- One of Eric Trump's top deputies played an important role overseeing the Trump campaign shell company that spent $617 million during the 2020 presidential race, sources told Insider.
- In one instance, the Trump campaign paid an extra 2% fee on all ads aired from a firm tied to its chief strategist, Jason Miller, Trump advisors told Insider.
- But much of the spending made through American Made Media Consultants remains a mystery, according to Trump advisors and an Insider analysis of Federal Election Commission records.
- The Trump campaign may have violated federal election laws with the arrangement. A trio of Democratic lawmakers have asked the FEC and the Justice Department to investigate, and a campaign watchdog filed a civil complaint with the FEC.
- Visit Business Insider's homepage for more stories.
The Trump campaign shell company that helped hide $617 million in 2020 presidential-campaign spending was almost exclusively a Trump family production, run in part by a top deputy to Eric Trump, Insider has learned.
That Eric Trump deputy, the attorney Alex Cannon, worked closely to run American Made Media Consultants with President Donald Trump's son-in-law Jared Kushner, daughter-in-law Lara Trump, and former campaign manager Brad Parscale. Together, they built a campaign shell company so powerful and opaque that key Trump campaign aides feared what they might uncover if they learned too much about its operations, according to interviews with more than a dozen Trump advisors and Republicans close to the campaign.
Vast swaths of AMMC's spending still remain a mystery to the public and Trump's own campaign team, though Insider was able to uncover some of American Made Media Consultants' expenditures from interviews and public documents filed with the Federal Election Commission.
The power and secrecy of the shell company has spurred calls for federal investigations, including requests filed by three Democratic lawmakers after Insider broke the news last week of Kushner and Lara Trump's involvement.
The AMMC shell company was originally created by the Trump children and Parscale as a means to protect Trump from exorbitant consultant fees and accusations of grifting, many of which had been levied at Parscale for his dual role running the campaign and approving payments to himself, the Trump advisors told Insider.
But as the campaign evolved during 2019 and into the 2020 sprint, AMMC was also used to make secret payments to Lara Trump and Kimberly Guilfoyle, the girlfriend of Donald Trump Jr., who doubled as the Trump campaign's national finance director.
It also facilitated large payments — not disclosed publicly — to top campaign strategist Jason Miller, through an arrangement with the campaign firm he worked for before joining the Trump campaign.
Now with Trump's loss clear to almost everyone except Trump, the campaign shell company has become a focal point for advisors lamenting what went wrong. Behind the scenes, competing factions in Trumpworld have been accusing each other of stealing from the president's campaign coffer via the shell company.
Insider broke the news Friday that Kushner helped create AMMC and picked Lara Trump and Vice President Mike Pence's nephew John Pence to serve on its board — facts unknown even to core Trump campaign operatives. Lara Trump is married to Eric Trump.
"The obfuscation raises so many questions," one Trump advisor said.
Whether Trump officials broke the law or will face any consequences remains to be seen. Any criminal charges would have to be decided on by prosecutors reporting to President-elect Joe Biden's Justice Department. Biden's transition team did not respond to requests for comment.
Shortly after Insider published its first exposé on American Made Media Consultants, Democratic Reps. Ted Lieu of California and Kathleen Rice of New York requested the FBI and Federal Election Commission investigate the Trump campaign and shell company for what they considered possible violations of civil and criminal campaign laws. They specifically cited laws barring the spending of campaign cash for personal use and requiring public disclosure of payees.
The shell company could incur upward of a billion dollars in fines because it was acting as a campaign committee without filing required disclosures, Rep. Mark Pocan, a Wisconsin Democrat, wrote Wednesday in a letter to the Justice Department and FEC seeking an investigation of AMMC. Such a fine, however, would be unprecedented.
At a basic level, the Trump campaign's use of AMMC means the public — including Americans who together made millions of small-dollar contributions to Trump's reelection effort — has no clear idea how the Trump campaign and a sister committee spent about half of the $1.26 billion it raised since Trump began running for reelection on the very day of his 2017 inauguration.
