Democrats seek to close 'Citizens United' loopholes to block foreign money in U.S. elections

Congressional Democrats are looking to close what they characterize as loopholes created by the 2010 Citizens United Supreme Court decision that allow foreign entities to funnel money into U.S. elections.

The bill, led by Rep. Jamie Raskin, D-Md., and Sen. Sheldon Whitehouse, D-R.I., and shared first with CNBC, would establish foreign ownership thresholds to determine which U.S. corporations should be barred from contributing to campaigns, ballot initiatives and referendums.

"The Roberts Court's reckless decision in Citizens United continues to spell disaster for American democracy, allowing oligarchs and autocrats around the world to wield their influence over our elections and undermine our institutions," Raskin said in a statement, referring to Chief Justice John Roberts and the ruling that enabled corporations and outside groups to spend unlimited sums on U.S. elections.

The proposal would "root out corruption and make sure our elections are decided by the American people, not the foreign oligarchs," Raskin said. Dubbed the Get Foreign Money out of U.S. Elections Act, it had more than 65 Democratic co-sponsors in the House and 11 in the Senate upon introduction on Wednesday. It faces an unlikely path to passage this Congress with Republicans in control of both chambers.

The bill comes as foreign equity in U.S. companies has shot up since the 1990s. And it follows the Supreme Court's June decision to strike down limits on the amount political parties can spend in coordination with candidates for office.

It's already illegal for foreign nationals to contribute to U.S. elections, but Raskin and Whitehouse's proposal would extend existing laws to some companies registered in the U.S. with foreign ownership over certain thresholds.

For example, business entities located outside the U.S. in which 50% of voting shares, total equity or membership units are owned by foreign nationals would be banned from making political contributions, as would those located within the U.S. in which a single foreign national outside the U.S. owns or controls 1% of voting shares, total equity, or membership units, among others.

Raskin and Whitehouse led a nearly identical bill in the 118th Congress, though it didn't get a vote in either chamber.

"Thanks to the disastrous Citizens United decision, foreign actors can exploit the same corrupting dark money channels that allow unlimited corporate spending," Whitehouse said in a statement. "We should get rid of the damned stuff entirely, but this bill would at least safeguard our democracy from foreign adversaries influencing American elections from the shadows."

The proposal comes on the heels of House passage earlier this month of a bipartisan bill, led by Reps. Brian Fitzpatrick, R-Pa., and Jared Golden, D-Maine, that seeks to prohibit foreign contributions in flooding local ballot initiatives, referendums and recall elections. The Senate has not yet voted on the measure.

"The ballot is the instrument by which a free people govern themselves. No foreign government, foreign national, or foreign interest should have a hand in deciding the laws Americans live under," Fitzpatrick said in a statement after passage.