Three Men Charged With Running ‘Scam PACs’ That Bilked Small Donors

The Justice Department said the three men defrauded donors of $3.5 million, including through robocalls that impersonated former President Donald J. Trump.,

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The Justice Department on Wednesday accused three political operatives of running a scheme to mislead donors and enrich themselves, charging the men with defrauding people of $3.5 million in 2016 and 2017.

The allegations involve two political action committees and include wire fraud, money laundering and making false statements to the Federal Election Commission. It was the latest indictment against operatives who raise money for what are known as scam PACs, which direct much of the proceeds back to the people who run them.

One of the three men charged, Matthew Tunstall, 34, of Los Angeles, has drawn scrutiny for years over the activities of his political action committees, which he has continued to operate. This year, CNN reported on the lavish lifestyle of Mr. Tunstall, who poses as an internet influencer under the name Matte Nox, flashing Gucci rings, wearing designer accessories and driving a black Porsche.

In social media photos, Mr. Tunstall sometimes appears shirtless, exposing a tattoo on his chest that reads “God Will Give Me Justice.”

On Wednesday, the Justice Department said that the two PACs linked to Mr. Tunstall had spent heavily to recruit small donors under false and misleading pretenses, including through robocalls that impersonated President Donald J. Trump.

The indictment, which also includes Robert Reyes Jr., 38, of Hollister, Calif., and Kyle George Davies, 29, of Austin, Texas, accused the operatives of defrauding donors through two entities, Liberty Action Group and the Progressive Priorities Political Action Committee.

“Between January 2016 and April 2017, the defendants obtained approximately $3.5 million from unwitting donors based on false and misleading representations and used those funds to enrich themselves and to pay for additional fraudulent advertisements soliciting donations,” the Justice Department said in a statement.

If convicted on all counts, Mr. Tunstall and Mr. Reyes face a maximum of 125 years in prison, and Mr. Davies faces 65 years.

The charges are notable in part because there are numerous political groups that raise money from unsuspecting small donors and then spend most of the funds not on actual politicking but on themselves, often directing cash to companies owned by the operatives behind the groups.

Paul S. Ryan, the vice president of policy and litigation at Common Cause, a watchdog group, called the indictment “good news for democracy and small donors,” adding that Mr. Tunstall was perhaps the best known of the fund-raising operatives taking advantage of donors in this way.

“This should send a sign to potential scam artists that the Department of Justice is watching,” Mr. Ryan said.

This year, the Federal Bureau of Investigation warned consumers that “scam PACs are on the rise.” Other scam PAC operators have faced charges, including one who pleaded guilty to wire fraud in May after he created PACs that purported to support both Mr. Trump and Joseph R. Biden Jr. last year.

While the charges cover activities in 2016 and 2017, Mr. Tunstall has continued to operate groups that have raised millions of dollars through 2021. One group, the Support American Leaders PAC, raised nearly $3 million in 2019 and 2020 and disclosed nearly $700,000 in direct payments to Mr. Tunstall.

The Support American Leaders PAC was accused of using Mr. Trump’s name and likeness to solicit contributions, and in 2019 Mr. Trump’s campaign sent a “disavowal notice” to the F.E.C.

That group’s activities were not in the charges that were announced on Wednesday.

Mr. Ryan said he expected that a superseding indictment would eventually cover Mr. Tunstall’s past four years of activity. He noted that the charges filed were made under financial crimes statutes and not under campaign finance law. And he urged federal lawmakers to stiffen the existing campaign-finance rules to better protect small contributors.

“Congress really needs to act here,” Mr. Ryan said.

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