"I don't think people stole money with it, but I do think it was used to conceal payments to people who didn't want to show up on reports," a second Trump advisor said of AMMC. "It was nothing illegal. But unseemly? Yes."
But other Republicans close to the Trump campaign said the shell company and the hiding of payments feels like Trump family members may have crossed a line.
"With Trump it's all about him and money and everyone around him took it to the Nth degree," said another Republican close to the Trump campaign. "It's truly a criminal enterprise."
A family enterprise
When Kushner and Parscale created AMMC in April 2018, they picked Lara Trump and John Pence for the board. Both were gone by late 2019.
John Pence's removal came at a time during the presidential campaign when Kushner and Ivanka Trump, the president's daughter, had soured on the vice president's nephew.
Parscale, Kushner and their allies were also freezing out the vice president's closest aides in the summer and fall of 2019. Trump advisors saw that move as removing a Pence loyalist and family member from some of the campaign's most sensitive operations.
But when Lara Trump quit the board, Trump advisors familiar with AMMC did not assume her power had waned. Rather, they saw the appointment of Alex Cannon to fill Lara Trump's position on the board as proof that Eric and Lara Trump were exercising more control over the operation.
Months earlier, Eric Trump had dispatched Cannon, one of his deputies at the Trump Organization and an understudy of longtime Trump company lawyer Alan Garten, to his father's reelection campaign, Trump advisors told Insider.
With Cannon on the AMMC board, those same advisors saw an Eric and Lara Trump loyalist enjoying a place of significant power within the president's political machine.
Cannon declined comment when Insider reached him on Tuesday. A Trump campaign spokesman said that Eric Trump had nothing to do with AMMC.
"Eric Trump had no involvement in the creation or operation of AMMC. No member of the Trump family was compensated by AMMC. The campaign reports all of its expenditures to the FEC as required by federal law," Trump campaign communications director Tim Murtaugh said in a statement to Insider.
A web of vendors and sub-vendors
The federal government could force the Trump campaign — and all political committees — to publicly reveal more about the true recipients of their spending than they do now.
But as is often the case with Congress and the FEC, change happens slowly, if at all.
Current federal law governing political spending disclosure is "broad enough to enable the FEC to enact regulations that would require the disclosure of vendors and sub–vendors, and ultimate payees," said former FEC Chair Ann Ravel, a Democrat who served on the commission from 2013 to 2017.
One way or another, disclosure of political sub–vendors and beyond should be compulsory to both guard against domestic shenanigans and disable a "mechanism to launder foreign contributions and expenditures," Ravel said.
Bradley Smith, a former Republican FEC chair who served from 2000 to 2005, concurs — to a point. While the FEC itself could more clearly define spending disclosure requirements without Congress changing the law, it probably couldn't do so in "a shotgun approach."
"If the campaign hires a vendor to produce ads, and that vendor pays various subcontractors — writers, cameramen, etc. — I'm not sure you can or would want that reporting," Smith said. "The big problem is practical — how do you define all the expenditures and purposes?"
While the FEC may be able to require some enhanced spending disclosure, "statues carry more weight," said Mike Sullivan, a campaign finance expert who served five terms as director of the Massachusetts Office of Campaign and Political Finance.
Without more legal clarity, "the worst case scenario is a kickback to someone in a campaign without the public knowing about it," said Sullivan, who urged Congress to address the issue in 2021.
FEC spokesperson Judith Ingram said her agency cannot "comment on pending or potential enforcement matters," and a DOJ spokesperson declined to comment.
In a related matter, Congress' veto-proof National Defense Authorization Act that Trump has yet to sign would require anonymous shell companies — including limited liability companies such as American Made Media Consultants — to disclose their real owners to the US Treasury Department.
On the afternoon of January 20, the Treasury Department will fall under Biden's control.
Where did all the money go?
"So who spent the other $1 billion? It wasn't me," Parscale tweeted on Monday, pasting a photo of a spreadsheet of his budget for the Trump campaign.
