Citing Mayor Adams’ federal corruption indictment, the city’s election finance watchdog agency is weighing the possibility of finding his campaign in “breach of certification” — the panel’s most severe penalty that could potentially cost his team as much as $10 million, the Daily News has learned.
The detail was contained in a Dec. 18 letter sent to Adams’ 2025 campaign by the CFB elaborating on the board’s decision this week to deny the mayor, who has pleaded not guilty in his federal case, the first round of public matching funds for his reelection run.
In the letter, Danielle Willemin, the CFB’s auditing director, wrote that Adams’ five-count indictment “establishes probable cause” he committed wire fraud to obtain public funds for his 2021 and 2025 campaigns by allegedly seeking matches on illegal donations he solicited from foreign nationals for both runs.
“The issues raised in this letter may cause the board to consider whether the campaign submitted a disclosure statement which the participant knew or should have known includes substantial fraudulent matchable contribution claims, which is one of the activities that can can lead to a finding of breach of certification,” Willemin wrote in the letter, a copy of which was obtained by The News via a Freedom of Information Law request.
“In addition, the campaign may be assessed financial penalties and may be found ineligible to receive public funds based on a finding of fraud or material misrepresentation, whether or not it is found in breach.”
The breach of certification finding is seen as the board’s most serious penalty because it doesn’t just block campaigns from receiving any future matching funds, it can also require them to pay back all public funds they’ve ever received.
Adams’ 2021 campaign received some $10 million in public matching funds. In Adams’ indictment, prosecutors from the Manhattan U.S. attorney’s office alleged the full $10 million should be considered obtained fraudulently, as the inclusion of allegedly illegal straw donations from foreign nationals tainted the mayor’s whole fundraising pot.
The matching funds program provides $8 in public money for every $1 a mayoral candidate raises from a city resident up to $250, a massive cash boost that can make or break a campaign.
Willemin wrote in the letter that the breach of certification is a potential finding the board is looking at as it continues a long-running audit of Adams’ 2021 campaign and scrutinizes matters related to his 2025 campaign, too, in light of his indictment.
In addition to his indictment, Willemin noted that the board has taken serious issue lately with the Adams campaign’s lack of communication. She wrote that the CFB on Nov. 15 asked Adams’ campaign for “documentation and information related to allegations” in his indictment, setting a Dec. 6 deadline for a response.
“On December 5, 2024, an attorney for the campaign called CFB Staff and left a voicemail stating that the Campaign would not respond to the CFB staff’s request at this time because the requests were related incidents referenced in the indictment. This failure to respond to a request for information is a basis for ineligibility for public funds,” Willimen added.
A breach of certification determination could upend Adams’ reelection efforts, as he’s already starting off the 2025 campaign without new matching funds as he faces more than a half dozen challengers in June’s Democratic mayoral primary.
Since the city’s public matching funds program was established in 1988 as part of a slate of anti-corruption reforms, only about 26 participating candidates have been found in “breach of certification,” according to Gothamist.
A lawyer for Adams, who is set to stand trial in April, didn’t immediately return a request for comment Friday. A spokesman for the CFB declined to comment.
This past Monday, the CFB denied Adams about $4 million he had sought in public matching funds for his 2025 campaign, citing concern about his indictment, which alleges he solicited bribes and illegal political donations, mostly from Turkish government operatives, in exchange for political favors.
Adams’ campaign can appeal the finding and try to apply again for matching funds on the next disbursement date set for Jan. 15, though legal expert have said the board is unlikely to come to any other conclusion unless something materially changes in his favor in his corruption case.
Mayor Adams’ campaign faces potential ‘breach of certification’ finding over federal corruption case
