Eric Adams allegedly abused the city’s matching funds program. A City Council member wants him to stop having access to it

City Council Member Lincoln Restler is urging the New York City Campaign Finance Board to disqualify Mayor Eric Adams from receiving public matching funds for his 2025 campaign and to demand he return all illegal contributions made to his 2021 campaign. The board, which oversees the city’s 8-to-1 taxpayer-funded public matching funds system, has the power to do exactly that and more.

“The integrity of our campaign finance system is at stake in this moment. New Yorkers were deeply disturbed by the sustained corruption of Adams’ campaign to defraud taxpayers and we need to ensure it never happens again,” said Restler, chair of the City Council Committee on Governmental Operations, of the charges federal prosecutors laid out against Adams last week. Restler sent a letter to Campaign Finance Board Chair Frederick Schaffer Thursday seeking the board’s action.

A key aspect of the five-count indictment of Adams centers on allegations that the mayor and his staff solicited and received illegal donations from foreign donors, including Turkish citizens, whose actual identities were hidden using U.S.-based “straw donors” to evade campaign contribution restrictions. Those fraudulent donations then allegedly helped increase the amount of money Adams’ 2021 mayoral campaign received from the city’s public matching funds program. While the contributions from the alleged straw donors detailed in the indictment amounted to only a portion of the total sum that allowed Adams to qualify for roughly $10 million in matching funds, the consequences could be steep – reverberating even beyond the ongoing criminal case.

Federal prosecutors charge that Adams knowingly defrauded and took advantage of the city’s generous public matching funds program, which provides candidates $8 for every dollar donated by New York City residents for contributions of $250 or less. Contributions from foreign donors are prohibited. Adams, who pleaded not guilty Friday, has called the charges  “entirely false, based on lies.”

The Campaign Finance Board’s penalty guidelines lay out a series of recommendations for how the board should respond to campaigns that violate the laws of the public matching funds program. Staff can recommend a penalty that goes beyond the standard amount if “the violation appears to have been willful or the result of reckless disregard for the law.” If proven to be true, the allegations Adams faces would likely qualify as such. 

“In the most egregious circumstances, CFB staff may recommend a penalty of up to $10,000 per violation – the statutory maximum for most violations – and/or, for campaigns, recommend a finding of breach of certification, which would require the return of all public funds received and may make the candidate ineligible to receive public funds in future election cycles,” the guidelines say.

Losing his eligibility to qualify for matching funds would be a massive blow for the mayor, putting him at a disadvantage in what’s shaping up to be an increasingly competitive field of challengers.

In a statement released yesterday, Schaffer said the Campaign Finance Board is “closely reviewing” the indictment. “While the mayor is presumed innocent until proven guilty and deserves due process, the board will nonetheless review all relevant information, including but not limited to the indictment, in order to uphold our city’s campaign finance rules and protect taxpayer dollars,” he said.

Adams’ campaign raised more than $8.9 million for his 2021 mayoral campaign and received more than $10 million from the public matching funds program – more than any other citywide candidate that year. The indictment does not say how much public matching funds the mayor allegedly received as a direct result of the illegal straw donations. Alex Spiro, an attorney for Adams, claimed Thursday that of the $10 million in matching funds, only $26,000 came from Turkish donors.

While candidates who choose to seek matching funds are required to certify that their campaigns have complied with all of the Campaign Finance Board’s rules, federal prosecutors alleged that Adams and his campaign submitted false statements to the Campaign Finance Board claiming to be in compliance despite knowing tens of thousands of dollars in contributions were the product of illegal straw donations. Federal prosecutors also charge that Adams continued to solicit and accept straw donations for his 2025 reelection campaign, of which he is again hoping to participate in the public matching funds program. No payments to any 2025 mayoral candidate have been issued at this point. The first public funds payment is in December.

Restler said the allegations that Adams defrauded taxpayers are “profoundly alarming.” Federal prosecutors aren’t the first to raise red flags about questionable donations made to Adams. In May, the Campaign Finance Board released a 900-page preliminary audit of Adams’ 2021 mayoral campaign that detailed numerous missing payments and false donations, claiming there was a $2.3 million gap in fundraising records. Claiming that the audit process was ongoing, Adams’ campaign attributed the issues to incomplete documentation and misplaced receipts, Gothamist reported.

“If this campaign were to receive any future matching funds, it would undermine the credibility of the CFB’s renowned public matching system,” Restler said. “The board of the CFB has to do the right thing by New Yorkers and begin restoring faith and trust in our campaign finance system.”

It’s unclear what actions the Campaign Finance Board will ultimately take against the mayor, although there is some precedent for members opting to enact sweeping penalties. In 2013, the Campaign Finance Board voted to withhold $3.5 million in public matching funds from former city Comptroller John Liu for his 2013 mayoral campaign after two of his campaign workers were convicted of arranging straw donations. The allegations Adams faces are far more serious.