you

contributions

reported

on

(5/7/92-5/20,92)

filed

on

o

At

the

time

of

excess

of

$1,000

(m

were

also

considere

48-hour

special

not

The

Campaign

G

1988),

on

page

24,

contribution

to

Inc

funds.

In

addition

A

Itemized Receipts

fi

ade

d t

Ice

lephone

conversation

r

review

of

our

"last

the

12

Day

Pre-Runoff

r

before 5/28/92.

ling,

I

was

not

aware

that

loans

In

by

the

candidate

from

personal

funds)

o

be

contributions

subject

to

the

filing

requirement.

ulde

for

Congressional

Candidates

(July

does

not

define

a

"last

minute"

lude

loans

from

the

candidate's

personal

when

the

loans

are

reported

on

Schedule

(FEC

Form

3),

as

denoted

in

the

example

page

40,

they

are

reported

as

"Loans"

the

Candidate,

not

"Contributions".

It

was

not

until

I

received

a

copy

of

problems"

letter,

on

or

about

June

1st

(add

candidate,

undated-copy enclosed)

from

Joan

Chairman,

that

I

realized

the

48-hour

repor

candidate

loans.

Prompt

"last

minut

personal

fu

These

recei

Report

(5/2

I

f

y'0

ol

t

ht?!

s , .501)

50

1 ) 5,

ly

e 18

Made

or

Guaranteed

the

"recurring

ressed

to

the

D.

Aikens,

ting

rule

included

thereafter,

I

have

reported

all

subsequent

contributions

(including

candidate

loans

from

nds)

with

pts

were

1/92-6,,'30

i" .,' ." -'

48-hours

of

so

reflected

2 ).

(J

eS

t

S.

I!

s

i,( .

'a~e

f

receipt

by

special

notice.

on the

July

15

Quarterly

h

J

s

a

t

727U3,

s

i

er

at

g* i

r

ter,

please

to

Flect

Doll

or

call

me

iol.

"."

C

t~t f'C -

T

e

CoIn

m itt,- , ,

,ect

Don

Nelms

N i

nl

1)(

e

)2, 3 ,t

DEMOCRAT

*

US

CONGRESS

*3RD

DISTRICT

The

Committee

to

Elect

Don

Nelms

'

ken

Lance,

Chairman

'

17

1 2

Eait

Center

I

FaN

etteville,

Arkansas

7701

MANIBU

MSS

Th

earl

ier

minute'

Report

(I ) I

Ne

I l

at.

(

Ms.

Joan

Aikens,

Chairman

...

Federal

Election

Commission

999

E

Street

NW

Washington,

DC

20463

RE:

MUR

3697

January

23,

1993

Committee

to

Elect

Don

Nelms

Dear

Ms.

Aikens:

I

am

writing

you

concerning the

fact

that

your

office

has found

reason

to

believe

that

our

campaign

committee

and

Ro,

Shorter.

as

treasurer,

has

violated

the

48-hour

notice

reporting

rule.

Mr.

Shorter

did

have

full

responsibility

for

reporting

to

your

commission

all

activity

of

our

campaign,

and

he

was

provided

a

manual

from

your

office

and

we

had

complied

with

all

of

its

regulations

as

stated

therein.

Your

campaign

guide

did

not

state

that

a

candidate

loan

should

be

reported

as

a

contribution

for

48-hour reporting

requirements.

Your

guide specifically

states,

on

page

11.

that

"personal

funds

loaned

to

the

campaign

are

reported

as

loans

from the

candidate

from

the

onset."

The

onh

letter

I

know

of

that

was

sent

to

me

was

a

letter

from

you

that

I

personally

received

at

my

home

address.

This

letter

(undated)

addressed the

48-hour

reporting

problem.

At

the

time.

I

was

travelling and

was

involved

in

our

campaign.

I did

not

read

it

until

approximately

two

weeks

after

it had

arrived.

After

reading

this

letter,

I

saw

no

need

to

contact

Mr.

Shorter

because

I assumed

the

campaign

guide

covered

those

topics

of

your

letter

and

he

is

a

CPA

who

is

very

accurate

in

reporting

these

types

of

matters.

Your

letter

gave

no

indication

that

it

contained

addition regulations

different

from

those

in

your

campaign

guide.

To

my

knowledge,

that

was

the

only

additional information

we

received

that

specifically

addressed

the

issue of

candidate

loans

to

be

reported

as

contributions

for

48-hour

notice

purposes.

Your

campaign

guide

does

not

state

this.

