With more than $1.6 million in ghost financial transactions and no more than a shameful wink by the Kansas Ethics Commission that forced the party to pay $89,000 in penalties – but to its political pals, no less – political organization treasurers at every level must be hoping for “The Democrat Deal” if they ever find themselves similarly askew of state election finance law.

Illuminating research by Johnson County data scientist Earl Glynn reveals the laxity with which the Kansas Ethics Commission allowed Democrat financial managers to slip the bounds of state election finance law leading up to the fall 2022 General Election, becoming subject to a “penalty” for their misdeeds that was paid to organizations that support Kansas Democrats in the first place.

Glynn published his findings recently in a post on his Substack “Watchdog Lab” :

“While studying contributions made by Mike Kelly, chair of the Johnson County Board of Commissioners, to several Kansas Democratic Party committees, I ran across five unusual expenditures totaling over $89,000 made by the Kansas Democratic Party’s Victory Fund 3 to five nonprofits in Oct. 2022.

What is “disgorgement”? The Legal Institute at Cornell University defines it as “…a remedy requiring a party who profits from illegal or wrongful acts to give up any profits they made as a result of that illegal or wrongful conduct. The purpose of this remedy is to prevent unjust enrichment and make illegal conduct unprofitable.“

Glynn said the numbers begged the question: Why is KDP giving $17,500 to a neutral non-profit, Kansas CASA Association, and why is the KDP giving $71,543 to four “nonpartisan” but politically progressive nonprofits — their friends? 

Glynn said the organizatioinal ties between those four 501(c)(3) nonprofits and the Kansas Democratic Party were historically clear:

• ACLU Foundation of Kansas. According to Influence Watch the ACLU is a “left-leaning activism organization” and in 2018 had become a “hub of liberal activism.”
• Kansas Appleseed Center for Law & Justice has laudable programs for foster care, food assistance and child nutrition, but why are these programs executed in the context of voting? Kansas Appleseed has been a direct recipient of grants from George Soros’ nonprofits and the Tides Foundation.
• League of Women Voters of Kansas. According to Influence Watch about the LWV:  “Though the group is officially nonpartisan under IRS nonprofit rules, it has been widely criticized for pushing left-leaning policies.”
• Trust Women Foundation was founded in the memory of abortionist, Dr. George Tiller. Trust Women provides abortions and “gender affirming care” and was active in opposing the Value Them Both amendment in 2022.  Trust Women received over $2 million in 2020-2022 from “dark money” Hopewell Fund.

Both ACLU Kansas and Kansas Appleseed receive significant funding from the Kansas Health Foundation for “integrated voter engagement.”

Self-Reporting

Glynn obtained a copy of a letter send by Kansas Democratic Party Chair Vicki Hiatt to the Ethics Commission on Oct. 6, 2022 with details of reporting errors from 2009 to 2016.

Read the entire letter with details in Exhibit 1:

	KDP Chair Viki Hiatt’s letter to Ethics …7.63MB ∙ PDF file
Download

The letter reported incredible reporting errors by former Kansas Democratic Party treasurers Matt Watkins and Tobias Schlingensiepen:

• $521,831 in unreported contributions
• $206,510 in overreported contributions
• $546,859 in unreported expenditures
• $252,513 in overreported expenditures
• $89,042 of unknown contributions

A Kansas City Star article from June 27, 2023 identified Watkins as a major Wyandotte County commercial developer, who had been arrested on June 15 and “charged with forgery, identity theft and fraudulent campaign finance reporting.”

Schlingensiepen is currently serving in the Kansas legislature as a representative from District 55, which covers central Topeka.

Stipulation

An undated stipulation summarized the failures of Watkins and Schlingensiepen in filing campaign finance reports. The Ethics Commission says this document was signed on Nov. 16, the day of the hearing.

A stipulation is a formal legal acknowledgment and agreement made between opposing parties before a pending hearing. [Source: Wikipedia]

Watkins’ failures spanned 2012 through 2015, while Schlingensiepen’s failures were only for 2016.

The Stipulation cites “The Letter” from Oct. 6 about the KDP’s proposed terms of disgorgement.

“Was the KDP allowed to pick their charities — mostly their progressive, political friends — without any objection by the Ethics Commission?” Glynn questionned. “No information was released about how the charities were selected and approved, which was a specific question in the KORA request.”

Glynn noted the stipulation is deceptive in claiming the KDP did not benefit from the reporting errors, since it fails to mention the KDP benefits from disgorgement of funds to its political friends.

View the Stipulation document here:

	Stipulation776KB ∙ PDF file
Stipulation by Mark Skoglund, Ethics Commission, with Respondents Matt Watkins and Tobias Schlingensiepen. The document identifies 13 campaign finance report dates signed by Watkins and two signed by Schlingensiepen.
Download

Civil Fine Determination and Hearing

According to the Stipulation, the Notice of Civil Fine Determination and Hearing was served on Oct. 10, 2022. 

The hearing was scheduled for Oct. 26 in the Ethics Commission’s Conference Room, but minutes of the Nov 16 meeting indicate the hearing was held on that date.

Notices to the respondents gave details of the 56 allegations against them.

	Notices of Civil Fine Determination and …1.32MB ∙ PDF file
Hearing scheduled for Oc. 26, 2022. Notice to respondent Matt Watkins contained 48 separate allegations. Notice to respondent Tobias Schlingensiepen contained 8 separate allegations.
Download

The Notices informed respondents about large potential penalties, especially given the large number of allegations.

