Attorney general james good morning. I want to thank you all for joining me. Im joined here this morning by the chief of the Charities Bureau and the cochief chief of the enforcement section. Enforcement section, emily stern. Just a few minutes ago, my office filed a lawsuit against the National Rifle association to dissolve the organization in its entirety. For years of selfdealing and illegal conduct that violates new yorks Charities Law and undermine its own mission. The National Rifle association or the nra is the largest and most influential Gun Organization in the nation. Since its founding in 1871, the nra has been a registered notforprofit Charitable Organization in the state of newark prayed the Attorney Generals Office has a large range of regulatory powers over charitable corporations and their trustees. Including the nra. The nra influence has been so powerful that the organization unchecked for decades while top executives funneled millions into their own pockets. Four years the nra diverted millions and millions of dollars away from its Charitable Mission for personal use by senior leadership. To award contracts to the financial gain of Close Associates and family. And appeared to deal out lucrative noshow contracts to former employees in order to buy their silence and continued loyalty. This lawsuit specifically charges the nra as a whole in addition to for individual defendants. One, the first individual. Longtime executive Vice President Wayne Lapierre who has been the face of the nra for decades. Too, former treasurer and chief Financial Officer wilson, woody, phillips. Three, former chief of staff and executive director of operations, Joshua Powell and four, corporate secretary and general counsel john frazier. These individuals in the nra are charged with failing to manage the nra funds and failing to follow numerous state and federal laws which continue to the loss of more than 64 million in just three years. Since its founding in 1870 when the nra has been a registered notforprofit charitable operation and the state of new york for these organizations are required by law to register and file annual Financial Reports with the office of the new York State Attorney general and the assets of such an organization are legally required to be used in a way that serves the interest of nra membership and advance the organization Charitable Mission. However, as today complaint lays out we found that the nra, instead, fostered a culture of noncompliance and disregard for internal controls that led to the waste and loss of millions in assets and contributed to the nra current deteriorated financial state. Not only were the nra internal policies repeatedly not followed, but they were blatantly ignored by senior leaders. The nra Board Audit Committee was negligent in its duty to ensure appropriate competent and judicious stewardship of assets by nra leadership. Specifically the Audit Committee failed to assure standard fiscal control. They failed to respond adequately to whistleblowers. Affirmatively took steps to conceal the nature and scope of whistleblower concerns from external auditors. And they failed to review potential conflicts of interest for employees. An hour lawsuit we outline dozens of examples of these failures. Many were led and perpetuated by the four individual defendants named in this lawsuit. Who failed to fulfill their fiduciary responsibility to the nra. They used millions upon millions of dollars from the nra for personal use. Including lavish trips for themselves and their family. Private jets, expensive meals, and other private travel. Wayne lapierre, woody phillips, Joshua Powell, and john frazier instituted a culture of selfdealing mismanagement and negligent oversight at the nra that was illegal oppressive and fraudulent. They overrode and they invade invaded evaded internal controls to allow themselves, their families, favorite Board Members, employees and vendors to benefit the reimbursed expenses related party transactions, excess compensation, side deals, and a waste charitable assets without regard to the nra best interest. The central figure behind the scheme was none other than mr. Wayne law fear. The National Face of the nra that was entrusted with running the daytoday operations he exploited the operation for his and his familys financial benefit. And the benefit of a close circle of nra staff, Board Members and vendors. Specifically, he spent hundreds of thousands of dollars with the nras charitable assets for personal private plane trips for himself and his family including extended family when he was not present he visited the bahamas by private air charter at least eight times an approximate three year period with his family at a cost of more than 500,000. To the nra. He traveled on multiple luxury Hunting Safaris in africa. At the expense of the nra vendor. He spent millions of dollars on un wanted travel consultants for decades including for the booking of luxury black car service. In the past two years alone mr. Lapierre has spent more than 3. 