Parscale's re-emergence in public over the past month, after a dramatic fall from grace in October, has tipped off a war behind the scenes to assign blame for Trump's loss. But the answer to the larger question Parscale posed is still something of a mystery.
In some ways, AMMC was a positively normal campaign operation for a major presidential re-election effort. It spent large amounts of money on advertising and seemed to pay below-market rates for some commissions to GOP ad firms.
The Trump campaign, along with its joint political venture with the Republican National Committee, publicly reported payments to AMMC using the broadest of descriptions.
The largest class of payments to AMMC went toward "placed media," which in political parlance typically means television advertising. Total tab: $250 million, an Insider analysis of FEC spending data indicates.
Next came "online advertising" and related services at nearly $237 million, followed by SMS advertising — text messages and such — at about $72.6 million. That includes about $2.2 million earmarked for recount-related messaging, according to FEC records.
AMMC also spent nearly $32 million on "digital list rental" and related services.
One glaring omission: Texas-based mobile application company Phunware appears nowhere in the Trump campaign's public spending disclosure reports.
That's despite Phunware, in a case study document this month discovered by Insider, saying it forged a "strategic relationship" with AMMC on the "development, launch and ongoing management and evolution" of Trump campaign mobile apps. Phunware said it sent about 42.6 million push notifications to users of the Trump campaign apps it developed and also credited its products for driving 166,535 users to the Trump campaign's donation page.
Where AMMC's money went from there is still largely a secret closely guarded by a small group.
The Trump campaign's TV ad-buying firm, National Media, charged a 1.9 percent fee for buying airtime across the country, according to Trump advisors familiar with the arrangement. The fee is considered reasonable by Republican consultants who spoke with Insider for this story. The Trump campaign approved the ad spending, transferred the money to AMMC, and AMMC paid National Media.
The ads, however, didn't always cost the campaign just a 1.9 percent commission. Whenever Jamestown Associates, where Jason Miller worked for years before joining Trump, made an ad it collected a video-production fee — and also an additional 2-percent commission on every one of its ads that aired, according to Trump advisors familiar with the arrangement.
Combined, the Jamestown ads ended up costing the campaign a 3.9 percent commission: 1.9 percent for National Media to buy the airtime and an additional 2 percent commission for Jamestown when it aired.
In addition to the commission, Jamestown also charged the Trump campaign $35,000 a month to pay for Jason Miller's campaign salary, according to Trump advisors familiar with the arrangement.
Miller did not return requests for comment from Insider. But one Trump advisor said they didn't see anything wrong with the arrangement, in part because it was well-known inside the campaign and nobody tried to hide it internally.
The Trump campaign never publicly disclosed Miller's campaign salary, just as it did not disclose the salaries of Guilfoyle and Lara Trump. Miller's salary is significantly higher than what the Trump campaign paid any other campaign staffer among those whose salaries are publicly disclosed, such as communications director Tim Murtaugh and chief strategist Michael Glassner, who each earned a paycheck of just under $10,500 every two weeks.
By contrast, the nominal president of the Trump campaign shell company, Trump campaign chief financial officer Sean Dollman, was paid directly by the Trump campaign in publicly available payments disclosed to the FEC. Trump advisors who spoke with Insider said Dollman wasn't calling the shots on how to run the shell company. Instead, it was Trump's family, deciding what would route through AMMC, the advisors said.
That's the spending Insider could identify through interviews and public records. The rest of the money spent through AMMC is, as one Trump advisor, a "black hole". The campaign brass knew who was getting the other $367 million from the AMMC pie.
The Trump campaign reported the broad categories of spending. But where it went from there was sometimes a mystery — even to people who worked there. Many of Trump's top advisors told Insider they didn't mind not peeling back the curtain on how Trump's family oversaw millions of dollars in spending.
"The campaign leadership made a decision that looking in the past made zero sense," said a third Trump advisor. "There was zero sense or necessity in looking backward."
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