Iowa Caucus App Maker Casts A Shadow Over Election

Monday night’s landmark debacle after the Iowa Caucus voting was embarrassing for our country’s election system and the future of our Republic as a whole. How did this happen and who was behind it?

We know that the Iowa voting app was made by a company called Shadow Inc. Shadow lists a Washington, DC address on their website. However, they are not registered with the DC government, which means they choose not to pay taxes in the District even though they claim to run a business in the District. Shadow Inc. is allegedly owned by ACRONYM, a non-profit company, which has the same DC address as the one listed on Shadow Inc.’s website. That DC address happens to be an old industrial building now owned by WeWork. If you wanted to locate beneficial owners of the company this address is about as useless as a PO box.

ACRONYM was incorporated by Johnathan Berkon using an address that is an office for Perkins Cole, a big DC law firm. Perkins Cole’s website lists Berkon as a partner and claims he “regularly works with individuals and entities wishing to establish Super PACs and other nonprofits, and he assists them in complying with complex fundraising, coordination and disclosure rules, in an increasingly hostile regulatory environment.”

ACRONYM lists Tara McGowan as a governor, along with Michael Derbin and Hannah Linkenhoker. McGowan is listed as having executive authority but nothing in the public record indicates if she is a beneficial owner.

In short, we know nothing about the ultimate beneficial owners of Shadow. A very strong odor of corruption permeates this mess, but no clear answers emerge.

Firms that are involved in creating the infrastructure for elections should be subject to strict disclosure rules. We need to know the ultimate beneficial owners of these firms. The public has a right to know who- the natural person(s), not shell companies, control, not sign documents on behalf of, these companies. We can't hire one of the players in the game to also act as the referee and expect to get a good outcome.

Even more importantly, we can’t hire a referee who doesn’t believe in the game, or has an incentive to delegitimize the results of the game. A referee who does best out of 21 on the coin toss, calls pass interference before the ball is snapped, punts the ball into the stands after every incomplete pass, makes all the announcements in Hungarian, and restarts the game in the middle of a commercial break can eventually reduce the game to a farce, killing fan participation, player participation and interest in the outcome.

What do we do? The post-Citizens United political establishment of both parties wants us to give up. The establishment wants to continue to profit by selling themselves to the oligarchs who control our politics. Foreign dictators want us to give up on finding the truth because a post-truth world suits them quite well.

The solution is simple- first, we need to create a registry of beneficial owners for every company. Hong Kong has one. Iceland has one. Germany has one. It is not difficult to create. Second, we need to create meaningful penalties for not putting truthful and accurate information into the registry. Finally, we need to enforce the law. Too often in this country we choose not to enforce the laws we already have on the books.

Transparency is not a cure-all or a completely perfect solution to all the problems plaguing our democracy. Transparency, in the form of a beneficial owners’ registry, is a good start and it is easy to implement. As a nation, we need to prove we can act against corruption by enacting small simple achievable fixes to the system.

Paul Lichstein is the Tri-state Regional Coordinator of TakeBack.org