I

will

note

that

vou

state

you

have

sent

this

letter,

as

well

as

a

report

notice

to

our

campaign

committee,

however.

our

records

do

not

show

that

we

ever

received

these items.

During

my

campaign

it

was

well

known

that

I

was

personally funding

my

campaign.

This

was

because

I

did

not

want

to

be

affected

by

any

adverse

influence

by

special

interest

groups.

I

stated

this

position

on

numerous

occasions

publicly.

There

was

no

way

that

any

of

my

loans

to

the

campaign committee

could

have

been

construed

as

being

deceiving

to

the

public

or

any

other

candidate

running

within

the

3rd

Congressional

District.

Ms.

Joan

Aikens

January

23,

1993

Page

Two

Your

commission

has

provided

us

a

manual,

we

followed

its

rules,

and

we

cannot

find

any

notices

of

revision

until after

the

fact.

I

suggest

that

this

manual

should

have

been

revised

to

make

this

48-hour

notice issue

clear

or

that

we

should

have been

notified

b.*

certified

mail

or

its

changes.

Mr.

Shorter

received

no

notification

of

%our

changes

and

I

did

not make

a

connection

from

your

letter

that

you

were.

in

fact.

making

new

rules.

I

request

that

you

take

no

further

action

against

our

committee and

find

that

there

was

no

violation

or

penalty.

Ms.

Aikens.

if

iou

want

to

discuss this

matter

with

me

personally. please

let

me

know.

I'll

be

happy

to

cooperate

with

%ou

in

any

"a%.

Sincerelv

yours.

Don

Nelms

cc:

Holly

Baker.

Attorney

>

NI 9fj,

/ ~Fn

4.

--

I:t.6

• .-,

,

.,

"

F.E.C.

BEFORE

THE

FEDERAL

ELECTION

COMMISSION

In

the

Matter

of

SENSITIVE

MUR

3697

The

Committee

to

Elect

Don

Nelms

and

Roy

J.

Shorter,

as

treasurer

GENERAL

COUNSEL'S

REPORT

I.

BACKGROUND

Attached

is

a

conciliation

agreement

which

has

been

signed

by

Roy

J.

Shorter,

the

treasurer

of

the

Committee

to

Elect

Don

Nelms

("Committee").

This

matter

began

as

a

referral

from

the

Reports Analysis

Division

on

October

14,

1992.

The

Committee

failed

to

file

two

48

Hour

Notices

for

candidate

loans

totaling

$25,000

in

the

1992

primary

runoff

election

held

on

June

9,

1992.

Don

Nelms

lost

in

Arkansas'

3rd

congressional

district.

On

November

5,

1992,

the

Commission

found

reason

to

believe

that

the

Committee

had

violated

2

U.S.C.

S

434(a)(6)(A).

The

Commission

also

approved

a proposed

conciliation

agreement

-2-

check

for

the

civil

penalty

has

been

received.

Attachment

II.

RECOMMENDATIONS

I.

Accept

the

attached

conciliation

agreement

with

The

Committee

to

Elect

Don

Nelms

and

Roy

J.

Shorter,

as

treasurer.

-3-

2.

Close

the

file.

3.

Approve

the

appropriate

letter.

Lawrence

M.

Noble

General

Counsel

BY:

(7K

Lois

G.

Lern

r

Associate

Ge

ral

Counsel

Attachments

1.

Conciliation

Agreement

2.

Photocopy

of

civil

penalty

check

Staff

Assigned:

Holly

Baker

Date

BEFORE

THE

FEDERAL

ELECTION

COMMISSION

In

the

Matter

of

The

Committee

to

Elect

Don

Nelms

and

Roy

J.

Shorter,

as

treasurer.

MUR

3697

CERTIFICATION

I,

Marjorie

W.

Emmons,

Secretary

of

the

Federal Election

Commission,

do

hereby certify

that

on

April

5,

1993,

the

Commission decided

by

a vote

of

5-0

to

take

the

following

actions

in

MUR

3697:

1.

Accept

the

conciliation

agreement

with

The

Committee

to

Elect

Don

Nelms

and

Roy

J.

Shorter,

as

treasurer,

as

recommended

in

the

General Counsel's

Report

dated

March

30,

1993.

2.

Close

the

file.

3.

Approve

the

appropriate

letter,

as

recommended

in

the

General Counsel's

Report

dated

March

30,

1993.

Commissioners

Aikens,

Elliott,

McGarry,

Potter

and

Thomas

voted

affirmatively

for

the

decision;

Commissioner

McDonald

did

not

cast

a vote.

