FPPC complaint alleges Chu skirted campaign finance laws

California Assemblymember Kansen Chu, who is running for Santa Clara County supervisor, is the subject of a complaint filed with the Fair Political Practices Commission.

The complaint, filed by former Assemblymember Paul Fong, alleges Chu violated the Political Reform Act by using his campaign for state Assembly to skirt the donation limits on candidates for supervisor.

In California, Assembly candidates can accept donations of up to $4,700, while candidates for supervisor can only accept up to $1,000 in Santa Clara County. Fong’s complaint alleges Chu maintained his Assembly campaign committee even after announcing in May 2019 he didn’t plan to run for Assembly in order to skirt these limits.

Chu denied any wrongdoing.

“I’ve got nothing to hide,” Chu told the San José Spotlight Aug. 17. “The FPPC is (looking) into it, but I’ve got nothing to hide.”

Part of the funds from the Assembly campaign paid for mailers to promote Chu’s supervisorial campaign in December, according to Fong’s complaint. Recipients of the mailers were mainly in the county’s District 3, where Chu is facing rival Otto Lee for termed-out Supervisor Dave Cortese’s seat.

But District 3 does not fall within Chu’s Assembly constituency.

“I don’t know if (the mailers are) legal or not but it’s certainly questionable,” said Pat Waite, who received one of the mailers and was listed as a witness in the complaint.

Fong, who chaired the elections and redistricting committee during his time in the Assembly, said he worked to pass laws that discouraged the kind of fundraising activity Chu is doing. He looked into Chu’s campaign after his daughter in Sunnyvale received one of the mailers.

Chu faces Lee, a patent attorney and former Sunnyvale mayor, in the District 3 race, and narrowly led the March primary election by less than 3% of the vote. Chu said he believes the state FPPC complaint is part of a smear campaign from Lee because Fong is a “kind of mentor” to Lee.

“They’re just throwing (expletive) at the fans and hoping something will stick,” Chu said.

Fong denied the complaint was part of a smear campaign, saying he was acting on his own ethical beliefs.

“I thought it was unfair and unethical, what (Chu) was doing,” Fong said. “It’s just my value system. It’s how I practiced in the state Assembly. I don’t think (Chu) is acting ethically.”

Fong’s complaint also alleges Chu violated rules for reporting gifts, meals or travel paid for by a campaign committee. Under the Political Reform Act, expenditures on gifts, meals and travel must be reported along with an explanation of the political, legislative or governmental purpose of the expenditure and information such as the date, amount and whether any “household” members were included, according to campaign finance law.

Fong’s complaint alleges that Chu underreported travel and other expenses and excluded information about the nature of the payments. Some of the reports lacking the necessary information are for payments made to Chu’s wife and son-in-law, some dating back to 2014.

The complaint is under review by the FPPC, according to an agency spokesman, which will determine if an investigation needs to be opened.

“On behalf of our neighbors in District 3 and the people of Santa Clara County,” Fong wrote in his complaint, “we demand that the FPPC take immediate action to rectify this issue by holding Assemblymember Kansen Chu accountable for his blatant disregard for ethics and integrity in the political process.”

Chu has received three warning letters from the FPPC throughout his career, which were enclosed with Fong’s complaint.

“I’ve been audited in every campaign,” Chu explained. “They say it’s on a lottery system but I always get audited.”

The first was in 2010 after Chu accepted two gifts in 2008 that exceeded the gift value limit for public officials. Chu responded that he thought they were exempt since the giving organizations were registered 501(c)(3) organizations, and FPPC closed the case.

In 2011, Chu received a second warning regarding gift limits. Chu was cleared after he provided the FPPC with a copy of a check proving he had repaid the full amount of the gift. The FPPC again closed the case.

Chu’s most recent FPPC warning was in 2018, after his 2016 Assembly campaign committee was audited.

The audit found Chu’s campaign committee “failed to maintain adequate records” of the dates of two donations. Because of the lack of records, which is a violation of Political Reform Act, the audit report could not determine if the donations were legal. However, further action was not needed because the audit found that Chu’s committee “substantially complied” with the state election laws.

“There was some oversight but no action,” Chu said of the warnings. “I’m sure the 2020 report will be the same.”

Lee and Chu face off Nov. 3.

Contact Stella Lorence at [email protected] or follow on Twitter @slorence3.