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GENERAL COUNSEL C.W.Hisgen OFFICE OT FEC Complaint RevB GENERAL COUNSEL C.W.Hisgen 7!1I9 H'M 70 PH |: 48 ' Las Vegas Nevada ^ 89107-1103 SENSITIVE Junl9,2018 Office of the General Counsel i I I Federal Elections Commission [wl IIR S / ^ ( 999 "E" Street NW IV«w i rr Washington DC 20463 By E-Mail and U.S. Mail » CO c_ cr Re; Written Complaint against Danny Tarkanian rvf " » t and Danny Tarkanian for Congress campaign of 2012 ~c< Dear Sir / Madame: Complaintant, as undersigned, hereby requests an immediate investigation into an illegal cop'%ate contribution made to a Federal campaign committee, Tarkanian For Congress. Danny Tarkanian was a candidate for Federal office and is also a current candidate for Federal office. In 2012 he used impermitted funds from an LLC he owns and controls, JAMD LLC, directly, and corporate funds from a public charity he owns and controls, the Tarkanian Basketball Academy, indirectly, in each case "in the name of another" to his 2012 Federal campaign committee, Tarkanian For Congress. His use of JAMD LLC was as a conduit for charity finds as will be shown. Complaintant cautions the FEC that Danny Tarkanian has been adjudicated a fraud, specifically frandulant transfer of assets: "steps were undertaken to both hinder and delay the collection efforts of creditors" in a bankruptcy proceeding (Case-13-20495-mkn-Doc-l 86 Memorandum Decision). Consequently any documents or testimony taken from him by commission investigators need to be thoroughly checked and positively vetted. The information identified herein was unknowable until it came to light during candidate Danny Tarkanian's bankruptcy proceedings as found in Federal Bankruptcy court Case 13-20495-mkn. Because the statutes of limitations on these offenses expire in 2019, complaintant respectfully requests that the Federal Election Comission, and if necessary the IRS and the FBI, kindly expedite the Comission's investigation into this matter. Background In 2018, Danny Tarkanian is again running for US Congress. I say again because this year he is running in Nevada CD3 for the second time. This complaint concerns matters from his 2012 campaign for congress in CD4. Again, the claimed unlawful activities were deliberately concealed and did not come to light until his bankruptcy litigation begining in 2013 and testimony given under oath bv him in May 2014. Factual Assertions Charity Problems Tarkanian Basketball Academy Inc. (TarkBBA) Mr. Tarkanian and his brother George Tarkanian founded a public charity, the Tarkanian Basketball Jun 19,2018 1 10:10:06 AM FEC Complaint RevB C.W.Hisgen Academy, Inc in Las Vegas Nevada in 2001 or 2002. The transcripts and documents provide two different dates. The Exhibits in Case 13-20495-mkn Doc 158 page 25 show 2001. The hearing transcript in Case 13-20495-mkn Doc 159 page 45 line 25 and page 46 lines 1:3: 'J " 25 And then the third one is the Tarkanian . 1 Basketball Academy which I briefly discussed which is a 2 sports facility that I started in 2002 I believe with my 3 brother. 'i-. The Tarkanian Basketball Academy Inc received its tax exampt status in 2003. Public charties organized under IRS Section 501(c)(3) are prohibited from participating "in, or intervene in (including the publishing or distributing of statements), any political campaign on behalf of (or in opposition to) any candidate for public office." Mr. Tarkanian will no doubt assert that the funds from the Tarkanian Basketball Academy, Inc were funds owed to him from a $2.2 million loan he made when founding the public charity. A thorough examination of his IRS 990 filings for the Tarkanian Basketball Academy quickly demonstrate that this is impossible. Nowhere on any of the filings from 2004 to 2015 is a liability the size of $2.2 million carried on the books. From 2004 forward, no liability is carried at all. Complaintent asks that the commission look at the page for "assets and liabilities" and specifically under the entiy for "Loans from officers, directors, trustees, and key employeees" which is blank for the begining of the year and the end of the year. This is true for each of the years 2004,2005, 2006,2007,2008, 2009, 2010,2011, 2012,2013, 2014, and 2015. This makes any assertion that funds taken out of Tarkanian Basketball Academy in any of these yearsuntrue. In 2012 alone the Tarkanian Basketball Academy appears to have "loaned" over $112,221 to JAMD, LLC, a property company over which Danny Tarkanian has checkbook control. The use of a public charity and its "excess cash flow" to bankroll or fund a private for profit business is not permitted. Nor is the diversion of funds from the public charity, directly or indirectly, to fund a political campaign. The details of this information come from a deposition made by Danny Tarkanian on 20 May 2014. As of the day of his deposition the "loan" had not yet been paid back. This for a $40,000 amount paid out on June 30,2012. The statute of limitations for FEC matters is five years. Since the activity of indirectly making a payment to his campaign from the charity only came to light as a result of the bankruptcy lawsuit in 2013 and deposition in May 2014, the statute of limitations did start until May 2014. Case-13-20495-mkn Doc 159, page 71, lines 1:7 Case-13-20495-mkn Doc 159, page 71, lines 8:19 extracted and shown below: 1 Q. Mr. Tarkanian, I believe you mentioned that you had 2 been borrowing — or JAMD had been borrowing money from 3 the Tarkanian Basketball Academy, right? 