A Republican senator faces serious allegations that he illegally loaned his campaign millions of dollars from his company. But the senator in question—Republican Mike Braun of Indiana—says he can’t fully answer the government’s questions because one of his key staffers “vanished.”
The Daily Beast found him within minutes.
On Wednesday morning, the Federal Election Commission released its audit of Braun’s campaign committee, alleging a litany of serious financial reporting errors, as well as millions of dollars in allegedly improper loans Braun used to finance his 2018 bid—including $1.5 million routed from the candidate’s former company.
However, the campaign claims it cannot fully comply because its former treasurer “vanished,” and they have not been able to locate him in three years.
But the campaign must not be looking very hard. It only took The Daily Beast minutes to identify and locate the man. His mother said in a phone call that she would pass along a request for comment.
The campaign’s Oct. 4 response to the audit explains that the treasurer in question, Travis Kabrick, “was, at least ostensibly, an experienced FEC compliance professional who had worked for many federal candidate committees over many years.”
However, the response adds that “at some point during the 2018 election cycle this individual began making mistakes and failing to perform his services as warranted (and for which he was being paid). He ultimately vanished, and he has not been able to be located since the end of 2018.”
In a hearing with FEC commissioners on Wednesday afternoon, Chris Gober, a lawyer for the campaign, confirmed that the campaign had still not reached Kabrick, who, Gober said, “effectively just up and left and disappeared on the committee.”
And Kabrick, Gober argued, is critical. Without his cooperation, Gober said, “we haven’t been able to obtain all the documents truly needed to address all findings.” He added that the “inability to make contact or get a response” was in fact so extreme that the campaign asked the FEC to subpoena Kabrick, though it is not clear when the request was made, or whether the agency has taken action.
An hour before the hearing, The Daily Beast had confirmed Kabrick’s current job in a phone call with his employer, as well as his location, contact information, and three social media accounts. (Twitter has suspended an account connected to the personal Gmail address Kabrick listed on campaign registration documents, but a company spokesperson did not say when or why the account was restricted.)
Going by the audit’s findings, Kabrick appears to have good reason to keep a low profile. But his absence alone would not seem to cover all of the allegations, which include allegedly illegal loans from Braun’s former company.
The auditors found that Braun’s reports show more than $8.5 million in “apparent prohibited loans” to his 2018 campaign. That includes $7 million in direct loans and lines of credit—with no collateral—“that did not appear to be made in the ordinary course of business.” The FEC also “identified two checks from one corporation totaling $1,500,000 that were reported as loans.”
Those checks came from Meyer Distributing, which Braun founded, and where he served as CEO. The auditors say that fact makes them corporate contributions, which are illegal. The campaign reported them three different ways: first as “compensation” to Braun, then as redeemed stock, and finally as loans.
But that’s just the beginning. The report cites an array of violations, including millions of dollars in misreported contributions and disbursements, as well as reporting errors for another nearly $2 million in donations. The audit also flagged hundreds of thousands of dollars that the campaign paid back to Braun, claiming those repayments exceeded the legal limit—another misstep that would appear difficult to pin on Kabrick.
The report raised eyebrows among campaign finance experts.
Paul S. Ryan, vice president of policy and litigation at campaign watchdog Common Cause, said the allegations cover “massive violations,” including breaking a law more than 100 years old.
“Federal law prohibits candidates from receiving contributions from corporations. This law has been on the books for more than a century for the purpose of preventing politicians from being in the pocket of big corporations,” Ryan told The Daily Beast. The audit, he said, “shows his campaign likely committed massive violations of federal law through receipt of more than $8.5 million in corporate contributions.”
Ryan explained that candidates can borrow money from financial institutions in the ordinary course of business and on standard lending terms. However, he said, auditors discovered more than $7 million in unsecured loans—without Braun putting up “the typically required collateral to assure the loans would be repaid.”
As for the $1.5 million from Braun’s own company, Ryan said the loan exemplifies “special treatment from financial corporations” that “undermines the integrity of our campaign finance laws.”
“Senator Braun and the corporate lenders should be held accountable for any violations,” Ryan added.
Brendan Fischer, director of federal reform at the nonpartisan Campaign Legal Center, offered a similar analysis.
“There is at least the appearance of Braun’s campaign getting special treatment from banks here,” Fischer said. Because this is an interim audit, he pointed out, the question is not yet decided, “but given the amount of money at issue, Braun’s campaign could be looking at some fairly substantial fines.”
The campaign denies wrongdoing. The bank loans, they claim, did not necessarily require collateral from the campaign, in part because Braun is so wealthy and has strong relationships with the lenders. The FEC, they said, should defer to the financial institutions’ judgment on the matter.
The FEC office of general counsel conceded that Braun was indeed wealthy—he reported a net worth at the time of between $35 million and $96 million—but shot down the excuse.
“[N]o documentation was provided to support the assertions outlined within the letter,” the FEC wrote. Therefore, “absent additional documentation,” the loans, lines of credit, and corporate checks “were not from a permissible source.”
As for those checks, the Braun campaign says they were his personal proceeds from Meyer stock redemptions. But contrary to the campaign’s explanation, the company sent them directly to the campaign, not to Braun, and the FEC auditors said they still have not received documentation that would change their mind.
The audit also found that the campaign broke the law again when it paid Braun back in “excessive loan and interest repayments”—about half a million dollars over the limit.
The campaign asked the FEC to scrap that accusation, citing a recent federal court ruling regarding a lawsuit Sen. Ted Cruz (R-TX) filed against the FEC. But that case is not over—it’s headed to the Supreme Court—and the general counsel’s office dismissed Braun’s request to toss the allegation.
The report also emphasizes that the Braun campaign was given ample opportunity to comply with the investigation, but did not.
Repeatedly, the auditors say that “no documentation was provided to support the [campaign’s] assertions,” and note that the campaign still hasn’t corrected the reporting errors it’s acknowledged, even though auditors asked them to do so.
Instead, the campaign tried to shovel the blame onto the elusive Kabrick—with the conspicuous exception of the loans.
For instance, when the current treasurer took over the books in early 2019, he found “a number of refund checks that had been prepared but not sent to donors.” The campaign also said “there are documents that the Committee believes existed at some point,” but it “cannot confirm whether any copies were retained by the former treasurer or otherwise exist.”
“The Committee has no choice but to proceed with this audit with the limited documentation from the 2018 election cycle that it has in its possession,” they added.
Brett Kappel, campaign finance law expert at Harmon Curran, told The Daily Beast that while Kabrick may be the object of the campaign’s ire, the FEC would likely target the campaign, and not him personally.
“The FEC hardly ever takes action against former treasurers as individuals rather than in their official capacity,” Kappel said, noting that on “rare occasions” the FEC has exacted civil penalties on a treasurer convicted of embezzlement.
“However,” he added, “a treasurer could be sued by the campaign for breach of contract, and, depending on state law, possibly even prosecuted for theft of services.”
While Kabrick no longer works in the campaign finance world, he did bring prior experience to the Braun campaign, including a 2015 stint as treasurer for a committee affiliated with Sen. Chuck Grassley (R-IA). And his filings didn’t draw much attention from FEC analysts until he took up with Braun.
The first of those notices flagged some of the same issues covered in the report. Kabrick’s response in part blames “the fax machine with the Secretary of the Senate,” speculating that it had “jammed” and “damaged” one of the filings. (To his credit, that explanation appears to hold water, as the documents appear to have been improperly scanned.)
Kabrick did not return The Daily Beast’s requests for comment. The Braun campaign did not reply to requests for comment.