Jury Finds NRA Guilty of Mismanagement: Latest Updates

TFD – Dive into the unfolding saga as a jury delivers a damning verdict against the NRA for mismanaging funds. Stay informed about the legal battle surrounding Wayne LaPierre and the implications for the organization.

In a lawsuit brought by the New York Attorney General’s Office against the National Rifle Association, a jury returned on Friday finding that the organization had mismanaged charitable funds by failing to prevent top executives, including longtime leader Wayne LaPierre, from using millions of dollars for dubious expenses such as lavish personal trips and no-show contracts.

The jury concluded that LaPierre ought to reimburse the influential gun rights organization $4.3 million for improper handling and misappropriation of charity proceeds. Wilson Phillips, the former CFO of the company, was also judged by the panel to have violated his fiduciary duties as an executive and should repay $2 million.

In a post on X, New York Attorney General Letitia James hailed the jury’s decision to convict the influential National Rifle Association and its senior executives as a “major victory” shortly after the verdict was announced.

“My office won our case against the NRA and its senior leadership for years of corruption and greed,” James declared, calling it a significant victory. “Wayne LaPierre and a senior NRA executive must pay $6.35 million for violating our laws and abusing the system.”

The ruling represents the most recent setback for the once unstoppable lobbying powerhouse, which has suffered in recent years from internal strife, accusations of wrongdoing and corruption, and dwindling membership.

The National Rifle Association of America (NRA) said in a statement, “A jury verdict in a high-profile New York trial confirms what the NRA contended all along – that it was victimized by certain former vendors and ‘insiders’ who abused the trust placed in them.”

LaPierre remained where he had been sitting the entire trial, staring blankly and not showing any emotion on his face as the verdict was read out. As he was led out the courthouse to a waiting car, he remained silent.

“As of two months into 2024, the NRA has successfully eliminated its political significance, their longstanding leader, and this trial,” stated Nick Suplina, senior vice president of law and policy at Everytown for Gun Safety. “This decision validates what we’ve witnessed in state legislatures, the halls of Congress, and recent elections: the gun lobby is stronger than ever, and the gun safety movement is stronger than ever.”

A lawsuit to dissolve the NRA was brought by the state attorney general in 2020 on the grounds that it had committed tax fraud, broken laws pertaining to non-profit organizations, and embezzled millions for personal use.

LaPierre was judged by the jury to have broken his fiduciary duty while leading the non-profit from 2014 to 2022. The panel found that his breach of his statutory duties cost the NRA $5.4 million in damages, although he was able to show that he had already paid back slightly more than $1 million to the organization.

He was also fired by the panel from his position as executive vice president of the gun rights organization. Despite his resignation last month, a bench trial is scheduled, and the court will determine whether to permanently disqualify him from running the NRA.

However, when he obtained a post-employment contract with the NRA in a package valued at over $17 million, the jury found that he was not guilty for breaking rules prohibiting self-dealing because the NRA board had duly approved it in advance.

Jurors found in the lengthy finding that the NRA had improperly entered into some deals without required board permission or ratification, benefiting its insiders, including its senior executives and board members. A post-employment consulting agreement with Wilson Phillips, the former CFO of the NRA, and spending for LaPierre’s wife’s hair and makeup were among the unethical self-dealing.

The NRA submitted false and deceptive information in its annual reports, the jury found.

The jury also found that the NRA had violated whistleblower protection statutes by neglecting to implement a suitable policy, by not looking into complaints from whistleblowers, and by taking retaliatory action against eight whistleblowers who raised concerns.

The jury determined that the NRA was not accountable for a single allegation, which questioned if LaPierre’s post-employment contract constituted an unlawful transaction. The New York Attorney General’s Office was determined by the jury to have failed to provide evidence that the NRA board had not properly approved the transaction.

Following the decision, the NRA’s attorney, William A. Brewer III, released a statement saying, “A parade of NRA witnesses and independent experts established that the NRA was the victim of actions that were pursued in secrecy and not in the interests of the Association – by former vendors and fiduciaries.”

In a case that highlights one of the most potent lobbying organizations in a country where there are more civilian weapons than people, the jury’s deliberations started on February 16.

caught “with the cookie jar between their hands”

The attorney general’s office contended during the closing arguments that the NRA and its top executives were involved in widespread corruption and that they owed the organization millions of dollars that they had spent on personal expenses.

