CBS 6 Investigates: Former AG Schneiderman's use of old campaign funds to pay legal fees

    Eric Schneiderman (Cropped Photo: Lonnie Tague)

    ALBANY, N.Y. (WRGB) - It's been ten months since Eric Schniederman bowed out of the political arena, yet his latest campaign finance filing in January shows a $6,455,370.39 balance.

    His campaign's returned $972,117.41 to donors since he resigned in May 2018. He's also paid $319,710.95 in campaign funds to Clayman and Rosenberg LLP. That's the law firm that represented him after four women accused him of physical abuse in a New Yorker article.

    Governor Andrew Cuomo appointed a special prosecutor to investigate these claims, but charges were never filed.

    New York's City's chapter of the National Organization for Women started an online petition calling for Schneiderman to donate the rest of his campaign funds after he stepped down. Chapter President Sonia Ossorio says the man who touted himself as a women's rights advocate should donate the rest of the funds to women's causes.

    "Mr Schniederman has an opportunity to give back to the community that he's hurt. He was elected. We trusted him,” Ossorio said.

    The campaign couldn't be reached for comment, but they told CBS News and the Associated Press that they'd donate the remaining funds to worthy and appropriate causes once they've honored their commitments.

    The practice of paying attorney's fees through campaign funds is legal, and Schneiderman's not the first New York politician to do this. Former Assembly Speaker Sheldon Silver and former Senate Majority Leader Joseph Bruno both spent millions on legal fees through their old campaign war chests. Both of these men stood trial for their scandals, Schneiderman on the other hand was never indicted.

    "The campaign contributions have often become sort of a honey pot for get out of jail free cards,” says Blair Horner, Executive Director of the New York Public Interest Research Group.

    Horner says the laws surrounding campaign finance are vague, and there's nothing on the books prohibiting using them for legal fees. He says there's always a major hurdle in getting campaign finance reform laws passed.

    "The people who have to vote on it are the winners of the game under the rules that exist now," Horner said.

    The state board of elections' enforcement division oversees campaign finances. They declined to comment on this story.

    New York’s “Personal Use” provision in the election law reads as follows:

    “Contributions received by a candidate or political committee may be expended for any lawful purpose. Such funds shall not be converted by any person to a personal use which is unrelated to a political campaign or the holding of a public office or party position.”

    The NYS Board of Elections did say that campaign committees may divest their funds In the following way.

    • Donate to an IRS recognized charity;
    • Provide pro-rata refunds to contributors;
    • Give the funds to the NYS general fund.

    Horner said a candidate may also keep the funds if they plan to run for office again. A candidate may also donate their funds to another political campaign. The BOE said there’s not a deadline for a campaign committee to divest all of their funds. Campaign committees are required to file campaign finance reports in January and July of every year until they meet state requirements to close an account.

    There’s a clause in the NY Public Officers Law that allows former politicians to apply for state reimbursement of their legal fees if they are acquitted. Former Senate Majority Leader Joseph Bruno got over 2 million dollars of his legal fees reimbursed in 2014. Eric Schneiderman, the Attorney General at the time, approved that application.

    CBS 6 asked the current Attorney General’s office if Schneiderman could use the same tactic. They said they’d have to wait for him to apply for reimbursement before making that determination.

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