Preventing Fraudulent Donations: Transparency, Verification, and Accountability

The Committee on House Administration will come to order. The title of today's hearing is " Preventing Fraudulent Donations, Transparency, Verification, and Accountability." I note that a quorum is present. Without objection, the chair may declare recess at any time. Also without objection, the hearing record will remain open for five legislative days. so members may submit any materials they wish to be included therein. Further, without objection, Chairman Jordan and Ranking Member Raskin of the Judiciary Committee, and Chairman Komar and Ranking Member Garcia of the Committee on Oversight and Government Reform, will wave on to the Committee on House Administration for this hearing, for the purpose of providing opening statements and questions to the witness. Thank you, Ranking Member Morelli, members of the committee, and our witnesses for participating in today's hearing. Let me also thank Chairman Jordan and Chairman Comer for joining us today in their partnership in this investigation. We believe in a principle that only Americans should decide American elections. Act Blue has violated that principle. Ms. Wallace-Jones is here today because there's a significant concern that Act Blue may have allowed foreign donations on their platform, lied to Congress, and withheld responsive documents from a congressional subpoena. All three of those actions are illegal. In twenty twenty three I opened an investigation into Act Blue, following reports that foreign actors were exploiting the platform to funnel money to a m- to funnel money to American political campaigns. As part of that investigation, I sent this letter to Act Blue, asking basic questions about its fraud prevention practices. In response, Act Blue's CEO, Regina Wallace-Jones, wrote to me in this letter, claiming that Act Blue had a robust approach to rooting out potential foreign contributions. However, according to the New York Times, Act Blue's outside legal counsel reviewed Ms. Wallace-Jones' response and found that it propo that it that it posed a substantial risk for Act Blue. Specifically, the concern was that Ms. Wallace-Jones' letters may have been false or misleading. In her letter, Ms. Wallace-Jones identified three steps ActBlue takes to prevent foreign donations. One, donors using a foreign address must provide US passport information. Two, if a contribution appears to be from a foreign address, ActBlue contacts a donor to request US passport information. And three, the contribution is refunded it if if ActBlue is unable to contact the donor. The New York Times reported that Act Blue's outside counsel determined those three steps are not always followed. In fact, outside counsel outside counsel warned that passport information was never requested for transactions made through third-party apps like PayPal and Venmo. Outside counsel also warned Act Blue that some of the funds received were impermissible contributions from foreign nationals. This committee issued subpoenas for documents related to fraudulent and foreign donations, an alleged misconduct by ActBlue staff. The documents provided by ActBlue revealed alarming directives from its leadership to lower fraud standards. In ActBlue meeting notes turned over to this committee, staff were instructed quote, remember that we that we want to look for reasons to accept contributions. Do not reject contributions for a single suspicious characteristic. Look for the forest and not the trees." According to those same notes, ActBlue staff was told that this guidance was " a bit antithetical" to prior feedback about contributions deemed " highly suspicious". Further, an ActBlue memo titled " Fraud Prevention One O One" for new associates in the workflow advises that " If an otherwise legitimate donor uses a fake name, we would want to accept their donation." We have additional evidence of Act Blue detecting at least twenty-two significant fraud campaigns. Nine of those fraud campaigns had a foreign nexus. After receiving this information, we disp- deposed and interviewed five former Act Blue employees. When deposed, Act Blue employees refused to answer a single question. Instead, they invoked the Fifth Amendment one hundred and forty-six times. We gave ActBlue employees an opportunity to answer our questions, but they refused. But now, Ms. Wallace-Jones, you have a real opportunity to explain how this occurred. Ms. Wallace-Jones agreed originally agreed to appear voluntarily before us this morning. But late Monday afternoon, her lawyers requested a subpoena in order for her to appear. A subpoena was provided. Ms. Wallace-Jones is now before us. I look forward to your answers to our questions. Congress and the American people deserve the truth. With that, I'll now yield to the ranking member, Mister Morelli, for the purpose of his opening statement.

