S.F. ethics probe flags lapses in Mark Farrell’s 2024 mayor campaign

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Mark Farrell in his 2024 run for San Francisco mayor failed to report payments, misreported spending and did not properly document donations in violations of state and local campaign finance laws, according to an audit from the city’s ethics commission published Monday.

“These findings represent instances of noncompliance that Auditors determined to be significant,” read the March 9 audit. That determination was reached based on the “frequency” and “significance of the dollar amount” of the transactions flagged.

The audit found that the “instances” of noncompliance were serious but concluded that “except as noted in the audit findings sections above” Farrell’s campaign “substantially complied” with local and state law.

While the ethics commission published audits that also found violations in the campaigns of Aaron Peskin and London Breed, Farrell had by far the most “material” violations.

That is perhaps unsurprising. Monday’s audit came 16 months after Farrell’s campaign was dinged $108,000 in a late-October penalty that, in a highly unusual move, was issued just days before the Nov. 5 election. It was the largest penalty in the ethics commission’s history. 

At that time, Farrell’s campaign was censured by the commission for “serious harm” and “severity” in violating basic donation limits stemming from his commingling of funds with a ballot measure campaign.

Farrell had effectively circumvented campaign finance limits and subsidized his mayoral run with money from a $2.5 million committee backing Proposition D, a charter reform measure, the commission found in issuing that penalty.

Monday’s audit, the commission noted, will be sent to the commission’s enforcement team for “further investigation” and “enforcement action as warranted.” That could also result in a fine.

The audit analyzed filings between Jan. 1 and Dec. 31, 2024, when Farrell unsuccessfully ran for mayor. It found lapses in properly recording payments, donor information, subvendors, and expenses, among other things.

Specifically, the audit found the campaign:

• Failed to report spending to subvendors for expenditures like office supplies and campaign flyers in 12 percent of cases, equal to $698,476. The campaign paid $556,310 to the ad agency Canal Partners Media but did not note the television broadcasters or other subvendors that Canal Partners used for its ads.
• Failed to provide “any” records for expenses in 9 percent of sampled expenses, equal to $6,898 for spending on dinners, coffee and consultants, among other things.
• Recorded expenses in the wrong time period in 8.3 percent of cases.
• Had incomplete information for 215 donors, including missing names or addresses. That was equal to 7.6 percent of all donors.

Farrell did not immediately respond to requests for comment. 

The treasurer for Farrel’s campaign, Money Wheel, LLC, issued various statements included as part of the audit. Money Wheel said it “promptly” reached out to subvendors for more documentation, for instance, and said it kept proper records for the “vast majority” of expenses.

Expenses for which documentation is missing “were for relatively minor expenditures” that could be “corroborated” by comparing bank statements, it said. For missing donor information, it tried to “verify and correct” information and also noted that the city’s NetFile system did not alert the campaign to missing records and “should flag this issue.”

Farrell finished in fourth place in 2024 but benefited from tremendous fundraising. His campaign and a pro-Farrell PAC took in $5.45 million compared to London Breed’s $5.56 million. Both were swamped by Daniel Lurie, who had $17.21 million behind him, according to ethics commission data.