House, Senate Majority Leaders Urge Democratic Party to Denounce Effort To Overturn Law Banning PAC-to-PAC Transfers

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MONTGOMERY – July 11, 2011 – Alabama House and Senate Majority Leaders today called on legislative Democrats and the Chairman of the Alabama Democratic Party to denounce an effort to overturn a law banning money laundering by political action committees, or PACs.

This practice, known as a PAC-to-PAC transfer, allows lobbyists and others to establish several PACs through which money can be transferred to conceal its true source. Lawmakers passed and then-Gov. Bob Riley signed into law a ban on such activity in last December’s special session on anti-corruption following the historic elections of 2010.

Last week the Alabama Democratic Conference (ADC), the state’s oldest black political group, filed a lawsuit challenging the ban on PAC-to-PAC transfers. Joe Reed, who leads the ADC as its chairman, is also vice chairman of the Alabama Democratic Party.

House Majority Leader Micky Hammon (R-Decatur) and Senate Majority Leader Jabo Waggoner (R-Vestavia Hills) say the lawsuit is an effort to thwart transparency and maintain a culture of corruption that the new Republican-led Legislature has been working to change since elected to the majority last November.

Senator Waggoner said the lawsuit is a blatant attempt to undermine transparency and accountability in the election process.

“Not only should the judge throw out this frivolous lawsuit, Alabamians should be outraged that one Democrat group is fighting for the right to hide political contributions,” Senator Waggoner said. “That’s not a fairness issue, it’s a transparency and integrity issue – and it’s a shame that the Democratic Party continues to tolerate unethical activities.”

Representative Hammon said the lawsuit presents an opportunity for legislative Democrats to stand up to special interests within their own party and stand up for transparency.

“Banning this kind of political money laundering was a stated goal of both parties for at least two election cycles,” Rep. Hammon said. “It should outrage mainstream Democrats that one wing of their party is attempting to undermine one of the most important reforms we’ve enacted in recent Alabama history. It’s a shame our friends in the Minority haven’t yet stood up to the radicals within their party, but it’s not too late. There is still an opportunity for legislative Democrats to the right thing and denounce the ADC’s lawsuit.”

The bill banning PAC-to-PAC transfers – House Bill 9, sponsored by Rep. Mac McCutcheon (R-Capshaw) – passed the House and Senate without a single dissenting vote.

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