When a small nonprofit called the Judicial Crisis Network poured millions into a campaign to stop the Senate from confirming Barack Obama’s Supreme Court pick last year, and then spent millions more supporting President Donald Trump’s choice for the same seat, political observers assumed conservatives from around the country were showering the group with donations.
Not so.
Newly obtained tax documents show that JCN’s money came almost entirely from yet another secretive nonprofit, the Wellspring Committee, which flooded JCN with nearly $23.5 million in 2016.
Most of Wellspring’s funds, in turn, came from a single mysterious donor who gave the organization almost $28.5 million — nearly 90 percent of its $32.2 million in revenues.
Like JCN, Wellspring — at one time tied to the donor network spearheaded by conservative industrialists Charles and David Koch — is a nonprofit that is supposed to be dedicated to social welfare functions and doesn’t have to disclose the names of its benefactors. Since the 2010 Citizens United Supreme Court decision loosened certain constraints on political spending, these and other 501(c)(4) groups have become increasingly politically active while providing anonymity to their donors. Often one group, like Wellspring, will act as a conduit, giving most of its funds to other, similar groups with political agendas.
"It sounds like Wellspring Committee acted as a dark money conduit to provide an extra layer of secrecy to whomever was bankrolling the Judicial Crisis Network ads," Brendan Fischer of the nonpartisan Campaign Legal Center in Washington said in an email interview. "This has the effect of layering secrecy on top of secrecy, and almost entirely insulating donors from any form of public accountability."
But, Fischer added, "Even though the public doesn’t know who is really behind the tens of millions spent, there is nothing stopping these secret donors from making their identities known to the beneficiaries of that spending."
Illinois Policy Action was another organization that benefited from Wellspring’s grants in 2016, receiving $2.5 million; it’s the lobbying arm of the Illinois Policy Institute, a conservative Chicago think tank in Chicago that has ties to the state’s billionaire governor, Republican Bruce Rauner, according to the Chicago Tribune. In 2016, the institute released a documentary critical of Rauner’s political opponent, Illinois House Speaker Mike Madigan, a Democrat.
The American Future Fund, another former Koch “dark money” nonprofit, pulled in $2 million from Wellspring last year. It spent more than $12.7 million in 2016 federal elections without disclosing its donors.
Early in the Republican presidential primaries, AFF appeared to be supporting Sen. Marco Rubio (R-Fla.) through attacks on his GOP opponents, Sen. Ted Cruz of Texas, Ohio Gov. John Kasich and Donald Trump.
When the group ran ads highlighting lawsuits against Trump University, the Republican frontrunner tweeted “Phony Rubio commercial. I could have settled, but won't out of principle!” Trump did eventually settle the lawsuit for $25 million after becoming president.
Wellspring also paid out $750,000 to a firm called BH Group LLC, not as a grant but for “public relations” services.
The corporation is nearly untraceable beyond an address for a “virtual office” in Arlington, Va. A representative of the company that manages the space, Regus, said that the BH Group has no physical presence and that all its mail is forwarded to another address. The representative would not provide a forwarding address or any names of individuals affiliated with BH Group “for security reasons.”
BH Group LLC’s only other appearance in the public record? On the list of Trump inaugural donors: It gave $1 million to help pay for the festivities. Virginia incorporation records show the LLC wasn’t formed until the end of August 2016. That means Wellspring’s payment to it was made between then and the end of the year — right around when the Trump inaugural committee was doing the bulk of its fundraising.
As for the Judicial Crisis Network, when Trump’s Supreme Court nominee Neil Gorsuch was sworn in last April, the group’s chief counsel was there, snapping pictures in the White House Rose Garden.
Robert Maguire is political nonprofit investigator at the Center for Responsive Politics