Firms Seek To Speed Up U.S. Campaign Donations By Text Message

by
Reuters
The companies that pushed U.S. regulators to approve political donations via text message want to accelerate the plan and are seeking a speedy response from the Federal Election Commission to the concerns of wireless carriers.

Firms Seek To Speed Up U.S. Campaign Donations By Text Message

The companies that pushed U.S. regulators to approve political donations via text message want to accelerate the plan and are seeking a speedy response from the Federal Election Commission to the concerns of wireless carriers.

Political consultancy Armour Media Inc and m-Qube Inc, an aggregator that serves as a middleman between wireless carriers and campaigns, have joined with U.S. Representative Jim Cooper in asking the FEC to clarify the process. Among other things, they want to know who would be responsible for ensuring text donations do not breach the numerous federal regulations and limits on political giving.

Their new request for an advisory opinion, posted online on Thursday, is an attempt to speed up implementation of text donations, which have been approved but not yet launched because of wireless carriers' legal concerns.

(To read the document please see: http://tinyurl.com/7lpmrm5)

The phone companies have a similar request pending with the FEC, asking to specify who would determine donors' eligibility or whether they might have to alter legal and business practices to stay out of political hot water. That request has not yet been acted on.

M-Qube wants the FEC to respond to its request on Wednesday for an advisory opinion in 20 days. Speedy consideration is warranted because Cooper, who would benefit from text donations, is on the ballot in the August 2 Democratic primary in Tennessee, and the presidential nominating conventions of Republicans and Democrats are within the next 60 days.

The FEC is required to act within 20 days on any request involving a candidate whose election is within 60 days.

The campaigns of Democratic President Barack Obama and Republican challenger Mitt Romney have told the FEC they support text-message donations, approved by the regulators in June in a ruling that was expected to mark a profound change in the U.S. campaign finance system by allowing cell-phone users to make instant anonymous donations.

But the major wireless carriers that would oversee the donations by text service - including Sprint Nextel Corp, Verizon Wireless, AT&T Inc and T-Mobile USA - did not take part in that request to the FEC and are wary.

PHONE COMPANY CONCERNS

The carriers, which account for about 90 percent of the more than 330 million wireless subscriptions in the United States, are worried about the liabilities that come with handling contributions to presidential and congressional candidates.

Earlier this month, their trade group, CTIA, asked the FEC for assurances that the phone companies would not have to determine donors' eligibility or compliance with donation limits. They also want to make sure they could stick to usual business practices without, for instance, being blamed for overcharging political campaigns or, vice versa, giving discounts and therefore risking the appearance of making a donation.

In their request on Wednesday, m-Qube, Armour Media and Cooper said campaigns themselves would be responsible for accepting any fraudulent donations. Those could include donations from foreign citizens, corporations or underage donors, or contributions exceeding federal limits of $50 a month, or $200 in total that allow donors to stay anonymous.

"As the Commission has frequently stated: it is ultimately the responsibility of the political committee treasurer to obtain the identity of contributors and prevent excessive and prohibited contributions," their letter said.

According to the proposal approved by the FEC in June, text donations would be capped at $10 per text and $50 a month by the aggregator, which would share the phone numbers with the campaigns and could alert them when donations from one phone number approach the limit of $200.

Carriers already allow charity donations by text, but those are done for free. Political donations, treated like any other commercial transaction over the mobile networks, would come with fees amounting to 30 percent to 50 percent between the cuts taken by a carrier and aggregator companies.

Industry insiders say carriers do not plan to start accepting text-message donations until they get more guidance from the FEC.

Presumably, if one of the major carriers began to offer a campaign-donation text service, the others would be forced into accepting campaign donations, analysts said.