	Background

The LDA, as amended by HLOGA, requires lobbyists to register with the  Secretary of the Senate and the Clerk of the House and file quarterly  reports disclosing their lobbying activity. No specific requirements exist for  lobbyists to generate or maintain documentation in support of the  information disclosed in the reports they file. Documentation to Support Some LD-2 Report Elements Varied, but Most Newly Registered Lobbyists Met Disclosure Reporting Requirements

		Most Lobbyists Provided Documentation for LD-2 Reports, but Documentation for Some Report Elements Did Not Match Their Disclosure Reports

As in our prior reviews, most lobbyists reporting $5,000 or more in income  or expenses were able to provide documentation to varying degrees for  the reporting elements in their disclosure reports. Lobbyists for an  estimated 93 percent of LD-2 reports were able to provide documentation  to support the income and expenses reported for the third and fourth  quarters of 2010 and the first and second quarters of 2011. Lobbyists for an  estimated 86 percent of LD-2 reports filed year-end 2010 or midyear 2011  LD-203 contribution reports for all of the lobbyists and lobbying firms  listed on the report as required. Last year, 21  lobbying firms indicated they planned to amend their LD-2 reports. Some LD-203 Contribution Reports Omitted Political Contributions Listed in the FEC Database

We estimate that overall, a minimum of 4 percent of reports failed to  disclose one or more contributions.contributions listed on lobbyists’ and lobbying firms’ LD-203 reports  against those political contributions reported in the FEC database to  identify whether political contributions were omitted on LD-2 reports in our  sample. This is a match rate of 88 percent of registrations, which  is consistent with our prior reviews. Compared to last year, fewer lobbyists told us  that they found the quarterly reporting requirement difficult to meet. Table 2 summarizes the feedback  we obtained from the lobbying firms in our sample of reports that rated  the lobbying terms as either “not clear and understandable” or “somewhat  clear and understandable.”

	U.S. Attorney’s Office Actions to Enforce the LDA

		The Office’s Authorities, Processes, and Resources to Enforce LDA Compliance

The Office stated that it has sufficient resources and authority to enforce  compliance with LDA requirements, including imposing civil or criminal  penalties for noncompliance. In addition, the  Office hired one contract staff member in September 2010 to work on  lobbying compliance issues on a full-time basis. As a result, the Office developed a system that allowed it  To enforce LDA compliance, the Office has primarily focused on sending  letters to lobbyists who have potentially violated the LDA by not filing  disclosure reports as required. The Office has also received referrals from the Secretary of the Senate  and the Clerk of the House for noncompliance with LD-203 reports. In  November 2011, the Office settled its first enforcement case since the  enactment of HLOGA in 2007 and reached a $45,000 settlement with a  lobbying firm that had been referred to the Office repeatedly for failure to  file disclosure reports. Agency Comments

We provided a draft of this report to the Attorney General for review and  comment. We met with the Assistant U.S. Attorney for the District of  Columbia, who on behalf of the Attorney General responded that  Department of Justice had no comments of the draft of this report. Appendix I: Objectives, Scope, and Methodology

Consistent with the audit mandates in the Honest Leadership and Open  Government Act (HLOGA), our objectives were to determine the extent to which lobbyists are able to demonstrate  compliance with the Lobbying Disclosure Act of 1995 as amended  (LDA) by providing documentation to support information contained on  registrations and reports filed under the LDA;  identify any challenges to compliance and potential improvements;  and describe the resources and authorities available to the U.S. Attorney’s  Office for the District of Columbia (the Office) and the efforts the  Office has made to improve enforcement of the LDA, including  identifying trends in past lobbying disclosure compliance. We  used the House database for sampling LD-2 reports from the third and  fourth quarters of calendar year 2010 and the first and second quarters of  calendar year 2011, as well as for sampling year-end 2010 and midyear  2011 political contributions (LD-203) reports, and finally for matching  quarterly registrations with filed reports. This  allowed us to generalize to a population of 51,792 activity reports. To determine if the LDA’s requirement for registrants to file a report in the  quarter of registration was met for the third and fourth quarters of 2010  and the first and second quarters of 2011, we used data filed with the  Clerk of the House to match newly filed registrations with corresponding  disclosure reports.
Why GAO Did This Study

