A legal watchdog group has filed a complaint alleging Steve Bannon and Rebekah Mercer failed to properly register groups in California, avoiding corporate taxes as well as disclosure laws.
A network of political groups tied to Donald Trump’s chief strategist may have dodged corporate taxes and shielded information about its executives by using Delaware shell companies to surreptitiously conduct business in another state.
The allegations involve a constellation of groups financed by the wealthy Trump-backing Mercer family: a super PAC called Make America Number 1 and two Delaware-incorporated political vendors, film production company Glittering Steel, and data firm Cambridge Analytica.
The super PAC has steered large sums to the two companies, which have in turn paid consulting fees to chief White House strategist Steve Bannon. The payments to and from Cambridge Analytica and Glittering Steel were sent to a single Beverly Hills address.
That indicates that the companies were engaged in intrastate commerce in California, according to a complaint filed with the state’s attorney general and secretary of State on Wednesday by the Campaign Legal Center, a legal watchdog group.
Out-of-state companies engaged in intrastate business in California must register as foreign corporations with the secretary of State, but that office has no incorporation records on file for either company.
Foreign corporate registration in California is designed to ensure that companies doing business in the state pay taxes on the income they earn there and disclose specific information about their corporate structures.
By failing to register with the California secretary of State, Cambridge Analytica and Glittering Steel may have escaped taxes on income derived in California and disclosure requirements that are far greater than those levied on corporations in Delaware, a state known for its corporate friendly business climate.
Out-of-state corporations and limited liability companies in California are required to disclose the names of their officers or managers. In Delaware, according to the Financial Transparency Coalition, “you need to provide more identification to obtain a library card than you do to create a company.”
Cambridge Analytica’s and Glittering Steel’s incorporation in Delaware adds another layer of opacity to the operations of a network of advocacy groups and political vendors backed by hedge fund magnate Robert Mercer and his daughter Rebekah that helped propel Trump to victory last year.
That opacity persists despite extensive business activities in California—activities that should, CLC says, force more information about the Mercer political network into public view.
Cambridge Analytica did not respond to questions about its corporate structure. Efforts to reach a representative for Glittering Steel were not successful. Bannon and his private spokesperson also did not respond to multiple requests for comment.
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- Discussion
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A Mercer super PAC's payments to 2 vendors, and the vendors' payments to Bannon, all went to 1 Beverly Hills address https://t.co/6WX5rFMdVv
— Lachlan Markay (@lachlan) April 14, 2017
Since the $$$ came from and went to entities in California, the vendors are bound by CA taxes and corporate disclosure. They filed neither.
— Lachlan Markay (@lachlan) April 14, 2017
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