Nearly half of 2019 donations to ActBlue, the Democratic Party’s biggest fundraising platform, were made by people who listed themselves as unemployed, raising red flags about whether the online processor is being used for foreign or otherwise illegal contributions.
An analysis of Federal Election Commission data by the conservative Take Back Action Fund found that 2.8 million ActBlue transactions in 2019, or 47.4%, were made by donors who identified themselves as unemployed or listed no employer.
That figure has risen to 50.1% in the first eight months of 2020, said Take Back president John Pudner, who has for years sounded the alarm about the potential for foreign influence on ActBlue over what he described as its lax online credit card security measures.
“Our biggest concern is foreign money. Do you really believe that half of the people who are giving money through ActBlue don’t have a job?” Mr. Pudner told The Washington Times. “To me, that just seems absurd.”
His concern is that illegal contributions could be made using prepaid gift cards and pairing them with either fake names and addresses or the stolen identities of real voters. The FEC provides an additional layer of security by requiring donors to list their employers, but there is no such check on those who identify themselves as unemployed.
“Anyone around the world could use this,” said Mr. Pudner, a former Republican campaign hand. “We were trying to get the practice made illegal just for this reason, because anyone in the world can put a fake name in if you’re not going to verify or if you’re going to use gift cards. We know that China, Russia and Iran are trying to meddle, and this is the easiest way for them to put money in.”
An ActBlue spokesperson defended the integrity of the fundraising powerhouse’s system, saying the platform uses “an array of data sources, internal validation, and third party services to verify the validity of transactions.”
“In addition to our internal security practices, ActBlue is a PCI Level 1 certified service provider, which is the highest level an organization can obtain,” said the spokesperson in an email. “We’re also audited regularly by an external auditor.”
At the same time, ActBlue, which has served as a conduit for more than $6 billion for Democratic candidates and progressive causes since 2004, acknowledged that a “significant portion” of its donors listed themselves as unemployed.
“We report every single federal donation made on our platform to the FEC, making donating through ActBlue the most transparent way possible to donate,” said the spokesperson. “We report the information donors enter about their occupation and employer, and we do see a significant portion of donors who report their status as not employed, such as retirees or full-time parents.”
Take Back senior adviser Matt Braynard said that the analysis excluded those who identified themselves as retired.
“Retirees get coded a certain way,” Mr. Braynard said. “Our numbers are exclusively those who say not employed or unemployed or left it blank.”
The result is donations that are virtually untraceable, he said.
“Because they are not verifying that the people making the donations are in fact the donors on record, they cannot reliably be traced,” Mr. Braynard said.
What about Republicans? The analysis found WinRed, the GOP version of the ActBlue fundraising platform, listed 5.6% of its transactions as coming from unemployed donors in 2019, and 3.8% in 2020.
The unemployment rate in 2019 was less than 4%, but rose sharply during the novel coronavirus pandemic in 2020, which was why Take Back broke out the figures from 2019 and 2020, Mr. Pudner said.
The Take Back analysis found a similar disparity between the presidential campaigns. The analysis found Biden for President, which does most of its fundraising on ActBlue, reported 51% of its 2019-20 transactions coming from unemployed donors, versus 2.7% on Trump for President.
Mr. Pudner said that WinRed and the Trump campaign use the bank verification system, which checks the name and address entered for online purchases against the credit card number, and bounces the transaction back if something doesn’t match.
“The normal bank-processor verification is free,” said Mr. Pudner. “It’s the same one that works if you were buying something online. If you’re using your credit card, the bank automatically bounces that to see if your credit card matches your name, so if someone stole your card and don’t know your ZIP code, that’s where it’s caught.”
He said that “what ActBlue did is it proactively opted out. They said they would only use bank processors if the processors did not do the normal verification bounce.”
“They opted out of a system that works perfectly for everything else, and that’s why it’s wide open,” Mr. Pudner said. “Anyone in the world who’s nefarious knows they’ve got a system where they’re not going to check, I can put whatever name I want in and give money.”
The ActBlue spokesperson disputed the credentials of Mr. Pudner, who worked on Republican campaigns for 25 years and ran field operations for the Bush 2000 campaign before founding the nonprofit Take Back the Republic and the Take Back Action Fund in 2015.
Fox News broke the story on Saturday.
“John Pudner, the source for this story, is not a security expert, and his wild conjecture about how security works demonstrates that,” said ActBlue. “ActBlue performs sophisticated analysis on every single contribution that passes through our platform. His assertion that ActBlue is an ‘untraceable system’ is demonstrably false and widely dismissed within the campaign finance community.”
ActBlue has served as a pass-through for $889,936,693 in donations in the 2019-20 campaign cycle, according to Take Back, while the year-old WinRed conduit has raised $301,920,677.