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Wednesday, November 05, 2008

Obama campaign's deliberate invitation to pre-paid credit-card fraud is the sort of flesh-eating political bacteria that may doom any Obama presidency

On October 29, I had a guest-post at HH.com of which I was, and remain, very proud. Unfortunately, it raises questions that have not been answered since then.

Someone inside the Barack Obama campaign, high up enough to make important fund-raising decisions, made the deliberate call to turn off the standard anti-fraud protections for the credit card processing software on the campaign website.

That guy, or those guys, need to be in prison.

What did Barack Obama know, and when did he know it?


[Copied here for archival purposes on November 5, 2008, from the post linked above at HughHewitt.com.]

(Guest Post by Bill Dyer a/k/a Beldar)

Fully $100 million of the record-breaking $150 million that the Obama campaign collected in September alone came over the internet via credit card donations. The Obama campaign has deliberately turned off the anti-fraud mechanisms available for internet credit card transactions. They have no clue how many millions or tens of millions of dollars have been donated to them in violation of federal election law. And now it turns out that the Obama campaign cheerfully takes even contributions from untraceable pre-paid credit cards, a/k/a "the pseudo-credit cards you use when you want to conceal illegal activity."

This newest disclosure about the pre-paid credit cards, along with belated mainstream media confirmation of what the right hemisphere of the blogosphere has been screaming about for a week now (that someone in the Obama campaign deliberated turned off the normal default-value anti-fraud mechanisms that are standard for processing credit card charges among honest people), comes in Tuesday's Washington Post.

But it didn't even make the front page.  (It's buried on page A02; emphasis in quotes below mine.)

Sen. Barack Obama's presidential campaign is allowing donors to use largely untraceable prepaid credit cards that could potentially be used to evade limits on how much an individual is legally allowed to give or to mask a contributor's identity, campaign officials confirmed.

Faced with a huge influx of donations over the Internet, the campaign has also chosen not to use basic security measures to prevent potentially illegal or anonymous contributions from flowing into its accounts, aides acknowledged. Instead, the campaign is scrutinizing its books for improper donations after the money has been deposited.

The Obama organization said its extensive review has ensured that the campaign has refunded any improper contributions, and noted that Federal Election Commission rules do not require front-end screening of donations.

In recent weeks, questionable contributions have created headaches for Obama's accounting team as it has tried to explain why campaign finance filings have included itemized donations from individuals using fake names, such as Es Esh or Doodad Pro. Those revelations prompted conservative bloggers to further test Obama's finance vetting by giving money using the kind of prepaid cards that can be bought at a drugstore and cannot be traced to a donor.

The problem with such cards, campaign finance lawyers said, is that they make it impossible to tell whether foreign nationals, donors who have exceeded the limits, government contractors or others who are barred from giving to a federal campaign are making contributions.

"They have opened the floodgates to all this money coming in," said Sean Cairncross, chief counsel to the Republican National Committee. "I think they've made the determination that whatever money they have to refund on the back end doesn't outweigh the benefit of taking all this money upfront."

The Obama campaign has shattered presidential fundraising records, in part by capitalizing on the ease of online giving. Of the $150 million the senator from Illinois raised in September, nearly $100 million came in over the Internet .

Credit cards (Visa, MasterCard, American Express, or Discovery) are the only way you can donate to Barack Obama's campaign via his internet website.

The whole "back-end screening" farce is insulting to anyone with a second-grade education. The Obama campaign cannot possibly have any objective measurement to even roughly estimate how many mistakes and how many episodes of deliberate fraud they're catching versus how many they're simply missing, even if one is naive enough to presume their good-faith best efforts.

Moreover, everything the Obama campaign has yet said about this entire issue utterly ignores the key questions: (1) Who ordered the anti-fraud protections turned off? And (2) why hasn't Barack Obama already fired every such person, and exposed them for criminal prosecution as aiders and abettors of national and international campaign contribution fraud?

Juan Proano, whose technology firm handled online contributions for John Edwards's presidential primary campaign, and for John F. Kerry's presidential campaign and the Democratic National Committee in 2004, said it is possible to require donors' names and addresses to match those on their credit card accounts. But, he said, some campaigns are reluctant to impose that extra layer of security.

"Honestly, you want to have the least amount of hurdles in processing contributions quickly," Proano said.

Sen. John McCain's campaign has also had questionable donations slip through.

Dan Pfeiffer, Obama's communication's director, said that "no organization can fully insulate itself from these problems. The McCain campaign has accepted contributions from fraudulent contributors like 'A for You,' 'Adorable Manabat,' 'The Gun Shop,' and 'Jesus II' and hundreds of anonymous donors."

But R. Rebecca Donatelli, who handles online contributions for the McCain operation and the RNC, said security measures have been standard in the GOP nominee's fundraising efforts throughout the campaign. She said she was "flabbergasted" to learn that the Obama campaign accepts prepaid cards.

Those submitting phony names along with contributions to the McCain campaign have managed to trick the system despite the anti-fraud measures used by merchants, meaning, for example, that they've matched up legitimate addresses for the card-numbers being used. That necessarily limits the scale of the fraud.

But when you take the approach endorsed by Juan "Let the Crooks Donate Too!" Proano, with the "least amount of hurdles in processing contributions quickly," then you invite crime. You put up a neon sign saying "We Can't Catch You When You Cheat!"

Where is the principled, honest Democrat of national prominence who will step up to a public microphone and say — "Not me! I will no longer stand silent while my party's presidential nominee continues to shelter the person or people who made the decision to encourage this fraud!" (See my previous post on this subject, For what does it profit a man to gain the whole world, and forfeit his soul? Still no takers.)

This is beyond disgraceful. This is beyond being a mere matter for partisan criticism.

This isn't even a "cancer" on the Obama campaign, because even the worst cancers don't move this fast and aren't this virulent.

This is an infectious disease, an antibiotic-resistant acute contagion of corruption, a type of flesh-eating political bacteria that will — best case for Democrats, unless immediately disinfected starting today by their candidate himself — rob their would-be president elect of any political legitimacy even before Election Day, much less before the inauguration. In both scope and consequence, this bodes to make Watergate look like a playground fist-fight among kindergartners.

To paraphrase a young Tennessee lawyer named Fred Thompson who was then assisting Senator Howard Baker (R-TN) and the Senate Select Committee on Presidential Campaign Activities: What did the wanna-be president know, and when did he know it?

— Beldar

Posted by Beldar at 04:14 AM in 2008 Election, Law (2008), Mainstream Media, Obama, Politics (2008) | Permalink


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