CEC to prepare measures to combat money laundering from electoral accounts

The Central Election Commission (CEC) plans to quickly develop measures that will help combat money laundering from the election funds of candidates. According to the Deputy Chairman of the CEC, Nikolai Bulaev, since the beginning of the current election campaign, they have tried to launder about 360 million rubles through these funds. Experts interviewed by Kommersant disagreed about tightening control over pre-election finances. On the one hand, in their opinion, the exemption of money from taxes attracts donors, and on the other hand, it is beneficial for sponsors to find technical candidates and cash out funds through fictitious contracts.

The development of measures aimed at suppressing procedures for laundering money from the electoral accounts of candidates was announced by the deputy chairman of the CEC, Nikolai Bulaev, at a meeting of the commission on July 12. According to him, since the beginning of the current regional campaign, 20 candidates have tried to launder about 360 million rubles. “We understand that these are not candidates. This is an excess of one’s passive suffrage for purposes not related to electoral actions. This is just money laundering, because we understand that the money that goes through the election fund is not taxed by the state,” Mr. Bulaev emphasized. He expressed hope that the CEC would find a solution to this problem “in the next month and a half”. CEC Chairwoman Ella Pamfilova, in turn, stressed that the new measures should not complicate the work of respectable candidates.

By law, all candidates and parties are required, after submitting a notice of nomination to the election commission, to create election funds. Their funds can only be used to cover the costs associated with the conduct of the election campaign. Funds can be replenished from the own funds of candidates and parties, as well as donations from citizens and legal entities. The money is kept in a special electoral account opened with Sberbank. All fund spending operations end on election day, and all unspent funds must be returned to those who transferred them.

Experts interviewed by Kommersant disagreed about the need for special measures to prevent money laundering from election funds. Thus, Oleg Zakharov, the former head of the Yaroslavl Regional Electoral Committee, believes that it is difficult to distinguish those candidates who used the fund’s money in bad faith from those who wanted to, but changed their minds, to participate in the elections. “For example, a candidate decided to participate in the elections, hired technologists, agitators, ordered campaigning, paid for it all from the fund, and then decided not to participate in the elections. And the money has already been spent. It can be assumed that this money was simply “spun”, but it is almost impossible to prove this,” Mr. Zakharov explains. According to him, the amount of dubious money roaming through the electoral accounts is hundreds of times higher than the published figures. But since payments from election funds are not taxed (there is a special personal income tax deduction for them), the state has not yet had serious questions about them, the expert continues. “The tax gap in the form of personal income tax benefits, of course, creates a temptation to minimize tax expenses through the election fund. But, on the one hand, this is a legitimate opportunity, and on the other hand, this technique is also used by major players to facilitate the financing of election campaigns. And parties may not support such amendments, as this will complicate their pre-election fundraising and finding sponsors,” he says. And even if some of the money from the election funds goes to “cash out” – this is the cost of the general scheme, adds Oleg Zakharov. “Fighting a penny single “cash out” by complicating the life of all parties and candidates is not the most working scheme,” he believes.

Electoral lawyer Roman Smirnov agrees that any tightening in this area could lead to an even greater reduction in the participation of businesses in election campaigns. “In the current economic situation, there is a problem of filling election funds. A situation may happen when candidates will be financed only by parties that themselves are financed from the budget for the votes received in the elections. And then it will be just a flow of funds, and it is not clear where to get new money, ”the expert emphasizes. In his opinion, the problem of “cashing out” funds through election funds is now irrelevant, otherwise we would have seen many technical candidates in the elections. “But now there are few of them, especially in the gubernatorial elections, where there is a municipal filter. In addition, businesses do not want to get into any kind of showdown, and parties maintain tight control over election funds, and in this case it is simply impossible to talk about withdrawing funds, ”the lawyer sums up.

Electoral expert Grigory Melkonyants, on the contrary, considers the problem of withdrawing funds from electoral accounts urgent. According to him, the scheme of cashing out money through funds has been flourishing for many years, and this is done not so much by the candidates themselves as by their “sponsors”. “They find people who are ready to run for election in order to earn money. For a small percentage, they pass money through their electoral accounts, which is then cashed out under fictitious contracts and returned to the “sponsors”. The organizers of such schemes are often experienced political technologists who are able to prepare the set of documents necessary for the nomination at low cost,” says the expert. According to him, the attractiveness of such a scheme is that this money is exempt from taxes and any tax reporting, you can even not submit a report to the election commission, paying a small fine. “To bring the participants of such a scheme to justice today is almost impossible,” concludes Mr. Melkonyants.

Elena Rozhkova