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Celeste Maloy

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via: theguardian.com

‘Dark money made darker’: funding labyrinth conceals donors to Republican campaigns

One man’s campaign finance operation in Wisconsin exemplifies the opacity of the US political funding system

In the summer of 2024, a non-profit called the Green Dragon Coalition wired the last $20,000 of a $445,000 grant to a Super Pac. Its tax return for that year would describe the purpose of the transfer as “educational”.

The same day, according to Federal Election Commission (FEC) records, the Super Pac spent $8,000 attacking Celeste Maloy, the Republican congresswoman for Utah’s second district, four days before the primary that would decide whether she kept her seat. It had already spent more than $400,000 promoting her challenger, Colby Jenkins, who was running to her right with the endorsement of the rightwing Utah senator Mike Lee.

One man was involved at every stage, and his name is on the paperwork for the charity that raised the money, the non-profit that passed it on, the Super Pac that the non-profit donated to and the campaign this money eventually supported.

His name is Thomas Datwyler, and his businesses are mostly headquartered in a rented address in Hudson, Wisconsin, a town of 15,000 near the border with Minnesota. Datwyler operates at an industrial scale, acting as treasurer of more than 350 federal political committees in the current election cycle, including 115 congressional campaigns and 100 Super Pacs, and as an officer of more than two dozen non-profits.

The extent of Datwyler’s activities over several political cycles raises questions about the attitude of Republican campaigns and candidates to campaign finance in the run-up to the November midterm elections, and the evolution of so-called “dark money” electoral funding.

Across the 2024 and 2026 cycles, Super Pacs whose books Datwyler also keeps have spent more than $2m supporting 14 candidates that are also his clients, or attacking their opponents, according to FEC filings. In several of those races the money reached the Super Pac through charities and social welfare groups for which he is a treasurer.

Datwyler-tied groups have been funded by donors connected to the rightwing megadonor Leonard Leo, along with the Conservative Partnership Institute and the personal foundation of the Claremont Institute’s board chair, the Thomas Klingenstein Fund, among others.

Money raised from these conservative donors has gone into organisations that Datwyler runs the books for, and those organisations have passed money on to Super Pacs that spent in Republican primaries. Non-profit tax filings do not show which donors’ funds made up any particular onward transfer.

Along the way, the same firms are paid by both the campaigns and the groups that are legally required to be independent of campaigns in order to maintain their tax-exempt status. In Florida’s 19th district, a campaign and the supposedly independent Super Pac backing it share 14 vendors, according to FEC filings.

Federal law prohibits coordination between Pacs and campaign committees, but proving it is challenging. The FEC is a reluctant cop, and while Datwyler has attracted significant controversy and state-level investigations, what he does may not be illegal.

“Somebody in Datwyler’s position is well aware of where all the cracks and crevices in the system are, how to sort of exploit the rules in a way that maximises his clients’ ability to secretly influence elections,” says Saurav Ghosh, director of federal campaign finance reform at the non-profit Campaign Legal Center.

“There’s a reason why the same handful of people – and Datwyler’s probably the chief among them – tend to come up in connection with these dark money operations. It’s because they have the knowhow of how to do it. And they’re willing to be the public face on each of these entities.

“The actual donors providing the money don’t want to be publicly outed as the source of the outside money pouring into the race.”

Datwyler wrote to the Guardian that “AxCapital [where he is CEO] is grateful that so many clients entrust our team to facilitate their participation in the democratic process. As an industry leader, we have strict internal firewalls, strong safeguards, and robust policies to ensure full compliance with all laws, regulations, and requirements.”

The Green Dragon entities exemplify a pattern that recurs across Datwyler’s network.

The Green Dragon Coalition is a 501(c)4 social welfare non-profit, and one of three entities registered in Delaware in 2023 with sequential IRS employer numbers, all listing the same address in Hudson, Wisconsin. The other two were the Green Dragon Society, a 501(c)3 charity, and the Constitutional Conservatives Fund, a Super Pac.

Datwyler is treasurer of all three, and is the only officer that any of the organizations pay: the Green Dragon Coalition paid him $25,012 during the 2024 cycle and the Green Dragon Society paid him $29,066.

This is just a fraction of the compensation Datwyler has received across various arms of the political operation he works on. Tax filings indicate that he received at least $487,545 in the 2023-2024 cycle from non-profits. FEC filings indicate that during the last two election cycles at least $793,470 flowed to Datwyler directly, or to two Delaware-registered consultancies, 10Six Consulting and Same Day Processing, that share a Wisconsin address with the vast majority of his political and charity organizations.

Meanwhile, AxCapital, where Datwyler is CEO, brought in $4.9m across both cycles. AxCapital was created in a 2022 merger of HenryAlan and Datwyler’s 9Seven Consulting.

The Green Dragon Coalition’s $445,000 “educational” grant to the Constitutional Conservatives Fund in 2024 is recorded in the Pac’s FEC receipts in five payments between 15 March and 21 June 2024. In turn, the Pac spent $447,347 supporting Jenkins. Datwyler was also treasurer of Colby Jenkins for Congress, a role he had held since October 2023, and of the candidate’s joint fundraising committee. Datwyler is therefore keeping the books for the charity, the social welfare group, the Super Pac attacking the incumbent and the campaign it was attacking her on behalf of.

The Green Dragon Coalition’s 2024 revenue was $917,002, of which $750,000 – or about 82% – came from the Concord Fund, the Leonard Leo-network group formerly called the Judicial Crisis Network. The Green Dragon Society, a 501(c)3, also took $250,000 from Purple Action, a 501(c)4 whose officers include tech mogul and former Trump administration “crypto czar” David Sacks, and $200,000 from the Conservative Partnership Institute, and $90,000 each from “dark money” vectors DonorsTrust and Fidelity’s donor-advised fund. The Thomas D Klingenstein Fund gave the 501(c)3 $75,000 in 2023, before the 2024 payments to the Super Pac.

Lawson Bader, the president and CEO of DonorsTrust, said the organisation was “unfamiliar with the Constitutional Conservatives Fund, and the fact that the Green Dragon Coalition has an affiliated 501(c)4”. Grants from donor-advised funds to a 501(c)3 “cannot be used for political purposes”, he said, adding that DonorsTrust “would reconsider future grant recommendations made to organizations that violate the rules governing charitable activities”.

A Fidelity Charitable spokesperson said: “Use of Fidelity Charitable grants for political contributions or campaign activities is prohibited. The terms all non-profits receive when grant funds are issued to them include explicit language to that effect.”

These are not the only money flows from major conservative funders through Datwyler-connected entities.

In 2024 American Majority Action, a 501(c)4 founded by conservative activist Ned Ryun, gave Integrity Minnesota, for which Datwyler served as treasurer, $250,000 for “voter registration and activation plans”. (A 2020 Campaign for Accountability complaint asked the IRS and two state agencies to investigate whether Ryun’s groups spent more than half their money on politics, which would violate IRS laws governing 501(c)4 groups. Campaign for Accountabili