TIME Supreme Court

The Robert Menendez Corruption Charges Undermine the Supreme Court

Ranking member Sen. Bob Menendez listens to testimony during a Senate Foreign Relations Committee hearing on Capitol Hill, in Washington on March 11, 2015.
Mark Wilson–Getty Images Ranking member Sen. Bob Menendez listens to testimony during a Senate Foreign Relations Committee hearing on Capitol Hill, in Washington on March 11, 2015.

The Supreme Court said super PACs aren't prone to corruption. Prosecutors are alleging otherwise in a case against Sen. Robert Menendez.

Correction appended, April 2

In his 2010 State of the Union, President Obama famously criticized the Supreme Court’s logic on a campaign finance decision even as several justices sat in the audience.

Now, prosecutors at the U.S. Justice Department have found an even better way to make the case.

In their indictment of New Jersey Sen. Robert Menendez, prosecutors have called foul on one of the central arguments for the court’s interpretation of campaign finance law in the Citizens United decision.

The indictment alleges that Florida opthamologist Solomon Melgen corruptly showered Menedez with gifts intended to influence official acts, from procuring visas for his foreign girlfriends to intervening in a dispute over Medicare billing. Among those things of value, according to prosecutors, was $600,000 in donations from Melgen’s company, Vitreo-Retinal Consultants, earmarked to help Menedez’s reelection through a super PAC called Majority PAC.

Those donations came two years after Justice Anthony Kennedy, writing for a majority of the court in Citizens United v. FEC, ruled that such contributions to outside groups not directly controlled by candidates presented no risk of corruption or the appearance of corruption.

“This Court now concludes that independent expenditures, including those made by corporations, do not give rise to corruption or the appearance of corruption,” Kennedy wrote. “That speakers may have influence over or access to elected officials does not mean that those officials are corrupt. And the appearance of influence or access will not cause the electorate to lose faith in this democracy.”

This argument was central to the Supreme Court’s decision to allow outside groups to collect and spend unlimited amounts of money to explicitly call for the election and defeat of a candidate for federal office. Since the money technically went to an organization not controlled by the candidate, the court reasoned, there was no sufficient government interest to stop it.

The indictment of Menendez, however, reveals in great detail the extent to which “independent” groups like Majority PAC have found ways to operate in close coordination with the candidate. And if Menendez is convicted, the case will prove that corruption can still be facilitated through these outside groups.

“The Citizens United court majority was obviously wrong in 2010 when it declared that independent expenditures can’t corrupt,” says Paul Ryan, an attorney for the Campaign Legal Center, who has long been critical of the decision. “Now we have concrete alleged evidence of how independent expenditures do corrupt.”

The indictment alleges that Melgen gave the money to support Menendez in two checks of $300,000. The first check was given on June 1, 2012, the very day when Melgen served on the host committee of Menendez’s annual fundraising event in New Jersey. Melgen allegedly gave the check to “a close personal friend” of the Senator at the fundraiser, who sent the check by FedEx to a person working to raise money for Majority PAC with a note saying “earmarked for New Jersey.” (That clearly meant Menendez. Majority PAC focused its spending on Democratic Senate races, and he was the only Democratic Senate candidate that year from New Jersey.)

Melgen issued a second check on October 12, 2012, less than a month before the election, prosecutors allege. An email from a fundraiser that accompanied the second check also read “earmarked for New Jersey.”

About six days after Melgen issued the first check, Menendez allegedly advocated on Melgen’s behalf in a Medicare billing dispute with the acting administrator of the Centers for Medicare and Medicaid Services. About a month later, Menendez sought a meeting with the Secretary of Health and Human Services to discuss Melgen’s concerns.

“During Menendez’s meeting with the Secretary of HHS, Menendez advocated on behalf of Melgen’s position in his Medicare billing dispute, focusing on Melgen’s specific case and asserting that Melgen was being treated unfairly,” the indictment reads. “The Secretary of HHS disagreed with Menendez’s position.”

After Melgen gave the second $300,000 check, Melgen separately emailed Menendez and a fundraiser for Senate Majority PAC a document asking again for Health and Human Services to intervene on his behalf in the Medicare billing dispute, the indictment claims. The fundraiser for the Senate Majority PAC wrote back by email that he would pass the information on to another senator, identified in the legal documents as Senator 3. “Dear Sal, I’m going to see him on Tuesday. I will give this to him directly. Is that ok?”

Menendez has maintained this innocence, and says he plans to fight the charges.

Correction: This post initially misidentified the senator that a fundraiser for Senate Majority PAC promised to communicate with on Melgen’s behalf.

Read next: New Jersey Senator Faces Corruption Charges

TIME Campaign Finance

The Political Kingmaker Nobody Knows

Highly Caffeinated Drinks, Five Hour Energy And Monster Energy Cited In 13 Death Reports
Spencer Platt—Getty Images

FARMINGTON HILLS, Mich. — The tiny bottles of 5-hour Energy that made Manoj Bhargava a billionaire are just about everywhere. But the Princeton dropout and former Hindu monk is nearly invisible.

Bhargava’s investment firm ETC Capital gave $2.5 million to the Republican Governors Association last year, joining conservative billionaires Sheldon Adelson and David Koch on the list of top five donors to the group that works to elect Republican governors.

Yet RGA Chairman and Tennessee Gov. Bill Haslam said, “I don’t know him.”

The 62-year-old Bhargava and several of his Michigan-based companies have given at least $5.3 million to candidates for state office and political groups around the country since 2009, according to state and federal campaign filings. But Bhargava remains a mystery man, even to many of the people who are benefiting from his largesse, including Bobby Schostak, who received a $25,000 donation from ETC Capital in 2010 during his first campaign for Michigan Republican Party chairman.

Schostak, who recently left the job, said, “I would have trouble knowing it was him if he walked in the door, honestly.”

Few people have given as much to politics at the state level as Bhargava and his companies in the past five years, and donors of such generosity are typically well known and aggressively courted by politicians who need their favor and funding to pay for campaigns. Yet Bhargava avoids the spotlight, both in politics and life: he said in a 2012 television interview that fame puts “a bull’s-eye on your forehead.” And he’s gone to great lengths to obscure his political activity, even as his signature product draws more scrutiny from some of the same politicians he’s supporting.

Only a fraction of the donations were made in Bhargava’s name or by the companies that oversee the production and marketing of 5-hour Energy. But an investigation by the Center for Public Integrity found that he makes donations through several of his more than 70 limited liability companies. As such, the motives for his political giving are as muddy as the circuitous way in which the donations are made.

He gives most heavily to Republicans but has donated to Democrats, too. Many of the donations appear to have ties back to Michigan, where his businesses are based. Nearly a quarter of the donations affiliated with Bhargava went to candidates for state attorney general, who have the power to investigate his business, and the organizations that support their election efforts.

Attorneys general in five states are suing Bhargava’s energy shot business, accusing it of deceptive marketing practices. A federal court in California is considering nine consolidated class-action lawsuits brought against 5-hour Energy in seven states, though the cases have been partially dismissed. And the Food and Drug Administration is investigating the safety of the shot, having received reports of more than 20 deaths potentially linked to its consumption. The political giving tied to Bhargava has only increased as investigations have multiplied.

Bhargava did not return multiple calls and emails sent over the past month seeking comment about his political giving, and a reporter who recently visited the two-story brick-and-glass headquarters of his companies was told Bhargava was not available. Several people who have worked with or live near him declined to comment, citing a fear of legal reprisals, or legal agreements barring them from speaking about Bhargava and 5-hour Energy.

Political operatives in Michigan say the relative anonymity seems to be how Bhargava prefers to do business.

“People are very conscious of the fact that he’s very secretive,” said Mark Brewer, the former chairman of Michigan’s Democratic Party.

The price of privacy

Bhargava grew up in Lucknow, India, a city of roughly 5 million in the northern state of Uttar Pradesh. He moved with his family at 14 to Philadelphia so that his father could pursue a Ph.D. at the University of Pennsylvania’s Wharton School of Business. He won a scholarship to The Hill School, a prestigious boarding school in suburban Philadelphia and, later, admission to Princeton University.

But Bhargava only spent a year at the Ivy League school, dropping out in 1973, according to The Daily Princetonian. He then spent more than a decade traveling between Hindu monasteries in India as a monk and working odd jobs back in the U.S. He returned to the U.S. permanently in the early 1990s and took over the family’s plastics company, Prime PVC, in 1996, growing it into a multimillion-dollar business that he sold to a private equity firm in 2007, according to multiple news reports.

By then, he had moved to Michigan and was on the hunt for a new business. He abandoned his first venture, the anti-hangover pill Chaser, but he won big with 5-hour Energy — a flavored energy drink that contains caffeine, vitamins and amino acids. As he has told it, Bhargava replicated an energy drink he stumbled upon at a trade show in 2003 after its developers refused to sell him the recipe. Sales of the 1.93-ounce bottles propelled Bhargava onto Forbes’ list of billionaires in 2012.