Thank you uh, Mister Chairman. The integrity of our democracy depends on the integrity of a campaign finance system. Corruption in campaigns yields corruption in government. When corporations and billionaires can buy politicians, Americans everywhere recognize that our campaign finance system is corrupt. The proof is right in front of us. The president's campaign accepted piles and piles of dark money from corporations and billionaires while Republicans cheered him on. In fact, the nonpartisan professional staff at the Federal Elections Commission found potential campaign finance violations in thirty-two instances involving President Trump. Yet in all thirty-two, Republican FEC commissioners blocked any investigation into potential violations of law. Knowing that Republicans will shield them from accountability, the administration is awash with insider trading and self enrichment. Look no further than the one point eight billion dollar slush fund, a fund to reward criminals who assaulted Cap- Capitol police officers on January sixth. The president is trying to force on the American people. Look no further than the Republican majority which slashed health care for millions of Americans while cutting taxes for their billionaire donors. The American people understand that congressional Republicans and this administration willingly tolerate corruption when it benefits them. So it's outrageous but hardly surprising that this Republican majority has flat-out refused to investigate critical credible reports of fraud, abuse and corruption on the Republican fundraising platform, WinRed. refused to investigate Winred for facilitating documented illegal foreign contributions that flowed through Winred to President Trump's campaign. Why haven't Republicans attempted to investigate the Chinese National who reportedly contributed thousands to President Trump via Winred? According to public reporting, a Chinese businessman illegally contributed five thousand dollars to the Trump campaign in twenty twenty four. What do House Republicans have to say about this corruption? Not a word. deafening silence. And it doesn't end there. Public reporting shows that Winred quote " victimized hundreds of elderly Americans and misled those battling dementia." And an examination of Trump campaign accounts shows that numerous donors listed their address as nine nine nine anonymous drive when contributing to the president. That is clear evidence of fraud. Those donors could be foreign nationals. These donors possibly committed crimes. But House Republicans have done nothing to investigate that. The cost of corruption is real. It hurts Americans in so many ways, including their bank accounts. But President Trump simply does not care about regular Americans. Don't believe me? Take him at his word. The President conceded just last month he doesn't think about the financial pain of American citizens. Yet House Republicans will do anything to protect him, even as gas and grocery prices skyrocket, as our economy crumbles and Americans lose faith, in their ability to achieve the American dream. Republicans won't investigate the clear pattern of fraud and criminality on Wind Red, precisely because the fraud benefits Donald Trump, because the money goes to the Trump campaign and to other Republican campaigns. Republicans' investigation today is not about safeguarding American elections. It's not about protecting American voters. It's about punishing enemies of the president and shielding his allies. And this all fits a pattern. Just look at this corrupt DOJ's vindictive, politically viol- motivated prosecutions, which have been repeatedly thrown out of court. Just look at the President's attempted slush fund for insurrectionists and criminals, for people who violently attacked police. The corruption is visible to everyone, but Republicans refuse to do anything to end it. So, owing to the majority's dereliction of duty, House Democrats have stepped into the gap. We sent a letter asking the Treasury Department for information related to financial irregularities on WinRed. We sent a letter to the Federal Trade Commission seeking information on allegations of fraud and abuse on WinRed. The Trump administration stonewalled both requests. We sent letters to the Republican Attorneys General of Virginia and Texas, seeking information on potential crimes committed by WinRed. Neither responded. So this morning, we sent a letter to WinRed asking for information related to foreign contributions and fraud on their platform. Critically, our letter made it clear that WinRed must retain all information relevant to future investigations into fraud, abuse or criminality on behalf of WinRed. When there is clear evidence of fraud, deceptive fundraising methods or potential foreign contributions in American elections, Congress has a duty to investigate. House Republicans have not taken that duty seriously. But next year, rest assured, committee Democrats will. The American people deserve confidence. that our elections belong to Americans, not to foreign actors, not to fraudsters, and not to special interests. That's the standard Congress should demand. It's the standard House Democrats will uphold next year. Before I yield back, I'd ask for unanimous consent to enter two things into the record. The June first letter, ranking members Raskin, Garcia and I sent to Attorney General Paxson regarding Winred and today's letter to Winred seeking documents and a transcribed interview. And with that, Mr. Chair, I yield back.

Without objection so ordered, uh I now yield five minutes to the Chairman of the Judiciary Committee, Mister Jordan, for an opening statement.

Thank you, thank you, Mister Chairman. Everything is fine. Everything is fine. We're not taking foreign contributions. That's what Miss Wallace-Jones said in November twenty twenty three, responding to a letter from the Chairman. She said, passport information is required from donors providing an address outside the United States. Quote, we have multi-layered screenings place to root out foreign contributions. She put it in le in in a letter put it in writing in a letter to Congress. Now the only problem is, ActBlue's outside counsel, as the chairman said, sent a memo to Miss Wallace-Jones where they said things were a little different than what she described to Congress. They said ActBlue's response to Congress was not entirely accurate. They said, quote, ActBlue did not have the rigor in its review of overseas donations that was required or that it described to Congress. Quote, there's a substantial risk some of the funds were impermissible contributions from foreign nationals. And ACBLU's staff was aware that its system was not as robust as necessary, making these contributions appear, listen here, knowing and willful. There's intent right there. Knowing and willful in an effort to conceal. Wow. Knowing and willful, not entirely accurate response to Congress in an effort to conceal. You know what they call that? They call that lying. So the question is who you gonna believe, the law firm or ActBlue? Now a few things to consider when you're asking, when you're evaluating that that question. That we've uncovered, the committees have uncovered, first there's just the general suspicious activity, foreign IP addresses with two hundred and thirty-seven contributions in one day. Seventeen hundred transactions in seven days where the donor's country did not match the country of the donor's IP address. That seems fishy. Second, the documents the committee obtained obtained did not square with Miss Wallace-Jones' response to Congress. We had one ActBlue uh Blue employee who uh in an email said " changes we have made over the last year have already meant we're accepting more fraud." So there was already some fraud they changed their standards so they were accepting more fraud. ActBlue board member Kimberly Peeler-Allen admitted up to quote " thirty-eight million in ActBlue contributions in twenty twenty-four had signs of a foreign origin." Third, as the chairman said, there were five people on the fraud prevention team at ActBlue who were concerned about foreign contributions and all five have either resigned, been fired, or been placed on leave. All five. The manager of the day-to-day fraud prevention, resigned. Vice president of customer service in charge of fraud prevention for twenty twenty four. resigned top lawyers at ActBlue General Counsel Darren Hurwitz fired given a hundred and seventy thousand dollar severance package as long as he didn't say anything without first checking with ActBlue Aaron Ting Associate General Counsel resigns ActBlue relie refuses to give us even though we've asked for it his resignation letter and Legal Counsel Zain Ahmad resigns after being retaliated against for blowing the whistle to the board about what was going on And as the chairman mentioned, we deposed all five of them, and every single one of them, one hundred and forty-six times, took the fifth. This is a tale as old as time. You get caught doing something wrong, and when you're questioned about it, you deny it. And when evidence emerges and questions persist, you take the fifth. Take the fifth. Now why would all that happen? Why would all that happen? Well I think there's probably three point eight billion reasons why all that happened. Three point eight billion dollars, ActBlue, took in in the twenty twenty-four election cycle. That's a lot of money. That's a lot of money. And we know that there's something going on here, and that's why the investigation persists and our investigation's different than what the Justice Department's doing, but we appreciate what they're doing too. And mostly I wanna thank this committee, I wanna thank Chairman Stile and this committee for the work they've done. But for that letter saying, we might not have figured this out. So I appreciate the chairman, the good work he's doing, and I yield back.

