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New York attorney general sues NRA in bid to dissolve organisation
6 August 2020, 18:37
New York's attorney general has sued the National Rifle Association (NRA), seeking to put the gun advocacy organisation out of business.
Letitia James' lawsuit, filed in state court in Manhattan on Thursday after an 18-month investigation, alleges high-ranking executives diverted millions of dollars for lavish personal trips, no-show contracts for associates and other questionable expenditures.
The NRA's long-time leader Wayne LaPierre is accused of awarding himself a 17 million dollars (£12.9 million) post-employment contract.
Simultaneously, the Washington DC attorney general sued the NRA Foundation, a charitable arm of the organisation designed to provide programmes for firearm safety, marksmanship and hunting safety, accusing it of diverting funds to the NRA to help pay for lavish spending by its executives.
The troubles, which Ms James said have been long cloaked by loyal lieutenants and a pass-through payment arrangement with a vendor, started to come to light as the NRA's deficit piled up and it struggled to find its footing after a spate of mass shootings eroded support for its pro-gun agenda.
Responding to the announcement, President Trump said: "That's a very terrible thing that just happened. I think the NRA should move to Texas and lead a very good and beautiful life."
President Trump responds to New York AG's lawsuit looking to dissolve the NRA for years of alleged financial schemes: "That's a very terrible thing that just happened. I think the NRA should move to Texas and lead a very good and beautiful life." https://t.co/yHU8ulrU7v pic.twitter.com/tLPTgdB6SX— CBS News (@CBSNews) August 6, 2020
The organisation went from a nearly 28 million dollars (£21.3 million) surplus in 2015 to a 36 million dollars (£27.4 million) deficit in 2018.
Ms James, a Democrat, argued the organisation's prominence and cosy political relationships lulled it into a sense of invincibility and enabled a culture where non-profit rules were routinely flouted and state and federal laws were violated.
Even the NRA's own bylaws and employee handbook were ignored, she said.
"The NRA's influence has been so powerful that the organisation went unchecked for decades while top executives funnelled millions into their own pockets," Ms James said in a statement announcing the lawsuit.
"The NRA is fraught with fraud and abuse, which is why today we seek to dissolve the NRA, because no organisation is above the law."
A spokesman for the NRA's legal team had no immediate comment.
Ms James is taking aim at the NRA after her office last year dismantled US President Donald Trump's charitable foundation and fined him two million dollars (£1.5 million) to settle allegations he used donations meant for worthy causes to further his own business and political interests.
Though it has its headquarters in Virginia, the NRA was chartered as a non-profit organisation in New York in 1871 and continues to be incorporated in the state.
The Washington DC attorney general has been investigating the NRA Foundation for more than a year.
It said its investigation determined low membership and lavish spending left the NRA with financial problems and so it exploited the foundation to remain afloat.
The New York action names Mr LaPierre and three other current and former executives as defendants - corporate secretary and general counsel John Frazer, retired treasurer and chief financial officer Wilson Phillips and Mr LaPierre's former chief of staff Joshua Powell.
While the lawsuit accuses all four men of wrongdoing and seeks fines and remuneration, none of them have been charged with a crime.
Mr LaPierre, who has been in charge of the NRA's day-to-day operations since 1991, is accused of spending millions of dollars on private travel and personal security, accepting expensive gifts such as African safaris and use of a 107ft yacht.
He is also alleged to have set himself up with a 17 million dollars contract with the NRA, if he were to exit the organisation, without board approval.
The lawsuit said Mr LaPierre, 70, spent millions of the NRA's dollars on travel consultants, including luxury black car services and hundreds of thousands of dollars on private jet flights for himself and his family, including more than 500,000 dollars (£380,000) on eight trips to the Bahamas over a three-year span.
Some of the NRA's excess spending was kept secret, the lawsuit said, under an arrangement with the organisation's former advertising agency, Ackerman McQueen.
The advertising firm would pick up the tab for various expenses for Mr LaPierre and other NRA executives and then send a lump sum bill to the organisation for "out-of-pocket expenses," the lawsuit alleges.