By Terrance Turner
Jan. 15, 2021
The National Rifle Association has filed for bankruptcy.
The NRA filed Chapter 11 papers today in a Dallas federal court. It will seek to re-incorporate in Texas instead of New York, according to the Associated Press. The move “will enable long-term, sustainable growth and ensure the NRA’s continued success as the nation’s leading advocate for constitutional freedom,” the NRA said in a statement.
The bankruptcy will come as no surprise to close observers; the NRA had been in financial trouble for quite some time. In September 2020, former executive Joshua Powell exposed cash flow problems in a tell-all book, Inside the NRA. “The finances of the NRA are in shambles,” Powell wrote, portraying the 148-year-old gun rights group as part of “the grifter culture of Conservative Inc.”
He accused NRA CEO Wayne LaPierre, his former boss and mentor, of “robbing every $45-dues-paying member to cover the costs of his own extravagance and his shameful mismanagement.” Powell is not alone. In August, New York Attorney General Letitia James filed a lawsuit against the NRA, alleging wrongdoing by LaPierre. Mr. LaPierre was accused of using N.R.A. funds to fund an extravagant lifestyle, even though he was already paid millions in direct compensation by the organization.
James’s lawsuit (against LaPierre and three others, including Powell) made damning allegations of corruption and misappropriated funds. “Among the numerous alleged violations laid out by Ms. James’s office, some were related to false reporting of annual filings both to the state and the I.R.S.,” said The New York Times. “Her office also cited ‘improper expense documentation, improper wage reporting, improper income tax withholding’ and failing to make required excise tax reporting and payment, among other issues.”
“Over six and a half years, the suit said, a personal travel consultant for Mr. LaPierre was paid $13.5 million, largely on no-bid contracts. Private flights were chartered for Mr. LaPierre’s wife and his niece. He took frequent trips to the Bahamas on the N.R.A.’s dime, often decamping to a 108-foot yacht called “Illusions” that was owned by an N.R.A. contractor and included a chef and four staterooms. He lavished gifts from Neiman Marcus and Bergdorf Goodman on his inner circle, and once put his niece up at a Four Seasons hotel for eight nights at a cost of more than $12,000, according to the complaint.”
The lawsuit charged that N.R.A. and its executives were “violating numerous state and federal laws” by enriching themselves, as well as their friends, families and allies, and taking improper actions that cost the organization $64 million over three years.
That was in addition to the millions the organization spent on lobbying and campaigning. In 2016, the NRA spent more than $30 million on behalf of the Trump campaign, according to Federal Election Commission data. Now, as President Trump prepares to leave office, the group that spent millions to elect him is filing for bankruptcy.