The chairman yields back. Uh the ranking member of the Judiciary Committee, Mister Raskins, is recognized for five minutes for an opening statement.

Thank you kindly, Mister Chairman, uh ranking member Morelli, uh for the invitation. It's great to be back here in the uh intimate quarters of the House Administration Committee. Um The hearing is called preventing fraudulent donations, transparency, verification, and accountability. That sounds like a valuable inquiry to me. The problem is that as we all know, that's not what the hearing's really about. If it were, our colleagues would have first demanded testimony from the CEO of WinRed, the fundraising platform that has generated hundreds and hundreds of serious fraud complaints from individual Americans, mostly Republicans, including a lot of elderly Americans and Americans with disabilities, who say they've been robbed, blind, hoodwinked by WinRed, in many cases fleeced out of their life savings. But the Republican chairs of our three committees have repeatedly refused to conduct any oversight or investigation into the WinRed platform that processes donations for over seventy-eight hundred GOP campaigns and committees across the United States including all the GOP senators and ninety-seven percent of GOP House members. Well, that's just not a serious approach to the problem. This hearing is really part of a political vengeance and vendetta campaign that yesterday came to the House Judiciary Committee in the form of a four-hour hearing interrogating the president of the Southern Poverty Law Center. After the twenty twenty election, banks and credit card issuers estimated that win-read fraud cases constituted as much as three percent of their total national fraud workload. across all transactions. That is a shockingly large share, given that there are a hundred and fifty million credit card transactions that American consumers and businesses engage in every single day in the country. Between January twenty twenty-two and June twenty twenty-four, the FTC received more than eight hundred complaints about Wind Red, nearly seven times the number it got about ActBlue. In the final months of twenty twenty alone, the Trump campaign, RNC and their shared accounts had to issue more than five hundred and thirty thousand refunds worth more than sixty-four million dollars that's more than eleven times the amount that the Biden campaign and the democratic committees had to refund and yet who have the administration and our GOP colleagues focused on exclusively from the beginning, ActBlue, the company that primarily processes contributions for democratic campaigns around the country. Last April the White House issued a presidential memorandum directing the AG and Treasury to quote " use all lawful authority to investigate Act Blue", which according the White House facilitated straw or dummy contributions or foreign contributions to political candidates and committees. But as Americans can see each day, every accusation by this administration is an admission, every allegation a confession, every charge a self-indictment. The arraignment of Act Blue is an admission about WinRed's continuing serious fraud against their donors. An associated press review of President Trump's political committees found more than sixteen hundred contributions from unverified donors who lived abroad had close ties to foreign interests or failed to disclose basic identifying information many of those contributions came through WinRed. AP reported that one Chinese businessman gave five thousand dollars to Trump through WinRed while listing a La Quinta Inn as his home address. Other contributions came from unnamed donors listing nine nine nine anonymous drive as their address. Another series of WinRed contributions listed the donor's address as a vacant building in Washington that turned out to be a defunct funeral home. Where is all of the righteous outrage about these abuses? Where is the mobilization of taxpayer resources to investigate Wynne Redd? Where is Attorney General Ken Paxton, who was impeached by the Texas House of Representatives for bribery, securities fraud, abuse of office and obstruction of justice? Attorney General Paxton sued Act Blue in April, but his office has ignored complaint after complaint from Texas constituents about the allegations of fraud and abuse, related to Wynne Redd. Who were the victims of Wynne Redd that Ken Paxton deliberately ignores? Well, one Texas woman tried to make uh small one-time contributions to Republican candidates, that she supported. Wynne Redd emptied more than fifteen thousand dollars out of her bank account, including charging her account twenty-nine times in one day. She wrote to Attorney General Paxton that she, quote, didn't realize they were sucking my life savings out of my bank account. He never even wrote her back. And if that's how partisan Republicans treat Republicans, you can imagine how they're gonna treat everybody else in the country. We, I, th- you don't want me to discuss these other uh complainants in Texas?

The the the gentleman's the gentleman's time has expired.

Oh. Okay.

Uh, the ranking member of the Oversight and Government Reform Committee, Mister Garcia, is recognized for five minutes for an opening statement.

Thank you, Mr. Chairman. Appreciate uh being here. And I wanna just begin by echoing of course, Ranking Member Morelle and Ranking Member Raskin. Um, look, the biggest fraud in this country that we should be talking about is happening at the White House. We're not talking about the one point eight billion dollar slush fund. We're not talking about the clear selling or influence of pardons in what's happening at the White House. We're not talking about the two billion dollars that Jared Kushner got, two months after leaving the White House for an investment fund, that's made no return. We're not talking about the possible Trump family pay to play schemes and scandals that are happening across the world as President Trump tries to do diplomacy and the Trump family follows up with real estate deals. We're here because Republicans wanna talk about Act Blue, not because they're serious about strengthening campaign finance laws or actually strengthening the abuse of fraud in this country. Now we should all support and and work to strengthen Security, prevent fraud, stop interference in foreign elections, and certainly if there are ways to improve platforms ar- across this country, public or private, that should be the focus. But if Republicans were serious about that goal, they wouldn't be exclusively focused on ActBlue. They'd also be examining the WinRed platform, with the exact same level of scrutiny. Now, a real investigation into WinRed would raise serious questions. The Trump campaign, as has been mentioned through Wind Red, has accepted thousands of contributions that reportedly lacked basic identifying information un- required under campaign finance law. Now according to reporting, President Trump received more than one thousand contributions that omitted key identifying information such as city, state, address, county. And he also received contributions from donors whose names were incomplete, listed as anonymous or marked, Name not provided. So there are concerns. And sure, there are concerns about foreign source donations as well, as it relates to WinRed. Now, one example involved a Chinese businessman whose contribution to the Trump campaign listed an address in La Quinta, California. Now, public records identified him as actually living in China, and described him as a Chinese national. If Republicans are concerned about foreign money in politics, they should be investigating those allegations with the same enthusiasm that they're bringing to act blue. But perhaps the most troubling allegations involving WinRed actually don't even concern foreign money. They concern WinRed victimizing American donors themselves, in fact, Republican donors. That was was raised by ranking member Raskin. Now, CNN reported that there was one eighty-two year old woman living in a modest Baltimore apartment who unknowingly gave more than three hundred and fifty thousand dollars to Republican causes through recurring donations. Another donor, an eighty year old Californian who later died of lung cancer, contributed more than a hundred and eighty thousand dollars and just had two hundred and fifty dollars left in her bank account when she passed away. Now these stories raise real concerns about Windred's use of pre-checked recurring donation boxes and confusing solicitations that many consumers, seniors and others have had a hard time understanding. Now according to CNN, Winred has been the subject of hundreds of complaints to the Federal Trade Commission, far more, by the way, than comparable complaints involving any democratic fundraising platforms. Yet it's interesting that we're only focused on ActBlue. Now Winred also faced scrutiny over aggressive text messaging practices and multiple State Attorneys General have investigated its recurring donation policies yet today's hearing ignores of course all of that. Because this is not a serious effort to improve campaign finance compliance. It is a partisan exercise designed to protect Donald Trump, to protect, win red, and attack Democrats and political opponents. If this committee wants a real investigation into campaign fundraising practices let's examine everyone, and let's follow the facts where they lead, not pretend to have some kind of investigation that only really is going off to one side. With that, I yield back. Thank you.

