NRA promises to reform charitable arm in new deal with D.C. attorney general

The National Rifle Association (NRA) settled a lawsuit with the D.C. Attorney General’s Office on Wednesday, concluding a three-and-a-half-year case with a promise to reform its troubled charitable arm while avoiding a trial.

Prosecutors said the NRA Foundation misused more than $10 million in tax-deductible donations, illegally funneling the money to its parent organization for political activities. The case was set to go to trial on April 29.

The settlement comes as the NRA recovers from a disastrous corruption trial in New York, which saw the organization and its top executives hit with multimillion-dollar fines for misusing funds.

A judge found that the NRA’s top executives spent millions of the group’s funds on luxury travel, clothing, dinners and other perks over decades. Former CEO Wayne LaPierre, who stepped down after the trial, was found liable for $5.4 million in damages, while former chief financial officer Woody Phillips faced a $2 million judgment.

In the D.C. case, Attorney General Brian Schwalb said the NRA charity violated the “sacred public trust” of nonprofits by “allowing the NRA to use them as an unchecked piggy bank.”

“Giving in to pressure from the NRA, the Foundation diverted millions of dollars to the NRA in grants and risky loans that were only repaid after the OAG filed its case,” he continued in a statement. “Tax-exempt nonprofits are a form of public trust – abusing that trust as the NRA did violates both the public interest and district law.”

The NRA did not admit wrongdoing in the settlement.

“This is further proof of the NRA’s commitment to good governance,” NRA President Charles Cotton said in a statement. “The NRA has faced this political attack – and emerges from this process strong, secure and vindicated.”

The organization also fought Schwalb’s characterization of the agreement in a statement to The Hill, with NRA attorney William Brewer calling it “distorted and untrue.”

“DCAG ‘spins’ today’s settlement to avoid the facts: DCAG long ago abandoned any allegations of wrongdoing against the NRA,” Brewer wrote. “Even by D.C. standards, this is a high-level political game — an after-the-fact justification for a failed prosecution by these officials.”

Brewer went on to claim that many of the allegations Schwalb alleged against the NRA Foundation were unfounded, specifically noting that the settlement does not include accusations or implications of wrongdoing on the part of the organization.

“In light of these facts, DCAG has settled its lawsuit – dropping all claims against the NRA and the NRA Foundation,” he wrote.

As part of the settlement, the NRA Foundation agreed to annual nonprofit compliance training for its board members and officers, more robust audits and the establishment of a conflict of interest policy.

It also calls on the Foundation to establish new policies “that govern the granting of grants, loans, shared services, and other activities with the NRA to ensure the Foundation’s transparency, independence, and adherence to the Foundation’s nonprofit mission.”

The settlement does not include financial penalties, as the District’s nonprofit governance laws do not allow for punitive damages. It will remain in effect until December 2026, Schwalb’s office said.

The NRA has struggled for years with declining membership and rising legal fees between the New York and D.C. lawsuits.

The association lost around half a million members from 2021 to 22, according to the nonprofit gun violence news organization The Trace. The ARN raised just US$213 million in 2022, about half of 2016’s total, according to the nonprofit Citizens for Responsibility and Ethics in Washington.

After an 18-month investigation into the New York case, Attorney General Letitia James (D) said the NRA fostered “a culture of self-dealing, mismanagement and lax oversight” that cost the group $64 million over the course of three years. She sought to dissolve the entire organization in the process, but a state judge scaled back that requirement last year.