Covington recently issued an advisory to its bank and financial institution clients explaining the rules governing their business dealings with candidates and political groups. The advisory, which is available here, deals with loans and other transactions that sometimes cause banks to run afoul of Federal Election Commission regulations or government ethics rules. While banks are often very familiar with the rules governing their own government affairs activities, they are not always as focused on how routine commercial dealings with campaigns and political committees are regulated. There have been multiple FEC cases over the years involving bank loans and even overdrawn checks drawn on campaigns’ checking accounts.
As we head into a new election cycle, this is a good time for banks, candidates, and PACs to get up to speed on these rules.