The gentleman yields back. Without objection, all other members' uh opening statements will be made part of the hearing record if they're submitted to the committee clerk by five PM today. As our witness today, we have Ms. Regina Wallace-Jones, the CEO of ActBlue. Ms. Wallace-Jones, will you please stand and raise your right hand. Do you solemnly swear or affirm that the testimony that you're about to give is the truth the whole truth and nothing but the truth, so help you God. Let the record show that the witness answered in the affirmative. You may be seated. I'll begin our questions today, followed by the ranking member. Foreign funds have no place in American political campaigns. American elections are for American citizens only. Ms. Wallace-Jones, in twenty twenty-three, I sent you this letter with five straightforward questions with a goal of confirming that foreign funds are not in our elections and that Act Blue had adequate fraud prevention measures in place. You replied a month later with a four-page letter describing your fraud prevention policies and procedures that ha- that you had in place at Act Blue. But according to the New York Times, your response to this committee may have been false and misleading. Ms. Wallace-Jones, When you signed this letter to me, did you believe that this letter was false and misleading?

On the advice of my counsel, I respectfully decline to answer this question pursuant to my fifth amendment rights under the Constitution.

Ms. Wallace-Jones, before you sent this letter, did you believe was it was it brought to your attention? That this letter that you sent me was false and misleading?

On the advice of counsel, I respectfully decline to answer the question pursuant to my fifth amendment rights under the Constitution.

Well, I think it's important for everybody here to know that according to the New York Times, you've been aware for quite a while that the response you made was likely false or misleading. Did you ever consider correcting the record for this committee when it was brought to your attention that your letter to me was false and misleading?

On the advice of counsel, I respectfully decline to answer the question pursuant to the attorney-client privilege and my Fifth Amendment rights under the Constitution.

That's pretty interesting. So now you're following the advice of your legal counsel, but you didn't when they warned you that your letter to me was false and misleading. Your letter claimed that passport information is required from donors providing an address outside the United States. In November, twenty twenty three, when you wrote that letter, did every Act Blue donation that provided an address outside the United States require passport information?

On the advice of counsel, I respectfully decline to answer the question pursuant to my fifth amendment rights under the constitution.

Okay. Your letter also claimed that Act Blue would contact a donor to request passport information if the contribution appeared to be from a foreign address. And you told this committee that the contribution would be refunded if Act Blue was unable to make contact with the donor. Is that correct?

On the advice of counsel, I respectfully decline to answer the question, pursuant to my Fifth Amendment rights under the Constitution.

Well, we have reason to believe that your letter in twenty twenty-three was not correct, because according to the New York Times, donations are made through third-party apps like PayPal or Venmo that passport information was not always required. So what's true? The twenty twenty three letter you sent me or the New York Times article

On the advice of counsel, I respectfully decline to answer the question, pursuant to my fifth amendment rights under the Constitution.

After you sent me the twenty twenty three letter, Act Blue weakened its fraud prevention rules twice in twenty twenty four. Quote, even after internal assessments confirmed that these policy changes would lead to more fraudulent donations. End quote. Did you weaken fraud prevention standards to increase donations on the ActBlue platform?

On the advice of counsel, I respectfully decline to answer the question. Pursuant to my fifth amendment rights under the constitution.

Ms. Wallace-Jones, I wanna make clear for the hearing record, you've been asked legitimate questions that are intended to elicit information the committee has the right to have to aid our inquiry. You've refused to answer the questions. Are you formally asserting your fifth amendment privilege against self-incrimination today?

On the advice of counsel, I respectfully decline to answer the question pursuant to my fifth amendment rights under the constitution.

For the record, I think it's important to know that we invited you to come here today to testify. Originally, you were coming voluntarily. On Monday, your attorneys reached out to this committee and requested a subpoena for you to testify. We provided you that subpoena. You're here today, you have an opportunity to testify, and you've chosen to take your fifth amendment constitutional right. I'll now recognize the ranking member, Mister Morelli, for five minutes for the purpose of asking his questions.