Bhargava credits much of 5-hour Energy’s success to the decision to place the small yellow and red bottles at checkout counters, rather than in coolers with the other energy drinks. The business has also engaged in an aggressive pattern of litigation, having sued more than a dozen competitors for producing or distributing similar products. Bhargava’s office is said to contain a mock graveyard, made up of the bottles of failed competitors.

In 2012, Bhargava publicly took the giving pledge championed by Bill and Melinda Gates and Warren Buffett, which encourages billionaires to donate the majority of their wealth to charity. Three years earlier, he transferred a stake appraised at $623.6 million in Innovation Ventures, a parent company of 5-hour Energy, to his Rural India Supporting Trust, which he has described as “the largest charity in India that nobody knows.” The organization has spent more than $60 million since 2008 supporting development projects in India, according to tax forms it has filed with the Internal Revenue Service.

In public speeches, Bhargava has prided himself on his modest lifestyle. He lives today in Farmington Hills, the same well-off Detroit suburb where 5-hour Energy is headquartered. While his five-bedroom, six-bath home is worth about $1.7 million, he has forgone the flashier Bloomfield Hills or other tony Detroit suburbs where someone of his wealth might be expected to live.

In many respects that home — and the fight to build it — highlight both the pugnaciousness of Bhargava and his quest for privacy while staying in the middle of everything.

Instead of a single home, the low-profile multimillionaire planned a 17-house development sandwiched between two existing tracts of homes, with a gated entrance, private road and a second, eight-foot fence surrounding his home in a city with only a handful of other gated neighborhoods.

By the time other homes in the development hit the market last year, listed at more than $600,000, Bhargava’s team had already sued both its initial developer and a neighbor who distributed fliers opposing the development. Both suits were settled, confidentially.

A complex web

When the trim, slightly balding Bhargava speaks publicly about his energy shot company, he emphasizes its common-sense approach. No one in the company uses business-school jargon, he told a 2012 meeting of the Asian Pacific American Chamber of Commerce, and he jokes that he doesn’t even know how to spell the words “strategic initiatives.” He says that his job is to make complex ideas simple.

But Bhargava’s various business ventures are anything but easy to follow. More than 70 limited liability companies, some of which are no longer active, have been registered at the address of 5-hour Energy’s headquarters. Such businesses, which as their name implies limit the personal liability of their owners, also offer tax benefits and, in Michigan and elsewhere, aren’t subject to the same restrictions on political activity as other corporations. Those LLCs include a host of other ventures, such as investment funds and Bhargava’s backing of several upcoming Hollywood films. The business of running 5-hour Energy itself is composed of three separate LLCs: Innovation Ventures, Living Essentials and MicroDose Sales.

For political purposes, Bhargava’s most active company has been ETC Capital, which bills itself on its website as “founded on the basis of opportunistic investing” and invests in companies that don’t qualify for traditional loans or private equity.

Since 2009, ETC Capital has given nearly $4.9 million to state candidates and political groups across the country, which helped it become one of the top 50 donors to state races in 2014. It’s unclear why the giving has come in ETC Capital’s name or who in the company decides which political groups merit donations.

In at least one case, a donation given by ETC Capital to Washington Attorney General Bob Ferguson was later publicly represented as sponsorship of a fundraiser by 5-hour Energy, according to The New York Times.

Seven donations totaling $319,500 were made during 2009 and 2010 in the name of Ted Mills, a former managing director at ETC Capital. Mills, however, told the Center for Public Integrity he didn’t make the donations, which were spread across five political action committees. Three of those were connected to Mike Bishop, a former Michigan Senate majority leader who ran for state attorney general in 2010. Mills declined further comment.

Matt Miner, treasurer of the three committees connected to Bishop, said the committees’ policies for handling donations from limited liability corporations, like ETC Capital, was to attribute them to someone affiliated with the corporation, such as Mills.

Giving to state investigators

Since 2009, companies tied to Bhargava have donated more than $1.2 million to candidates for attorney general and political committees that support them, according to data from the IRS and the National Institute on Money in State Politics.

The bulk of that giving, more than $850,000, has benefited two Republican groups: the Republican Attorneys General Association and the Republican State Leadership Committee. Bhargava’s companies also donated more than $310,000 to the Democratic Attorneys General Association, and more than $40,000 went directly to state attorney general candidates from both parties in at least seven states.

Those donations haven’t insulated Bhargava and 5-hour Energy. Since 2013, 33 state attorneys general have investigated the marketing or safety of 5-hour Energy. Five of those states — Indiana, Hawaii, Oregon, Vermont and Washington — have sued the company since last July, accusing it of making deceptive claims in its marketing. Ohio settled with the company in July without filing suit, after investigating the company for deceptive marketing, with the energy drink company agreeing to pay $1 million for research or public education on childhood disease. Ohio and Indiana are the only states among the six with Republican attorneys general.

Two of the five attorneys general to sue Bhargava’s company in the past year received campaign donations from him as candidates. Washington’s Ferguson, a Democrat, returned a $1,000 donation from ETC Capital in July 2014, one day after his state filed the suit against 5-hour Energy. When asked recently about the donations, his office referred to prior public statements in which Ferguson has acknowledged personally soliciting a donation from Bhargava’s company.

Indiana’s Greg Zoeller, a Republican, also sued Bhargava’s company after receiving a total of $7,500 in donations from the Bhargava-connected Oakland Law Group in 2011 and 2012, which placed the law firm among Zoeller’s top 10 donors in that two-year period.

Andrew Buroker, the treasurer of Zoeller’s campaign, said in an email that while Zoeller doesn’t solicit contributions from organizations under investigation, these donations wouldn’t be returned because they were made before the state’s investigation into 5-hour Energy began.

After The New York Times last year highlighted efforts by 5-hour Energy to influence states not to file suit, Bhargava and his company accused attorneys general of soliciting political contributions from the company while it was being investigated by them.

“Ninety percent of my money is pledged to charity,” Bhargava said in a statement to the newspaper. “I am certainly not going to take it from the poor and give it to the attorney general.”

Not showing up in Michigan

Donations to Michigan political groups given in the name of ETC Capital, Mills and Bhargava totaled more than $450,000 in 2009 and 2010, according to IRS and state filings. Since then, none of them has donated directly to Michigan groups or candidates. But national groups that have received the biggest checks from Bhargava’s companies have been very active in Michigan politics. The timing of the donations and the spending by such groups in the state raises questions about whether the money was earmarked for Michigan.

For example, eight weeks after ETC Capital gave $275,000 to the Republican Governors Association in October 2013, the group gave $276,000 to the Michigan Republican Party. In 2014, Bhargava’s company gave $2.5 million to the governors’ association, which paid $3.2 million on the same day to the media company it used to place ads backing the re-election of Republican Michigan Gov. Rick Snyder.

Bhargava’s company also gave heavily to Republican groups active in Michigan’s 2014 attorney general race. In 2013, ETC Capital gave $125,000 to the Republican State Leadership Committee, which donated $34,000 to Republican incumbent Bill Schuette’s campaign on the same day.

Yet numerous Michigan politicians, ranging from his local mayor to statewide political bosses, say they barely know Bhargava, even the ones who have benefited from the political donations of his various companies.

A spokeswoman for Schuette said he has never met with Bhargava and doesn’t know him. Snyder, who won re-election in 2014 thanks, in part, to an estimated $7.4 million in ad spending by the RGA, has met with Bhargava only once — during Snyder’s first year in office in 2011, according to a spokeswoman.

Several Michigan political insiders also said they don’t know of particular pieces of legislation or policy issues that Bhargava has tried to influence.

“What was strange is he never asked for anything back,” said Ron Weiser, a former chairman of the Michigan Republican Party and an ex-national finance chairman for the Republican National Committee. “Usually people want something.”

Bhargava’s low-key approach stands in stark contrast to other wealthy political donors in the state, such as the scions of Richard DeVos, who made a fortune after co-founding Amway Corp., the world’s largest direct seller.

“In Michigan everyone knows the DeVos family,” said Susan Demas, publisher of the political newsletter Inside Michigan Politics. “They’ve made no secret of the fact that they’re willing to be big donors and fundraisers.”

Bhargava’s name, meanwhile, appears sparingly in campaign finance filings. He appears to have made only two political donations in his own name: $1,000 to President George W. Bush’s campaign in 1999 and $500 a decade later to the campaign of Jim Townsend, a Democratic state representative in nearby Royal Oak.

Despite the donation to Bush, the bulk of political giving by Bhargava’s companies has so far been focused on state-level races. Michigan isn’t scheduled to elect a new governor until 2018, but presidential contenders are already visiting the state to shore up support for 2016. Last month, Republican presidential contender Jeb Bush was in town talking to a packed room at Detroit’s convention center.

