CRIMINAL CAPITALI$M

CANADIAN Billionaire Fined Huge Penalty for Funneling $1.75M to Pro-Trump PAC

Jake Thomas - 
Newsweek
© Chip Somodevilla/Getty Images

U.S. election regulators have hit a Canadian billionaire with one of their largest ever penalties for illegally funneling money to a political action committee affiliated with former President Donald Trump.

The Federal Election Commission fined Barry Zekelman, a Canadian steel executive, and two of his companies $975,000 for directing $1.75 million to the Trump-aligned America First Action, in violation of America's ban on foreign nationals donating to federal elections.

The fine stems from a complaint filed in 2019 by Campaign Legal Center, an elections watchdog group that cited reporting from The New York Times. The complaint alleged that Zekelman used his companies to direct the money to the super PAC in hopes of influencing Trump's tariff's on steel imports.

Super PACs are political action committees that can raise unlimited amounts of money from corporations and individuals. Adav Noti, vice president and legal director of Campaign Legal Center, said in a statement that the fine, the FEC's third largest, should serve as a warning to super PACs.

"Imposing this serious penalty helps protect the voices of voters from being drowned out by foreign corporations and other special interests," Noti said. "Super PACs funded by foreign money are just one example of how wealthy special interests use campaign contributions to rig the political system in their favor."

Zekelman, CEO of Zekelman Industries, used the company's subsidiary, Wheatland Tube, Inc., to make the series of alleged illicit donations in 2018, according to FEC documents.

Responding to the allegations, Zekelman argued the donations were not illegal because the president of Pennsylvania-based pipe manufacturer Wheatland Tube is a U.S. citizen, according to FEC filings assessing the penalty.

However, the FEC determined that "Zekelman Industries, through the actions of its executives, provided substantial assistance in Wheatland Tube's making of prohibited foreign national contributions."

Mickey McNamara, who serves as president of Wheatland Tube and general counsel of Zekelman Industries, said in a sworn declaration that he made the decision to contribute to the PAC after speaking with Zekelman, according to an FEC filing. McNamara said he made the decision to contribute independently and did not know that having Zekelman participate in the discussion would have any legal implications, the filing states.

"The available information nevertheless indicates that there is reason to believe that Zekelman, a foreign national, directed or participated in Wheatland Tube's decision-making process to make the contributions, and Zekelman Industries, through the actions of its executives who report to Zekelman, provided substantial assistance in the making of the prohibited contributions," reads the FEC filing.

The FEC noted that it "did not find that the violation was knowing or willful."

As part of the FEC's decision, Zekelman and his companies must also request a refund of the contributions or that the money be handed over to the U.S. Treasury.

Newsweek has reached out to Zekelman's attorney for comment.