New calls went up for Postmaster General Louis DeJoy to be fired from his job Sunday after it was reported that former employees of the GOP megadonor and logistics executive now running the U.S. Postal Service reimbursed workers at the company for donations they made to the Republican Party at his behest—an arrangement that would be illegal under both state and federal campaign finance laws.
"Add Trump's crony DeJoy to the list of allies who should be indicted. This is against the law and DeJoy must be fired."
—Rep. Gerry Connolly (D-Va.)
The arrangement with former employees at his company, New Breed Logistics, was first reported by the Washington Post on Sunday.
Along with other employees who confirmed the story but requested anonymity for fear of reprisal from DeJoy, the Post spoke with David Young, longtime human resources director for DeJoy who is now retired but had access to payroll records from the 1990s up until 2013.
"Louis was a national fundraiser for the Republican Party. He asked employees for money. We gave him the money, and then he reciprocated by giving us big bonuses," Young explained to the newspaper. "When we got our bonuses, let's just say they were bigger, they exceeded expectations—and that covered the tax and everything else."
One of the unnamed employees said DeJoy "would ask employees to make contributions at the same time that he would say, 'I'll get it back to you down the road.'" That kind of arrangement, the Post explained "would be unlawful."
Responding to the Post's reporting, Senate Minority Leader Chuck Schumer called for an urgent probe into the matter.
"These are very serious allegations that must be investigated immediately, independent of Donald Trump's Justice Department," Schumer said in a statement Sunday evening. "The North Carolina Attorney General, an elected official who is independent of Donald Trump, is the right person to start this investigation."
Monty Hagler, a spokesperson for DeJoy, told the Post that the Postmaster General—a major donor to the GOP and President Donald Trump who has been at the center of intense controversy since taking over at the Postal Service and been accused of trying to sabotage from the within the agency he has been charged with leading—was not aware that any of his former employees had felt pressured to make donations. DeJoy, Hagler added, "believes that he has always followed campaign fundraising laws and regulations."
As labor experts like Steven Greenhouse point out, if DeJoy was laundering political giving to the Republic Party through employees at his company, it would be a criminal violation of federal election laws.
Breaking -- Postmaster General Louis DeJoy's rise as a GOP fundraising powerhouse was fueled by his urging his employees to donate to the GOP -- and then he illegally reimbursed them for those donations. https://t.co/XqU56Dc0sf
— Steven Greenhouse (@greenhousenyt) September 6, 2020
"This, if true, is a big no-no," tweeted Blake Hounshell, Politico's editorial digital director, in response to the story. If proven accurate, said independent journalist Judd Legum, "DeJoy blatantly violated federal law."
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Rep. Gerry Connolly (D-Va.), chair of the subcommittee on Government Operations which has oversight over the USPS, said such behavior would be reason to have DeJoy removed from his powerful post.
Add Trump’s crony DeJoy to the list of allies who should be indicted. This is against the law and DeJoy must be fired. https://t.co/f6YRAyZUk1
— Rep. Gerry Connolly (@GerryConnolly) September 6, 2020
According to the Post:
Although it can be permissible to encourage employees to make donations, reimbursing them for those contributions is a violation of North Carolina and federal election laws. Known as a straw-donor scheme, the practice allows donors to evade individual contribution limits and obscures the true source of money used to influence elections.
Such federal violations carry a five-year statute of limitations. There is no statute of limitations in North Carolina for felonies, including campaign finance violations.
During sworn testimony before the House in August, Dejoy was specifically asked by Rep. Jim Cooper (D-Tenn.) if he had ever reimbursed executives at his company for donations they gave to Trump's campaign. Not only did Dejoy say that he had not, he called the question "outrageous."
During his testimony, DeJoy was asked by Rep. Jim Cooper (D-Tenn.) if he had repaid executives for making donations to the Trump campaign. “That’s an outrageous claim, sir, and I resent it. . . . The answer is no,” DeJoy responded angrily. https://t.co/DJAQJklZRB
— Reza Aslan (@rezaaslan) September 6, 2020
Sanho Tree, a fellow at the Institute for Policy Studies in Washington, D.C., said it appears as though what DeJoy is alleged to have done is the same "straw donor crime" that right-wing political operative Dinesh D'Souza "was convicted of—and for which Trump pardoned him." In 2014, D'Souza pleaded guilty to one felony charge over the incident and was sentenced to eight months in a halfway house and fined $30,000. Trump pardoned D'Souza for the crime in 2018.
"What is alleged here—"straw" donations— is not a minor violation," said political columnist Karen Tumulty. "Many people have faced prison for this."
Note: This piece was updated from its original to include additional comment from Sen. Chuck Schumer.