Hey Gun Nuts, The NRA's Been Having Greasy Orgies In Piles Of Your Hard-Earned Money
Among the many Republicans who should send Bill Barr a thank you note, NRA President Wayne LaPierre is high on the list. If the entire country hadn't spent the weekend wading through 448 pages of NO CONCLUSION, last week's New Yorker/Trace story on the slow motion implosion at the gunhumper mothership would be dominating the news. But Bill Barr ain't our daddy, and we are not letting those death merchants off the hook so easy.
We got a glimpse of the rot when the NRA sued its longtime advertising company Ackerman McQueen and its subsidiary company the Mercury Group (collectively AMc) to force them to hand over details of their million-dollar contract with Oliver North. The NRA pays AMc and its various subsidiaries $40 million per year, but now AMc is telling its boss to get bent when it asks for an accounting? That's ... not how any of this works.
In fact, AMc has spent three decades slowly devouring its client. As The Trace's Mike Spies lays out, the parasite has now become the host.
The N.R.A. and Ackerman have become so intertwined that it is difficult to tell where one ends and the other begins. Top officials and staff move freely between the two organizations; Oliver North, the former Iran-Contra operative, who now serves as the N.R.A.'s president, is paid roughly a million dollars a year through Ackerman, according to two N.R.A. sources. But this relationship, which in many ways has built the contemporary N.R.A., seems also to be largely responsible for the N.R.A.'s dire financial state. According to interviews and to documents that I obtained—federal tax forms, charity records, contracts, corporate filings, and internal communications—a small group of N.R.A. executives, contractors, and venders has extracted hundreds of millions of dollars from the nonprofit's budget, through gratuitous payments, sweetheart deals, and opaque financial arrangements. Memos created by a senior N.R.A. employee describe a workplace distinguished by secrecy, self-dealing, and greed, whose leaders have encouraged disastrous business ventures and questionable partnerships, and have marginalized those who object. "Management has subordinated its judgment to the vendors," the documents allege. "Trust in the top has eroded."
Reading between the lines of the lawsuit, it appears that some time in 2017, the NRA undertook an audit to ensure its compliance with New York State's laws regulating charities. And the audit did not go well. According to the New Yorker, the NRA's auditors huddled up with the bigwigs last July and said that the 2017 tax returns were going to be UGLY.
According to two people familiar with the meeting, Emily Cummins, who for twelve years had been the N.R.A.'s managing director of tax and risk management, told the board members that the filings would make unprecedented disclosures about Ackerman McQueen, and briefed them on a series of problematic vender arrangements, each of which had cost the N.R.A. at least a million dollars in the previous year.
Cummins declined to comment for the record, but memos that she wrote in the weeks before the meeting give a sense of the issues. One was addressed to Rick Tedrick, the managing director of finance, and titled "List of Top Concerns for Audit Committee." The memo, written by hand, lists seven areas of primary concern. "N.R.A. pays overbilled, deceptive, vague invoices to 'preferred' vendors and contractors," one entry says. Another notes that "decisions are made in the best interests of vendors," especially, the memos make clear, those of Ackerman McQueen. A nonprofit's board is charged with scrutinizing business arrangements and providing fiscal oversight. Yet, according to the memos, the "board hasn't been told of what's embarrassing."
In addition to AMc's alleged overbilling, the NRA had been telling the IRS for years that it engaged in no "related party transactions," that is, they didn't use contributions to pay directors or their relatives without making it clear to donors.
Here's the NRA's 990 --i.e. charitable tax return -- from 2016. Nope, no money paid to relatives of board members here!
And here's the 2017 return. What a difference a year makes, huh?
Hmmm, let's see what's on that Schedule L, shall we?
PETE BROWNELL, we meet again! Now we had assumed that Brownell got unceremoniously You're Fired from being NRA president last May because of his associations with unsavory characters. As NRA president, Brownell had gone on that 2015 happytimes USA-Russia free love and firearms junket to Putinland organized by Russian honeypot spy Maria Butina, which is very much not a good look.
Brownell, Butina, and Dipshit Jr.From Butina social media accounts.
But perhaps Brownell got the boot because his company was doing $3 million of business with the NRA while he was the "non-profit's" president. Or maybe it was both!
Well, if Wayne LaPierre and the rest of the Death Merchants aimed to get rid of their self-dealing problem by pushing out Brownell, they probably should have chosen someone other than Ollie "Contra Scam" North. Because North immediately turned around and hired himself out to scream nonsense into the camera for NRATV -- an AMc production -- for a million dollars per year. And when the NRA asked for details of the contract, AMc told them to piss off and North's lawyers told them he couldn't hand it over without AMc's consent. Which is going to make it difficult to tell the nice agents at the IRS exactly how much self-dealing they're into when the NRA has to file that 2018 return!
Now, your Wonkette was born on a Tuesday, but it wasn't last Tuesday. We are under no illusion that Donald Trump's IRS is going to go after the NRA. The NRA suit against AMc strongly implies that the "charity" figured they could just about bullshit their way out of disclosing North's side gig to the IRS if AMc called him a subcontractor, rather than an employee. But the NRA is chartered in New York, and the company seems much less sanguine about the prospect of getting a clean bill of health from state regulators. In fact, you don't have to squint too hard to read the lawsuit as a performative declaration to any and all tax authorities that the NRA is really, really trying to comply with the law.
But, as the Trump Foundation recently discovered, New York is a lousy place to locate your charity if you plan to play fast and loose. And like the Trump Foundation, the NRA wanted to play very fast and very loose. The New Yorker reports:
Marc Owens, who served for ten years as the head of the Internal Revenue Service division that oversees tax-exempt enterprises, recently reviewed these records. "The litany of red flags is just extraordinary," he said. "The materials reflect one of the broadest arrays of likely transgressions that I've ever seen. There is a tremendous range of what appears to be the misuse of assets for the benefit of certain venders and people in control." Owens added, "Those facts, if confirmed, could lead to the revocation of the N.R.A.'s tax-exempt status"—without which the organization could likely not survive.
Do head over and spend some time with the New Yorker story; the amount of graft going on among top executives -- paying themselves millions of dollars a year and spreading it around like whipped butter -- is truly shocking ... even for the NRA.
We're not counting on IRS Commissioner Chuck Rettig to use his agency to shut down the NRA. But New York Attorney General Tish James is another matter. And New York Governor Andrew Cuomo already used his power to shut down the NRA's (really, AMc's) CarryGuard murder insurance program. So we have a strong suspicion the two of them are not done yet. Because if the Wall Street Journal, and the New York Times, and The New Yorker, and WNYC all have stories about money issues at the NRA, it's a safe bet there's more incoming.
LOCK 'EM UP!
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Liz Dye lives in Baltimore with her wonderful husband and a houseful of teenagers. When she isn't being mad about a thing on the internet, she's hiding in plain sight in the carpool line. She's the one wearing yoga pants glaring at her phone.