Thank you, Mr. Chairman. When it comes to upholding the integrity of American elections, when it comes to protecting and defending the rule of law, sadly, Republicans are absent without leave. Distracted by their pretextual partisan investigation into democratic fundraising, Republicans ignored a fire raging in their own house, so if Republicans on this committee, afraid of crossing Donald Trump, refuse to investigate this corruption, Democrats will. Let's begin with the Chinese businessman who used WinRed to illegally funnel money to President Trump. Public reporting indicated that Jiajun Jack Zhang, a jet-setting Chinese businessman, used WinRed to illegally send five thousand dollars to President Trump's campaign listing a California hotel as his address. How did WinRed's internal legal compliance system allow this? Why wasn't this contribution and potentially scores of others like it blocked? Committee Republicans don't seem to care about the answers to these questions, so Democrats have stepped up. We began our own investigation. What did we find? Democrats found that while Mister Zhang was corruptly funneling money through WinRed, he was allegedly involved in a poker tournament at a casino that once owed a three point one million dollar settlement to the California Justice Department for violating the Bank Secrecy Act, a casino that also paid, incidentally, a two point eight million dollar penalty to the Treasury Department's financial crimes enforcement network, a casino that on a separate occasion admitted that it failed to properly follow federal anti-money laundering uh laws. What was this Chinese national who we know was channeling illegal money to President Trump? Really doing it at the casino? Who was he meeting with? Why do House Republicans refuse to investigate this egregious violation of federal law? Is it because the corrupt illegal money flowed through WinRed to President Trump? Let's take another example. A no doubt imaginary person identified only as Alex A gave nearly five thousand dollars to President Trump's campaign in twenty twenty four through WinRed. This Alex person Listed an address, four twenty eight street northeast, just a few blocks from where we're sitting right now. This was not a one-off mistake or a clerical loan. This was someone using a false name to explicitly break the law to the tune

Chairman.

of over forty problematic donations through WinRed over the course of more than a year. This is not one of those hard to find cases where someone tries to cover their tracks. This is clear as day. Anyone could tell you that Alex A is a pseudonym, that Alex A does not in fact reside at four twenty eight street northeast because four twenty eight street northeast is a defunct funeral home in a vacant building near Union station, a building that has been vacant for over seven years. How did Winred not catch any of this? Why aren't we investigating this clear pattern of fraud, of illegality, of corruption? What are House Republicans covering up? It's as clear as day. While we're actually here today, anyone watching today knows a hearing on quote "preventing fraudulent donations without looking into wind red" is not a serious proceeding. If we as a committee were truly interested in combating fraudulent political donations, we would be undertaking a good faith effort to understand the problem and to discuss solutions. But Republicans are not interested in solutions, they're interested in a partisan witch hunt. Last week Democrats on House judiciary, on judiciary, In an oversight in government form, sent a letter to Texas Attorney General Ken Paxton seeking information related to his investigations, if any, on WinRed. We set a deadline for a response. It was this past Monday, June eight. Attorney General Paxton ignored us. So now, Mister Chairman, it's time this committee to start taking our duty to protect American voters, protect American elections seriously. Americans deserve to know what WinRed is hiding, what Republicans are hiding. It's time for us to draw a line in the sand to make clear that regardless of partisanship, no one is above the law. And with that, Mister Chairman, pursuant to clause two K six of rule eleven, I move that the committee's subpoena warn Kenneth Paxton, Junior, the Attorney General of Texas.

I recognize the motion and hold it in abeyance until the end of the hearing.

Uh, thank you, Mister Chair. I uh yield back my time.

The gentleman yields back, in deference to the chair of the and the ranking member of the other full committee, I now

Thank you.

Thank you.

Uh, thank you, Mr. Chair. Mister Garcia in his opening statement said, we're here because Republicans are playing politics. Let's be clear. We're here because Act Blue's legal counsel said Miss Wallace-Jones lied to Congress, willfully and knowingly misled the Congress of the United States. That's why we're here. Oh, by the way, who was her, who was the legal counsel, Covington Burley? Who was her counsel? Dana Remus, not some Republican. She was former White House counsel for Joe Biden. That's who said that. That's why we're here. So I just have a couple questions for you, Miss Wallace-Jones, just a couple. Your board chairman said, ActBlue accepted up to thirty eight million contributions in twenty twenty four that had the signs of foreign origin. How much fraud is too much fraud?

On the advice of counsel, I respectfully decline to answer the question, pursuant to my fifth amendment, rights under the constitution.

How many foreign contributions did Act Blue accept?

On the advice of counsel, I respectfully decline to answer the question pursuant to my fifth amendment rights under the Constitution.

How much money did Act Blue accept from Russia?

On the advice of counsel, I respectfully decline to answer the question pursuant to my fifth amendment rights under the Constitution.

Why did your entire legal team quit? Your in-house legal team?

On the advice of counsel, I respectfully declined to answer the question, pursuant to my fifth amendment rights under the constitution.

Did your legal team quit because of reduced fraud standards?

On the advice of counsel, I respectfully declined to answer the question, pursuant to my fifth amendment rights Under the Constitution.

I understand. Uh, and we won't keep you here all day, but um, let me just do one more. Did you weaken your fraud standards to help Democrats?

On the advice of counsel, I respectfully decline to answer the question, pursuant to my fifth amendment rights, under the Constitution.

Uh, Mister Chairman, I, again, I appreciate the good work you and your committee are doing. And with that, I would yield the balance of my time to the gentleman from North Carolina.

Thank you for appearing today. I'm sorry that this has turned into a partisan exercise. The American people deserve truth, truth in everything. I'm not gonna disagree with some of my democratic colleagues that say they want truth, um, from other fundraising platforms. I want this too. But the fact is, these were egregious practices that were put forth by ActBlue that are well documented. Do you regret any of the things that you said or the any of the things that Act Blue has done in the past in regards to foreign in in uh donations?

On the advice of counsel, I respectfully decline to answer the question, pursuant to my fifth amendment rights under the constitution.

If you had the chance to pick another place to be employed, would you have joined Act Blue?

On the advice of my counsel, I respectfully decline to answer the question,

Boy, you seem very happy.

Pursuant to my fifth amendment rights under the Constitution.

