The Facts

The Royal Embassy of Saudi Arabia gave $1 million to the McCain Institute Foundation in 2014, tax records show. The donation was transferred to the Arizona State University’s fundraising arm to benefit the McCain Institute for International Leadership, which is run through the university.

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Foreign campaign contributions to U.S. elections are banned under federal law. But there’s no restriction on donations to nonprofits with ties to candidates or sitting politicians. Companies and foundations, some that have business before Congress, have contributed at least $100,000 each to the foundation, USA Today reported in 2014. Ethics watchdog groups criticize the practice and the laws that allow it, saying such donations provide a means for foreign governments and special-interest groups to exert influence over politicians.

The five-term Republican is running for reelection this November.

In April 2012, McCain met with several of his longtime political allies in Sedona, Ariz., to discuss his vision for a nonprofit aimed to preserve his political legacy. Those in attendance included then-Sen. Jon Kyl (R-Ariz.), Sen. Lindsey O. Graham (R-S.C.), then-CIA Director David Petraeus, former U.S. ambassador to NATO Kurt Volker and actor Ben Affleck, the Arizona Republic reported in 2012.

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The McCain Institute for International Leadership was created in December 2012, with an $8.7 million donation in unused funds from McCain’s 2008 presidential campaign.

It was established to promote “character-driven leadership” and focus on issues that shaped McCain’s career, such as foreign policy and national security. Its mission statement says it is “guided by values that have animated” McCain’s career and his family. The Washington-based McCain Institute runs an internship program and holds events focused on issues like human trafficking and national security.

“For McCain, he thought it was very important to have something that becomes institutional, that will focus on issues and things that he’s cared about in his career that goes well beyond his own contribution,” Volker, McCain Institute director, told the Arizona Republic in 2014.

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McCain regularly attends events and fundraisers hosted by the McCain Institute. His wife, Cindy McCain, is on the institute’s Human Trafficking Advisory Council, working with the nonprofit to raise awareness for her main policy issue. Many of McCain’s longtime political allies sit on the nonprofit’s board of directors. Tax records show a longtime McCain fundraiser, Carly Eudy, maintains the McCain Institute Foundation’s financial records.

McCain compared his role with the institute to that of his Senate predecessor, Republican Barry Goldwater, with the Goldwater Institute in Arizona. The think tank was founded in 1988 by a group of conservative activists, with the blessing of Goldwater to use his name.

There’s no indication Goldwater himself started the think tank. His widow told the Phoenix New Times in 1999 that Goldwater “had lent his name to the institute in 1988 because he believed its founder, former Northern Arizona University political science professor Michael Sanera, intended it to be an academically oriented policy research organ.” But Goldwater was critical of some of the policy positions the institute took, and tried to convince its board to change direction.

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It’s clear McCain’s role with the McCain Institute is not exactly comparable to Goldwater’s. Still, McCain’s role appears to be largely honorary, and his name does not appear in the foundation’s tax records. The institute’s employees report to the ASU president, and McCain has no involvement in its management or operations decisions, Volker told us.

“The Senator’s involvement is truly a supportive role to ASU, its goals and thus the Institute,” Volker said. “We are incredibly grateful that he attends some of our events and meets with the Institute’s ASU students when his schedule allows. Operational decisions made by the Institute are taken by its Executive Director, with counsel from the Institute’s advisory Board of Trustees, under the overall authority of the University.”

Rachael Dean, McCain’s spokeswoman, explained McCain meant to express that he has no ties to the Saudi donation.

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“Senator McCain intended to convey that he had nothing to do with the solicitation of the Saudi donation to the McCain Institute,” Dean said, and confirmed he has no position with the institute or role in its governance. “He is supportive of the University’s goals and programs for the Institute, and he is proud to participate in Institute activities as his schedule allows.”

The Pinocchio Test

McCain’s answer during the media scrum was curious, since he helped set up the McCain Institute and clearly still has ties to it. He has a symbolic role with the nonprofit, attends fundraisers and he and his wife are supportive of its efforts. So his role clearly goes beyond how he characterized it – being the namesake of a think tank, like Barry Goldwater was for the Goldwater Institute.

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It appears McCain misspoke. According to his spokeswoman, McCain meant to express that he “had nothing to do” with the donation from the Saudi government to the McCain Institute Foundation, rather than with the institute itself. We don’t play gotcha at The Fact Checker, and we understand that people make mistakes when they speak off the cuff. But McCain should be held accountable for his inaccurate claim, because it ultimately misled the public to believe he had no ties to the institute that he helped create. We award him Two Pinocchios.

Two Pinocchios

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