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NRA Under Fire – Leadership Facing Fraud Charges

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In a lawsuit filed on August 6th, New York’s Attorney General is pursuing the dissolution of the National Rifle Association. This claim comes from an 18-month investigation into the gun rights group, raising allegations of fraud and abuse. Due to a pervasive culture of corruption, Attorney General Letitia James advocates shutting down the NRA.

“A Personal Piggy Bank”

James claims that executives, including longtime chief Wayne LaPierre, misused millions of dollars of funding. Mr. LaPierre faces accusations of looting the foundation’s charitable collections to pay for a lavish lifestyle, though he was already receiving millions of indirect payment from the organization. The lawsuit contains numerous allegations against the executive, ranging over the course of six and a half years:

  • A secret “poison pill” contract promised to pay LaPierre $17 million dollars, following his retirement.
  • Private flights were chartered for LaPierre’s wife and niece, on the NRA’s dime.
  • $13.5 million was spent on a personal travel consultant.
  • The influential Second Amendment advocate allegedly took plenty of trips to the Bahamas, and occasionally absconded to a luxurious 108-foot yacht.
  • LaPierre supposedly granted his personal circle expensive gifts from Neiman Marcus and Bergdorf Goodman.
  • He put his niece into a Four Seasons hotel at a price tag of over $12,000.
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LaPierre, along with three suspected co-conspirators, stands accused of blowing $64 million dollars over a three-year span. Although some employees tried to report on the fraudulent behavior of company leadership, LaPierre and his colleagues are said to have retaliated against the whistleblowers. The claims state that these four men brazenly stole money for themselves, their friends, their families, and their allies.

On top of pointing out violations of state and federal laws, the suit also outlines a great many tax violations. An ongoing investigation involving the IRS shows evidence of false reporting of annual filings, improper documentation and wage reporting, and a failure to make excise tax reporting, among many more issues.

Incidents of incompetence were also outlined; LaPierre hired a convicted embezzler as his personal assistant. This PA allegedly repeatedly robbed the NRA funds for her own expenses. James has announced that although the current suit is confined to the civil court, the Manhattan district attorney may file a criminal suit if the IRS uncovers proof of illicit activity.

Money and Political Intrigue

The aforementioned accusations, along with a medley of other claims, prompted the attorney general to sue the NRA for restitution in the order of tens of millions of dollars.

The suit comes at a time when the NRA is already under financial strain: the organization’s finances have been deeply impacted by the pandemic, which shut down fund-raising events. Internal conflict has cost the group tens of millions in legal fees, and outraged donors have withdrawn funds after learning of the executives’ fraudulent behaviors.

The NRA responded to these accusations with a counter lawsuit against the office of Letitia James, stating that her action was unfairly politically motivated. LaPierre insists that the attorney general’s determination to close down the organization was unconstitutional, and an attack on American freedom.

James, a Democrat, has referred to the NRA as a “terrorist organization,” and many disagree with her stance towards the gun-rights group. As the 2020 election cycle approaches, the lawsuit will likely impede on the NRA’s ability to support the Trump campaign, raising suspicions that the suit is a political ploy. Nonetheless, the contents of the suit, if proven true, are damning.

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What Comes Next?

Sean Delaney, a former head of the charities bureau in the office of the attorney general, suggested that the total dissolution of the NRA is unlikely. After all, dissolution is an extreme penalty, rarely enforced by courts.

To make a case for dissolution, Delaney implied, the attorney general would need to show that the NRA is overwhelmed with corruption, beyond the point of salvaging. Systemic fraud must be revealed to be so ingrained in the roots of the organization, the court must find it not worth saving.

However, David Samuels, former deputy chief of the same bureau, claimed that the attorney general has a strong case for dissolution in the context of New York law.

In 2013, New York’s policies on conflicts of interest and related party transactions were tightened. Samuels suggested that the lawsuit cites violations of these policies, which were created to prevent misuse of charitable assets.

If the dissolution goes through, it’s not certain that the influence of the NRA would be snuffed out altogether. One possibility is that donors or employees may defect to a rival organization, such as Gun Owners of America. It’s also possible that the organization could be reincorporated into a different location.

That being said, the NRA cannot move its assets during the investigation. Upon being hypothetically dissolved, leadership would have to start over from scratch. And the ‘leadership’ likely wouldn’t include the four executives named in the suit.

Even if the NRA wasn’t successfully shut down, the suit would still remove the individuals from power, and ban them from serving on other New York-based charity boards.

The worst-case scenario for the NRA is complete dissolution. A more probable outcome is a restructuring of leadership, financial hemorrhaging, and a temporary inability to lobby on behalf of gun ownership or conservative politicians. In any case, this powerful group is bound to suffer losses as the lawsuit moves through the courts.

This article was written by Avanti I of Boston, Massachusetts.

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