I am amazed at the number of attorneys that are behind you to be able to coach you to say these things. Um, that's really, that's quite an expense Act Blue is gonna have. Um, i- it's just a tragedy that we're here today on partisan grounds. Um, we can't get to the truth. This is what the American people have asked Congress to do. They ask us to get to the truth. They don't talk about money to go into Ukraine. They don't talk about uh you know, Joe Biden wanting to make sure that he gets paid, um, they just want the truth. And the fact that w- that you guys have literally allowed, continued, and agreed with foreign intervention in our elections just because of monetary, um, consequences which help certain types of candidates, in my opinion, is horrible, disgusting, egregious, and sadly, unpatriotic and un-American. I wish I could ask you more, but I know what the answers are gonna be. Um, I pray we get to this, maybe we'll get to this in a court of law. It seems like that's where things are going these days. So if you gotta plead the fifth, that's where I guess we end up, so. Um, thank you for coming today. I'll yield back the remainder of the time.

The gentleman yields back. The chair now recognizes the ranking member of the judiciary committee, Mister Raskin, for five minutes with the purpose of asking questions.

Thank you kindly, Mr. Chairman. Um, a Republican donor from Fort Worth complained that Winred siphoned eleven thousand dollars from his account without any personal authorization from him. He wrote, "I'm eighty-one years old and I've been taken advantage of." He's still waiting for a response from Attorney General Paxton. Why isn't he here today testifying about what's actually taking place

Definitely.

to our people? CNN reported that one eighty-two year old woman wearing pajamas with holes in them when they interviewed her because she didn't want to spend money on new pajamas was swindled of more than three hundred and fifty thousand dollars of her life savings that she had no idea she was giving to Republicans through WinRed. This is what real fraud looks like. Why don't we investigate it? Attorney General Paxton, who himself uses WinRed, systematically ignored all of these desperate constituent complaints. But somehow the day after James Tallarico, Mister Paxton's opponent, In his Senate race, raised a remarkable two point five million dollars in a twenty four hour period from Act Blue Mr. Paxton suddenly decided to investigate Act Blue and dispatch undercover investigators to trawl Act Blue's business practices. Meantime, Paxton has consistently ignored oversight letters ranking members Morelli, Garcia and I have sent to him. But whistleblowers come forward every day about Winred's fraud. Just this week, My office got a whistle-blower tip from a woman in Colorado, a registered Republican who said she gave a hundred dollars to WinRed, which WinRed turned into recurring weekly one hundred dollar contributions without her permission. She's been fighting over these fraudulent charges since February, contacting WinRed and the Republican National Committee, but has gotten absolutely nowhere. So she reached out to my office for help. And if that's the way that Republicans treat Republicans, it makes sense to me that Donald Trump has the lowest opinion ratings of any president in decades. But it's not just Paxton covering up Winred's fraud. Last summer, we asked the Treasury Department to turn over all suspicious activity reports. Uh, its financial monitors have gotten related to Winred, and we asked FTC Chair Andrew Ferguson to turn over all complaints related to Winred. CNN has revealed that Winred had been used to defraud hundreds of elderly Americans and mislead specifically people battling dementia and other cognitive uh impairments, including uh Alzheimer's disease, into giving away millions of dollars, far more than they ever intended, far more than their families could afford. But the Treasury Department and the FTC have refused to turn over any documents, or even answer our letters. They've refused to explain why they won't turn over the documents. But one detail in CNN's report provides a hint. The single biggest beneficiary of all these small dollar donations from these unwitting recurring donors was none other than Donald Trump, the founder of Trump University. There are some obvious things that we can and should do to stop online fundraising abuse across the board politically. In twenty twenty one, the FEC recommended that Congress ban pre-checked recurring donation boxes so we would know that any recurring donations are unauthorized and illegal. That would have prevented many, if not most, of the deplorable fraudulent practices that have swindled millions and millions of dollars of people's life savings in Texas and all across the country. That was common sense when it was unanimously recommended by the FEC and it's common sense today. Can we agree to that? How about today? I'd support that today. But I fear this hearing is not about making any positive policy changes. Uh, it's about hauling in the CEO of Act Blue, forcing her to take the Fifth Amendment. You know, Donald Trump's taken the Fifth Amendment four hundred and forty times. So before anybody starts denouncing the Constitution of the United States, think about what you say about people who uh invoke the Fifth Amendment against petty political vendettas and and prosecutions. Um so this is exactly the kind of thing that the Fifth Amendment was designed uh to be there for. The Supreme Court has said the Fifth Amendment protects the innocent as well as the guilty. People who might be ensnared by ambiguous circumstances, and we can see today also ensnared by political vendettas and partisan investigations instead of seriously looking at a problem and trying to address it. That's what we should be doing. There are obviously problems across the board. Most of them relate to WinRed, but I'm sure some of them could relate to ActBlue too. Why aren't we seriously addressing that? Why does everything have to be the occasion for partisan exploitation and persecution? instead of actually doing the business of the public. So we're waiting for a lot of answers from WinRed. I hope that we will get them, and I hope that we can have real change with a real investigation and a real hearing. I yield back and thank you, Mr. Chairman.

The gentleman yields back. The gentleman from Georgia, Mister Lautermelk, is recognized for five minutes.

