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Bustamante can't use "old" money to fight Prop. 54

AP reports,

A judge blocked Lt. Gov. Cruz Bustamante on Monday from using a campaign finance loophole to spend millions of dollars from an old campaign committee on ads featuring him opposing a ballot measure as he simultaneously campaigns for governor.

Sacramento County Superior Court Judge Loren McMaster ordered that any money left from the more than $4 million raised from Indian tribes and labor unions by Bustamante's old campaign committee be returned to donors through that account.

Bustamante had argued he accepted the money legally in an account that predated campaign finance reforms limiting donations to $21,200. He said any conflicts were resolved when he shifted the money from his campaign fund into a separate effort to defeat Proposition 54, a ballot initiative banning the state from collecting most racial and ethnic data.

Critics and his fellow candidates said the tactic was akin to money laundering. They complained that the cash was used to fight the initiative in television ads that feature Bustamante and look virtually identical to his gubernatorial recall campaign ads.

"It's wrong for Bustamante to hijack the campaign against Prop. 54 for his self-promotion," said independent candidate Arianna Huffington, who also opposes the voter initiative.

Proposition 54 is the Ward Connerly initiative to block the collection or use of racial statistics.