6 million on these travel agent services. He secured a postemployment contract for himself with the nra without board approval. Currently valued at more than 17 million. He allotted several Million Dollars annually in nra funds for private security costs for himself, and his family. Without sufficient oversight on their use. He received more than one point to Million Dollars in reimbursement and just a fouryear period for expenditures that include gifts for favored friends and vendors, travel expenses for himself and his family, and membership fees and golf clubs, hotels, and other member clubs. He even secured lucrative contracts for exemployees and Board Members with millions of dollars. Yet often it resort in turn resulted in little if any actual work. In addition to grossly misusing funds for personal use he had an illegal path to conceal the very nature of these expenditures. For decades mr. Law fear and the founder the nras longtime Advertising Firm had a practice whereby Ackerman Mclean would pay for the noncontractual outofpocket expenses for mr. Lapierre and other nra executives. Hen passed those expenses through to the nra. His expenses would then be paid for without written approval without receipts without any Business Purpose and documentation. Ackerman mclean would aggregate the expenses into a lump sum amount and bill them to the nra without any details on the nature or purpose of the expense, completely in violation of state law. These expenses did not comply with irs requirements and as a result all expenses should have been included by the nra and taxable personal income for mr. Lapierre and other recipients. In 2017, and 2018 alone, just two years, Ackerman Queen was paid more than 70 million. A significant amount of these funds include payments to this side agreement. And when Board Members challenge mr. Lapierre and the three other defendants over this lavish spending, their financial governments or their leadership of the nra are, mr. Lapierre retaliated and turned the board against those who challenge his illegal behavior. The complaint lays out numerous other instances in which mr. Lapierre, mr. Phillips, mr. Powell, and mr. Frazier and other executives and Board Members at the nra abused their power. And illegally diverted of tens of millions of dollars from the nra. These funds were in addition to millions of dollars before individual defendants were already receiving a grossly excessive salaries and bonuses that were baseless and did not adhere to prudent standards for evaluating and determining compensation as is required by law. Altogether, there are 18 causes of action on these action violated multiple laws including the laws governing the nras chervil status. False reporting on annual filings with my office and the irs. Improper expense documentation, and improper wage reporting improper income tax withholding, failure to make required tax reporting payments, payments in excess of reasonable compensation to disqualified persons, and waste of nra assets amongst other offenses. For these years of fraud and misconduct, we are seeking an order to dissolve the nra in its entirety. To require mr. Lapierre, mr. Phillips, mr. Powell and mr. Fraser to make full restitution for funds they unlawfully profited in salaries they earn both employees and paid penalties. To remove mr. Lapierre and mr. Frazier from the nras leadership and to ensure none of the four individual defendants can ever again serve on the board of a charity in new york state. It is important to note that mr. Phillips and mr. Powell have left the nra. It is clear that the nra has been failing to carry out its stated mission for many, many years and instead has operated as a breeding ground for greed, abuse, and brazen illegality. In this state we have a set of laws that every individual and entity must be held accountable to, regardless of who you are, regardless of your power, size, influence, wealth, station in life. One set of laws. And today, we sent a strong and loud message that no one is above the law. Not even the nra. One in the most powerful organizations in this country. Again, i would like to thank the chief of the Charities Bureau, and the co chief of the enforcement section and they lead with a dedicated, experienced and professional team of attorneys who i am very proud to be associated with. Also a team of accountants, legal assistance, and they include assistant attorney general and special counsel of the litigation bureau, monocle culprit assistant attorney general assistant attorney general sharon staff. Assisted attorney general jonathan conley. Assistant attorney general thompson, and erika james all of the Charities Bureau. With additional assistance from chief accountant, judith welsh. Assistant associate accountants, darren, and associated accountant charles. In addition to numerous other individuals in the office of the attorney general. The Charities Bureau as part of the division for social justice which is supervised by chief Deputy Attorney general and first Deputy Attorney general Jennifer Leedy who were integral and at instrumental in overseeing this entire process. And now my friends, i am happy to take questions. Civic. [inaudible] [inaudible] i can see this developing from the present terms of the republicans are going to say youre only going after the nra and because of their support of the republican spread how would you respond to that . By no means this was an investigation that started 2019 through this day based on the facts. Befall the facts and the law