Thank you, Mr. Chairman. Um, look, there's serious allegations that have been made against ActBlue and uh they're they're exceptional in in these these allegations and either they're true or they're not. And this is part of what we're here trying to determine. But what is amazing to me is my colleagues on the other side of the aisle have not addressed one of these allegations. If I was you I'd be a little offended because not single one of them has come to your defense. Every one of them have deflected to something else. Let's let's look a little bit at some of the allegations. In fact, ActBlue in its own words decided to take a quote " more lenient approach" to fraud prevention leading up to the twenty, twenty-four election. But instead of addressing that, Mister Morelli decides to talk about a Chinese man gambling in a casino. Another fact, ActBlue took action despite detecting at least twenty-two significant fraud campaigns on its platform in recent years. instead of addressing that, Mister Raskin wanted to talk about some Texas buying Texas buying pajamas. Another, in the wake of the twenty twenty four election, almost the entirety of Act Blue's legal and compliance department was e- was either fired resigned or left the company alleging retaliation for highlighting vulnerabilities and unseriousness in addressing fraudulent donations. Instead of addressing that or clarifying that, Mister Garcia wanted to talk about the President's slush fund, even though, which he left off as President Obama had the same type of fund called the Keeps Eagle fund. How did that help you in your position here? What that shows me is they're not willing to defend against these allegations because likely they know that they're true. This is called deflection. This is politics at its ugliest and its dirtiest. So, I do have a a series of questions for you, but I I wanna make sure I'm respectful. Is it Miss Jones or Miss Wallace-Jones?

On the advice of counsel, I respectfully decline to answer the question pursuant to my fifth amendment rights under the constitution.

Well, you can take it.

Okay, wow, okay, didn't expect um Expect that one. But I I think I see where this is going. Um but I let me go ahead and ask questions. What role do you play in the process of Act Blue? Well, let me back up. I think I wa I wanna ask these first. Miss Wallace-Jones, has the FEC ever completed an audit of Act Blue during the twenty twenty election cycle?

On the advice of counsel, I respectfully decline to answer the question. Pursuant to my fifth amendment rights under the constitution.

Okay, let uh just wanna bring up, Mister Chairman, that was a simple yes or no. There's no allegation in that, it was just whether an audit of Act Blue took place in the twenty twenty election cycle. Does Act Blue have an application programming interface with the FEC database?

On the advice of counsel, I respectfully decline to answer the question, pursuant to my fifth amendment rights. Under the Constitution.

Okay. This committee just passed bipartisan legislation that requires donors to include their CBV or C or CVC when donating to a political campaign online. The committee originally passed the same legislation last Congress and pointed out that Act Blue did not require the CBV for online donations. Soon after that, Act Blue changed its policies to require the CBV. What was that dec what was that decision connected to to what this committee was doing.

On the advice of counsel, I respectfully decline to answer the question, pursuant to my fifth amendment rights under the constitution.

All right. What role do you play in the process of actively changing fraud prevention policies such as requiring a CBV or, increasing the thresholds for risk tolerance?

On the advice of counsel, I respectfully decline to answer the question, Pursuant to my fifth amendment rights under the constitution.

Mister Chairman, it it appears that since I can't even the the the her name is protected under the fifth amendment of the constitution, I don't I don't think my time is is gonna be more well spent, so I yield back.

The gentleman yields back, uh the gentlewoman, m Representative Sewell is recognized for five minutes for the purpose of asking questions.

Mister Chairman,

I wanna begin by unequivocally stating that guaranteeing the authenticity of campaign donations requires serious and honest engagement. I believe Congress should be making deliberate efforts to prevent foreign donors from attempting to influence our democracy. And any investigation that would be serious uh use of our time and our resources here in this committee would include an investigation not just of Act Blue, but of when read as well. We're holding a a a hearing today, quote unquote an investigation, to prevent fraudulent donations, but it's nothing more than a hyper-partisan witch hunt. This investigation is just one example, one more example of Republicans and President Trump using power of his office to harass and intimidate anyone willing to challenge him. The Trump's d- Department of Justice has used its power to intimidate and victimize communities of color, especially black Americans. Just look at their targeted harassment of the Southern Poverty Law Center, an organization that has worked tirelessly for decades to counter white supremacist organizations. Over and over again, Donald Trump's Department of Justice has harassed black women with bogus lawsuits. We should not forget the harassment of the Federal Reserve Board of Directors Board of Governors Lisa Cook, the harassment of the New York Attorney General Tish James, and the harassment of our colleague, New Jersey Congresswoman LaMonica McGyver. So it is not surprising that this Republican-led committee is now attacking ActBlue and its CEO, Miss Wallace-Jones. Why? Because ActBlue is a platform that holds, that helps empower voices of thousands of millions of American voters, and supports the electoral efforts of a racially and ideologically diverse group of Americans that are willing to stand up against uh the harmful actions of this president. This investigation is clearly just an extension of President Trump's retribution tour and I want to apologize to you uh Miss Wallace-Jones for having to be here and under these very hyper-parti- partisan um uh circumstances and not in in any way uh looking into an investigation of fraudulent foreign donors that would include both Republican and Democratic organizations. This investigation is clearly an extension of President Trump's retribution tour. In April of last year, the President issued an executive order targeting Act Blue and demanding a Department of Justice investigation into the platform. Less than two weeks after the executive order, a group of committee chairmen jointly sent a letter to Attorney General Bondi that detailed their committee's quote " ongoing investigations" into Act Blue and unquote, while pledging to quote " work collaboratively with DOJ" end quote. Let me repeat that again, pledging to work collaboratively with DOJ, clearly committing to using legislative tools and information uh to advance the executive branch's law enforcement vendetta. This is clearly an attempt by those with power to go after those who don't have power. These are tactics of an authoritarian regime. This is clearly an attempt to use the powers of the federal government to go after Donald Trump's political opposition. In a meaningful investigation, Mister Chairman, would also include Wen Red. This committee should be conducting serious work. We would uh be better spent, time better spent, trying to provide grant funding for election systems across this country. Or we could be considering approaches to improving the day-to-day operations of the House of Representatives, which is a core jurisdictional function of this committee. Instead of spending this time using invaluable time and resources of this committee to go after a witch hunt. I'm embarrassed that we're using our committee time in such a way, and I want to again apologize to Miss Wallace-Jones for her having to be here and listen to this craziness. With that, I yield back my time.

The gentlewoman yields back. The the the gentleman from North Carolina, Doctor Murphy, is recognized for five minutes.

