The FEC's 4-2 decision in July, yet to be published, determined foreign nationals — individuals, corporations, and even governments — can spill money into ballot measures because it is not directly funding election campaigns, Business Insider reported.
The case before the FEC orbited around an Australian mining company contributing to funding a ballot measure in Montana, a move that concerned critics.
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"This FEC decision reflects a big loophole in the federal ban on foreign money in U.S. elections," Campaign Legal Center's Brendan Fisher told Axios.
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Federal law prevents foreign entities or persons from contributing to U.S. election campaigns, but they can pour money into legislative bill campaigns, according to the FEC ruling.
"Are we, as U.S. citizens, really OK with letting foreign money go directly to state lawmaking via citizen initiative campaigns?" David Brooks, who lost his challenge in the Montana-based case, told Axios in a statement.
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Seven states have banned this type of foreign funding — California, Colorado, Maryland, Nevada, North Dakota, South Dakota, and Washington, according to Axios.
The Federal Election Campaign Act "regulates only candidate elections, not referenda or other issue-based ballot measures" and "spending relating only to ballot 3 initiatives is generally outside the purview of the Act," the FEC's analysis declared.
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"The FEC has now officially said this is fine, this is OK," Campaign Legal Center's Aaron McKean told BI. "Really, it's pretty upsetting, and it goes against the mission of the FEC to protect our elections."
"The FEC is opening the door to more foreign influence in U.S. politics with this law," McKean lamented to BI.
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"It's years later, and we're still having the same problems with foreign money in our elections," he said. "And it's something that the FEC could fix by themselves. It's their interpretation of the law that is allowing foreign money to get into our elections.
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"The important thing here is that people at all levels of government recognize this is the problem. This is self-governance."
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"There are state laws, there are local laws that are trying to patch up these loopholes, and it really hurts when the FEC essentially blesses this loophole," McKean concluded.
Democratic Commissioner Ellen Weintraub spoke out about the decision on Twitter, stressing that a fuller statement would be delivered tomorrow.
"I voted to protect our nation's ballot initiatives from foreign influence, but my view did not prevail," she wrote. "Ballot initiatives can reach deeply into the laws of a state or locality and directly rewrite both statutes and constitutions. They are vulnerable to manipulation and are deserving of no less protection from foreign influence than are our candidate elections."
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