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Report: Obama Donor System Vulnerable

Updated 3:45 pm ET

A new report by the privately funded Government Accountability Institute concludes that online safeguards against fraudulent contributions are not being employed by many federal campaigns, including President Obama’s.

The report, which you can find here, notes that the Obama campaign does not employ the commonly used Credit Verification Value, or CVV – the set of three or four numbers found on a credit card that ensure the person using the card has it in his or her possession.

The report indirectly suggests, but does not specifically allege, that this could lead to foreign donations to the campaign. However, the report does not say exactly how failure to use CVV would increase foreign donations, other than that it could increase illicit donations generally.

According to the report, the Obama campaign claims that it has its own system for vetting donations. The report does not disprove this, though it suggests the claim is suspicious because the campaign does use CVV for sales of merchandise on its website. The report also notes that failing to use CVV increases the campaign’s transaction costs by millions of dollars.

What’s more, the report again indirectly suggests, but does not specifically allege, that the Obama campaign subtly encourages foreign donations through the use of social media, email solicitations, and third party websites that link to the official campaign website. But the report does not provide specific evidence – like an internal campaign document – that proves the Obama campaign is intentionally trying to drum up foreign donations.

According to the report, nearly half of Congress also fails to use CVV. The Romney campaign does use the CVV protocol for donations on its website.

The Government Accounting Institute bills itself as nonpartisan, though most or all of its board appears to lean conservative. Nevertheless, its investigations have targeted Republicans as well as Democrats, including a recent piece revealing some of Mitt Romney’s hidden big-ticket donors, known as “bundlers.”

The Obama campaign did not respond to a request for comment.

UPDATE: The Obama campaign responded this afternoon with a statement, which included the following:

OFA does not accept donations from foreign nationals or any other ineligible individual—and the campaign voluntarily goes above and beyond Federal Election Commitments to ensure the integrity of fundraising efforts.

Here’s how we do that:

  • All credit card contributions are processed using AN Address Verification System (AVS) to ensure their legitimacy.
  • OFA invests significant resources into a manual process to review any transaction that’s been flagged by the campaign’s credit card processor’s fraud detection services.
  • Though not required by law, OFA requires a copy of a valid passport from any contributor who has been affirmed as eligible but donates with a mailing address outside the U.S. If they do not offer in one in a timely manner, the donation is returned.
  • OFA screens all online credit card contributions that originate from a foreign IP address and, if any questions arise regarding the contributor’s U.S. citizenship, the campaign requests proof of a current and valid U.S. passport in order to be in compliance with the FEC’s safe harbor guidelines.

The phrases in bold are as they appear in the statement.

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21 Responses to Report: Obama Donor System Vulnerable

  1. Foreign money? of course, it’s called a kickback. For all the billions of borrowed money that this Administration sends overseas, the least they could do is send some of it back to MrObama.
    The ordinary Frenchman is not donating to an American politician, nor is a Swedish housewife sending her ‘cookie jar’ funds to MrObama.
    Those who are donating are hoping for more funds from America, better access to our markets and a seat at the table when it’s all divvied up.

    OT; I’m still steaming from MrObama’s Columbus Day message wherein he insults every Italian-American, accuses the Italians as predators, and trashes another traditional American holiday. All for the sake of making Native Americans think he cares about them and hoping that they would vote for him, he took the discovery of America that was the beginning of the greatest country on earth and made it sound like a murderous invasion.

    • This again goes back to doing what is truly right for certain population segments. the BIA has an annual budget of $2.5 billion (approx.) and is administered through DC. If the government really wanted to help native Americans, they would do away with BIA, and establish a tribal counsel that would administer the money in block grants based on the size of the tribe.

      This eliminates all the excess costs of running programs and actually puts the tribes in charge of what they are going to spend and what they need. Mostly, from my experience, the need is in education reform, drug and alcohol programs, and employment opportunities. If the money earmarked for native Americans was administered strictly by the tribes, there might just be some changes within the tribal communities.

  2. Summary from article:

    “Amazon.com uses more credit card security for online book purchases than many federal candidates accepting $2,000 campaign donations via credit card,” Schweizer said. “To protect the integrity of U.S. elections, that must change.”

  3. Speaking of foreign–Romney’s foreign policy address was very strong, I heard–have not read it yet. They are all over it with “Oh, yeah, well, he screwed up in Europe more than Chevy Chase did” or something like that. Pretty weak gruel so far.

  4. No voter fraud, no contribution fraud, move along.

    obama.com is owned by an individual in Shanghai and directs donations to barackobama.com, OFA’s site?

    No problem.

  5. Peter Schweizer is indeed bipartisan in his exposure of the crony capitalists and thieves on Capitol Hill. I’m calling BS on that supposed AVS system they employ. They lie about everything else, and I know for a fact that citizen journalists have made donations with bogus addresses that were accepted without a hitch. Besides, the campaign uses the CVV for their merchandise sales, so their excuse doesn’t hold water.

    The report also focuses on a website – Obama.com – owned by a Obama campaign bundler living in Shanghai, China. The website redirects to an Obama donation site that does not include the CVV code. The report also found that almost 2/3rds of the the internet connections to the donation website originate from foreign countries. That’s campaign fraud in my book.

    • It’s curious that they use the CVV for merchandise but not donations. It’s like they purposely don’t want any verification. It’s also curious that the Obama campaign would allow just anybody, such as the owner of Obama.com, to redirect a website to Obama’s donation site. This is yet one more story that doesn’t hold up.

  6. And this will go exactly nowhere. As long as Valerie Jarrett gets 24/7 SS protection and our embassies and American staff throughout the world are denied security because of Lazybones’ insane foreign policy that wouldn’t recognize an enemy unless it was a white republican god fearing woman married to a man with children who go to church and respect the constitution and the rule of law, this man and his thugs can get away with anything. And it is in no small part thanks to the media and the Democrat party who have used lies and taxpayer dollars to buy votes with goods and services that we cannot pay for. This is what outrages me when the Democrat Party openly calls a man running for President of the United States a liar and people are still insisting that Mitt Romney provide more and more detail.

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