NY AG sues to dissolve the NRA, DC AG files to dissolve the Foundation

JimP

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As with any large organization you are going to have problem and even more where there are billions of dollars concerned.

The NRA needs a shake up at the top and I believe that most agree with this. They need to trim down and get back to what they do best.

This case is going to take years to settle. Then once a verdict is passed I am sure that one side or the other will appeal it.
 

wesheltonj

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The NRA board is too large...........way too many folks that do nothing. Reduce the board size to 8-12 people and make them accountable.

Yes it is. And the SCI board is too large also. Both need to be trimmed way down.

. . .Hate that donations will be used to pay for this. $64m missing then settlement and legal fees. We need those funds for down ballot races across the country right now.

Give to the NRA PAC. I would not give a dime right now, to the main NRA and I am a Benefactor Life Member. Maybe NRA-ILA, but it has problems too.

>>>>This case is going to take years to settle. Then once a verdict is passed I am sure that one side or the other will appeal it.<<<<

No, it will not. If Biden wins, the AG will go in for the kill, they are broke. If Trump wins, she will settle. Her suit says she wants LaPierre out. The Democrat party makes too much money making the NRA their whipping boy.
 
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wesheltonj

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The other NRA Foundation lawsuit.


AG Racine Sues NRA Foundation for Diverting Charitable Funds to Support Wasteful Spending by NRA and Its Executives
August 6, 2020
Foundation Allowed NRA to Raid Its Coffers Through Multi-Million-Dollar Loans and Unjustified Fees
WASHINGTON, D.C. – Attorney General Karl A. Racine today filed a lawsuit against the NRA Foundation and the National Rifle Association (NRA) for misusing charitable funds to support wasteful spending by the NRA and its executives. In its lawsuit, the Office of the Attorney General (OAG) alleges that the NRA Foundation violated District laws by allowing charitable funds to be used for noncharitable purposes, failing to operate independently, and placing the NRA’s interests ahead of its own charitable purposes. OAG also alleges that the Foundation’s Board of Directors was controlled by the NRA and allowed the NRA to exploit it through risky multi-million-dollar loans—including a $5 million loan that the NRA has never repaid. Additionally, the Foundation agreed to pay the NRA millions of dollars in fees without documentation of the work the NRA was performing or how it supported the Foundation’s charitable purposes. With this lawsuit, OAG is seeking to return the charitable funds improperly wasted on the NRA to the Foundation and a court order imposing changes to the Foundation to ensure it is operated independently and fulfills its charitable purposes.
“Charitable organizations function as public trusts—and District law requires them to use their funds to benefit the public, not to support political campaigns, lobbying, or private interests,” said AG Racine. “With this lawsuit, we aim to recover donated funds that the NRA Foundation wasted. District nonprofits should be on notice that the Office of the Attorney General will file suit if we find evidence of illegal behavior.”
The NRA Foundation is a 501(c)(3) charitable organization incorporated in the District of Columbia. While the Foundation is affiliated with the NRA, it operates independently. The Foundation collects tax-deductible contributions to be used for charitable, educational, and scientific purposes related to firearms, firearm safety, hunting safety, firearm history, and marksmanship, and it provides grants and sponsorships to organizations across the country related to these purposes. While the Foundation can provide financial support to the NRA, it can only fund NRA activities consistent with its own charitable purposes. The NRA is a 501(c)(4) social welfare organization incorporated in New York and registered to do business in the District. As a social welfare organization, the NRA can engage in political campaign activity, and donations to the NRA are not tax-deductible.
OAG investigation
In recent years, low membership and lavish spending left the NRA with financial problems. OAG’s investigation found that as the NRA struggled to pay its bills, it attempted to exploit the Foundation. Because the Foundation’s Board of Trustees and executives were controlled by the NRA, they ignored their obligations to the Foundation and prioritized the NRA’s interests.
In 2017, the NRA Foundation’s board approved a $5 million loan request from the NRA, despite awareness of the NRA’s financial problems. In 2018, the NRA requested a second $5 million loan, which the Foundation’s Board also approved. Later, the Board also granted repeated requests to extend and modify loan terms in ways that benefitted the NRA and harmed the Foundation—including a change that allowed the NRA to repay other debt before it repaid the Foundation. As of August 2020, the NRA still owes the Foundation $5 million.
OAG also found that the Foundation agreed to huge unjustified increases in the fees it paid the NRA to run the organization. Instead of employing staff to run daily operations, the Foundation pays the NRA to provide those services. In 2018, the NRA increased the Foundation’s “management fees” by nearly $5.9 million, including a $4 million “catch up fee” to be paid immediately. The Foundation did not receive documentation from the NRA showing that these payments were being used for charitable purposes, rather than for unrelated NRA work or prohibited political activities. Nevertheless, after a meeting lasting less than 50 minutes, the Foundation’s board approved the fee increase and the $4 million payment.
Lawsuit
OAG oversees nonprofit business activities in the District of Columbia. In its complaint, OAG alleges that the NRA Foundation’s trustees and officers violated the District’s Nonprofit Corporations Act by:
  • Allowing charitable funds to be used for non-charitable purposes: The Foundation failed to provide the oversight necessary to ensure that fees it paid the NRA were being used to support its charitable purposes. In fact, OAG’s investigation revealed that the NRA wasted fees paid by the Foundation on, for example, lavish consulting agreements with individuals who provided no discernible benefit to the Foundation and its charitable purposes.
  • Failing to uphold their fiduciary duty: Contrary to its fiduciary duties, the Foundation’s Board made financial decisions based on what was good for the NRA, not the Foundation. The Board approved multi-million-dollar loans to the NRA with the knowledge that the NRA had financial problems, and the Foundation might not be repaid. The Board also agreed to pay millions more in fees to the NRA without any apparent benefit to the Foundation.
  • Abandoning the Foundation’s charitable purpose: The Foundation awards national grants and sponsorships to organizations across the country that meet its charitable purpose. These programs are funded from contributions made to the Foundation. By approving the two loans and the increase in management fees to the NRA, the Foundation undermined its own ability to make grants between 2017 and 2019.
  • Placing the interests of the NRA above those of the Foundation: Under District law, the Foundation must have a Board of Trustees that acts independently and protects the Foundation’s interests. However, the NRA controls the election of Foundation trustees and the appointment of officers and there is significant overlap between the membership of the Foundation’s Board and the NRA’s Board. As a result, the majority of the Foundation’s board did whatever the NRA requested without question, investigation, or inquiry into the best interest of the Foundation. Trustees typically voted in favor of NRA demands, even when those demands harmed the Foundation.
A copy of the complaint is available at: https://oag.dc.gov/sites/default/files/2020-08/NRA-Foundation-Complaint-Redacted.pdf
OAG is asking the court to impose a constructive trust over the amount improperly diverted to the NRA. OAG is seeking a modification of Foundation policies to ensure proper independence from the NRA and an order requiring nonprofit governance training for all Foundation officers and board members. The office is also seeking a court-appointed monitor to supervise financial decisions and transactions and ensure required policy changes are made.
OAG’s Nonprofit Enforcement Work
This lawsuit is OAG’s latest effort to ensure that nonprofits operating in the District spend their money for purposes that benefit the public, and to hold these organizations accountable when they break District law. Under AG Racine’s leadership, OAG has invested resources to expand this nonprofit enforcement capacity. Already, OAG has litigated and resolved actions against several District charter schools, and the president of a nonprofit that owned an affordable housing building, for mismanagement of nonprofit funds. The office has also sued the 58th Presidential Inaugural Committee for misusing funds for private enrichment, and took action against Howard Theatre Restoration, Inc. for failing to properly obtain financial audits. Several additional investigations remain open.
If you suspect that a nonprofit doing business in the District of Columbia is violating District law, please contact the Office the Attorney General at (202) 727-3400.
Attachments
NRA-Foundation-Complaint-Redacted.pdf
 

