And The Ted Cruz Goldman Sachs Loan, Explained : NPR
1. Cruz had a legal obligation to disclose the loans
There are two disclosure requirements. He complied with one, reporting both the Goldman Sachs and Citibank deals in his personal financial reports as a candidate and newly elected senator. The campaign paid zero interest, the documents say.
The personal financial disclosures also report Cruz's no-interest loans to the campaign. There's no connection made between the two sets of transactions. The disclosures also don't show any sell-off of the couple's financial investments.
Cruz's Senate campaign reported to the Federal Election Commission that Cruz made the loans; there's no mention of Goldman or Citi. This appears to be contrary to election law, which requires a candidate not only to report the amount, interest rate, terms and date but also to file the actual loan documents. That last is to thwart secret sweetheart deals.
Candidates often take out second mortgages on their homes, which appear in FEC filings as bank loans to the candidate to benefit the campaign. The Cruz Senate campaign didn't do this with the Goldman and Citi deals; it just reported personal loans from Cruz. The two scenarios may not be exactly parallel — or they could conceal problems.
Take joint ownership. Larry Noble, a former general counsel at the FEC, said that beyond the residence, a candidate usually cannot borrow against more than 50 percent of jointly owned assets. The spouse is restrained by the contribution limits; for Heidi Cruz in 2012, that would have been $5,000 total for the primary and general elections.
1. Cruz had a legal obligation to disclose the loans
There are two disclosure requirements. He complied with one, reporting both the Goldman Sachs and Citibank deals in his personal financial reports as a candidate and newly elected senator. The campaign paid zero interest, the documents say.
The personal financial disclosures also report Cruz's no-interest loans to the campaign. There's no connection made between the two sets of transactions. The disclosures also don't show any sell-off of the couple's financial investments.
Cruz's Senate campaign reported to the Federal Election Commission that Cruz made the loans; there's no mention of Goldman or Citi. This appears to be contrary to election law, which requires a candidate not only to report the amount, interest rate, terms and date but also to file the actual loan documents. That last is to thwart secret sweetheart deals.
Candidates often take out second mortgages on their homes, which appear in FEC filings as bank loans to the candidate to benefit the campaign. The Cruz Senate campaign didn't do this with the Goldman and Citi deals; it just reported personal loans from Cruz. The two scenarios may not be exactly parallel — or they could conceal problems.
Take joint ownership. Larry Noble, a former general counsel at the FEC, said that beyond the residence, a candidate usually cannot borrow against more than 50 percent of jointly owned assets. The spouse is restrained by the contribution limits; for Heidi Cruz in 2012, that would have been $5,000 total for the primary and general elections.