4 A. It did on occasions, yes. 5 Q. What did you do with the $40,000 amount that the 6 Tarkanian Basketball Academy borrowed from JAMD on 7 June 28th of 2012? 8 A. It lent it to JAMD, and it went into JAMD's account. 9 Q. And then didn't that money go into your account 10 after that? 11 A. It went into the congressional campaign account. Jun 19,2018 2 10:10:06 AM FEC Complaint RevB C.W.Hisgen 12 Well, it probably went into my account first, yes. 13 Q. Okay. And then you withdrew that same $40,000 on 14 June 28th of 2012, correct? 15 A. Yes. 16 Q. Have you personally repaid that $40,000 back to the 17 nonprofit that it came out of? 18 A. I didn't personally borrow it from it. JAMD did, 19 and JAMD has not repaid it back yet. JAMD, LLC Corporation or Partnership JAMD LLC is a limited liability company (LLC). From the court transcripts, exhibits, and public records it is impossible to determine if JAMD LLC is handled as a corporation or a partnership by its owners. JAMD, LLC lists no corporate stock on its registration. The exhibits provided in the bankruptcy case in Case-13-20495-mkn Doc 123-9 do not indicate a partitioning of JAMD LLC by shares of stock, but, rather by percentages allocated to the various partners. Exhibit C, Pages 13-29,. In the absence of a declaration JAMD, LLC is handled as a corporation, it is entirely reasonable to ascertain that JAMD, LLC is a partnership. For purposes of the charge herein it does not matter. JAMD LLC's role in this was as an entitiy with interests indestinguishable from Danny's and over which he had operational and checkbook control and consequently served as a conduit to mask his actions. , Complaintant's Analysis and Understanding of FEC Rules Campaigns may not accept contributions from the treasury funds of corporations, labor organizations or national banks. This prohibition applies to any incorporated organization, including a nonstock corporation, a trade association, an incorporated membership organization and an incorporated cooperative. Incorporated charitable organizations— like other corporations — are prohibited from making contributions in connection with federal elections. Unlike most other corporations, charities face additional restrictions on political activity under provisions of the internal revenue code. Contributions in the name of another; CFR Title 11 Section 110.4 A contribution made by one person in the name of another is prohibited. For example, an individual who has already contributed up to the limit to the campaign may not give money to another person to make a contribution to the same candidate. Similarly, a corporation is prohibited from using bonuses or other methods of reimbursing employees for their contributions. Contributions CFR Title 11 Section 114.1 Definitions. (a) For purposes of part 114— (1) The terms contribution and expenditure shall include any direct or indirect payment, distribution, loan, advance, deposit, or gift of money, or any services, or anything of value (except a loan of money by a State bank, a federally chartered depository institution (including a national bank) or a depository institution whose deposits and accounts are insured by tlie Federal Deposit Insurance Corporation or the National Credit Union administration, if such loan is made in accordance with 11 CFR 100.82(a) through (d)) to any Jun 19,2018 3 10:10:06 AM FEC Complaint RevB C.W.Hisgen candidate, political party or committee, organization, or any other person in connection with any election to any of the offices referred to in 11 CFR 114.2 (a) or (b) as applicable. Complaintant's Conclusions Complaintant has reviewed applicable FEC regulations. Based on Complaintant's read of the transcripts and read of the FEC regulations, complaintant reasonably believes that the following CFR Title 11 sections have been violated as discussed above: CFR 11 Section 110.4 Count (1) Contributions made by one person in the name of another: money from the J AMD LLC Partnership contributed in a manner to appear as a loan from the candidate, Danny Tarkanian.
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