WASHINGTON _ U.S. Sen. Ted Cruz improperly accounted for loans he received from Goldman Sachs Group Inc. and Citigroup Inc. during his 2012 campaign, saying the funds were his own personal contributions to the Senate race, the Federal Election Commission said Thursday.
The finding, released on the FEC website, marked a rare instance of agreement among the agency's five commissioners, who voted unanimously that the $1.1 million of loans from the banks should have been disclosed to voters. The FEC didn't say whether there would be a penalty.
Under federal election law, candidates can take out loans from commercial banks as long as they disclose the source of funds, the interest rate they are paying and the term of the loan. They can also lend or give their campaigns unlimited amounts from personal funds.
In his bid for the Senate, Cruz, a Texas Republican, said that he was financing his bid in part with personal funds, liquidating assets to compete in an expensive runoff election against a well-funded candidate. Cruz's 2012 financial disclosure showed that he hadn't sold enough assets to be able to lend his campaign as much as he had claimed. It also listed personal loans from Goldman Sachs, where his wife was an executive, and Citigroup.
The discrepancy was originally reported in January 2016, when Cruz was running for president. Catherine Frazier, a spokeswoman for his presidential campaign, acknowledged that the Goldman Sachs loan had been used for his Senate campaign and said the omission was "inadvertent."
The FEC auditors found that Cruz made five loans to his campaign during 2011 and 2012 that totaled $1.4 million. Of that amount, $800,000 came from Goldman Sachs and $264,000 from Citigroup. The rest came from Cruz's personal funds, the FEC said.
In his 2012 bid, Cruz raised about $14.5 million, a little more than half the amount taken in by his opponent in the Republican primary, David Dewhurst, the lieutenant governor and favorite of the GOP establishment. Cruz finished second to Dewhurst in a crowded primary field, then handily defeated him the runoff, taking 57 percent of the vote.
Cruz ran as a fiery populist, criticizing Wall Street banks and bailouts. Both Goldman Sachs and Citigroup benefited from programs adopted in the wake of the 2008 financial crisis by the administrations of Presidents George W. Bush and Barack Obama.
