The National Rifle Association (NRA) has vowed to implement a series of changes to its charitable arm after settling a lawsuit with the District of Columbia Attorney General’s Office.
Attorney General Brian L. Schwalb announced the settlement involving the NRA and the NRA Foundation in a press release on Wednesday.
The settlement marks the conclusion of a lawsuit filed in 2020 by the attorney general’s office that accused the NRA and its foundation of misusing nonprofit funds, along with other alleged violations.
According to Mr. Schwalb’s office, the agreement will require thorough oversight and extensive changes to how the association operates, ensuring it does so independently from the NRA and fully complies with the district’s nonprofit laws.
Under the terms of the agreement, the NRA Foundation must adhere to its articles of incorporation and bylaws in all decision-making processes, both inside and outside of formal board meetings, conduct annual nonprofit compliance training for every board member or officer, and set up an audit committee to ensure its foundation’s financial affairs are in order.
It must also work with an external auditor, establish a new conflict-of-interest policy, adopt new policies in grantmaking, loans, and other activities to bolster transparency, and report any changes to its policy to the attorney general’s office within 30 days of the changes being approved.
‘Unchecked Piggy Bank’
The case was set to go to trial on April 29, however, the settlement agreement means a trial will now be avoided.“Donors are entitled to know that their charitable contributions will be used in furtherance of a nonprofit organization’s stated charitable mission,” Mr. Schwalb said. “The NRA Foundation—the charitable arm of the NRA—violated this sacred public trust, allowing the NRA to use them as an unchecked piggy bank. Caving to pressure from the NRA, the Foundation diverted millions of dollars to the NRA in grants and risky loans that were repaid only after OAG filed its lawsuit,” he continued.
“Tax-exempt nonprofits are a form of public trust, abusing that trust as the NRA did violates both the public interest and District law. Today’s outcome builds on our longstanding commitment to safeguarding nonprofit donors’ money and ensuring that all nonprofits operating in the District of Columbia follow the law,” he added.
The NRA did not admit wrongdoing in the settlement agreement. NRA president Charles Cotton said the agreement is “further proof of the NRA’s commitment to good governance.”
Jury Finds Top NRA Executives Liable for Corruption
Elsewhere, NRA counsel William Brewer called Mr. Schwalb’s comments regarding the settlement “distorted and untruthful.”“The DCAG ’spins’ today’s settlement in avoidance of the facts: the DCAG long ago abandoned any claims of wrongdoing against the NRA,” Mr. Brewer said in a statement to The Hill.
“Even by DC standards, this is rank political gamesmanship, an after-the-fact justification for a failed lawsuit by these officials,” he added.
The jury found that Mr. LaPierre abused his position by spending millions of the organization’s dollars on luxury trips and expensive clothing, among other things. He was found liable for $5.4 million in damages ordered and to pay $4.35 million.
Meanwhile, Mr. Phillips was ordered to pay $2 million in damages for failing to properly administer charitable funds and violating state laws that protect whistleblowers.
In response to the ruling, the NRA said it had been “victimized by certain former vendors and ‘insiders’ who abused the trust placed in them by the Association” and noted it had implemented a string of corrective changes following its own internal probe into the claims.
“NRA members should be heartened by the NRA’s commitment to best practices, and we will continue to amplify our compliance record in the pivotal next phase of these proceedings,” Mr. Cotton said at the time.
