Nevada’s low fines fuel anonymous attack ads

An unknown person wants to destroy a candidate’s reputation without sullying his own name or that of the politician he’s supporting.

He anonymously gives tens of thousands of dollars to a third party to mail slick ads attacking the candidate he’s opposing.

When the state demands to know who is paying for the mailers, the third party refuses to disclose its funding source.

The penalty? A maximum of $5,000. And the identity of the person paying for the attacks remains a mystery.

Welcome to Nevada, where if you have funds for modest fines, campaign law allows anonymous attacks.

A recent case highlights the state’s weak campaign laws.

A mysterious company that sent negative mailers in April’s elections faces a fine that even state officials acknowledge is unlikely to stop the practice in the future.

Nevada Policy Group mounted attacks in April against incumbent Mesquite Mayor Bill Nicholes and Las Vegas City Council candidate Laurie Bisch.

Bisch lost to incumbent Councilwoman Lois Tarkanian in April’s election. Nicholes failed to win re-election outright in April by 200 votes. He lost a run-off earlier this month.

“It cost me the election,” Nicholes said of the mailers sent out against him by Nevada Policy Group.

Only Yale Cunningham, a political operative who briefly headed the state Republican Party, has been officially tied to the Nevada Policy Group.

Cunningham did not respond to requests for comment.

Before April’s election, he posted a letter on his Las Vegas front door claiming the company was only seeking to promote integrity in politics.

But a former associate of Cunningham, Dave Gallagher, said money behind Nevada Policy Group came from casino mogul Robert “Randy” Black, according to the Las Vegas Business Press.

In an interview with the Review-Journal this week, Gallagher, now working in Cincinnati, said, “I can’t be certain.”

Black, who owns a number of Mesquite resorts and is a neighbor of Tarkanian, did not respond to a request for comment.

Both Tarkanian and Nicholes’ opponents in the mayoral race have denied any association with Nevada Policy Group or knowledge of who was behind it.

The public may never know.

Since March, the secretary of state’s office has sent letters to the Nevada Policy Group informing them of the need to file an independent expenditure report.

Frank Cremen, an attorney hired by Nevada Policy Group, has told the secretary of state that he disagrees.

The case has been forwarded to the state attorney general’s office, said Matt Griffin, deputy secretary for elections.

Individuals behind the company may be revealed in depositions or subpoenas.

But Griffin acknowledged that the complaint will be dropped if the company agrees to pay the $5,000 fine.

No criminal charges are being pursued, Griffin said.

“Nothing at this point, as far as the information we have, suggests anything criminal occurred,” he said.

Cremen argued against disclosure, saying it’s a First Amendment issue. He compared it to a newspaper’s endorsement.

But a campaign finance expert, Steve Levin of the nonpartisan Center for Governmental Studies, said case law has already established that endorsements and political mailers are treated differently under the law.

Both Nicholes and Bisch questioned the system when told that the identity of those behind the mailers could be kept a secret and Nevada Policy Group would pay $5,000.

“So if you anonymously set out to sabotage a political candidate, it’s nothing,” Bisch said. “That’s absolutely crazy.”

Dan Hart, a veteran campaign consultant who handled Bisch’s campaign, called for criminal charges to be brought against the Nevada Policy Group.

“The consequences of not prosecuting are far-reaching,” he said. “Don’t the voters of Ward 1 deserve to know who the Nevada Policy Group is?”

Nevada’s campaign financial disclosure laws ranked 46th out of the 50 states in a 2005 survey by the Center for Governmental Studies.

Levin, political reform project director for the nonprofit, said the Nevada Policy Group situation highlights a problem with Nevada campaign law.

“Penalties aren’t strict enough,” Levin said. “It’s a loophole.”

Some states have adjustable fines based on how much was spent by the companies or individuals who violated campaign laws.

The weak laws will stay in place for the next two years. Almost all ethics reforms proposed during the legislative session that ended earlier this month died in a state Senate committee.

One bill that did pass was Assembly Bill 80, which requires companies who participate in the political process to disclose the names of those who are members or who are funding the company.

If a company refuses to disclose who is behind it, the maximum penalty it faces is $5,000.