“Everybody who’s a player and who wants to be a player was there,” said Dennis Darnoi, a political consultant in Bhargava’s home base of Oakland County. “But he wasn’t.”

Associated Press reporter David Eggert contributed to this story.

This piece comes from the Center for Public Integrity, a nonpartisan, nonprofit investigative news organization. To follow the Center’s investigations into state government and politics, go here or follow them on Twitter.​

TIME Campaign Finance

How Super PACs Are Taking Over

US-VOTE-REPUBLICANS
Paul J. Richards—AFP/Getty Images US Senator Ted Cruz( R-TX) smiles at the crowd while delivering remarks announcing his candidacy for the Republican nomination to run for US president March 23, 2015, inside the full Vine Center at Liberty University, in Lynchburg, Va.

A new breed of high-dollar outside groups is reshaping the 2016 presidential race

Texas Sen. Ted Cruz says he no longer listens to classic rock, but he still found a way to channel the lyrics of John Lennon when he launched his presidential campaign. “Imagine,” he told students at Virginia’s Liberty University on March 23, repeating the refrain 38 times in a half-hour stem winder that felt less like a campaign speech than a guided tour of a conservative Valhalla.

The dreamy slogan may have seemed out of whack for the firebrand politician. But in some ways Cruz was just following the lead of an independent group that hopes to make him President.

Weeks before Cruz climbed onstage, the Stand for Principle PAC printed and passed out T-shirts and placards that read “Imagine Ted Cruz as President.” The group’s organizer, Maria Strollo Zack, says helping Cruz promote his message is just the start. Zack wants to raise as much as $50 million—perhaps more than the campaign—to pay for anything from television ads to grassroots outreach. “We’re rewriting the book on how super PACs can be leveraged,” she says.

So are Cruz’s rivals. Likely candidates such as Jeb Bush and Scott Walker have been deeply involved in setting up their outside-spending vehicles, installing top staff and drawing down funds to pay for early voter contact, including trips to primary states. Such efforts are the latest way to game the traditional campaign-finance system, which limits the amount of money individuals can give to candidates and forbids direct donations from corporations. The Cruz super PAC, for instance, is barred from directly coordinating campaign spending or strategy with Cruz, but it is able to raise and spend unlimited sums on the candidate’s behalf while collecting money from just about anyone.

In 2012 super PACs were used as blunt instruments of destruction: the group backing Mitt Romney devoted about 90% of the $142 million it spent overall to TV attack ads. But in the 2016 presidential race, these organizations are poised to play a much bigger role, taking over more-traditional campaign duties ranging from field organizing and voter turnout to direct mail and digital microtargeting. “They are becoming de facto campaigns,” says Fred Davis, a Republican media consultant who ran former Utah governor Jon Huntsman’s presidential super PAC in 2012.

Campaign-finance watchdogs say that super PACs, which were created in the wake of two 2010 court rulings, undermine spending limits that have governed elections for generations and allow high-dollar donors to amass influence that Congress has long sought to prevent. The new crop of super PACs are now pushing boundaries in ways that were unimaginable just five years ago. “The sky’s the limit.” says Carl Forti, a GOP strategist who co-founded the Romney super PAC in 2012.

Many Republican hopefuls have delayed their official campaign announcements so they can spend more time and energy seeding their outside groups. Bush, the former Florida governor, has been dropping in on donors’ conclaves across the Republican Party’s wealthiest precincts, soliciting massive checks for his Right to Rise super PAC. Mike Murphy, Bush’s longtime senior adviser, is expected to stay at the super PAC to orchestrate its strategy rather than migrate to the campaign.

Walker’s high-dollar outside group, Our American Revival, is run by the Wisconsin governor’s future campaign manager, Rick Wiley, who—like Walker’s spokesperson, senior political advisers and key field staff in states like Iowa and New Hampshire—is drawing a salary from the organization until the formal campaign kicks off. Former New York governor George Pataki charged up to $250,000 per head at a fundraiser for his group, We the People Not Washington, which features a form on its website for supporters to request a meeting with Pataki. And as Hillary Clinton marches toward a likely campaign launch, her super-PAC supporters at Ready for Hillary are laying the groundwork by adding to their email rolls and signing up a flurry of new members for the group’s finance council.

Much of this activity exploits a legal loophole. “What’s unique,” says Anthony Corrado, chairman of the board of trustees at the nonpartisan Campaign Finance Institute, “is candidates becoming associated with a super PAC before embarking on a campaign.” Building early receptacles for large checks may also limit the amount of time candidates are forced to spend raising money later on.

As the balance of power shifts toward super PACs, the strategists running them are studying the ways outside committees can be more than just attack machines once the campaigns take flight. “Every super PAC will have to decide what their mission should be and how they want to game plan,” says Austin Barbour, who will run former Texas governor Rick Perry’s super PAC if Perry jumps into the race. “But we’re in a post-TV age.” Super PACs will take on a variety of new tasks over the next year, from grassroots organizing and micro-targeting to digital operations. “Those will all be a part of any well-run super PAC this cycle,” predicts a GOP strategist running another likely presidential candidate’s outside group.

The question no one has an answer for yet is how a super PAC’s time and money can dovetail with the campaign’s efforts instead of duplicating them. Since such groups are barred from coordinating strategy with campaigns after the candidates declare, they may struggle to run complementary data or field operations. But campaign-finance watchdogs worry the rules will be flouted because there’s nobody to enforce them. “It’s open season,” says Fred Wertheimer, president of Democracy 21, who notes that three of the six members of the Federal Election Commission—the agency in charge of overseeing political spending—view money as a form of speech and are ideologically opposed to reining it in. And while the Department of Justice can prosecute violations of campaign-finance law, experts predict they will be wary of doing so except in extreme cases.

Candidates will be able to send strategic cues in public statements that super PACs can pick up on. But campaign strategists say the anything-goes legal landscape could ultimately cause problems for the indiscreet. “Someone’s going to get popped,” one predicts. “The question is who and when.”

After his speech at Liberty, Cruz began a fundraising tour that would whisk him to meetings with New York financiers, Texas investors and other executives. Within 36 hours, he said he had raised more than $1 million for his actual campaign. The cash infusion was overdue: Cruz’s coffers are already dwarfed by those of rivals like Bush. As a federal officeholder, Cruz hasn’t had the same freedom to work with his super PAC.

But the outside group will be there to help him with his stated strategy—to win the nomination by mustering a grassroots army that mixes the Tea Party faithful with the social conservatives who dominate the first-in-the-nation Iowa caucuses. And at the head of the brigade is an old pal: Cruz’s college roommate and debate partner David Panton, a Jamaican-born Atlanta private-equity executive who cut the super PAC its first $100,000 check last November. “I think he should be President,” Panton says. “It requires a lot of money to run a presidential campaign.”

Zack says the Senator can live on less cash than his rivals but insists that support will be there when he needs it. After all, Stand for Principle can get Cruz himself to juice fundraising by appearing at its events, as long as he does not ask for the money directly. Just imagine the possibilities.

With reporting by Zeke J. Miller and Michael Scherer/Washington

Read next: 3 Things Ted Cruz Could Learn From Taylor Swift

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TIME Campaign Finance

Police Advocacy Group Leaves Few Fingerprints

The Law Enforcement Alliance of America has no known office. The group’s address leads instead to “suite 113” inside this shipping supply store in Lake Ridge, Virginia. Rachel Baye/Center for Public Integrity
Rachel Baye — Center for Public Integrity The Law Enforcement Alliance of America has no known office. The group’s address leads instead to “suite 113” inside this shipping supply store in Lake Ridge, Virginia. Rachel Baye/Center for Public Integrity

Wedged between a nail salon and a pizza shop in a strip mall about 25 miles south of Washington, D.C., is a postal supply store where a small brass mailbox sits stuffed with unopened envelopes.

It’s the unlikely home of one of the country’s most mysterious political hit squads.

The Law Enforcement Alliance of America once had offices in a nearby office park, but it abandoned them more than a year ago. It hasn’t filed required IRS reports in two years, and its leaders, once visible on television and in congressional hearings, have all but vanished.

But the nonprofit that calls itself “the nation’s largest coalition of law enforcement professionals, crime victims and concerned citizens” still has teeth. It has succeeded in helping knock out 12 state-level candidates in 14 years, including an Arkansas judicial candidate last year. In doing so, the group helped launch the current governors of Texas and Nevada to their stepping-stone positions as state attorneys general.

The LEAA uses brute tactics — parachuting into otherwise small-dollar races close to the end and buying up TV ads that accuse candidates of siding with “baby killers” and sexual predators.

“They can put out some sort of horrible attack ad on any judges that they want and really influence an election with a fairly small amount of money,” former Mississippi Supreme Court Justice Oliver Diaz said. “They’re buying seats on supreme courts in states all around the country.”

Diaz knows. He’s among those who have been pushed out of office after being targeted by the LEAA, which spent about $660,000 in the last two weeks of his 2008 campaign running ads linking him to rapists and murderers.

