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How ABC and Ken Sim skipped Campaign Financing 101 and came out ahead



by Sal Robinson


In the fall of 2021, I was secretary-treasurer of a newly-formed political party – TEAM –  and what I knew about the inside of an election campaign was exactly nothing.  The caution I received from someone who had lived and breathed election campaigns for decades was this: “At your peril will you make any mistakes with money.”  So, I read the legislation and made notes on potential pitfalls for the uninitiated, and in early November attended an Elections BC webinar for party officials.  It clearly explained our duties, what we were prohibited from doing, and what it might cost if we did. 

 

And so I was astonished when ABC’s December 2023 amended disclosure statements revealed they had accepted six figures’ worth of prohibited contributions because, they said, they misunderstood the rules.  As reported by The Vancouver Sun’s Dan Fumano on Jan. 4, “ABC’s financial agent Corey Sue said most of these prohibited donations stemmed from the party’s ‘unique situation with four independent candidates doing their own thing before joining ABC.’”

 

Independent candidates “doing their own thing” is not such a unique situation that there isn’t a rule about it in Elections BC’s Guide to Local Elections Campaign Financing in B.C. for Candidates.

 

Here it is on page 16: “When a candidate receives endorsement from an elector organization, the financial agent for the candidate must provide all campaign contribution information to the financial agent of the elector organization to ensure that contributions from eligible individuals do not exceed the limit.”

 

As financial agent for ABC (the “elector organization,” in Elections BC lingo) that’s what Sue had to do, when he had to do it and why he had to do it. How hard is that to comprehend?

 

For clarity, as they say in the statutes, when in mid-September 2022 [for dates see cover pages of each] candidates Rebecca Bligh, Lisa Dominato, Sarah Kirby-Yung and Ken Sim received ABC’s endorsement and appointed Sue as their financial agent, they had to give him their records just so he could look for the very duplications that ABC has now disclosed.

 

No loophole exists whereby independent candidates may raise money for years, get a party endorsement and financial agent just before an election, and then throw all their cash into a common pot.  That would be no different than the bad old days before the Local Elections Campaign Financing Act imposed annual donor limits.

 

A simple spreadsheet, updated as donations came in, is what TEAM used.  Probably that’s what the three council candidates used, too, because before they appointed Sue to act for them, their record-keeping was exemplary and their contributions legitimate (with a couple of exceptions which Dominato documented receiving and returning).  [pp 13 to 15]

 

When ABC endorsed them and absorbed their resources, the result for the donors they had in common was inadvertent violation of the annual limit.  The excess was required to be refunded to those donors as soon as Sue found them by scrutinizing the records of ABC’s newly on-boarded candidates.  That did not happen.

  

Ken Sim, who is a chartered accountant and therefore presumably familiar with numbers,  disclosed no prior financial agent [see last page]. Therefore he was, by default, responsible for ensuring the legitimacy of contributions he collected before his campaign financing arrangement with Sue, dated September 14, 2022.

 

Sim had already collected $667,975 before his April 2021 announcement that he would run for mayor in 2022.

 

In 2021, when the contribution limit was $1200, he accepted $21,600 from just six people. That’s $14,400 in prohibited contributions. He also accepted $2400 from a business and only refunded it seven weeks ago. [see p 50 of Sim’s amended report]

 

There’s another category of prohibited donations to be examined.  “Indirect campaign contributions are not allowed. This means that someone cannot give money or other property or services to a person for that person to make a campaign contribution.”  [page 22 of the Guide]  Neither donating in the name of one’s spouse or child, nor accepting such a donation, is lawful.

 

And this is not Ken Sim’s first rodeo.  Back in 2020, he was in the news for making two prohibited personal loans totalling $37,000 during his 2018 mayoral run with the NPA.  Elections BC levied no penalty for those offences, deeming the loans a mistake.  Fool me once…

 

This time around, “ABC’s financial agent says the party had believed they were following the rules and, upon learning otherwise, acted quickly to return prohibited donations.” (“ABC Vancouver returns $116,000 in prohibited donations from 2022 election,” Vancouver Sun, Jan. 4, 2024)

 

No doubt they “acted quickly;” there is serious incentive to do so.  In a worst-case scenario for financial agents who don’t properly handle prohibited contributions, they can be hit by a monetary penalty of double the amount: a potential $232K fine for Corey Sue.

 

Penalties for over-contributions can be equally severe for parties and donors, depending on what the B.C. Chief Electoral Officer decides: $232K for ABC and a total of that for the extra-generous donors. [see p 53]

 

It might not happen. Maybe it’s only “strike two.”

 

But what did happen is that ABC had all that money right when it came in handy, during the 2022 campaign.

 

People may not loan to a campaign more than they may legally donate.  If they’ve already donated the maximum, they may not loan a dime.   In effect, ABC “borrowed” $116K from their donors and didn’t have to pay it back until they got caught, more than a year later

 

For context, what could $116K buy for ABC?  It might have paid for all their campaign period social media and television ads.  Or nearly three quarters of their signs.  Or more than half of their radio spots.  Or it might have covered 98% of Ken Sim’s campaign period expenses. [see p 72 for elector organization expenses, p 77 for Sim’s expenses]

 

Since last July, TEAM has been communicating with the Chief Electoral Officer and Elections BC compliance officers regarding ABC’s prohibited campaign contributions.  ABC’s amended disclosure in December validated our concerns. Our scrutiny of the public record continues.

 

So far, they’ve had to pay back $116K and must have fundraised to manage it, as only half that amount remained in their campaign account after the election ($58,506.86, to be exact; see page 2).  We won’t know until the 2023 financial reports are made public later this year if generous ABC supporters made donations to reimburse themselves.

 

Do fines mean anything to a party such as ABC whose backers have endless resources? Demonstrably not.

 

Does a penalty with real impact exist?  Potentially.  

 

Progress Vancouver’s failure to comply with finance and filing rules got their party deregistered and their candidates barred from running  - with any party - in the next election.

 

A punishment as meaningful as political exile might be sufficient to command respect for the law.

 

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