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Ridge Runner

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Hhmmm......

The NRA is a membership driven organization, and not a business such as any of those traded on Wall Street.

Wall Street Exec's are the only one's prosecuted for their crimes, and the company they worked for remains in
business under new leadership.

I don't really see how any AG can prosecute or disband any legally operated organization.

I can see how they can audit, and prosecute the executives or any person committing or whom committed a criminal act while employed in that business.

It will be just another taxpayer money wasted investigation by the Nazis Socialist Fascist Demcommie Party that ends in little to nothing negatively happening, only a positive for the increase of memberships for the NRA.

Taxpayer money would be better spent on arrest, and severely punishing known major drug and Wall Street criminals.
 

Newboomer

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How convenient for a political witch hunt in a hotly contested election year. If they knew of these infractions by the NRA Board and the Foundation years ago, why wait until now? Pure dirty politics to attempt to destroy their enemy and weaken our Constitutional rights. It all plays into the antigun, anti hunting lunacy of the left.

Granted, there probably are improprieties, but that is common in any organization regardless of size or mission. There is a direct ratio of power to corruption. The more power, the more corruption. The larger the number of people involved, the more likely the chance of corruption.

This is a great reason for term limits. Get them out before they can establish a power base and subvert the organization. New blood, new perspective, renewed mission.
 

sestoppelman

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Purest political hit job! This worthless twit AG once called the NRA a "terrorist" organization!! Do you think politics are involved here?!?!
In her world we are all terrorists! Again, she does not care one f'ing bit about us, purely for political purposes. She wants to destroy the NRA, not make it better.
 

Fred Gunner

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Serious Question for the members who can understand Lawyer language.

Wayne LaPierre is accused of bilking 5 million card carrying NRA members of $65+ Million. He conspired with other NRA Officers to do so. How is this not a criminal case?

In my tiny Adirondack Town our Assistant Fire Chief was arrested for embezzling $5K+. The funny part of this story, the Judge (who is a volunteer fireman) ordered the Ex-Chief to post $10K bail.
 
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sestoppelman

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I had the same thought exactly. If WLP committed some crime, why is he not charged with one? Instead the aim seems to be to discredit and besmirch the NRA and force its closure. This is a lawsuit, not a prosecution. Makes no sense except on a political level.
 
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wesheltonj

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Serious Question for the members who can understand Lawyer language.

Wayne LaPierre is accused of bilking 5 million card carrying NRA members of $65+ Million. He conspired with other NRA Officers to do so. How is this not a criminal case? . . .


Who says there will not be one.
 

Hunter4752001

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I can't comment on the allegations themselves except to say that if there is evidence then the normal processes of the criminal law should proceed.

However what I don't understand with the American system is why Racine is not arrested. In Commonwealth countries there is a common law relating to misconduct in public office, a serious indictable offence. Using a public office for private benefit is one of the activities which falls under that offence. Racine has publicly stated that he wants the job of US AG if the Democrats win in November, hence he stands to benefit if the NRA is neutralized in the lead up to the election.

If there indeed was criminal activity at the NRA, and he was a person of integrity, he would have recused himself from the matter and played no role in coordinating various State Democrat AGs in this action.
 

sestoppelman

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Take two minutes and read this. Makes it simple enough for all to understand.
 

sestoppelman

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