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How the Trump campaign took over the GOP’s fund-raising

The Boston Globe logo The Boston Globe 3/9/2020 Danny Hakimand Glenn Thrush

CHARLOTTE, NC - MARCH 2: U.S. President Donald Trump speaks to supporters during a rally on March 2, 2020 in Charlotte, North Carolina. Trump was campaigning ahead of Super Tuesday. (Photo by Brian Blanco/Getty Images) © 2020 Getty Images CHARLOTTE, NC - MARCH 2: U.S. President Donald Trump speaks to supporters during a rally on March 2, 2020 in Charlotte, North Carolina. Trump was campaigning ahead of Super Tuesday. (Photo by Brian Blanco/Getty Images) WASHINGTON — President Trump’s campaign manager and a tight-knit circle of allies have seized control of the Republican Party’s voter data and fund-raising apparatus, using a network of businesses whose operations and ownership are cloaked in secrecy, largely exempt from federal disclosure.

Working under the aegis of Jared Kushner, the president’s son-in-law, with the cooperation of Trump appointees at the Republican National Committee, the operatives have consolidated power — and made money — in a way not possible in an earlier, analog era. Since 2017, businesses associated with the group have billed roughly $75 million to the Trump campaign, the RNC, and a range of other Republican clients.

By commanding the party’s repository of voter data and creating a pipeline for small donations, the campaign and party officials have made it increasingly difficult for Republicans to mount modern, digital campaigns without the president’s support. The process has not been frictionless, shot through with accusations of empire-building and profiteering by the campaign manager, Brad Parscale, and his allies. His flagship firm, Parscale Strategy, has billed nearly $35 million to the Trump campaign, RNC and related entities since 2017; the vast bulk of it, he said, was passed along to advertising and digital firms.

The move to consolidate voter data came at the expense of a competing data vehicle developed by the conservative activist Koch brothers, provoking resentment from Koch allies, especially in the Senate. And a fierce campaign to centralize fund-raising on the new platform, a for-profit company that Trump branded WinRed, brought dissent.

WinRed, created last summer, has given the party an overdue counterweight to ActBlue, the Democrats’ small-donor fund-raising juggernaut. With WinRed, donors could contribute with a few clicks, and candidates could reap windfalls through joint appeals with the president. In its first six months, capitalizing on the Republican base’s outrage over impeachment, WinRed raised $100 million.

Its chairman, Henry Barbour, also chairs the other pillar of the GOP machine: Data Trust, a storehouse of personal, commercial, and demographic voter data collected from state parties and voter files or bought from data brokers (or from WinRed, itself a vital source of donor information). Data Trust, a private company controlled by a board of Republican grandees, provided much of the raw material behind the Republicans’ digital-messaging advantage in 2016.

The Parscale-led group — including Katie Walsh Shields and her husband, Mike Shields, both former RNC chiefs of staff, and the party’s former digital director, Gerrit Lansing — has also presided over the creation of other political tools.

Parscale declined to comment in detail. But he and his associates have said that private companies give them greater flexibility, given the constraints of campaign finance laws. The millions moving through opaque businesses have left even the president concerned that Parscale and his team are making too much money, according to campaign and White House staff members.

The Trump family looms over the whole operation, starting with Kushner. His most consistent assignment has been informal campaign chair, overseeing the most vital arm of the new family business: politics.

After Mitt Romney’s failed 2012 presidential run, the party released a 100-page report in which Reince Priebus, then the RNC chairman, offered this: “Our message was weak. Our ground game was insufficient. We weren’t inclusive. We were behind in both data and digital.” Trump’s team embraced the call for change.

Previously, parties had spent heavily on television advertising, but now the RNC moved to rebuild around Data Trust, which it had helped establish. The idea was compelling: If state and national party committees and campaigns fed information into one place, it could create a deeper understanding of voters. If that place were outside the party, fund-raising limits would not apply.

Opposition included the Koch brothers and their data vehicle, i360, which built personality profiles of millions of voters and was used by a number of campaigns. They weren’t the only skeptics who worried the committee was steering business to its pet company.