we come to conclusions of law as a result of that we have come to the conclusion that the nra unfortunately was serving as a personal piggy bank to four individuals. Under followup. Hes been on for so many years and ought this is not easy decision to come to. Why ask for it to resolve instead of the removal of all these people in keep the organization intact . Why are you making go away . Because the corruption is so broad and the level of waste. Theyve basically destroyed all the assets of the corporation it was critically important that one of the causes of action or one of the remedies we are seeking is dissolution of the nra. Reporter courts always look for prior precedents to do Something Like this. What is the prior precedents you would cite for dissolving the organization . So there are two prior cases in the last couple of years. One is called the multicultura multicultural Multicultural Federation of multi programs out of brooklyn and the second is the Trump Foundation. Reporter in terms of criminal charges here where there no criminal charges . [inaudible] the office of attorney general and regards with the notforprofit law is tasked with having jurisdiction over notforprofit than the civil realm that the criminal realm. And that is why this is a Civil Enforcement action. Reporter [inaudible] what effect would mean. [inaudible] i know you been deployed and outspoken and all. [inaudible] to make this has nothing to do with my personal opinion with regards to gun violence. This has to do with the fact that four individual defendants in the nra is a corporation unfortunately did not follow notforprofit that lot in the state of new york for it as a result of that they should be held accountable. An dissolution, seek the banning of these four individual defendants. We seek restitution. These individuals did not follow the nra. Reporter to bring dennis at tht youve been waiting for . So its not a moment ive been waiting for. At sequestered again following the facts and applying the law heard when you apply the line you come to a conclusion the only conclusion you can come to is that these four individual defendants, as well as the nra and all of its directors and officers violated a law. And they did it over a period of years. It went on unchecked for a period of years. We came to the conclusion based upon our thorough investigation that enough was enough. And we need to step in and dissolve this corporation, just as we give the Trump Foundation. [inaudible] so to have any concern for your safety considering the nra is such a powerful organization has support . Gemini concerns . So none whatsoever. So introduced the colors on the phone. Good afternoon. For reporters who join us virtually for todays press conference please do the following hand function at the bottom of your screen if you wish to ask a question. So our first questions they will come from the new york times. Low attorney general. You anticipate seeking or making a criminal referral with this matter . Would you allow doing so in the future if not planned to do so now . So first of all thank you forgo. If we uncover any criminal activity we will referred on to the manhattan district attorney. At this point in time we are moving forward in Civil Enforcement. So our next question of the washington post. So attorney general james this is carol think if your news conference. I have a question about your findings regarding lapierres ability to avoid reporting expenses as personal income on his personal income taxes. Have you or will you refer that to the irs . And do you believe he evaded personal income taxes in a pattern over several years . I will not again come to a conclusion on whether or not he violated Internal Revenue code. We are in the midst of submitting our complaint to the irs and we will contact the irs accordingly. So thank you our next question is from cbs. Hi thanks very much for taking my question but many people today were speculating the conference was going to be related to present donald trump can you give us an investigation you have with President Trump or theyve reportedly received documents of also subpoenaed georgia bank have they complied with your subpoena . And if so can you give us a sense of what theyve given you . Thank you for that question which is not the subject of todays press conference and we will not comment on any other investigation. Thank you. The next question comes from john campbell. [inaudible] news. Hello attorney general. The Trump Foundation lawsuit which predated view here, it resulted in a settlement. Are you open to any sort of settlement with the nra that would result in anything less then the dissolution of the organization . Thank you for the question. It is not my habit to negotiate any resolution in public prayer we filed our complaint today there are 18 causes of action include but not limited to the dissolution of the nra in its entirety. Next questions in the wall street journal. Sorry i was muted. The attorney general thank you so much. I was wondering since youre seeking to dissolve this organization, is it possible this could lead to some type of tip for tats some other attorney general. [inaudible] or is it possible the nra could say okay you want to dissolve bolt moved to wyoming or oklahoma and now are dealt