Tax filings cited by The Post are said to reveal that Sharpton’s charity—The National Action Network (NAN)—committed to paying the preacher $531,000 for his “life story rights for a 10-year period.”
The story could hypothetically be sold down the road at a profit to those wanting to produce a book or film documenting the activist preacher’s life.
Sharpton told The Post that movie deals alone could be sold for at least three times what the charity paid for them.
He told the paper that the initiative was thought up by several unnamed NAN board members as a way to provide the organization with future streams of revenue. He said they wanted to create a source of revenue for the civil rights organization after he steps down in about a year.
“This way they make a profit from the beginning and all of the revenues,” he said of the civil rights organization’s plans to secure funding after he steps down.
Sharpton’s list of credentials runs long, including founder and president of NAN, civil rights activist, Baptist minister, television/radio talk show host, and former White House adviser for President Barack Obama.
Sharpton told The Post there was interest from multiple sources in memorializing his legacy. He said he had signed contracts for two movies, and a third was being negotiated. He cited additional assets, including a recording where James Brown is singing and he’s talking, and video footage of him with Michael Jackson, as potential valuable revenue streams for NAN.
‘Potential for Funny Business’
Legal experts cited by The Post said that for a nonprofit to do deals with its president is potentially treacherous territory. If not done carefully, it could threaten a charity’s tax-exempt status.Marcus Owens, a former IRS official and a partner with the Loeb & Loeb law firm in Washington told The Post that if a charity pays too much for assets of the type it paid to Sharpton, it could violate tax rules regarding excess benefits given to a nonprofit’s key officials.
Sharpton told The Post that the value of the assets that were part of the transaction was formally appraised, while tax filings showed that the board’s “executive committee independently approved” the deal.
But Linda Sugin, a Fordham University Law School professor and associate dean, questioned the impartiality of the decision.
“In this case, it’s really difficult because of his role in the organization and just because of his overall influence,” Sugin said.
“When I see this kind of thing, it just makes me roll my eyes because there’s so much potential for funny business,” she added.
A less controversial way for NAN to benefit from the sale of Sharpton’s story rights would have been for him to sell the rights to a production company and donate part of the proceeds.
