Is Obama linked to the Dem finance scandal?

Until yesterday, I had only a mild interest in the growing scandal surrounding Kinde Durkee, the prime mover behind Durkee and Associates, a Burbank accounting firm which handles the campaign funds for many California Democrats. At first glance, this would seem to be a simple matter of embezzlement.

An affidavit from an FBI agent alleges that Durkee, who has served as treasurer on hundreds of political campaigns, took money from campaign funds that she controlled and used the money to pay her own personal and business expenses. She also allegedly used cash from some campaigns to cover shortfalls in the accounts of other campaigns. 

Specifically, Durkee allegedly took nearly $700,000 out of the account of California Assemblyman Joe Solorio.

So: Looks like Solorio got robbed. That's what the FBI's complaint says. Some of that money went into the account of another Dem, Loretta Sanchez. Durkee has, over the years, taken money from various accounts for personal use; she would then cover her tracks with money taken from still other candidates. From the complaint:

...bank records reviewed by the FBI establish that Ms. DURKEE appears to have signature authority over more than 400 bank accounts, including those for political campaigns, and that substantial sums of money have been routinely moved out of client campaign committees into D&A accounts or into other client campaign committee accounts.

So far, this looks like standard-issue theft. But an excellent post by lambert at Corrente draws our attention to some complicating factors.

Senator Diane Feinstein is claiming that Durkee "wiped out" her campaign war chest, which held some five million bucks. "Durkee alone controlled access to the account."

What's odd here is that I've (so far) seen no indication that this kind of money went to Durkee personally. In fact, we've heard that she used stolen money to fund "shopping trips to Costco." If Feinstein is down five mill, where did it go?

A more important question: Why did the Democrats keep using her? There were plenty of indications that she was crooked. In recent times, Durkee has racked up large fines from Fair Political Practices Commission. 

One longtime client, state Sen. Christine Kehoe (D-San Diego), fired Durkee in 2009 and notified the district attorney's office after an audit of her campaign fund by the state Franchise Tax Board turned up "irregular activities."

More than that. Durkee and Associates did accounting work even though they were not licensed to do so.

The strangest tale comes from 2007: See here and here. Durkee was listed as the treasurer for a group called "Californians for Obama," which existed -- allegedly -- to raise money for the Obama presidential campaign. This group was run by a classic con artist (and claimed movie mogul) who bears the delightfully appropriate name of Emmett Cash. Cash, who is black, asked predominantly African American contributors to pony up for a fundraising cruise featuring Ertha Kitt and Maya Angelou, even though Kitt was booked elsewhere and Angelou supported Hillary. Ultimately, he didn't raise much money -- and none of the money he did raise went to Obama.

Cash isn't important. What's worth noting is the fact that Durkee was not tainted by this story, even though it all came tumbling out in 2007. Lambert asks the right question:

So, with a track record like that, why would the Ds use her?

His speculation:

...one obvious answer would be that while Durkee was diverting money for her own personal use, that was just her commission for laundering money to her D candidate clients for their personal use.

I'm going to have to agree and disagree here. Money laundering seems very possible -- but so far, I've seen zero indication that the candidates used Durkee to dip into their own campaign bank accounts. All the evidence so far suggests that those candidates were robbed.

For me, the question is: Did Durkee establish a link to the Obama campaign in 2008?

She was in a key position, given her contacts with Hollywood.

Major donors whose money is presumed lost in the scam range from film studios, Sony, Universal, Warner Brothers and Disney, to Rupert Murdoch's News Corporation. Robert Iger, the head of Disney, and Ron Meyer, of Universal, were also named as the sources of private donations which may have been embezzled, according to the Reuters news agency.

Ms Feinstein's celebrity supporters include Hollywood liberals Tom Hanks, Jane Fonda and George Clooney.

Interesting to think of Murdoch contributing to Feinstein.

At any rate, while this piece establishes that Durkee had close links to Hollywood money, it does not really tie her in with the Obama campaign. So far, her only verified "Obama" link goes to the scam run by Emmett Cash, which really had nothing to do with the man sitting in the Oval Office.

And yet: Surely the revelation of that scam would have brought Durkee to the attention of some folks in the Obama camp...?

Would it be hideously irresponsible to suggest that the campaign may have found a use for someone with Hollywood connections and a certain, shall we say, moral flexibility?

I ask these questions because everyone seems to have forgotten the huge tales of financial irregularity that came out during the 2008 campaign. See my earlier posts here and here. Those stories cite, in turn, this CBS expose on fake Obama donors bearing names like Dahsudhu Hdusahfd and Uadhshgu Hduadh. Newsweek found donors named "Doodad Pro" and "Good Will".

Obviously, the money from "Doodad" came from somewhere, or someone. It is reasonable to ask if these fake names hid donors from, oh, say, Hollywood -- donors who wanted to give more than the law allowed.

In a rambling later piece, I returned to the Mystery Donor theme. The key citation went to this Slate investigation. 

In addition to the donations the campaign has disclosed, however, it has taken an unprecedented $218 million from donors whose names it is keeping secret, according to FEC spokesman Robert Biersack.

That money came from individuals who in theory never passed the threshold of $200, the limit the FEC set for public disclosure of a donor’s name and place of residence, so there is no way of knowing how much foreign money could be included in that amount.

$218 million? Now we are talking real money.

Let me stress: I know of no evidence -- none whatsoever -- linking Durkee with the Mystery Donors. On the other hand, she was certainly well-positioned to interact with donors from Hollywood. Obviously, someone was going around to big donors and telling them: "If you want to hide your donations to the Obama campaign, here's what you do..."

Any favors she did for the Obama campaign may have encouraged Obama to make sure that California's top Democrats kept using her services, despite all of the warning lights.

(The previous sentence is pure conspiracy theory, of course. It was very irresponsible of me to have written such a sentence. I really deserve a good talking to.)

Incidentally, Obama's finance chairperson in 2008 was Penny Pritzker, the billionaire heiress to the much contested Pritzker fortune. She is a real piece of work in her own right: See her Wikipedia page and this In These Times article. I've found nothing linking her in any way to Durkee and Associates.