Tuesday, April 21, 2015

Lawyers, Guns, and Money

It appears the NRA has been taking membership dues and donations
and using them for Political Action Committee electioneering, a clear violation of U.S. law.

Alan Berlow has been making periodic donations to the NRA to see where the money ends up, and he reports:

Some of it quickly found its way into the account of the National Rifle Association Political Victory Fund, the NRA’s political action committee. And that was of no small interest, because I never knowingly contributed to the NRA-PVF. For me, this wasn’t a big problem; my contributions were a spit in the bucket for an organization that spent $37 million on the 2014 elections and operates on an annual budget of more than a quarter of a billion dollars. But my contributions and others like them may be a big problem for the NRA because, according to some of the nation’s top experts on federal election law, they are all illegal.

The issue is not just that my donations ended up in a political fund account, but the way the NRA solicited them — and presumably those of thousands of others. In fact, each of these transactions almost certainly violated multiple provisions of the Federal Election Campaign Act (FECA) and a legion of state and federal antifraud statutes designed to protect the public from phony charities and false or misleading solicitations.

The FECA makes a hard distinction between solicitations for elections and other solicitations, in part because many Americans don’t like donating to politicians. An NRA member might contribute to the organization because she admires its work on behalf of hunters. She might also contribute to an environmental group because she wants to preserve forests. But this same donor may vehemently oppose the candidates endorsed in federal elections by both the NRA and the environmental group. As a result, the law makes it clear that when these groups are soliciting for electoral purposes they must disclose that fact to potential donors. 

To be clear, the National Rifle Association's violations are clear black-letter law violations of both the FEC and IRS, and there are not just a few of them, but at least a half-dozen dealing with their PAC, their corporate political expenditures, and their accounting and reporting.

Among the top 25 political nonprofit groups spending money in federal elections in 2012, only the NRA failed to report any of its political expenditures to the IRS. The other politically active nonprofits all acknowledged when they were involved in direct or indirect political activity, filed the required IRS reporting schedule with their tax return, declared how much they spent to support or oppose candidates, and paid any tax owed. Although several reported huge expenditures — $71 million for Crossroads GPS, $36 million for the Chamber of Commerce and $37 million for Americans for Prosperity — none had anywhere near the investment income reported by the NRA, or a substantial tax liability. Based on the NRA’s reports, it appears it would have owed more than $600,000. Put another way, none of the other groups had as much to lose by filing the returns required by law as did the NRA.

Read the whole thing. here.

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