FEC says Edwards should repay $2M in federal funds

Former Sen. John Edwards' 2008 presidential campaign should repay the U.S. Treasury more than $2 million, the Federal Election Commission said Thursday after an audit of the campaign.

Federal auditors said the campaign understated its cash on hand and overstated its expenses, including money spent to wind down the campaign. Auditors also found that the campaign failed to itemize more than $4 million in loan repayments.

Patricia A. Fiori, an attorney for Edwards, D-N.C., said the campaign would appeal the commission's 6-0 decision.

"The determination is not based on any violation of law, or improper spending, but instead deals with issues such as stale dated checks, and other technical accounting matters," Fiori said in an emailed statement.

Fiori said such determinations are routine in audits of presidential committees.

Audits are required by law for federal campaigns that accept public financing, several of the commissioners noted.

"It is not at all unusual for a campaign to have a discrepancy," said Ellen Weintraub, a commissioner. "It's just a math problem and that's how the math worked out."

Federal auditors said about $2 million of the amount to be repaid was due to federal matching funds the Edwards campaign received but did not deserve. Auditors said the repayment also should include $141,808 in checks the campaign issued that were never cashed. Most of the checks were refunds of general election contributions, the audit said.

The campaign received nearly $13 million in matching funds after it was approved by the FEC in December 2007. Edwards dropped out of the race Jan. 30, 2008.

The FEC's ruling is the latest problem for Edwards, who was indicted last month on federal charges that he accepted illegal campaign contributions to hide an affair during his unsuccessful 2008 White House bid. Edwards, who was the 2004 vice presidential nominee, has pleaded not guilty to six felony charges that include allegations he filed false campaign reports to cover up the payments.

Fiori said in her statement: "One thing needs to be made clear now: Neither Sen. Edwards nor his attorneys have received any funds from the committee in connection with his legal defense related to criminal charges."

The Edwards campaign has continued to spend down its cash. It had about $2.6 million in cash on hand on June 30 after spending $183,000 during the previous three months.

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