“When a 6-month-old child was raped and murdered, Supreme Court Justice Diaz was the only one voting for the child’s killer,” the ad’s two announcers said. “An elderly woman kidnapped, beaten and raped: Diaz, the only one voting for the rapist.”

How the LEAA pays for the campaigns is a mystery that political opponents, state officials and advocacy groups have fought unsuccessfully for years to unravel. The group, which has ties to the National Rifle Association but no public connections to official law enforcement agencies, has repeatedly gone to court to fend off such efforts. A dispute over whether the group violated Texas campaign laws is expected to wrap up this month, but the group’s donor list has so far remained a closely guarded secret.

The LEAA and its current leader, Chief Operating Officer Ted Deeds, did not respond to repeated calls and emails. Lawyers representing the group said they were not authorized to speak on its behalf, and the LEAA’s accountant referred questions back to the group. In the past, its leaders have argued that its anonymously funded activities are protected under the right to free speech.

The group is an extreme example of a growing cadre of political organizations — from the conservative Crossroads GPS to the environmental advocate League of Conservation Voters — that insert themselves into elections, flood the airwaves with attack ads and often tip the scales in favor of the candidate they prefer. All the while, voters have no idea who is behind the effort and what their motives are because of a gap in disclosure laws.

The LEAA is among the most mysterious and successful, coming into races like a stealth assassin, then all but disappearing when the race ends.

In the LEAA’s sights

Two weeks before last year’s Arkansas Supreme Court election, the LEAA swooped in to take out a trial attorney it didn’t like.

“Tim Cullen worked to throw out the sentence of a repeat sexual predator, arguing that child pornography was a victimless crime,” said the voiceover in one ad. “Victimless? Tell that to the thousands of victims robbed of their childhoods and left with permanent psychological and physical scars.”

Cullen responded, saying the ad misrepresented his argument. The Annenberg Public Policy Center’s Factcheck.org, which monitors the truthfulness of political messages, mostly agreed, calling the LEAA’s ad “beyond the pale.”

The group spent at least $320,000 airing the attack ads, as well as some supporting Cullen’s opponent, Court of Appeals Judge Robin Wynne, according to local TV station records. It was the first time a group unconnected to candidates or political parties bought ads in an Arkansas court race.

Wynne, who denied any involvement with the ads, won by a 4-percentage-point margin.

The ads not only contributed to Cullen’s loss, they also led him to give up politics, even though his supporters want him to run again.

“Because I still do not know their motives or the source of their funding, I am concerned that they (or whoever is behind them) might again hijack any future race if I was a candidate,” Cullen said in an email.

A bill that would have required groups like the LEAA to reveal their donors failed in the Arkansas House this week, the Arkansas Democrat-Gazette reported.

The Arkansas race was simply the latest in a string of judicial elections in which the LEAA helped determine the winners.

Two years before, the group spent at least $450,000 airing ads that criticized losing Mississippi Supreme Court candidate Flip Phillips. And in 2010, the LEAA spent $800,000 airing ads that attacked Michigan Judge Denise Langford Morris, who subsequently lost her campaign for state supreme court, according to Justice at Stake, an advocacy group critical of judicial elections.

In the Diaz case, Mississippi’s Special Committee on Judicial Election Campaign Intervention condemned the ads, causing Comcast to pull them from its stations, according to Mississippi’s The Clarion-Ledger. Still, he lost by 16 percentage points, despite the $100,000 he estimated his campaign spent fighting back.

The group also jumped into races for at least two more supreme court justices, seven attorneys general, two state legislators, plus four congressional races. Each time, the LEAA made a name for itself with harsh attack ads, and almost every time, its candidate won.

Taking aim at gun control

The LEAA was created by the National Rifle Association in 1991 to represent pro-gun police officers willing to defend their right to bear arms, according to Leroy Pyle, an 18-year veteran of the San Jose, California, police department, whom the NRA tapped to launch the group.

At its peak in the late 1990s and early 2000s, the group had about eight employees, two former staffers recalled.

Today the group describes itself as a coalition of thousands of dues-paying law enforcement professionals around the country. The number of members is not publicly verifiable.

“LEAA was established early to give a voice to cops so that when the police chiefs would show up and have a press conference and say, ‘Well, this is what cops think,’ that the public at least have some indication that this is not what all cops think,” said former employee David Bufkin, who now owns a communications firm outside of Washington, D.C.

However, the International Union of Police Associations and the Fraternal Order of Police, two major national police labor groups, disavow any link between the LEAA and their organizations.

“If we have ever agreed with them, it’s been totally coincidental,” said FOP spokesman Jim Pasco.

Officials speaking on behalf of state chapters of the FOP have used even stronger language to distance themselves from the LEAA.

For example, when the LEAA ran ads criticizing now-Illinois Attorney General Lisa Madigan in her 2002 race, the state branch of the FOP said it was an “insult for this group to pretend to represent police when they promote policies that would endanger the lives of law enforcement officers,” according to the Chicago Tribune.

Changing tactics with changing leaders

For most of its early existence, LEAA staff regularly lobbied Congress and state legislatures, usually opposing measures that would restrict gun ownership.

Jim Fotis, the group’s full-time executive director from about 1993 until 2006 and a member of the board of directors until 2010, was a regular presence on Capitol Hill. A former cop in Lynbrook, New York, for 14 years, he also represented the group in “hundreds of TV and radio programs as a commentator on sensitive issues ranging from gun control to international terrorism,” according to his LinkedIn profile.

Fotis could not be reached for comment.

The LEAA’s focus shifted more toward elections in the 2000s, and its newest leader, Deeds, has kept a much lower profile. He also has a tenuous connection to law enforcement.

The 51-year-old worked as a corrections officer for three months in 1984 in the Arlington County Sheriff’s Department and for seven months in 1986 for the Loudoun County Sheriff’s Department, both in Virginia. He was fired from both jobs, according to county personnel records obtained by the Center for Public Integrity. The Virginia Employment Commission later found no evidence to show misconduct connected with his work in Arlington County, but he was not reinstated.

Guns and money

In its early years, the LEAA would not have survived without the NRA, according to Stephen Chand, the group’s legislative director for a few years in the mid-1990s.

“There were other gun groups that were involved, other unions that were involved, but the close tie was really the NRA,” Chand said. “Every time it looked like we were going belly up in the first couple of years, they came in to help float the bills.”

Money was tight enough that the group couldn’t do much, especially when it came to influencing elections, Chand said.

“I remember one year we were handing out $50 to some candidates — the best we could come up with,” he said.

After Chand left in the late 1990s, he was surprised to see the LEAA spending vastly larger sums on state races.

The NRA gave the group at least $2 million over seven years, ending with a grant of $180,000 in 2010, according to the NRA’s tax documents. Since then, the NRA’s tax filings don’t show money going to the LEAA. The NRA did not respond to requests for comment.

Despite the financial links, then-LEAA spokesman Kevin Watson denied his group was a front for the NRA in a 2001 Pittsburgh Post-Gazette story.

“There are a great chunk of issues that have nothing to do with the NRA,” he said.

Chand said the LEAA also had close ties to Americans for Tax Reform, the nonprofit run by NRA board member Grover Norquist, who is known for seeking public pledges from elected officials to not raise taxes.

The U.S. Chamber of Commerce also collaborated with the LEAA to influence the 2001 Virginia attorney general’s race, according to a memo the Center for Public Integrity obtained from a meeting between LEAA staff and its accountant.

Representatives of Americans for Tax Reform and the U.S. Chamber of Commerce did not respond to questions about whether they helped to fund the group’s efforts.

Operating in secrecy

It’s hard to know whether the LEAA still has links to such groups because it conducts business in near-complete secrecy.

The organization has no known office, having left just a box of posters and pile of unopened mail at the now-vacant space it listed on its last tax form. The LEAA’s current address leads instead to the mailbox in the Lake Ridge, Virginia, postal supply store.

The IRS said the LEAA has not filed mandatory forms with the federal tax agency since the ones that covered 2011 — something that could carry a fine of up to $50,000. The group also failed to release its tax records in response to the Center for Public Integrity’s requests, as required by law.

Even if the LEAA had filed the required documents, they likely wouldn’t have revealed much. Federal law doesn’t require a nonprofit like the LEAA, which is regulated under section 501(c)(4) of the U.S. Tax Code, to reveal the names of donors publicly or to offer many details about how it spends money.

Known as “social welfare organizations,” these nonprofits have become frequent vehicles for political activity by groups whose donors don’t want their names revealed. Unlike candidates, such nonprofits can raise unlimited amounts of money from unions and corporations, plus spend unlimited amounts.

In down-ballot races like those for state supreme court, the secrecy of such nonprofits is particularly problematic, because the groups may be the only ones offering information about the candidates, according to Jessica Levinson, a Loyola Law School professor who specializes in election law.

