It might not be bad advice, but it might already be too late. The National Rifle Association’s board is holding a meeting today in Indianapolis to deal with an avalanche of bad news, not from a biased media but from inside the NRA itself. A power play at the top of the organization has exposed a number of questions about its operations, and a new investigation over its finances by the New York attorney general is at the top of its list of crises:
The New York attorney general’s office is investigating potential financial and disclosure problems at the National Rifle Association, amid boardroom turmoil at the group that led Saturday to the departure of NRA President Oliver North after a bruising internal political battle.
The probe is looking into alleged financial misconduct of the kind that Mr. North has raised in the internal battles. A spokeswoman for Attorney General Letitia James confirmed the probe and said subpoenas have been issued, but had no further comment.
Mr. North, in a letter read to NRA members Saturday morning at the group’s annual meeting in Indianapolis, said he had hoped to be renominated for a second one-year term as president, but “I am now informed that will not happen.”
North ended up on the losing end of a power battle with Wayne LaPierre, the CEO of the NRA. LaPierre accused North of extorting him and the NRA over financial irregularities, including an alleged outlay of over $200,000 for LaPierre’s wardrobe:
Longtime National Rifle Association leader Wayne LaPierre has told the group’s board he is being extorted and pressured to resign by the organization’s president, Oliver North, over allegations of financial improprieties, in a battle stirring up one of the nation’s most powerful nonprofit political groups.
In a letter sent to NRA board members late Thursday afternoon, Mr. LaPierre, the group’s CEO and executive vice president, said he refused the demand. Instead he called on board members to “see this for what it is: a threat meant to intimidate and divide us.” …
Mr. North previously had sent a longer letter to the board’s executive committee detailing new allegations of financial improprieties involving more than $200,000 of wardrobe purchases by Mr. LaPierre that were charged to a vendor, according to the people. One of those people described Mr. LaPierre’s letter as an “angry reaction” to Mr. North’s longer letter.
At the same time all of this happened during the NRA Annual Meeting, at which Donald Trump spoke, Russian agent Maria Butina got sentenced for her efforts to penetrate the group, among others. Butina got an 18-month prison sentence, more than half of which will get removed for time already served, and will be deported upon her release. Butina got convicted for failing to register as a foreign agent, for which she apologized, although Vladimir Putin called her conviction and sentence “lawlessness.”
The second-biggest headache for the NRA is its close relations with ad agency Ackerman McQueen, which has packaged the NRA for decades — and done very well by doing so. The NRA sued Ackerman earlier this month, which has apparently fed into the feud between North and LaPierre. Both men have their ties to the firm, but LaPierre claims that North’s NRATV program netted him “millions of dollars” from Ackerman:
The suit specifically mentions a contract between Ackerman McQueen and North, the Journal reports, who was hired by the agency last year to host an NRATV documentary program, which LaPierre says nets him “millions of dollars annually.”
LaPierre detailed a phone call between one of his staff members and North that took place Wednesday, in which North allegedly suggested Ackerman McQueen was prepared to release an “allegedly damaging letter to the entire NRA board.”
“The letter would contain a devastating account for our financial status, sexual harassment charges against a staff member, accusations of wardrobe expenses and excessive staff travel expenses,” LaPierre wrote. “But then, Col. North explained the letter would not be sent — if I were to promptly resign as your Executive Vice President. And, if I supported Col. North’s continued tenure as president, he stated he could ‘negotiate’ an ‘excellent retirement’ for me.”
LaPierre wrote that after the call, he was informed by others he “needed to withdraw the NRA lawsuit against [Ackerman McQueen] or be smeared.” An Ackerman McQueen spokesman declined to comment to the Journal.
LaPierre went on to assert the claims made by the advertising firm were “conveniently” fabricated and brought up amid the lawsuit and demands from the NRA for accurate books and records.
It’s getting ugly at the nation’s oldest and strongest organization for responsible gun rights. Trump advised them this morning to clean up their act quickly before they do any more damage to their influence — and suggested that a change of venue might be in order, too:
The NRA is under siege by Cuomo and the New York State A.G., who are illegally using the State’s legal apparatus to take down and destroy this very important organization, & others. It must get its act together quickly, stop the internal fighting, & get back to GREATNESS – FAST!
— Donald J. Trump (@realDonaldTrump) April 29, 2019
….People are fleeing New York State because of high taxes and yes, even oppression of sorts. They didn’t even put up a fight against SALT – could have won. So much litigation. The NRA should leave and fight from the outside of this very difficult to deal with (unfair) State!
— Donald J. Trump (@realDonaldTrump) April 29, 2019
At this point, it may be too late to leave. If the state AG finds that the group violated its tax-exempt status, the state can levy fines or pursue criminal penalties for past filings. Trump knows this well, having gone through a similar process with the state AG for his Trump Foundation in 2017. The NRA’s battle with Cuomo is a lesser issue, at least existentially, and might be resolved by a change of venue:
[Attorney General Letitia] James has opened an investigation into the tax-exempt status of the organization, which is chartered in New York, that has included the issuance of subpoenas.
The NRA, meanwhile, has been involved in litigation with Cuomo over a directive last year urging insurance companies, state-chartered banks and other financial services companies to review their relationship with the NRA and consider whether those ties “harm their corporate reputations and jeopardize public safety.”
The biggest problem facing the NRA is not just the James probe but the risk of a follow-up IRS probe. Moving to another state won’t solve that problem. If the group has issues with tax-exempt compliance, the fallout on both levels could seriously damage the group and its mission to defend Second Amendment rights. That is no doubt the motivation behind these attacks too, but the eruption of finger-pointing and dueling accusations at the top of the NRA makes it appear that there’s some fire to all this smoke, too. Small wonder Trump wants this key part of his 2020 strategy to “get its act together,” and fast.
New York state attorney general Letitia James is probably going to make the impending investigation as lengthy, painful and embarrassing as possible for the NRA. As Tim Mak lays out, the NRA can’t simply dissolve its charter and registration from New York to a state with a friendlier attorney general. The NRA’s board of directors may prefer to enter the investigative phase with new leadership, unconnected to the current allegations.
Can the relationship between the NRA and Ackerman McQueen recover? (Considering how LaPierre accuses Ackerman McQueen of trying to oust him, probably not if LaPierre remains as executive vice president.) If the NRA cuts ties to Ackerman, does NRATV disappear entirely? Does the NRA go out and hire a new company to produce programming, or decide to produce it in-house?
If James’ investigation finds serious financial impropriety, how severe would the legal consequences be? (Investigations launched by James’ predecessor led to the dissolution of the Trump Foundation.)
And if the NRA is spending so much time, energy and money dealing with this investigation… how much will be left over to focus upon the 2020 elections?
Or on protecting gun rights? That might be a bigger priority right now at the board meeting, which is taking place right now.