… the Kansas Governmental Ethics Commission … may assess a civil fine in an amount not to exceed $5,000 for the first violation, $10,000 for the second violation, and $15,000 for the third and for each subsequent violation.

Civil Fine Assessment Orders

Progressive attorney Pedro Irigonegaray represented the KDP’s former treasurers and attempted to minimize the failures according to the minutes: 

Mr. Irigonegaray said the stipulations set forth explain what happened, and it was important to note that not a single penny of the misreported funds benefited either Mr. Watkins or his client, Mr. Schlingensiepen, and the manner in which these two gentlemen worked was on a voluntary basis. Mr. Irigonegaray said paragraph nine (9) explains the process through which they received the reports for their signature and that Mr. Watkins and his client, Mr. Schlingensiepen, did not have the opportunity to review the totality of the documents but were simply provided by staff and by a firm the documents to be signed. Mr. Irigonegaray said steps have been taken to ensure that this will not happen in the future.

So no one at the KDP, including the treasurer, is responsible for accurate campaign finance reports?

Ethics Commissioner Amy James made successful motions about the civil penalties to be assessed. 

The motion about Watkins included a $5000 fine, which would be waived for writing 10 letters and serving 24 hours of community service.

Ms. James made a motion to assess Mr. Matt Watkins a total fine in the amount of $5,000 however if Mr. Watkins disseminates at least ten (10) letters to party or central committee treasurers of record promoting education awareness on the importance of following campaign finance reporting laws and performing twenty-four (24) hours of non-political community service, the payment of the assessed fine shall be waived if completed in the next 90 days, and then send a letter of caution indicating that future violations could result in a civil fine and it is a misdemeanor offense.

A similar motion about Schlingensiepen included a fine of $1000, which would be waived for writing 10 letters and serving 8 hours of community service.

	Civil Fine Assessment Order against Matt…120KB ∙ PDF file
Download

	Civil Fine Assessment Order against Tobi…156KB ∙ PDF file
Download

Waivers

In response to a KORA request, the Ethics Commission provided the template of the letter used by Matt Watkins as part of the waiver of his $5000 fine. [The intent of the KORA request was to get a copy of an actual letter that was sent.]

Dear campaign treasurers,

As a former campaign treasurer who recently experienced firsthand the challenges and potential consequences of this important role, I agreed to share my story and offer some cautionary guidance to others who serve in this role.

As the treasurer for the Kansas Democratic Party (KDP) from 2010-15, I was responsible for reviewing and signing finance reports that were compiled by the KDP staff and reviewed by a compliance consultant. I relied on the information provided as I believed it was complete and accurate. However, treasurers are the legally responsible party for compliance with Kansas Ethics Rules and Regulations.  Errors in finance reports can expose you to fines or other actions by the Kansas Governmental Ethics Commission (KGEC).

Treasurers are held to a high standard of responsibility, regardless of whether or not you prepare the report yourself. It is essential to have access to bank records and actively participate in the completion of the report yourself or diligently check the report if it is provided by a third party. Additionally, you must ensure that any succeeding treasurer has all the records that you had access to.

If you cannot adequately confirm the accuracy of a campaign finance report, you should insist on getting complete information or consider resigning.

I hope my experience can alert other treasurers to avoid a similar situation and potential fines. Make accuracy and completeness the highest priority in your reporting to stay in compliance with KGEC Rules and Regulations.

Sincerely,

Glynn said an email from Mark Skoglund at the Ethics Commission indicated there was only confirmation by phone that Matt Watkins completed the community service: “Other items were confirmed via phone call for which no document would exist” Skoglund’s letter said in part.

A sample letter to treasurers by Tobias Schlingensiepen was not available and apparently was also confirmed by phone.

This letter confirmed Schlingensiepen completed his community service in compliance of the fine waiver agreement:

Unanswered Questions

Glynn says while the data reveals much in terms of Kansas Democrat financial dealings and the degree to which its legal transgressions were soft-pedaled by the ethics commission, more questions abound:

1. What documents exist in the exchange between the Kansas Ethics Commission and the KDP about what disgorgements would be necessary, especially any suggestions about recipients? 
2. Was there any discussion about making disgorgements to “political friends”?

The Ethics Commission declined to release such documents for legal reasons.

FEC hammered KDP in 2021

The incident wasn’t the first to bring Kansas Democrat Party finances into question. On March 8, 2021, the Federal Election Commission released a letter with details of a $60,000 civil penalty assessed against the KDP for violations that total $2,964,990.

	FEC “Statement of Reasons” for $60,000 c…785KB ∙ PDF file
Download

Related

Inside Democrat’s Best-Kept Secret: Mass nonprofit voter registration, Hayden Ludwig, Restoration News, Mar. 8, 2023.

“For decades, leftists have weaponized America’s charitable sector for partisan gain, thanks to loose laws and a near-limitless wellspring of cash …”

Kansas ethics commission to evaluate factors influencing waiver of campaign finance penalties.  Members of KGEC interested in crafting framework for weighing appeals.  Tim Carpenter, Kansas Reflector, May 25, 2023.

Check online for revisions and updates.

Free subscriptions receive all articles. Paid subscriptions help defray costs for data and open record requests.  Thank you!