“People typically aren’t as ill-informed about who’s running for president or governor or even secretary of state as they are about judicial races,” Levinson said. “A few well-placed radio or TV ads can make a big difference because that can be the only thing that people remember about the candidate.” here for more stories in this blog

Fighting in court

The LEAA has repeatedly fought efforts by state officials and opponents to require it to reveal its donors.

After the group failed to register as a political committee in Pennsylvania in 2001, a judge there ordered the LEAA to remove from the air ads attacking state supreme court candidate Kate Ford Elliott. Registering would have required revealing details about donors and spending.

In response, Deeds repeated an argument the LEAA has used frequently: that the First Amendment protects the group’s right to spend money on ads without revealing its donors.

Elliott lost in the end anyway, and the Pennsylvania Supreme Court shifted to Republican control.

Three years later, two Texas candidates sued after claiming the LEAA spent more than $1 million opposing their 2002 candidacies. The LEAA had aired ads saying Democratic state Sen. Kirk Watson, who was running for attorney general, “made millions suing doctors, hospitals and small businesses, hurting families and driving up the cost of health care.”

And less than a week before the election, the LEAA accused Democratic state house candidate Mike Head of being on the side of “convicted baby killers” via postcards sent throughout his district.

“What they were doing was just ethically and morally wrong,” Head said. “It misrepresented what I do, and when it hits every mailbox — your friends, family, church members, your children’s [friends’] parents — it certainly will give you pause before you put yourself out there to do that again.”

The LEAA argued that its right not to reveal donors’ identities is protected under the group’s right to free speech.

The legal fight dragged on for more than a decade. The two Democrats reached a settlement agreement with the LEAA in late February 2015, their attorney told the court, and the case is expected to be dismissed this week. Watson declined to comment, and the attorney for both Watson and Head did not return calls.

Yet the effect of the election cannot be undone. Former state Supreme Court Justice Greg Abbott beat Watson to become the attorney general. Today, Abbott, a Republican, is the governor of Texas.

Alan Suderman contributed to this story.

This piece comes from the Center for Public Integrity, a nonpartisan, nonprofit investigative news organization. To follow the Center’s investigations into state government and politics, go here or follow them on Twitter.

TIME 2016 Election

Jeb Bush Supporter Stumbles Into Campaign Finance Tangle With Radio Ad

Former Florida Governor Jeb Bush speaks to the media after visiting Integra Biosciences during a campaign stop in Hudson, New Hampshire
Shannon Stapleton—Reuters Former Florida Governor Jeb Bush speaks to the media after visiting Integra Biosciences during a campaign stop in Hudson, New Hampshire March 13, 2015.

How a Bush backer ran afoul of the former governor's lawyers

Jay Schorr was one of Jeb Bush’s biggest fans.

The owner of a South Florida media company, Schorr was so glad to see Bush taking a hard look at a presidential campaign that in early February, he began funding radio ads touting the former Sunshine State governor as the solution to America’s ailments. “Only one man is running on a record of success: Jeb Bush,” intoned his initial 49-second spot, which Schorr believes was the first to promote Bush as a presidential candidate.

But there was a problem: Bush isn’t officially running for anything. Even as he winks and nods his way across early primary states, doing all the things candidates do—giving speeches, meeting with the press, raising money and building supporter lists—the former Florida governor has exploited the blind spots in U.S. campaign finance law to avoid the legal definition of candidate activity.

As a result, what Schorr got this week in return for his zeal and financial support was a cease-and-desist letter from Bush’s lawyers. “While we appreciate your enthusiasm,” they wrote in the missive, a copy of which was obtained by TIME, “your ads erroneously suggest that Governor Bush is a candidate for office and claim that he approved the messages in the ads. Please be aware that Governor Bush is NOT a candidate for any office and he has not approved any of your advertisements.”

As a legal matter, Bush’s lawyers had plenty of reasons to be cautious. His effort to reach the White House can only be carried out legally in its current incarnation if he denies that any of it is being done as part of a dedicated effort to win the White House.

If that sounds strange, welcome to the world of modern day campaign finance. The 2016 presidential election is poised to shatter spending records, with more money sloshing around than ever before. And a big part of the reason is the proliferation of individual-candidate super PACs, groups that can raise unlimited sums in support of specific candidates, but cannot directly coordinate most of their efforts with those candidates once they declare for federal office.

Super PACs emerged as a force in 2012, with patriotic monikers like Restore Our Future (which supported Mitt Romney) and Priorities USA Action (which backed Barack Obama and has since thrown its muscle behind Hillary Clinton). In 2014, they spread widely to Congressional races. And in the nascent phases of the 2016 race, they have become the most effective weapon in a presidential hopeful’s arsenal, a way for an undeclared candidate to stockpile unlimited sums right out of the gate.

Bush, like an array of other all-but-certain candidates, is using his Right to Rise super PAC to rake in millions of dollars, all while maintaining the pretense that he is not officially running for anything. After he becomes a candidate, he is almost certain to cut official ties to Right to Rise, leaving it in the hands of his staff, who will run television ads on his behalf. In the meantime, his lawyers are careful to ensure he doesn’t run afoul of Federal Election Commission regulations. (Charlie Spies, counsel to the Right to Rise PAC and the main author of the letter to Schorr, did not respond to a request for comment.)

The cease-and-desist letter shocked Schorr, who says he was simply trying to exercise his First Amendment rights to enumerate Bush’s merits. Schorr’s idea was to create one radio ad each week until November 2016. One quirky spot featured an imaginary dialogue between Bush and Bill Clinton; another challenged David Letterman to a monologue contest in response to a recent Late Night swipe. So far, he’s done about a half-dozen ads in total, paying about $7,000 out of his own pocket to place them on local radio and the Internet. “A mere pittance in political advertising terms,” he notes, “but for someone not being financed by big pocket donors, it’s significant.”

Though the spat has soured him a bit on Bush’s operation, Schorr says he still supports the former Florida governor. But he has come to believe that the episode highlights how Bush, like many other 2016 hopefuls, is flouting the spirit of U.S. campaign-finance laws, if not the letter.

“The whole campaign finance landscape is a sham. It’s a legal fiction. The candidates themselves are wink-winking—‘if I decide to run’,” he says. “They’re paying lip service to some ridiculous federal regulations that everyone circumvents.”

“People need to know,” Schorr adds, “that these candidates are running wild.”

TIME Campaign Finance

Big Business Gave Heavily to Thwart Ballot Measures in 2014

Voting booths in polling place
Getty Images

Anthem Inc. quickly mounted its defenses when consumer advocates pushed for a 2014 ballot initiative in California that would have made it more difficult for the nation’s third largest health insurer to raise rates.

The company, based in Indianapolis, Ind., shelled out $12.8 million to back television ads and a website that warned voters the measure would “give one politician too much power,” “create more bureaucracy” and “interfere with your treatment options.”

Anthem’s money, combined with millions from other interested parties, swamped efforts by Consumer Watchdog, the advocacy group that spent four months gathering the signatures to put Proposition 45 on the ballot. Opponents of the bill together gave more than $31.5 million — dwarfing supporters’ $2.6 million.

In November, Anthem and the other big business interests won at the polls, with nearly 59 percent of the vote.

Anthem, formerly known as WellPoint, was the second-biggest donor to groups fighting over ballot measures in the nation last year, according to a Center for Public Integrity analysis. The donors gave the money to political committees that advocated for or against the propositions. The health insurer did not respond to requests for comment.

Anthem’s victory on Proposition 45 was part of a pattern that played out across the country: Business interests poured money into ballot question fights, largely to protect their own revenue, with overwhelmingly positive results.

More than three-quarters of the $272 million given by the top 50 donors to ballot measure groups nationwide came from corporations or business trade groups, according to the analysis. They gave most of their money to defeat proposals and were almost always successful, winning 96 percent of the time.

Related: Meet the Top 50 Donors Who Influenced Ballot Measures

“There’s no question that when business or corporations or entities that are affected by ballot initiatives give to the ballot initiative process, they’re not doing so out of altruism,” said Joe Tuman, a professor of political and legal communications at San Francisco State University. “They’re doing so out of rational self-interest.”

‘Spending matters’

The Center for Public Integrity collected campaign finance records filed by statewide ballot measure groups that ran ads on local broadcast, national broadcast and national cable television networks in 2014. The Center then analyzed the donations behind the groups to create the list of the top 50 contributors to ballot measure fights around the country. [More details on the methodology].

Together, those 50 mega-donors gave $272 million, nearly two-thirds of the $429 million contributed to those ballot measure campaigns in 2014.

That means that a few powerful entities dominated debates nationwide over ballot initiatives, which were originally intended to give citizens a stronger voice in government.

Most of the top donors gave to more than one ballot fight — and almost half of them helped fund battles in multiple states. A few were also generous in other 2014 elections, as well. Five of the top 50 ballot measure contributors were also among the top 50 donors to races for state-level candidates.