I'll defer my time. Not gonna waste my time. Thank you, Mr. Chairman.

The gentleman yields back. The gentlewoman from Texas, Representative Johnson, is recognized for five minutes.

Um, thank you, Mister Chairman. This has to be one of the most brazen political desperate acts I've seen in Congress, this hearing today.

I'm gonna take a dinner.

It is disappointing, it's disgusting, and it's offensive. We have seen this administration and Republicans in Congress systematically go on an attack to attack every aspect of elections in this country because Donald Trump is terrified that he's gonna lose the party's election control in twenty twenty six. Terrified that Rep- Democrats are gonna take the gavels back in this building to hold his administration accountable for the horrific damage they've done on the American people, to the economy, to our deficit, to everything that this government is supposed to be responsible. And instead what they've done is attack what they've gone at at every level. So they've offered the Save Act, right? To keep people from voting, to restrict access to the ballot box, to attack mail-in voting, to attack people of color, to attack people from being able to legally cast their ballot. That wasn't good enough. So they've done as rep- as partisan gerrymandering to redraw the lines, to make it so extreme for people to cast ballots for th- cuz they're so terrified that they're gonna lose elections. We have spent billions of dollars in this country responding to redrawing maps because Donald Trump and Republicans are afraid. And now what are we doing? Now we're gonna go after the money scheme. the money path. And if this was a legitimate exercise in politics, we would have WinRed and ActBlue here together. They both serve a purpose, which is to seek a vehicle for people to give small dollar contributions to the pitali political candidates of their choice. But we're not here to have a legitimate, responsible dialogue. We're here again because Republicans are desperate and afraid and they're coming to attack Miss Wallace-Jones, the head of ECBLU, out of a lack of seriousness. Because Win Red is a corrupt organization and I've seen firsthand what Ken Paxton and the Texas Attorney General has done to abuse his authority and the overwhelming depth of corruption that that man has put on the state of Texas, and through Win Red. We've seen examples highlighted by my colleagues. I'm the only member of this committee that was in the state legislature that had the privilege to convict and impeach Ken Paxton when I was in the Texas House. And I've seen up close and personal the depth of his corruption and what he did that through Win Red. So the fact that Win Red isn't here, the fact that Republicans have no desire to police their own side of the street, their own house, just highlights again the political desperateness by which we are here. Because at the end of the day, now they're so scared, they've redrawn the maps, they've tried to restrict people's access to the polls, they're not investing in election integrity and election security to make sure that we have the appropriate number of machines the appropriate number of offices, they're doing everything they can to keep our overseas people from being able to cast a ballot. Now they're trying to go after the money of democratic small donors, the little mom and pops, the little teachers who send their twenty-five dollars a month in to elect the candidates of their choice because they're terrified that they're gonna lose in November. So my comment to the American people is vote, contribute through Act Blue, send money to your Democratic candidates, make sure that Democrats win in November so we can stop this nonsense once and for all. And I yield back.

The gentlewoman yields back. The gentlewoman from Illinois, Representative Miller, is recognized for five minutes.

Thank you, Chairman. I want to take a moment to highlight a section of an ActBlue employee training document, Fraud Prevention one O one for new associates in the workflow. Your company's memo states, and I quote, "If an otherwise legitimate donor uses a fake name, we would want to accept their donation." End quote. Can you confirm whether this is the advice that you give to your employees?

On the advice of counsel, I respectfully decline to answer the question, pursuant to my fifth amendment rights under the constitution.

Chairman, I yield back.

The gentleman yields back. This committee is engaged in a legitimate inquiry of possible serious violations of federal election law. These are issues that are clearly within the jurisdiction of this committee, the Committee on House Administration, and the information we're seeking is important to assist us in our legislative and oversight responsibilities. You've invoked your fifth amendment privilege against self-incrimination, that is, your constitutional right. I'm disappointed to say that it's clear that you're not going to answer the committee's questions today. I can assure everyone, though, that the committee will continue to take every appropriate step to obtain the information that we are seeking. Without objection, the witness is excused.

One second.

Well, now we can start.

You're gonna take the motion. You're ready to take it? All right.

It's now in order to consider the motion offered by Mister Morelli from New York.

Mr. Chairman, I have a motion.

The gentleman's recognized.

May maybe hear it on the on the motion?

The the the gentleman's recognized.

I have a motion to table the motion to subpoena.

The motion to table is not debatable. All those in favor of tabling, signify by saying aye.

Aye.

Aye. All those opposed, signify by saying no.

No.

The opinion of the chairs, the ayes have it. The motion table is agreed to.

Aye, yes. Yeah, yeah.

A recorded vote is requested. The clerk will please call the roll.

Chairman Stile?

No.

Chairman Stile votes no. Um

I I can

Mr. Lee?

Yes.

Mr. Lottermilk?

Yes. Yes.

Mr. Lottermilk votes uh yes. Mr. Griffith?

Yes.

Mr. Griffith votes yes. Miss Dr. Murphy?

Yes.

Dr. Murphy votes yes. Miss Spice? Mr. Carey? Yes. Um Miss Spice votes yes.

What

Uh Miss M Mrs. Miller?

Yes.

Okay, yes, okay. Mr. Morelle?

No.

Mr. Morelle votes no. Miss uh Mrs. Sewell?

No.

Mrs. Sewell votes no. Miss Torres? Miss Johnson? Johnson votes no.

Miss Clerk, I'd like to be recorded as yes.

Okay.

Have all members voted? Does any member wish to change their vote? The clerk will report the tally.

Mr. Chairman, for this vote there are five yeses and three nos.

The motion carries. I'd like to thank our committee members uh for joining us today. Without objection, each member will have five legislative days to insert additional material into the record and to revise and extend their remarks. There's no further business. I want to thank the members for their participation. And without objection, the committee stands adjourned.

Thanks Michael.