FEC faults Cruz for disclosure error
Audit finds senator’s 2012 campaign failed to report $1.1 million in loans
WASHINGTON – U.S. Sen. Ted Cruz’s 2012 campaign improperly reported loans he received from Goldman Sachs Group Inc. and Citigroup, according to a preliminary Federal Election Commission audit.
The audit, approved unanimously by the commission on Thursday, found that the campaign failed to disclose to voters some $1.1 million Cruz had received in personal bank loans.
Cruz campaign spokeswoman Catherine Frazier issued a statement Friday calling it the “same inadvertent reporting error that was widely reported during the presidential campaign,” and that the campaign has long been working with the FEC to rectify the matter.
Cruz, running for reelection next year, said in 2012 and in a subsequent autobiography for his 2016 presidential run that he and his wife, Heidi, a Goldman Sachs executive, had financed his Senate bid largely by liquidating their family assets.
In fact, FEC auditors found that he made five loans to his campaign during 2011 and 2012 totaling $1.4 million. They said that $800,000 of that total came from Goldman Sachs and $264,000 came from Citigroup, with the rest coming from Cruz’s personal funds.
Questions about the loans first came to light in the early stages of his presidential bid in January 2016, when the New York Times questioned Cruz’s public accounts of his long-shot Senate race against a better-funded establishment favorite, then Lt. Gov. David Dewhurst.
Thursday’s unusual unanimous vote by the FEC leaves open whether Cruz could face penalties. The vote, which was procedural in nature, now
triggers a final audit report, expected in the coming months.
The Senate campaign for El Paso U.S. Rep. Beto O’Rourke, who is running against Cruz next year, seized on the FEC report Friday, sending out a fundraising email saying “If we can’t trust Ted Cruz to disclose who’s funding him, why should we trust him with representing Texans in the U.S. Senate?”
Federal law allows candidates to take out commercial bank loans, so long as they disclose them.
Cruz argued that the loans were reported in personal financial disclosure reports filed with the Senate. But the campaign has acknowledged that it erred in not reporting the loans to the FEC and has offered to amend their filings.