Attest:

Date

Received

in

the

Secretariat:

Circulated

to

the

Commission

Deadline

for

vote:

(4/t

Marjorie

W'

Emmons)

'Secretary

of

the

Commission

Wed.,

March

31,

1993

12:11

p.m.

Wed.,

March

31,

1993

4:00 p.m.

Mon.,

April

5,

1993

4:00

p.m.

(WlAdtJ

0

BEFORE

THE

FEDERAL

ELECTION COMMISSION

In

the

Matter

of

The

Committee

to

Elect

Don

Nelms

) MUR

3697

and

Roy

J.

Shorter,

as

treasurer

CONCILIATION

AGREEMENT

This

matter

was

initiated

by

the

Federal

Election

Commission

("Commission"),

pursuant

to

information

ascertained

in

the

normal course

of

carrying

out

its

supervisory responsibilities.

The

Commission

found reason

to

believe

that

The

Committee

to

Elect

Don

Nelms

and

Roy

J.

Shorter,

as

treasurer ("Respondents"),

violated

2

U.S.C.

S

434(a)(6).

NOW,

THEREFORE,

the

Commission

and

the

Respondents,

having

participated

in

informal

methods

of

conciliation,

prior

to

a

finding

of

probable

cause

to

believe,

do

hereby

agree

as

follows:

I.

The

Commission

has

jurisdiction

over

the

Respondents

and

the

subject

matter

of

this

proceeding,

and

this

agreement

has

the

effect

of

an

agreement

entered

pursuant

to

2

U.S.C.

S 437g'a' 4 i A' I

II.

Respondents

have

had

a

reascnace

opportunity

t:

demonstrate

that

no

action

should

be

zaken

:n

this

matter.

III.

Respondents

enter

vcounza'

v

"nto th:s

agreement

with

the

Commission.

IV.

The

pertinent

facts

in

this

matter

are

as

follows:

-2-

1.

The

Committee

to

Elect

Don

Nelms

is

a

political committee within

the

meaning

of

2

U.S.C.

5

431(4),

and

is

the

authorized

principal

campaign committee

for

Don

Nelm's

1992

congressional

campaign.

2.

Roy

J.

Shorter

is

the

treasurer

of

The

Committee

to

Elect

Don

Nelms.

3.

The

Federal

Election

Campaign

Act

of

1971,

as

amended

("the

Act"),

requires

principal campaign committees

of

candidates

for

federal

office

to

notify

in

writing

either

the

Secretary

of

the

Senate,

the

Clerk

of

the

U.S.

House

of

Representatives

or

the

Commission,

as

appropriate,

and

the

Secretary

of

State,

of

each

contribution

totaling

$1,000

or

more,

received

by

any

authorized

committee

of

the

candidate

after

the

20th

day

but

more

than

48

hours before

any

election.

2

U.S.C.

5

434(a)(6)(A).

The

Act

further

requires

notification

to

be

made

within

48

hours

after

the

receipt

of

the

contribution

and

to

include

the

name

of

the

candidate

and

office sought,

the

date

of

receipt,

the

amount

of the

contribution,

and

the

identification

of

the

contributor.

Id.

The

notification

of

these

contributions

shall

be

in

addition

to

all

other

reporting requirements.

2

U.S.C.

S

434

al!6)(B,.

4.

According

to

2

U.S.C.

§ A,

and

II

C.F.R.

$

100.7[a

ilvfB,,

a i

-an

Is

a

cinto:ib2t

n

at

the

time

it

is

made

and

is

a

contribution

to

t e

extent

that

:t

remains

unpaid.

Each

guarantor

or

endorser

of

a

loan

shall

be

deemed

to

have

contributed

that

portion

of

the

total

-3-

amount

of

the

loan

to be

liable

until

5

431(8)(B)(vii)(I)

1992

loan

t

I

and

C,

candida

and

a $

for

the

0

for

which

the

guarantor

or

endorser

agreed

the

loan

is

repaid.

2

U.S.C.

and

11

C.F.R.

5

100.7(a)(1)(i)(C).

5.

The

Respondents

received

on

May

7

and

May

15,

:wo

contributions

of

$1,000

or

more

(in

the

form

of

:rom

the

candidate) totaling

$25,000.

6.

The

contributions

were reported

on

Schedules

A

of the

1992

12

Day

Pre-Runoff

Report,

(with

the

te,

Don

Nelms,

listed

as

the

maker

of

a

$10,000

loan

15,000

loan

to

the

Committee).

