California's FPPC Updates Campaign Disclosure Rules, Including Cryptocurrency Contributions
California's FPPC updated campaign rules, including guidelines for cryptocurrency contributions, ensuring compliance with U.S. regulations and transparency in political financing.
The California Fair Political Practices Commission (FPPC) has made significant updates to its campaign disclosure manuals, including the introduction of detailed rules for cryptocurrency contributions. These new guidelines were revealed in the FPPC's August 2023 agenda.
Under the new rules, cryptocurrency contributions are subject to applicable limits and must adhere to specific requirements. Contributions in cryptocurrencies may not be accepted from foreign principals, lobbyists, or anonymous sources. They must be received through U.S.-based payment processors registered with the U.S. Department of Treasury and the Financial Crimes Enforcement Network.
Payment processors are required to convert cryptocurrency contributions to U.S. dollars at current exchange rates and deposit the funds into the committee’s campaign bank account within two business days. Cryptocurrency contributions are labeled as non-monetary contributions, and any processing fee paid to the processor is not deducted from the reported amount.
In other matters addressed by the FPPC, the ACLU of Northern California was found to have violated Government Code Sections, leading to a proposed penalty of $6,500. The violations included failure to disclose reportable activity and improper disclosure statements on an advertisement.
The Commission also presented Proposed Regulation 18318, which delegates the authority to the Executive Director to settle monetary penalties for a lesser sum. Guidelines on the circumstances that warrant a settlement were also outlined.
Furthermore, proposed amendments to Regulations 18531.1 and 18537.1 were discussed to address the return, transfer, or carry-over of campaign contributions when a candidate withdraws or does not run in an election.
Lastly, the FPPC provided an update on audit requirements, the audit process, FY 2022/23 audits, and common audit findings, reflecting the Commission's ongoing commitment to transparency and accountability in political practices.
These updates mark a significant step in California's efforts to regulate political contributions, including the emerging field of cryptocurrency, ensuring a more transparent and accountable political financing system.
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