The Senate committee’s staff was concerned about a consulting contract given to Shields by Data Trust, given Walsh-Shields’ influence, though she had briefly left the RNC in 2017 during the period when it was awarded. Data Trust also chronically needed to purchase new state voter files and pay its staff and vendors like Shields. The party has pumped nearly $15 million into the company since 2016, filings show.

Just before the Republicans lost the House in 2018, Kushner convened operatives to confront a threat. Republicans had watched with alarm as ActBlue helped Beto O’Rourke, a previously obscure Texas congressman, pull in more than $50 million to challenge Senator Ted Cruz. Megadonors warned Kushner that, come 2020, they would not make up for the small-donor deficit.

Republicans had tools, but by coalescing around a single vendor like ActBlue, candidates could raise money jointly and more easily share data on contributors. There were several contenders. But to Kushner and Parscale, who by then was the 2020 campaign manager, only one vendor was acceptable, said several people: a company called Revv, which had already been processing payments for the campaign.

Revv had been cofounded by Lansing. In 2017, Politico reported that, after taking over as the RNC’s digital director the year before, he had encouraged campaigns to use Revv, earning a $909,000 payout from the company. Some party veterans viewed this as self-dealing.

By summer 2019, WinRed was created atop Revv’s platform, but only after negotiations that ended with the Senate campaign committee and RNC representatives imposing restrictions that blocked Lansing from selling WinRed in the future and tightening control of firms he could hire.

The new company was a joint venture of Revv and Data Trust, with 60 percent of profits going to Revv. Parscale, Walsh-Shields, and Shields do not own stakes, records show.

Key aides have positioned themselves at the center of a formidable machine. Walsh-Shields’ consulting firm gets a $25,000-a-month RNC retainer and 1 to 5 percent of money it raises for the party’s 2020 convention. Shields’s Convergence Media represents clients including the RNC. But Parscale has most often been the focus of Trump’s complaints that others are making too much money from his name. He has bought a $2.4 million home in Florida; two condos, owned with his family, together worth $2 million; and a Ferrari.

After a rival aide left an underlined copy of a Daily Mail story detailing his spending on the president’s desk, Trump summoned Parscale for a pointed lecture, according to a senior White House official.

Others in his circle have made purchases of their own.

Lansing bought a $1.7 million home in Washington; Walsh-Shields and Shields bought a $2 million beach house in the Florida Panhandle.

Startups have proliferated around the Trump campaign.

A company called Excelsior Strategies, run by employees at Shields’ firm, Convergence, was contracted to rent Trump’s crown jewel: his list of some 20 million donors; Shields said that only the campaign profited from the arrangement. And Opn Sesame, a voter-texting startup run by Gary Coby, a Parscale protege, is being paid $200,000 to $300,000 a month through the RNC, according to campaign filings.

To allay Trump’s concerns, tens of millions of dollars’ worth of campaign advertising that once ran through Parscale Strategy has been redirected to a new company, American Made Media, which is run by a Parscale lieutenant. There are no public records detailing the company’s financial structure; Parscale and other advisers said they did not profit from it. Parscale has declined to provide a detailed accounting of his network of interlocking businesses and has told associates he follows Trump’s directive, relayed through Ronna McDaniel, the party chairwoman, that he make no more than $700,000 or $800,000 for his campaign work.

Even to insiders, the campaign’s activities can seem opaque.

Last fall, Vice President Mike Pence’s office scheduled his first visit to the headquarters. But when the day came, Parscale canceled, even though the visit was already on the vice president’s official schedule. The visit has not been rescheduled.

For the moment, such concerns are muted as the Trump campaign, the RNC and other affiliated committees raised $155 million in the final three months of 2019, a 23% increase over the previous quarter that was buoyed by the impeachment proceedings.

Most Republican officeholders have succumbed to the WinRed pressure campaign. One late convert was Sen. Thom Tillis of North Carolina, who learned the power of being linked to Trump’s money machine when WinRed unexpectedly sent out a joint fundraising appeal that brought in a “six-figure sum in a single day,” said Tim Cameron, a Tillis adviser and former digital director at the Republican senatorial committee.

Without Trump’s victory, “there’d be nothing at the scale of WinRed,” he said. “All of a sudden, it’s one election, and we have the upper hand.”

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