New York Attorney General Letitia James sued the National Rifle Association and four individuals, including its chief executive, Wayne LaPierre, on Thursday, seeking to dissolve the gun rights advocacy group and accusing top executives of "years of illegal self-dealings" that funded a "lavish lifestyle."
James said the NRA, a not-for-profit organization, undercut its charitable mission by engaging in illegal financial conduct, including diverting millions of dollars "for personal use by senior leadership, awarding contracts to the financial gain of close associates and family, and appearing to dole out lucrative no-show contracts to former employees in order to buy their silence and continued loyalty."
"The NRA is fraught with fraud and abuse, which is why, today, we seek to dissolve the NRA, because no organization is above the law," she said.
Also named in the complaint are Wilson "Woody" Phillips, a former treasurer and chief financial officer; Joshua Powell, a former chief of staff and the executive director of general operations; and John Frazer, the corporate secretary and general counsel. They are accused in the suit of failing to manage the NRA's funds and abide by state and federal laws, contributing to the loss of more than $64 million in three years.
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James alleged that the executives had used the corporation as a "personal piggy bank" and that millions of dollars from NRA reserves were used on trips for them and their families and to pay for private jets and expensive meals. LaPierre is also accused of having spent more than $500,000 on eight trips to the Bahamas over three years, securing luxury black car services, paying for hair and makeup for his wife and obtaining a post-employment contract valued at $17 million.
"Given the breadth and depth of the corruption, the illegality and the brazen attempts to evade the law," she said, it is necessary for the NRA to shut its doors for good to protect members and donors.
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In a statement, LaPierre said James' investigation is "an affront to democracy and freedom."
"This is an unconstitutional, premeditated attack aiming to dismantle and destroy the NRA — the fiercest defender of America's freedom at the ballot box for decades," he said. "The NRA is well governed, financially solvent, and committed to good governance. We're ready for the fight. Bring it on."
Phillips, Powell and Frazer did not immediately respond to the lawsuit, which was filed in state court in Manhattan after an 18-month investigation and seeks fines and remuneration. None of the men have been charged with a crime, but James said the suit would be forwarded to the IRS for investigation of potential violations of tax law.
"If we uncover any criminal activity, we will refer it to the Manhattan district attorney," she said. "At this point in time, we're moving forward, again, with civil enforcement."
Also Thursday, District of Columbia Attorney General Karl Racine sued the NRA and the NRA Foundation, its charitable arm, which is incorporated in D.C. The suit alleges that they misused charitable funds "to support wasteful spending by the NRA and its executives." The suit seeks the return of money that it says was donated to the NRA Foundation but was improperly diverted to the NRA and to ensure that the foundation is "operated independently and fulfills its charitable purposes."
NRA President Carolyn Meadows called the New York complaint a "baseless, premeditated attack on our organization and the Second Amendment freedoms it fights to defend." She said the organization would "confront it and prevail."
"It's a transparent attempt to score political points and attack the leading voice in opposition to the leftist agenda," Meadows said in a statement.
The NRA filed its own countersuit against James on Thursday, claiming that the group's First Amendment rights had been violated ever since she suggested in 2018 that it was akin to a "terrorist organization" and said she would open an investigation if she became attorney general.
"Importantly, James made these promises without a single shred of evidence, nor any sincere belief, that the NRA was violating the New York Not-For-Profit Corporation Law, or any other law," the countersuit says.
It seeks a reprieve from James' investigation and a judgment declaring that the NRA is "operating in substantial compliance with New York not-for-profit law."
President Donald Trump, whom the NRA endorsed last month for a second term, defended the organization, saying a "very terrible thing that just happened."
"I think the NRA should move to Texas and lead a very good and beautiful life," told reporters outside the White House.
James confirmed in April 2019 that an investigation was underway, part of a campaign promise to dig into the NRA's not-for-profit status. James issued subpoenas, reportedly looking into its campaign finances, payments to board members and tax compliance.
The same month, Oliver North, the retired Marine lieutenant colonel who became the NRA's president in 2018, stepped down after alleging that other leaders had engaged in financial improprieties.
His departure revealed a fractured organization and an internal power struggle in which North and his supporters were reported to have tried to oust LaPierre, the CEO and executive vice president who has led the NRA and its more than 5 million members since 1991.
LaPierre, the longtime public face of the NRA, later accused North of trying to extort him. But he has also come under scrutiny from major donors worried about the group's revenue and mounting legal troubles.
After learning of James' investigation last year, Trump defended the NRA, tweeting that it was "under siege" by her and New York Gov. Andrew Cuomo, both Democrats, "who are illegally using the State's legal apparatus to take down and destroy this very important organization, & others."
William A. Brewer III, a lawyer representing the NRA, said in a statement in December that the "financial records of the NRA and affiliates were audited and reported in tax filings, in accordance with state and federal regulations — a fact that underscores the Association's commitment to good governance."
He said James' investigation had a "partisan purpose — not an actual concern that the NRA is not effectively using its assets to pursue its members interests."
The NRA's headquarters is in Fairfax County, Virginia, but the New York attorney general has investigatory authority over its status as a not-for-profit organization because it is chartered in New York. The group remains the most powerful gun lobby in the United States, although it has laid off or furloughed dozens of employees and cut salaries during the coronavirus pandemic.
