Shining a Light on Karl Rove's 'Dark Money' Group

Aug. 1, 2012 -- The walls are slowly closing in on the so-called shadow campaigns being run by political operatives like President George W. Bush's longtime lieutenant, Karl Rove.

A Federal Election Commission decision last week could mean new restrictions on Rove's Crossroads GPS group, and other similar outfits, testing their ability to keep secret the names of the wealthy donors who fund the core of its political messaging.

Crossroads GPS, unlike the Super PACs that have become such a bitterly disputed element of this campaign season, is in legal terms a nonprofit "social welfare organization." This designation has allowed the group to keep donor names private. The FEC ruling, finally reached after multiple court decisions, will make that a little bit tougher.

Crossroads is the largest such social welfare organization and among the biggest spenders of the election season. The nonpartisan Sunlight Foundation has counted up more than $85 million in planned and delivered ad purchases by Crossroads GPS. Of that, according to the group's research, about $70 million will go to fund ads attacking President Obama on particular issues.

Crossroads GPS TV spots have names like "Basketball" and "Ants." They are vaguely titled and carefully worded. They do not explicitly state how the viewer should vote, nor is there much talk about jump shots or pest control. But their purpose is as clear as donors' intents are murky.

And that is unlikely to change, at least before the November elections. It could, however, make for some difficulties down the road, a road likely to lead back to the Supreme Court.

For Crossroads GPS and other similar groups, including the pro-Obama Priorities USA, anonymity is the big selling point. Not every big giver wants to become a political celebrity (like casino magnate and Romney travel-buddy Sheldon Adelson), so Crossroads allows them to get in the game without being made to put names on the back of their jerseys.

The FEC mandate, which comes as the result of a case brought by Rep. Chris Van Hollen, D-Md., and argued in part by The Campaign Legal Center's Paul Ryan, means that the groups must now use, as Ryan says, certain "magic words like 'vote for' or 'vote against'" in order to legally keep their donors' names out of the public sphere.

"The irony," he explains, "is that the more explicitly the ad pushes one particular candidate, the less disclosure is required."

That's where the IRS comes in – or could - Ryan says, if it chooses to be more engaged.

Crossroads GPS maintains its tax-exempt status specifically because it does not – or has not to this point – released so-called independent expenditure ads. That's the legal term for spots that openly push for or against a candidate's election. If the FEC ruling in the Van Hollen case pushes groups like Crossroads GPS too deep into that kind of advertising, the IRS could revoke their exemptions and put a crimp in their finances.

Crossroads GPS spokesman Jonathan Collegio told Mother Jones that the group is "aware of the key dates, and closely follows all laws and regulations that govern the process." He has yet to respond to a request from comment from ABC News.

Ryan suspects that the decision will not have an immediate impact – the IRS, though apparently interested, is unlikely to jump into the fray so close to Election Day - and that the "dark money," as critics call it, will continue to roll in until more court cases are brought and won.

'Hellbent on Hiding Donors'

"There is such strong determination to avoid donor disclosure and that will see them find a way around this," he said. "They're hellbent on hiding donors."

Sen. Sheldon Whitehouse, a Rhode Island Democrat, has similar concerns, saying that the FEC is regarded by organizations like Crossroads GPS as being a "paper tiger, easily deadlocked" into inaction and "ignored with relative impunity."

Rep. Van Hollen seems to agree, his office conceding in a statement that "there is more to be done" in the quest to "promote transparency and disclosure of the funds being used to influence our political process."

The utility of the new rules will get a quick test. By law, they go into effect 60 days before the general election or 30 before primary votes or national political conventions. The Republican National Convention, scheduled to convene Aug. 27 in Tampa, Florida, is less than four weeks away.