7.

The

Respondents

did

not

submit

48

Hour

Notices

se

contributions.

V.

The

Respondents

failed

to

report

campaign

contributions

in

excess

of

$1,000

received

after

the

20th

day,

but

more

than

48

hours

before

the

primary election,

within

48

hours

of

receipt

of the

contributions,

in

violation

of

2

U.S.C.

5

434(a)(6).

VI.

Respondents

will pay

a civil

penalty

to

the

Federal

Election

Commission

in

the

amount

of

Three

Thousand

Dollars

($3,000)

pursuant

to

2

U.S.C.

$

437g(a)(5)(A).

VII.

The

Commission,

on

request

of

anyone

filing a

complaint

under 2

U.S.C.

5

43Tga,a

I c

-

nzerning

the

matters

at

issue

herein

or

on

:ts

own may

a

e,.-iew

-cmpiiance

with

this

agreement.

If

the

CommIsscn

Leh1e

es

that

this

agreement

or

any

requirement

-herecf

has Ieen

,v4clated,

it

0

-4-

may

institute

a

civil

action

for

relief

in

the

United

States

District

Court

for

the

District

of

Columbia.

VIII.

This

agreement

shall

become

effective

as

of the

date

that

all

parties hereto

have

executed

same

and

the

Commission

has

approved

the

entire

agreement.

IX.

Respondents

shall have

no

more

than

30

days

from

the

date

this

agreement

becomes effective

to

comply

with

and

implement

the

requirement ccntained

in

this

agreement

and

to

so

notify

the

Commission.

X.

This

Conciliation

Agreement

constitutes

the

entire

agreement

between

the

parties

on the

matters

raised

herein,

and no

other

statement,

promise,

or

agreement,

either

written

or

oral,

made

by

either

party

or

by

agents

of

either

party,

that

is

not

contained

in

this

written

agreement

shall

be

enforceable.

FOR

THE

COMMISSION:

Lawrence

M.

Noble

General Counsel

BY:

"

Lois

G. L

,1'er

Date

Ass'6ciat

'

General Counsel

FOR

THE

RESPONDENTS:

(Namsi'

e

Position

FFDE

R.,

M

IIf

( \ ) - " )\

Aril

q,

1993

Roy

J.

Shorter

c/o

Nelms

Motors,

2781

North

Colleg

Fayetteville,

AR

Inc.

e

St.

2703

Dear

Mr.

Shorter:

RE:

MUR

3459"

ommittee

to

Elect

and

Roy

2.

Shorter

Don

Nelms

as

treasurer

On

accepted

submitted

2

U.S.C.

Campaign

the

file

April

5,

the

signe

I

on

your

§

434(a)1

Act

of

19

has

been

"993,

the

Federal

Electicn

d

conciliation

agreement

a

behalf

in

settlement

of

a

6)(A),

a

provision

cf

the

71,

as

amended

"the

Act"

closed

in

this

matter.

Commission

nd

civil

penalty

violation

of

Federal

Election

•

Accordingly,

The

confidentiality

provisions

at

2

U.S.C.

S

437g(a(12)

no

longer

apply

and

this

matter

is

now public.

:n

addition,

although

the

complete

file

must

be

placed

on

the

public record

within

30

days,

this

could

occur

at

any

time

following

certification

of

the

Commission's

vote.

If

you

-wish

to

submit

any

factual

or

legal

materials

to

appear on

the

public

record,

please

do

so

as

soon

as

possible.

While

the

file

may

be

placed

on

the

public

record

before receiving

your

additional materials,

any

permissible

submissions

will

be

added

to

the

public

record upon

receipt.

Please

be

advised

that

information

derived

in

connection

with

any

conciliation

attempt

will

not

become

public

without

the

written

consent

of

the

respondent

and

the

Commission.

See

Z

U.S.C.

5

437ga1(4i(B1.

The

enclosed

conciliation

agreement,

however,

will

become

a

part

of

the

public

record.

Enclosed

you

will

find

a

copy

of

the

fully

executed

conciliation

agreement

for

7Our

files.

-f

you

nave

anv,,

Questions,

please

oontact

-e

at

: 2

-347

At-,

rne

Enclosure

Conciliation Aqreement

FEDIRkL

EItCIION

COMM,',i

ISSI()N

THIS

IS

THE

ET

-T

lR

_69

CAA

NO.

2-,

DATE

F:L''D

;

CE

RA'

.

CRR 1104 3697

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