Some of the money paid for mailers and robo-calls, but much of it went to TV ad blitzes. In 2014, more than $190 million was spent on ballot measure ads alone.

Multinational oil companies BP, ConocoPhillips and Exxon Mobil Corp. successfully beat back a measure in Alaska that would have repealed tax breaks for the oil companies. After giving more than $3.5 million each to the “no” side, they won with nearly 53 percent of the vote.

The American Beverage Association, a trade group based in Washington, D.C., that represents beverage producers, gave more than $8.2 million to fight a Massachusetts measure that would have expanded the deposit that customers must pay when buying bottled drinks. It, too, got what it wanted when 71 percent of voters rejected the new deposit proposal.

But 2014 also proved that money only goes so far, said John Matsusaka, a professor and executive director of the Initiative and Referendum Institute at the University of Southern California.

“Spending matters. If you spend money, you are going to get some votes,” he said. But “if it’s an unpopular measure you can spend as much as you like and it’s not going to pass. It’s not a system where you can just walk in and buy laws.”

Mile High USA Inc., a subsidiary of the Rhode Island-based Twin River Casino company that owns a racetrack and off-track betting parlor in Colorado, gave more than any other ballot measure donor in the U.S. in an unsuccessful effort to expand gaming at its Arapahoe Park racetrack near Aurora, Colorado.

Mile High gave $19.8 million to a “yes” campaign, which worked out to $9.84 per ballot cast in Colorado. Mile High’s corporate clout was countered not by citizens, but by a group of competing casinos in the state that together gave nearly $16.3 million to defeat the measure. Mile High promised that much of the newfound gambling revenue would go to a state education fund: “By permitting limited gaming at Arapahoe Park, 68 will provide millions to our schools each year,” said one backer in an ad. But voters were not swayed: 70 percent of them voted against the amendment.

In another expensive, uphill fight, Wal-Mart gave $9.3 million to an effort to pass a measure in North Dakota that would have let the company open pharmacies in the state, a haven for small, pharmacist-owned drug stores. Wal-Mart also lost, though its opponents raised a fraction of what the big-box retailer gave.

Giving big on defense

Within the top 50 donors, business interests fighting to defeat ballot measures were more successful in 2014 than those whose money was directed at trying to pass initiatives. Companies such as MGM Resorts International and Monsanto gave heavily to fight proposals that would have hurt their profits.

MGM, which is building an $800 million casino in Springfield, Massachusetts, helped pay for TV ads that warned voters the state would lose thousands of jobs if it nixed its gambling law in a November ballot question. “If Question 3 passes, we’ll lose it all — as simple as that,” said a man dressed as a construction worker in one ad. “We’re asking people to vote no on 3 so we can keep the jobs.”

For MGM, the investment of nearly $5.4 million to fight Question 3 paid off — voters rejected the initiative.

That fits with what political experts know about ballot measures: They’re easier to defeat than to pass.

“It’s easier to defend the status quo, often,” said Daniel Smith, a University of Florida professor who has studied ballot measures for two decades. “The onus is on the proponents to articulate why a measure needs to be passed by the people. People know what the status quo is, and you can raise doubts about whether you’re going to be better off under this proposed change.”

Some companies made successful “no” arguments across more than one state. Agricultural giant Monsanto gave $10.7 million to fight ballot questions in Colorado and Oregon that would have required genetically modified foods to be specially labeled. The company is the largest producer of genetically modified seeds in the world.

“We fully support the idea of providing information to consumers to help them make choices about foods as long as the information [on the labels] being provided to consumers is accurate, science based and does not mislead,” said Monsanto spokeswoman Charla Lord in an email. “What we are not supportive of is a state-by-state patchwork of labeling laws.”

Supporters of labeling, many of them natural food companies, raised nearly $1 million in Colorado and nearly $6.5 million in Oregon, but it wasn’t enough. Monsanto and its food-industry allies raised more than $16 million in Colorado and $20 million in Oregon, winning the ballot contests with 65 percent and just over 50 percent of the vote, respectively.

Giving money to ballot measure fights has become the norm for companies seeking to defend their profits, said Justine Sarver, executive director of the progressive Ballot Initiative Strategy Center.

“Ballot measures were originally created as a check on corporate influence in state legislatures,” Sarver said. “Today, corporations use the process to pad their bottom line.”

And business groups are continuing to fight for their profits at the polls. For example, plastics companies in California are already gearing up for a referendum battle over the state’s ban on single-use plastic bags.

The companies have already given millions to back a referendum repealing the ban, delaying its implementation and allowing the companies to continue raking in profits until the vote.

Billionaires and ballot questions

In addition to corporate giants, several wealthy individuals, including former New York Mayor Michael Bloomberg, used their vast stores of cash in an effort to influence state and local laws. Their new prominence in the ballot measure scene has surprised experts.

“That’s become a big issue now,” Matsusaka said. “It seems like there’s a lot of them these days.”

Bloomberg and Texas billionaire John Arnold each gave more than $2 million to groups supporting electoral reform in Oregon. The proposal would have reshaped the state’s elections into contests between the top two primary vote-getters rather than representatives from mainstream political parties. (Arnold and his wife are co-founders of the Laura and John Arnold Foundation, a donor to the Center for Public Integrity.)

But Oregon voters were skeptical of the political designs of those two outsiders, because Bloomberg has also promoted gun control and Arnold has backed pension reforms. Sixty-eight percent of Oregon voters rejected the idea, even though the pro-reform side gave more than status-quo supporters by a nearly 5-to-1 ratio.

Las Vegas casino mogul Sheldon Adelson, a generous GOP donor, gave $5.5 million to defeat Amendment 2, a measure that would have allowed medical marijuana in Florida. Fueled by Adelson’s money, marijuana opponents spent an estimated $5.1 million on TV ads, compared to supporters’ $2.1 million. The pot measure lost.

But two individual givers managed to change laws through ballot measures. California tech magnate Henry Nicholas gave nearly $4.3 million to pass a law in Illinois giving more rights to crime victims. Nicholas, a vocal advocate of crime victims’ rights ever since his sister, Marsy, was murdered in 1983, started his crusade for “Marsy’s law” in California and has since taken it to other states. The law to provide restitution and notification about court proceedings to crime victims passed in Illinois with 78 percent of the vote and essentially no opposition.

Rex Sinquefield, a former financial executive and now prolific political donor in Missouri, gave $2.9 million to pass the Show-Me state’s Amendment 10, which gives the Republican-led legislature more control over the budget. Observers viewed this as a shot at Democratic Gov. Jay Nixon.

“It’s not shocking that he would support a measure that adds to the institutional strength of a Republican-dominated legislature at the expense of a Democratic governor who he’s spent tens of thousands of dollars to defeat,” said Jeff Smith, a Missouri politics expert at New York City’s New School.

Healthy-sized giving

Among the top contributing business sectors, one outranked them all: Health care groups gave nearly $88 million in 2014, almost entirely in California. Casino companies were a close second, giving nearly $60 million across the nation.

The Golden State is known as the Wild West of ballot initiatives, with a long history of opponents and supporters spending eye-popping sums with far-reaching consequences. In 2014, two initiatives attracted considerable cash. Propositions 45, on insurance rate approval, and 46, which would have raised the state’s cap on medical malpractice damages and forced doctors to be drug tested, faced more than $90 million worth of opposition from insurers, hospitals and doctors.

Anthem’s crusade against Proposition 45 was aided by other health industry organizations also willing to give millions. Kaiser Foundation Health Plan, another of California’s largest health insurance plans, gave $12.4 million to defeat both 45 and Proposition 46.

Medical malpractice insurers Norcal Mutual Insurance Company, The Doctors Company and the Cooperative of American Physicians each gave more than $10 million to fight the health measures in California.

The Proposition 46 opponents framed the measure as the darling of trial lawyers, who indeed backed it and argued that it would have protected patients by reducing preventable medical errors.

“Before you vote, remember the risks about Prop. 46,” said one ad paid for by the insurers. “The trial lawyers wrote it to serve themselves, not the rest of us, mixing three unrelated provisions together to hide what Prop. 46 actually does — allow the trial lawyers to make millions, for more medical lawsuits and higher jury awards, while Californians pay when our healthcare costs skyrocket. That’s the true story.”

Hal Dasinger, a spokesman for The Doctors Company, noted the election results showed voters agreed with his company’s position: “Proposition 46 was bad for patients, bad for physicians, bad for local and state government budgets, and opposed by an unprecedented, broad list of groups.”

Giving tens of millions of dollars to ballot measure contests was worth the investment for the health care companies, according to Wendell Potter, a former insurance executive-turned-whistleblower who writes an opinion column about health care for the Center for Public Integrity.

“These insurers have enormous amounts of money,” he said. “The largest companies make billions of dollars in profits every year. They have the money to spend, and they’re quite willing to spend it to prevent any legislation or regulation that they have reason to believe might in some way cost them money or have a negative impact on profitability.”

