In 1984, Sequoia Pacific System Corporation purchased the voting machine business of AVM Corporation (the former Automatic Voting Machine Corporation) and reorganized it as Sequoia Voting Systems. By the time Sequoia bought the AVM voting business, the AVM Automatic Voting Computer (AVC) was ready for market.
Under Sequoia’s ownership, AVC was certified for use in several states in 1986 and 1987, and it went to market as the ‘Sequoia AVC Advantage DRE voting machine’ in 1990.
In late 1997, benefiting from an antitrust action by the U.S. Department of Justice, Sequoia Voting System obtained the intellectual property rights of the Optech line of ballot scanners. It proceeded to manufacture scanning voting machines and developed a touch-screen.
But the product underperformed after several years of losses.
In March 2005, the company was acquired by Smartmatic, which had developed a range of advanced election systems, including voting machines. Since then, Smartmatic has assigned most of its development and management teams to work on retrofitting some of Sequoia’s old-fashioned, legacy voting machines and replacing their technology with proprietary features, resulting in new high-tech products.
As a result, Sequoia sold many next-generation election products and experienced a healthy financial recovery in fiscal years 2006 and 2007. However, in the 2006 presidential election, Sequoia’s voting system was called into question.
- Cook County, Illinois is the second most populous county in the United States. It had many problems using the Sequoia Voting System. Problems were suspected to be related to a software error of the voting system.
- Florida replaced the punch card voting system with a touchscreen system after the 2000 election problems, but the touchscreen system purchased from Sequoia had some major problems.
The Committee on Foreign Investment in the United States (CFIUS) opened an investigation into Sequoia only after Rep. Carolyn Maloney (D-NY), who chaired the subcommittee overseeing CFIUS and who co‐authored the Foreign Investment and National Security Act 2007 (FINSA), wrote a letter to then-Treasury Secretary John Snow inquiring whether the Venezuelan government could use Sequoia to manipulate U.S. elections. Maloney cited the fact that the Venezuelan state had invested in Smartmatic’s affiliates, the company’s current ownership was buried in a labyrinth of offshore trusts, and revelations that Sequoia had flown 15 Venezuelan nationals to Chicago to tabulate votes in a local election.
“There clearly remained doubt surrounding this company, and as long as those doubts lingered, many people would have legitimate questions about the integrity of these voting machines,” said Maloney. “When I first raised this case with Treasury, I thought that it was ripe for a CFIUS investigation, because the integrity of our voting machines is vital to national security. At that time, Smartmatic flatly refused to undergo a CFIUS review. But now it seems the company could not overcome the cloud of doubt surrounding this doubt – had they been able to, we would not be talking about a sale of Sequoia today. As I said in May, it seems that a CFIUS review was in fact the proper course.”
The company replaced its headquarters in Boca Raton in favor of a complex structure with offices in multiple locations. The U.S. State Department said its Venezuelan owners “remain hidden behind a network of holding companies in the Netherlands and Barbados”; its organization is “a complex network of offshore companies and foreign trusts.”