Amended Complaint from NY AG Shows How NRA Continues To Pay The Price For Failed Bankruptcy
Lawsuit Alleges LaPierre “Exploited The Organization For His Financial Benefit”
NEW YORK – Everytown for Gun Safety and its grassroots networks, Moms Demand Action and Students Demand Action, released the following statement after New York Attorney General Letitia James filed an amended complaint yesterday evening in its lawsuit against the National Rifle Association, which seeks to dissolve the organization entirely. The new filing alleges that since the original complaint was filed in August 2020, “the NRA, [CEO Wayne] LaPierre, and [General Counsel John] Frazer have continued the same course of misconduct in violation of New York law, IRS requirements for exempt organizations, NRA bylaws, and internal policies and procedures without objection from the NRA Board.”
The amended complaint in large part draws from revelations from the NRA’s failed bankruptcy, dismissed in May, as evidence in its case of how LaPierre and the NRA have failed to make any meaningful changes in the operation of the NRA — highlighting again what a disaster the NRA’s bankruptcy filing was.
“Wayne LaPierre’s failed bankruptcy scheme gave the NRA a stack of legal bills — and the New York Attorney General a stack of legal ammunition,” said John Feinblatt, President of Everytown for Gun Safety. “Everytown has been warning regulators and the public about the NRA’s corruption for years, and the NRA bolstered our case when it filed for bankruptcy and opened itself up for long-overdue scrutiny.”
“Beyond tens of millions in legal bills, the NRA keeps paying the price for its failed bankruptcy,” said Shannon Watts, founder of Moms Demand Action. “Thankfully Attorney General James continues to hold the non-profit and its leaders accountable for years of deception, decadence, and self-dealing.”
The new filing alleges publicly for the first time that (paragraph citations included):
- The NRA has paid more than $10 million for LaPierre’s private flights, an amount that for years, according to the Attorney General, should have been reported to the IRS as taxable income but wasn’t (paras 217-219).
- Between March 2018 and December 2020, NRA paid the Brewer law firm nearly $75 million and the bankruptcy “cost the NRA tens of millions of dollars in legal fees and other costs” (paras 13, 494, 646).
- LaPierre’s travel consultant worked for decades in a no-bid relationship with the NRA until 2019, when the NRA conducted a competitive bidding process that was “largely a sham” in which the consultant had conversations with NRA staff to ensure that she would win (paras 190, 196).
- The NRA paid $200,000 for two personal trips for LaPierre and Ackerman McQueen executive Tony Makris to Arizona. LaPierre and Makris stayed at the Four Seasons on both trips, and on one leg, departed on separate private flights — on the NRA’s dime (para 206).
- LaPierre signed the NRA’s 2019 New York state nonprofit filing despite the fact that he knew it “included materially misleading information and falsely attested to the accuracy of the information provided, under penalty of perjury” (para 566)
- For years, LaPierre and members of his family traveled to the Bahamas to stay on a yacht owned by the principal stakeholder in three NRA vendors. Between 2018 and January 2021, the NRA paid two of these firms $28.7 million in excess of what was agreed to in their contracts (paras 167, 176, 606-614).
These new revelations join what was revealed from the bankruptcy trial, which are now a part of the official NY AG complaint against the NRA:
- In throwing out the case, a federal judge found that LaPierre’s failure to inform “the vast majority of the board of directors, the chief financial officer, and the general counsel” about his intention to enter the NRA into bankruptcy “is nothing less than shocking” and that the case was not filed in “good faith.”
- Deposition testimony read in court showed former longtime NRA CFO Woody Phillips, who is at the heart of the NY AG’s complaint, invoking his Fifth Amendment rights no fewer than 80 times.
- LaPierre admitted that NRA vendor Under Wild Skies covered the costs of hunting trips — including airfare, licenses, and professional hunters — to locales like Botswana for him and his wife. The vendor even reportedly paid to preserve and ship their hunting trophies to the couples’ home.
- In 2018, the NRA considered the purchase of a $6 million Dallas mansion for Wayne LaPierre, going as far as cutting a $70,000 check to proceed. The NY AG’s amended filing references testimony from the bankruptcy trial that indicated the sale was stopped only after Susan LaPierre “requested a social membership in a golf club” for the home, leading vendor Ackerman McQueen’s CFO to question the purported “ security” purpose for the purchase and to refuse to proceed.
Last month, Bloomberg News reported that legal spending at the NRA this year was on track to exceed record-highs for the group, with $22 million spent in the first five months of 2021 alone. Everytown has chronicled the revelations from the NRA’s failed bankruptcy and other filings at NRAWatch.org, including publishing a report “NRA on Trial: Wayne’s Kingdom of Orange Jumpsuits, Golden Parachutes, and Management by Chaos” with audio from the trial. For further information about the state of play for the NRA, please email [email protected].