But in 2016, the health care industry, along with its money, will take on a harder task in California: trying to pass a measure, rather than defeat one.

The California Hospital Association is sponsoring an initiative to make permanent a program to attract more federal dollars for low-income patients’ care. The hospital group plans to round up allies and spend big, if necessary, in yet another ballot measure showdown.

“It could be 20 million. It could be 40 million. It could be more than that,” said Jan Emerson-Shea, the group’s spokeswoman. “Our decision will be based on: ‘What do we have to do to win this measure?’ If there is opposition we have to fight off, then the price tag will be higher.”

TIME 2016 Election

Ben Carson’s Rise Fueled By Massive Direct Marketing Success

Ben Carson
Scott Olson—Getty Images Dr. Ben Carson speaks to guests at the Iowa Freedom Summit on Jan. 24, 2015 in Des Moines, Iowa.

The subject line read, “Dr. Carson: Serious Trouble…” But the neurosurgeon Ben Carson, who now polls in the top tier of Republican contenders for the presidency, was certainly not the one with problems.

“The Republican Party is in serious trouble,” ran the words that followed under a oversized font reading “From The Desk Of Ben Carson.” “So please join me in supporting Black America’s PAC with a contribution of at least $20.16 today.”

If you want to understand the conservative appeal of the former director of pediatric neurosurgery at Johns Hopkins Hospital, messages like this, which go out by the thousand on conservative email lists, are the place to start. No prospective candidate’s name and likeness, including the Democratic field-clearer Hillary Clinton, has been as successful in attracting small donations over the last year than that of Carson.

In addition to his own political action committee, Carson has lent his name and signature to other online efforts, including American Legacy PAC, which Newt Gingrich co-chairs. There Carson is the face of a $5.9 million campaign called “Save our Healthcare,” which raises money in the name of fighting President Obama’s health insurance reforms.

A separate independent effort, the National Draft Ben Carson for President Committee, raised more than $12 million in the 2014 cycle through email and direct mail with appeals featuring Carson’s name. That effort, which Carson plays no direct role in supporting, collected more during the reporting period than Ready For Hillary, the SuperPAC run by Hillary Clinton’s former aides to prepare the ground for her campaign.

Carson’s online fundraising efforts are so prolific that his own political operation is sometimes not aware of them. Terry Giles, who is set to be Carson’s campaign manager if he runs, had not heard of the Black America’s PAC email until the day after the email went out last week. He said there was no relationship between USA First Pac, which Carson founded to test the waters for a presidential run, and the group.

Black America’s PAC, or BAMPAC, was founded by former Presidential candidate Alan Keyes to support black conservative candidates. The group raised $255,803 in the 2014 cycle, according to the Center for Responsive Politics, and redirected only $20,750 to state and federal candidates. Almost all of the rest went to pay for fundraising expenses or the $90,000 in direct payments to the group’s director, Alvin Williams, a former advisor to the Republican National Committee and the 1988 campaign of George H.W. Bush.

“Dr. Carson has received no financial compensation for the use of his signature and BAMPAC has no affiliation with any group that is promoting Dr. Carson as a candidate,” Williams said in an email to TIME, when asked about Carson’s involvement. He declined to comment on how much money Carson’s appeals had raised, other than to say that the email was “effective.” The money, he continued, “will go towards supporting candidates who share BAMPAC’s political philosophy.”

Adam Waldeck, the executive director of American Legacy PAC, also said Carson received no payment for his fundraising support of the group. Since the “Save Our Healthcare” project was launched almost exactly one year ago, he said it had raised $5.9 million and signed up over 600,000 people across the country.

Waldeck acknowledged that a large portion of the proceeds were put “back into growing our footprint,” by funding more fundraising. In 2014, American Legacy PAC gave 3.3% of total contributions to candidates, while 89.7% was funneled back into more fundraising efforts, according to the Center for Responsive Politics.

Advocates of the conservative direct mail argue that groups that spent the bulk of their money on fundraising, as opposed to direct political action, are nonetheless effective, because the fundraising itself can educate voters and build momentum behind a candidate. Carson’s prolific presence in the inboxes and mailboxes of Republican primary voters, they argue, has raised his profile in the crowded Republican field.

In addition to its direct fundraising efforts, the National Draft Ben Carson Committee has spent money directly to drum up support for a Carson candidacy, including buying radio ads, staffing booths at conservative conferences and paying for electronic billboard advertising in Iowa.

Much of the fundraising expenses for the group went to companies affiliated with Bruce Eberle, a powerhouse in conservative direct marketing. Jim Newberry, a senior copywriter at Eberle Associates, explained one of the appeals of Carson to TIME last year. “A black candidate has an advantage in raising money from direct-mail donors,” he said. “There’s nothing they love more than a black candidate who agrees with them on conservative views.”

In the latest national poll by Fox News, Carson polled at 9% among self-identified Republicans, about the same as Rand Paul, Jeb Bush and Mike Huckabee. Mitt Romney, who took himself out of the race on Friday, polled at 21%. An Iowa poll released Sunday by the Des Moines Register and Bloomberg Politics found that Carson also had 9% of likely Republican votes in the first caucus state. Wisconsin Gov. Scott Walker led with 15% of Republican support.

On his last swing through Iowa, Carson said he had not yet made a final decision on launching a presidential campaign. “Still considering it very, very carefully,” he told reporters. “I have a surgical personality, which means you have to dot all the I’s and cross all the T’s.”

The original version of this story was updated to clarify Newt Gingrich’s relationship with American Legacy PAC.

TIME Campaign Finance

How National Kingmakers Flooded State Elections With Cash

New Jersey Governor Chris Christie gives the annual State of the State address on Jan. 13, 2015 in Trenton, New Jersey.
Andrew Burton—Getty Images New Jersey Governor Chris Christie during his State of the State address on Jan. 13, 2015 in Trenton, New Jersey.

The top 50 contributors spent more than $440 million in 2014 races.

If money is influence, the Republican Governors Association wielded more of it than anyone else last year in state elections nationwide.

The group, led in 2014 by New Jersey Gov. Chris Christie, gave roughly $69 million to candidates, political parties and independent groups — more than double its Democratic counterpart — as it tried to elect Republicans to the top office in as many states as possible. The group gave more than any other donor to state-level elections last year — from races for governor to legislator to supreme court justice.

The association applied an effective strategy that’s becoming more common: giving money using multiple paths to circumvent limits on campaign contributions to candidates and parties, a Center for Public Integrity analysis has found.

In addition to the money it spent directly on TV ads and other campaign efforts, the group gave about $14 million to candidates including Illinois’ new Republican Gov. Bruce Rauner. It also gave more than $3 million to state parties, including those in Texas and Maine.

The bulk of the checks it wrote, however, totaling about $50 million, went to other political groups that in turn spent the money on state races.

Its efforts largely paid off. Republicans gained four governorships in 2014 and only lost two, leaving them holding the reins in 31 states.

The group “was designed to supplement what candidates could do on their own in the states,” said Dick Thornburgh, a former Pennsylvania governor who turned the association into a powerhouse in the mid-1980s. “Obviously, it’s grown beyond that.”

Its competitor, the Democratic Governors Association, gave $32 million and ranked second among the sugar daddies of 2014, according to the Center for Public Integrity’s analysis. The group only picked up one new governor’s mansion, with Pennsylvania’s Tom Wolf defeating incumbent Republican Tom Corbett. (Alaska’s Republican incumbent was beaten by an independent, Bill Walker.)

Together, the two governors’ groups and other national political organizations gave significantly more than political parties, unions, multimillionaires or corporations that also contributed heavily to influence state-level campaigns. The donations went beyond races for governor. The funds made their way into lower-ballot contests such as attorney general, state supreme court justice and state legislator.

The national groups also cropped up on the lists of the biggest donors in most states, outgiving homegrown political players in a sign that all politics may now be national.

In all, the top 50 political givers spread more than $440 million to the people and groups pushing candidates for state office, the Center for Public Integrity found. The list is thick with billionaires such as former New York City Mayor Michael Bloomberg, unions such as the American Federation of Teachers and corporations such as telecom titan AT&T Inc.

They also were more successful in backing winners than most donors, becoming the de facto kingmakers of state politics.

“It’s an amazing amount of power concentrated in a handful of organizations,” said Ed Bender, executive director of the National Institute on Money in State Politics that collected some of the data used for the analysis. “If people want to understand why government is dysfunctional, you don’t have to look much farther than this list.”

The Citizens United effect

To identify the kingmakers, the Center for Public Integrity looked at donations given to 2014 state candidates and political parties during 2013 and 2014, as tracked by the National Institute on Money in State Politics. Reporters also collected state and federal contribution records for 140 independent organizations that aired political TV ads during 2014 state elections.