with new york. In others you would no longer have power over that. Im not going to speculate as to the future plans of the nra. The nra again was formed under the notforprofit loss in the state of new york. As a result with the office of attorney general has supervisory jurisdiction over all notforprofits including and not limited to the nra. Civic the next question. [inaudible] subject oh yes hello. Allegations that you have laid out here suggests that the nra members were really essentially victimized allegedly by these actions. Is it not further victimizing them by forcing their organization to close, an organization thats pretty popular across the whole country. Is that necessarily fair to those victims here . Select the issue is the following. A number of donors have contributed to the n arabica they believe in their mission. At this point in time, the nra right now, financially is it a deficit. As a result of four individual defendants have basically looted its assets. And so one would think that the donors would like for an organization to have some governance, some standards of behavior, and that they would recognize the fiduciary responsibility or non for Profit Mission as opposed to looting assets and using it for their own personal benefit and their family. Our next question. [inaudible] hi, thank you general attorney. Do you find the money with from a campaign . If yes which one . This is not a subject of this press conference today. I do into to know our investigation is ongoing. The next question from 11. Attorney general thank you for taking my question. I was just wondering if you could walk us through the next couple of immediate steps with the understanding this type of legal action, what was in the coming weeks and months . So im confident there will be a response that will be filed by the nra. We will go through a series of motions, there will be discovery. Its a normal course of action all of our cases. And so we will continue to keep you abreast of the status of this litigation. Our next question. [inaudible] from new york city media. So hello attorney general james thank you for taking my question. Many have criticized the settlement your office brokered with the Weinstein Company maintaining the sun wouldve been greater wind scene personally had to pay into it. At any point during the settlement process as you consider or advocate for Harvey Weinstein paying into the settlement . It if not why not . So that is not the subject of the press conference here today. We will give you an update in regards to the weinstein negotiation. I thank you for the question. will you attempt to leave the absence of the targets of this investigation or the nra [inaudible] . In our pleadings and so we look forward to again doing investigations to determine if there are any Hidden Assets and whether or not they can be frozen again for the purposes of benefiting those donors who gave to the nra over the years for the intended mission. Our last question will be from cnn. Hello, attorney general. Thank you for taking my question. Its a two parts. One, it seems like there are a lot of allegations of potential tax fraud that has been reported to the irs. Why take the measure to dissolve the entire organization instead of removing its numbers, can you speak to why that was necessary in this case . We thank you for those questions that were previously asked and answer but we will answer them again. We will forward the complaint to the iss and be in touch with the irs in regard to any violation of the Internal Revenue code and two, the cook because of the numerous complaints and based upon the facts of the application of law we concluded that the best way to address this matter was to seek resolution before the New York State Supreme Court judge and that is what we are seeking again given the breadth and depth of the corruption and the legality and brazen attempt to basically evade the law. I thank you all for coming. The Congressional Oversight Commission is a five person Panel Established by the cares act. They hold a hearing monday in response to mainstream coronavirus main street business aid. You can watch online at cspan. Org or listen live on the free cspan radio app. American history tv on cspan3, exploring the people and events that tell the american story, every weekend. Coming up this weekend, sunday marks the 75th anniversary of the atomic bombing of nagasaki, japan, three days after hiroshima. Journal, we will look back at how the bombings ended world war ii and the aftermath of the decades ahead with richard frank, author of downfall, and a professor at american universitys Nuclear Studies institute. They will take your calls, texts, questions, and tweets. At 4 00 p. M. Eastern, the 1946 effects of the atomic 1000 cranes. The 75th anniversary of the pot stem congress, where harry truman informed england and russia the soviet union about the new super weapon. Watch American History tv this weekend on cspan3. Acting Homeland Security secretary chad wolf was on capitol hill to testify in his departments response to recent protests in portland oregon. He says federal Law Enforcement was deployed to protect property and rejected the idea that agents were attacking peaceful protesters. Aring
comparemela.com © 2020. All Rights Reserved.