A complaint alleging that Democrat Chris Kelly, candidate for attorney general, violated state election law in donating $12 million to his campaign was dismissed Monday by the state's political watchdog agency.
Opponent Kamala Harris, San Francisco's district attorney, filed the complaint last month against Facebook's former chief privacy officer in connection with his sale of stock in the social networking website to raise millions for his campaign.
"After review of the complaint and material provided by Chris Kelly, we have found insufficient evidence to warrant further investigation," the Fair Political Practices Commission ruled. "We are closing this matter without further action."
Kelly had obtained a loan from a Delaware-based private equity firm, FBI Investments, to exercise his stock options in Facebook. He then sold shares to the lender, repaid the loan and used some of the proceeds for his campaign, said Robin Swanson, his campaign spokeswoman.
Swanson characterized the transaction as the kind of personal-property sale that anyone has the right to make. Kelly sold private stock at market value to a firm that commonly makes such investments, she said.
Harris' complaint disagreed.
Kelly should have treated the loan as a political contribution subject to the state's $6,500 limit because it was obtained for a political purpose from a private equity firm, not a commercial lending institution, the complaint alleged.
The complaint said Kelly violated state election law by not disclosing publicly who bought his Facebook stock. Voters need such information to properly evaluate whether the sale was a "sweetheart deal," Harris contended.
Roman Porter, FPPC executive director, declined to discuss specifics but said the matter is closed unless new evidence surfaces.
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