Related: Meet the Top 50 Donors Who Influenced State Elections

The analysis does not include funders of groups that don’t disclose their donors to any state or federal agencies — so-called “dark money” groups. And it does not total overall contributions, because some donors received money from other donors on the list. [More details on the methodology.]

The findings paint a picture of independent groups playing a bigger role in financing state-level elections than even political parties or the candidates’ campaigns, one effect of the landmark U.S. Supreme Court case Citizens United v. Federal Election Commission. The 2010 ruling allowed many groups to accept and spend unlimited amounts of money from corporations, unions and wealthy patrons to influence elections as long as they did not coordinate with the candidates. Thus, they could bypass limits on giving to a candidate or political party and leapfrog ahead.

The top 50 donors identified by the Center for Public Integrity gave more than 40 percent of their contributions to independent political groups, surpassing what they gave to either candidates or political parties.

The strategy allows donors to multiply their influence, said Larry Noble, former general counsel of the FEC who now works as an attorney at the Campaign Legal Center.

“You give the maximum to the candidates, but then you want to give more,” he said. “You give to the party committee that’s also going to support the candidate. You give to outside groups that are also going to support the candidate.”

The mega-donors thus control more of the political messages that determine which issues are central to the campaign — roles previously played by candidates and political parties. And in exchange, they may expect the newly elected officials to dance with the ones that brought them.

Behind the curtain

National political groups have their own heavy-hitting donors. But because the groups function as the middlemen of political giving, voters often don’t know the original source of the cash behind a politician’s election.

The Republican Governors Association, for one, served as a conduit for billionaires and corporations looking to influence governors’ races.

The five largest contributors behind the group’s gargantuan giving power all appear separately on the Center for Public Integrity’s top 50 donor list: Las Vegas casino magnate Sheldon Adelson; billionaire David Koch, who runs the Kansas-based Koch Industries with his brother; electricity giant Duke Energy; investment firm ETC Capital, whose founder, Manoj Bhargava, also founded the company behind the 5-Hour Energy drink; and billionaire hedge-fund manager Paul Singer, according to IRS records from 2013 and 2014.

Meanwhile, four of the five largest contributors to the counterpart Democratic Governors Association were also familiar names from the top 50 list: Michael Bloomberg and branches of three labor unions — the American Federation of State, County and Municipal Employees, the National Education Association and the Service Employees International Union.

The Republican and Democratic governors’ associations employ another common strategy that both amplifies and obfuscates their giving: contributing to “an outside group with a good-sounding name” to make support of a candidate look more diverse and to help attract different constituencies, Noble said.

For example, state records collected by the Center for Public Integrity show that the Democratic Governors Association gave more than $6 million to a group called Making Colorado Great, while the Republican Governors Association gave nearly $5.5 million to Grow Connecticut. The Colorado and Connecticut organizations then spent millions airing TV ads in their states’ respective gubernatorial contests.

“It’s name branding,” Noble said. “If you were a teacher and you see an ad from a teachers union, you’re going to give it a lot more credibility than an ad from the DGA.”

Diverse giving becomes trendy

All but a handful of the top 50 mega-donors used more than one avenue to spread their gifts. And most gave money to influence races in more than one state.

Billionaire hedge-fund manager Kenneth Griffin, for example, gave more than $4.6 million before the election to the campaign committee of Rauner, the Illinois Republican gubernatorial candidate, according to data from the National Institute on Money in State Politics.

Worth about $5.5 billion, according to Forbes, Griffin and his soon-to-be ex-wife Anne also gave at least $2.2 million to independent political groups that backed state candidates, such as the Republican Governors Association, and more than $500,000 to state GOP parties in Illinois and Florida.

A representative for Griffin declined to comment.

Some of the top donors also gave widely. Sixteen of the top 50 contributors gave to 50 or more state-level candidates running in 2014.

Getting what they paid for

Nearly 85 percent of the candidates backed directly by the top 50 donors won their elections in 2014, a far better success rate than the typical political contributor, who backed winners only 52 percent of the time.

Duke Energy, for example, had a 94 percent success rate after supporting 381 different candidates.

For corporations, in particular, political giving is a way to ensure a seat at the table once a lawmaker is elected, said Loyola Law School Professor Justin Levitt. Giving across the aisle improves their odds of having an ally in office come January.

“They’ll give to the incumbent and also the challenger just in case the challenger wins,” Levitt said. “They’ll give more to leadership positions because leadership positions are gateways to access for committees, for legislation, for broader regulation.”

Mass media giant Comcast picked winners in 93 percent of the more than 1,000 candidates it backed. It gave nearly $1.7 million directly to candidates, spreading it widely in 36 states.

“The contributions that the company makes are because we operate in a highly regulated industry,” said Comcast spokeswoman Sena Fitzmaurice, adding that most candidates backed are incumbents. “The decisions that are made by legislatures control our business.”

In addition to its national giving, the Philadelphia-based Comcast gave heavily in its home state. Top recipients were Gov. Tom Corbett and running mate Jim Cawley, both Republicans, who together raked in $107,000 from the state’s top broadband provider but lost re-election. Hedging its bet, Comcast also gave $1,000 to Wolf, who won the governorship from Corbett.

Duke Energy, another company regulated by states, divvied up more than $500,000 among the hundreds of candidates it backed, many of whom ran for office in North Carolina, where the company is headquartered.

Additionally, the electric utility donated more than $210,000 to the Republican Party of Florida, according to the National Institute on Money in State Politics. Duke Energy may have been trying to boost its support in the Sunshine State, where it has faced massive criticism for charging customer fees for nuclear plants that do not — and may never — provide power. Florida’s governor and legislature are responsible for naming the members of the commission that regulates the utility and allows such fees.

“We do not make contribution decisions on single issues,” Duke Energy spokesman Chad Eaton said. “Our employee-led PAC considers an array of issues before any decisions are made.”

In general, he said, Duke Energy donates to candidates who demonstrate “support for public policy issues that are important to our business, customers and communities” in the six states where it provides electricity.

The International Brotherhood of Electrical Workers, meanwhile, gave nearly $2.7 million to 568 candidates in 34 states and had a 64 percent win rate. It contributed more than half million dollars to Democrat Pat Quinn’s failed bid to retain the Illinois governorship, but saw more success with the $410,000 it gave to Wolf’s successful run for governor in Pennsylvania. In both states, the Republican opposition had supported scaling back public pensions or preventing unions from deducting union dues directly from members’ paychecks.

Money does not always guarantee a win, of course, and a lack of funds doesn’t necessarily foretell a loss.

In Maryland’s governor’s race, former Lt. Gov. Anthony Brown, a Democrat, outraised Republican Larry Hogan several times over yet lost in one of the biggest upsets of election night. Brown was hurt by low popularity ratings that no giant war chest could fix, according to Todd Eberly, a political science professor at St. Mary’s College of Maryland. And because Hogan accepted public funds for his campaign, he was limited on how much money he could spend yet also freed up to spend time on the campaign trail, not the fundraising one.

And some of the top benefactors saw little return on their campaign investments.

Billionaire physicist Charles Munger Jr., son of the Berkshire Hathaway executive of the same name, gave nearly $300,000 to 45 Republican candidates in 2014. Only 13 won for a 29 percent success rate.

The nation’s largest teachers union, the National Education Association, also fared poorly when backing candidates directly — only three of their 13 candidates won.

Allies in office

Most of the more than 6,300 state officials elected in November began work this month, shaping and creating policy across the country in 50 governors’ mansions and 99 legislative chambers — 11 of which flipped from Democratic to Republican control in the 2014 election.

For some big donors, that means the candidates they backed can now fight for their causes in state office. Or they might just be more willing to take a phone call from a benefactor who has a legislative wish list.

Noble said candidates typically know which donors they have to thank for their success — even when patrons filter their donations through independent groups.

And now, for some top givers, the real campaigning is about to begin.

Rauner, the newly sworn-in Republican governor, for one, is already gearing up for battles with the veto-proof Democratic-controlled legislature in Illinois as he pushes his stated goals of plugging the state’s budget deficit and strengthening ethics laws. He isn’t just counting on good will or smooth talking to win over potentially reluctant legislators. He’s counting on cold, hard cash to help make the case.

Rauner and two top donors, Griffin and shipping supply magnate Richard Uihlein, poured $20 million into the governor’s campaign committee in the final two days of 2014, which Rauner reportedly plans to use to back other candidates who support his policies.

Rauner’s new war chest will enable the new governor to be in a state of “perpetual campaign” — to air commercials aimed at persuading state legislators or to donate to other lawmakers’ re-election campaigns in exchange for support of Rauner’s agenda, said Christopher Mooney, director of the Institute of Government and Public Affairs at the University of Illinois, Springfield.

In the past, a governor might have promised state legislators financial backing for development projects in their districts or helped them acquire contracts or new jobs.

“Instead of building somebody a playground in the school, he’ll be able to donate money to their campaign,” Mooney said.

And if they don’t do want he wants? “He’ll be able to fund an opponent,” he said.

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