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Congress made it easy for Jesse Jackson Jr. and wife to loot campaign fund

Jesse Jr. Sandi JacksFebruary 2007 when she wher race for alderman.  |  JON SALL~SUN-TIMES

Jesse Jr. and Sandi Jackson in February 2007 when she won her race for alderman. | JON SALL~SUN-TIMES

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Updated: April 21, 2013 6:46AM

There’s a reason Jesse Jackson Jr. and Sandi Jackson were able to get away with looting the congressman’s campaign fund of $750,000 over seven years.

Congress long ago stripped the agency assigned with overseeing its members’ campaign funds of its power, and, according to the watchdog group Citizens for Responsibility and Ethics in Washington, if there’s another congressman doing the same thing, it’s nearly impossible to find out, short of a criminal probe.

“They made it so it’s nearly impossible to root this thing out. There are no random audits. There are no checks,” Melanie Sloan, the group’s executive director, told the Chicago Sun-Times. “Everything can be a lie. As long as your forms look pretty, as long as you use the magic words and file in a timely manner,” you’re in compliance, she said.

Because the Federal Election Commission is not allowed to do random audits, as it once was able to, she said, there is no fear of having to turn over receipts to corroborate expenditures. The FEC must have cause to investigate a campaign fund, such as someone filing a complaint or fund with a history of issues.

Federal election rules prohibit congressmen from dipping into campaign money for personal use. But last month, Jackson and his wife, a former Chicago alderman who was also on his campaign payroll, pleaded guilty to indulging in a lifestyle way beyond their means by using campaign money and disguising the expenditures as legitimate campaign expenses.

That included spending more than $5,000 on four fur coats in one day, dropping $43,000 on a Rolex watch, taking trips to Disney World and Martha’s Vineyard as well as buying Michael Jackson, Bruce Lee and Martin Luther King Jr. memorabilia.

Before he resigned last fall, Jackson was a 17-year congressman who raised money easily. His popularity meant he rarely needed to campaign. Still, he routinely drew down his campaign account. Charges unveiled last month showed the couple used the money to rehab their second home — in Washington, D.C., — and even buy toilet paper, toothpaste and underwear.

After the couple’s guilty pleas, Ronald Machen, the U.S. Attorney in Washington D.C., said the Jacksons went out of their way to hide their behavior, making it tougher to detect.

But he also described a couple who found it easy to dupe the system.

“The nature of this spending makes clear that this was not momentary lapse of judgment, this was not a short-streak of impulsive behavior. Over seven years, the Jackson engaged in over 3,100 transactions for their personal gain,” he said. “It is clear that Jesse Jackson became convinced that his campaign account could be used to satisfy his personal whim.”

In light of the Jackson episode, Sloan’s group is calling on Congress to beef up its regulations on how members are able to spend their money, including banning family members from being on the payroll.

Ironically, it was the Jacksons who paved the way for allowing family members on the campaign payroll after they got an FEC decision allowing Sandi Jackson to act as a campaign manager. She was paid $5,000 a month out of Jackson’s campaign fund.

Now other members of Congress use the Jackson decision as a basis to get family members on the payroll, Sloan said.

Lawrence Norton, former general counsel at the FEC noted that lawmakers still can form leadership PACs, where there is no ban on personal use of money. Candidates have used those political action committees to subsidize their travel, to make contributions to other candidates and even for golf outings, he said.

Where personal use is banned — in campaign funds — it would be wise, Norton said, for congressmen to have their own checks and balances, so there isn’t one person in charge of handling the money from receipt to deposit to logging it in.

“They run a shoestring operation, even when they have a lot of money,” Norton said. “When you start getting into the hundreds of thousands of dollars and the millions and it’s still being run informally, with one individual without general accounting principles … you can suffer some really serious embezzlement.”

Still, Norton, who was with the FEC from 2001 to 2007 said in his experience, it was more typical for a campaign treasurer to swindle an official who entrusted the person with the money than for the official to actually be in on it. In that sense, he called the Jackson case an unusual one.

“All that said, I don’t have any reason to think that abuse is widespread,” Norton said. “I think most of the time people pay trusted advisors [to properly handle the campaign money.] There are people who do this kind of thing for a living.”

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