A mysterious dark money group that has received Koch-connected funding called "Americans for Job Security" has dropped $689,000 on ads in Wisconsin attacking GOP Senate candidate (and billionaire hedge fund manager) Eric Hovde. It is the first major ad buy in the 2012 election cycle from the secretly-funded group, which is officially registered as a 501(c)(6) nonprofit "trade association" like the U.S. Chamber of Commerce or PhRMA, but does not appear to advance the interests of any particular industry or trade.
The two "issue" ads, which began running just a few weeks before Wisconsin's August 14 primary, accuse Hovde of taking federal stimulus dollars, which the ad says is "leading us towards bankruptcy." However, several TV stations have since taken the ads off the air after Hovde threatened legal action. Hovde claimed that the company, Virginia-based ePlus, had clients that received stimulus funds but did not directly take any stimulus money. AJS has since released a revised ad.
AJS has also had other ads pulled in past elections for misleading content, and faced controversy for others. But the organization and those behind it have largely been able to escape accountability because its funders are kept secret.
"This is the very heart of why our political system is broken," Hovde said of AJS and the ads in an interview with the Milwaukee Journal-Sentinel. Hovde is largely self-funding his campaign. "Money pours in. You don't know where it's coming from. ... This is robbing us of our democracy."
Donors Kept Secret
Which corporations or deep-pocketed special interests back Americans for Job Security? No one knows.
The "about us" page on AJS's website says "Our members are businesses, business leaders and entrepreneurs from around the country," but "AJS does not disclose or discuss its membership further than this."
The group has said in the past that, as a 501(c)(6) "trade association," it raises funds not through donations earmarked for political ads, but from voluntary "membership dues," which the group's leaders decide on their own how to disburse. This has allowed AJS to disguise its funders because of a loophole in campaign finance law only requiring disclosure of donations made for the purpose of funding electioneering communications. This loophole is currently being challenged in federal court in the VanHollen v. FEC case, but AJS has still not disclosed its funders for its Wisconsin ad buy.
Known Funding from Koch-Connected Sources
Though AJS does not disclose its donors, two funding sources have been identified from disclosures filed by contributing organizations.
One known funder of AJS is another mysterious nonprofit called the Center to Protect Patient's Rights (CPPR), which gave AJS $4.8 million in 2010, according to its most recent IRS filings. CPPR's misleading name gives the impression it is concerned about healthcare but it actually appears to operate as a conduit for funding right-wing electoral operations. As a nonprofit, CPPR is not required to report its funders, but it must disclose its grant recipients -- and through those disclosures, Open Secrets discovered that CPPR gave $55 million in 2010 to a variety of nonprofit groups that in turn spent at least $46 million attacking Democrats in the 2010 elections.
CPPR's President Sean Noble has been described as a "Koch operative" affiliated with a number of Koch-connected political operations, and who in the runup to the 2010 elections met regularly with GOP strategists and Karl Rove's Crossroads groups to plot and coordinate that year's Republican electoral landslide. Other individuals associated with the group also have Koch ties. Consultant Cheryl Hillen has raised at least $2.6 million for the organization and was formerly director of fundraising for the Koch-backed Citizens for a Sound Economy (which later split into Americans for Prosperity and Freedomworks). One of CPPR's original directors, Heather Higgins, is chairwoman of the Independent Women's Forum, a climate change denialist group that has received Koch money and was previously run by a Koch lobbyist.
Close Coordination with Other Right-Wing Groups
Not only has AJS received millions from an apparent funding hub for the groups behind the GOP's 2010 electoral victories, AJS itself is closely connected to the right-wing electoral powerhouses currently active in the 2012 campaign.
A New York Times report on AJS from 2010 reported that, while their mailing address is a UPS drop box in Alexandria VA, the group's President Stephen DeMaura, who is only 27 years old and is the former Executive Director of the New Hampshire Republican State Committee, works out of the notorious 555 suite of 66 Canal Center Plaza in D.C., which also houses the headquarters of Karl Rove's American Crossroads SuperPAC, the related Crossroads Media, as well as consultancies like the Black Rock Group and Target Point Consulting. AJS paid Crossroads Media $649,800 to produce and place its anti-Hovde ads in Wisconsin.
Wisconsin's primary is scheduled for August 14.
Will Dooling contributed to this article.