HLOGA requires lobbyists to file quarterly lobbying disclosure reports and semiannual reports on certain political contributions. HLOGA also requires that GAO annually (1) determine the extent to which lobbyists can demonstrate compliance with disclosure requirements, (2) identify any challenges to compliance that lobbyists report, and (3) describe the resources and authorities available to the Office and the efforts the Office has made to improve its enforcement of the LDA. This is GAOs fifth report under the mandate. GAO reviewed a stratified random sample of 100 quarterly LD-2 reports filed for the third and fourth quarters of calendar year 2010 and the first and second quarters of calendar year 2011. GAO also reviewed two random samples totaling 160 LD-203 reports from year-end 2010 and midyear 2011. This methodology allowed GAO to generalize to the population of 51,792 disclosure reports with $5,000 or more in lobbying activity and 32,301 reports of federal political campaign contributions. GAO also met with officials from the Office regarding efforts to focus resources on lobbyists who fail to comply. GAO provided a draft of this report to the Attorney General for review and comment. The Assistant U.S. Attorney for the District of Columbia responded on behalf of the Attorney General that the Department of Justice had no comments on the draft of this report.

What GAO Found

Most lobbyists were able to provide documentation to demonstrate compliance with disclosure requirements. This finding is similar to GAOs results from prior reviews. There are no specific requirements for lobbyists to create or maintain documentation related to disclosure reports they file under the Lobbying Disclosure Act of 1995 as amended (LDA). Nonetheless, and similar to last years results, for two key elements of the reports (income and expenses), GAO estimates that lobbyists could provide documentation to support approximately 93 percent of the disclosure reports for the third and fourth quarters of 2010 and the first and second quarters of 2011. According to documentation lobbyists provided for income and expenses, GAO estimates that the amounts disclosed were properly reported and supported for 63 percent of the quarterly lobbying disclosure (LD-2) reports. For lobbyists and lobbying firms listed on the LD-2 report, an estimated 86 percent filed year-end 2010 or midyear 2011 reports of federal political campaign contributions (LD-203) reports as required. For LD-203 political contributions reports, GAO estimates that a minimum of 4 percent of all LD-203 reports omitted one or more reportable political contributions that were documented in the Federal Election Commission database. Fewer lobbyists17 this year versus 21 in the prior yearstated that they planned to amend their LD-2 report following GAOs reviews to make correction on one or more data elements. As of March 2012, 9 of 17 amended their disclosure reports.
Lobbyists are required to file LD-2 reports for the quarter in which they first register. The majority of lobbyists who newly registered with the Secretary of the Senate and Clerk of the House of Representatives in the third and fourth quarters of 2010 and first and second quarters of 2011 filed required disclosure reports for that period. GAO could identify corresponding reports on file for lobbying activity for 88 percent of registrants.
The majority of lobbyists felt that the terms associated with disclosure reporting were clear and understandable and the requirements were easy to meet. However, a few lobbyists reported challenges in complying with the LDA.
The U.S. Attorneys Office for the District of Columbia (the Office) stated that it has resources and authorities to pursue civil or criminal cases for noncompliance with LDA requirements. To enhance enforcement efforts and support the 17 staff who have been working on compliance issues on a part-time basis, the Office hired one contract staff member in September 2010 who works full-time on lobbying compliance issues. The Office has primarily focused on contacting lobbyists who have potentially violated the LDA by not filing disclosure reports. In November 2011, the Office settled its first enforcement case since the enactment of the Honest Leadership and Open Government Act of 2007 (HLOGA), and reached a $45,000 settlement with a lobbying firm that had been referred to the Office repeatedly for failure to file disclosure reports. More than half of the 561 lobbyists who were contacted for noncompliance with LD-2 requirements for calendar years 2009 and 2010 are now compliant. Approximately 1,081 lobbyists were referred by the Secretary of the Senate for noncompliance with LD-203 requirements for calendar year 2009.