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Donors gave a House candidate more than $8 million. A single firm took nearly half of it.
U.S. House candidate Kim Klacik walked onto Mike Huckabee’s cable talk show last August as the latest conservative celebrity, riding high on a viral campaign ad that had attracted 10 million views and was shared on social media by President Donald Trump and his eldest son.
“We raised close to $2 million,” the Republican congressional hopeful said of the three-minute spot, which showed her marching in a red dress and high heels past abandoned buildings in Baltimore, asserting that Democrats do not care about Black lives.
But later that night, Klacik’s staff told her it would be best to stop disclosing how much money the ad had raised for her campaign against Rep. Kweisi Mfume (D) — because she wouldn’t be keeping much of it, Klacik recounted in an interview.
The company that produced the video, Arsenal Media Group, would take a cut. And a firm hired to promote the video, Olympic Media, would keep up to 70 percent of the money it generated, some of which was not disclosed in Klacik’s initial campaign finance filings.
Klacik, a self-described college dropout who launched a nonprofit organization to help disadvantaged women before running for office, said she did not personally approve or know about the contract with Olympic Media until that conversation.
“When I saw it, I almost passed out,” she said.
Klacik reported paying millions of dollars to WinRed that actually went through the donation processor to other vendors. Stewart and a WinRed spokesman confirmed the error. Other Republican candidates, including Lacy Johnson and Rep. Jim Jordan (Ohio), also misreported expenses paid to vendors, WinRed said.Both the Klacik and Johnson campaigns said they are amending their filings. Jordan's campaign, which also hired Olympic Media for digital services, did not respond to a request for comment.
WinRed said in a statement that it “proactively insists that campaigns report fees accurately” to the Federal Election Commission and that it is “the responsibility of each campaign to manage their own agencies and their own FEC compliance.”
Stewart called the arrangement with Olympic the “price of doing business.” He said Olympic — which also worked for North Carolina Republican Madison Cawthorn, who won his House race — fit with the campaign’s insurgent brand and “did good work for us” by repackaging the Arsenal video.
But although Klacik said she thought Arsenal’s fees were fair, given the company’s creative work, she took issue with Olympic’s digital marketing rates.
“Whoever’s over there is making a killing,” she said.
Once campaigns have the donors’ names, email addresses and phone numbers, they can seek repeat donations and keep 100 percent of the proceeds. But if a candidate takes off as a national fundraising target, as Klacik and Lacy Johnson did, the share of the money collected by the fundraisers spikes as well.
“If you’re a candidate who doesn’t have money, that makes sense,” said one GOP consultant, speaking on the condition of anonymity to protect the identity of his clients. “It’s just that, ultimately, the campaigns aren’t paying for it. The donors are.”
Suzanne Salata, who is active in Republican politics in San Jose, Calif., researched Klacik and gave her $500 after seeing her initial viral video on Fox News.
“I knew she was a long shot, but I felt it was worth investing in her,” said Salata, who also donated to Lacy Johnson and other GOP hopefuls.
But Salata found it “ridiculous” that companies would take a sizable cut of a candidate’s fundraising money. “Like at a nonprofit, if their overhead was 40 or 50 percent, you wouldn’t give to them,” she said. “It’s not exactly apples to apples. But I’ve never heard of a kickback like this [in campaigns].”
Greg Ruggles of Bettendorf, Iowa, sent Klacik $100 after stumbling onto her Baltimore campaign ad. He said he felt a little “duped”after learning that a large chunk may have gone to a vendor.
“If you’re giving money to a cause,” he said, “you want it to go to the cause, not to the company creating the ad.”
In the future, he added, “I’ll certainly be more cautious about my donations.”