The defendants – the NRA, LaPierre, Philips and general counsel John Frazer – were caught “with their hands in the cookie jar,” Assistant Attorney General Monica Connell said in closing arguments last week.

They breached their fiduciary duties by failing to properly administer charity funds and by breaking non-profit laws, which they denied, deflected, and laid blame on one another for, according to her.

“What occurs if someone is exposed in the act?” Connell enquired. “What actions will they take? What do our life experiences and common sense indicate they will do?

Connell continued, “Ceasing illegal activity after you’ve been caught does not make your wrongdoing go away.

LaPierre, who resigned from his NRA position last month due to health concerns, stated in court that he wasn’t doing it for the money. Rather, he said that the costs were a component of an endeavor to increase the organization’s prominence and reach.

According to Connell, LaPierre has a lengthy history of corruption, having spent millions of dollars on insider deals, automobiles, private jets, five-star hotels, apparel worth hundreds of thousands of dollars, and rewards to devoted board members.

According to Connell, the NRA paid $600,000 in total for LaPierre’s private flights to the Bahamas, and the cost of his hair and cosmetics came to about $41,000.

Every time LaPierre or his spouse spent time on the yacht owned by the proprietors of Ackerman McQueen, an MMP company, the NRA’s contract with its old advertising business, MMP, grew, she alleged.

The NRA paid MMP businesses $109 million between 2015 and 2022; Connell told the jury that LaPierre, Philips, and Frazer should split the damages.

Connell stated, “We’re talking about trust of NRA donors” and members who contributed hard-earned cash to charitable causes.

AG: NRA CEO retained gang of devoted followers

Connell cited LaPierre’s hiring and firing of Oliver North, the former president of the NRA who had previously testified for the state, as an egregious illustration of his wrongdoing.

LaPierre gave him the position of president without getting permission, made North an offer of a million-dollar deal, and then, she told the jury, repressed and fired him when North voiced objections. North originally came to the attention of the country in the 1980s as a key player in the Iran-Contra crisis.

Connell further contended that LaPierre retained a faction of supporters on the NRA board who guarded “Wayne’s world.”

In a strange turn of events, an NRA verdict against previous officials might be advantageous to members. Connell declared that the state would get no payment.

“This isn’t a witch hunt,” declared Connell. “The attorney general is attempting to restore funds that were improperly taken from the NRA to the NRA.”

The former CEO “wasn’t interested in building a big pile of money for himself; he wasn’t interested in getting money through a back door at the organization,” according to LaPierre’s lawyer Kent Correll during the closing remarks.

According to Correll, the state had implied that each private flight taken by LaPierre “was somehow a personal flight.” It wasn’t. It served the NRA’s interests.

“The AG wants you not to observe the bravery. They would rather that you not see the freedom he has battled for. He said, “They want you not to look at the 4 million members.”

Correll said the New York attorney general set out to destroy the organization and she knew the best way to do that was to get to LaPierre.

He claimed that Letitia James’ desire to “decapitate the organization” was motivated by politics.

Attorney Sarah Rodgers for the NRA claimed that the non-profit was not informed of the wrongdoing and that the fact that the group will receive damages rather than the state “tells you what we need to know” about the case.

LaPierre stated in her testimony, “I wanted to pay it back in interest if anything was found where I received an advantage or benefits.”

The NRA’s recent troubles—the legal lawsuit, the organization filing for bankruptcy in 2021 after a protracted leadership dispute that resulted in the loss of its longstanding senior lobbyist—have been accompanied by a decrease in political spending and a sharp decline in membership.

The NRA was primarily nonpartisan for its first 100 years of existence, supporting various gun control laws during that period. However, in the 1970s, the organization started to advocate against federal firearm laws. Among political conservatives, mainly in the Republican Party, it found supporters.

But the NRA’s influence is still strong within the GOP, whose leaders continue to be nearly exclusively in line with the organization’s viewpoints. As per observers, the NRA will not face a corporate death penalty if guilt is found.

Ray Sanchez of CNN contributed to this article.

We will be updating this story as it develops.