NRA, D.C. Attorney General Settle Lawsuit Concerning Foundation Spending

By Todd McElwee

Settling a lawsuit brought by the D.C. Attorney General’s Office, the National Rifle Association (NRA) has agreed to reform its foundation’s financial practices.

On April 17, Attorney General Brian L. Schwalb said the terms of the settlement require thorough oversight and extensive operational changes to ensure that the NRA Foundation operates independently from the NRA and fully complies with District nonprofit laws.

“Donors are entitled to know that their charitable contributions will be used in furtherance of a nonprofit organization’s stated charitable mission,” said Schwalb. “The NRA Foundation—the charitable arm of the NRA—violated this sacred public trust, allowing the NRA to use them as an unchecked piggy bank.”

The Office of Attorney General’s (OAG) 2020 lawsuit alleged that the Foundation disregarded its duty to protect its donors’ contributions and to operate independently, instead permitting the NRA and its executives to dictate its spending. OAG said the NRA tapped the Foundation’s coffers for grants and loans when the association needed money due to financial problems, decreasing membership, and lavish spending by its executive leadership.

A New York jury recently found such spending to be part of a pattern of corruption and mismanagement by the NRA and its leaders.

“Tax-exempt nonprofits are a form of public trust—abusing that trust as the NRA did violates both the public interest and District law,” said Schwalb. “Today’s outcome builds on our longstanding commitment to safeguarding nonprofit donors’ money and ensuring that all nonprofits operating in the District of Columbia follow the law.”

The Washington Post reported that under D.C. laws, prosecutors can’t collect financial penalties from wayward nonprofits. The settlement requires the NRA Foundation to form an audit committee and establish new policies on avoiding conflicts of interest and making grants and loans to the NRA. Board members will have to undergo annual nonprofit compliance training through 2026.

The NRA announced “a legal victory in a high-profile governance matter” when discussing the issue. It added “discovery proved that all funds received from the NRA Foundation were applied exclusively in furtherance of its charitable programs and that there was no misuse of Foundation monies.”

“This is further proof of the NRA’s commitment to good governance,” said NRA President Charles Cotton. “The NRA confronted this political attack—and emerges from this lawsuit strong, secure, and vindicated. The NRA and NRA Foundation are fully committed to pursuing their world-class firearms education, training, and safety programs.”  

A New York jury voted on February 23 to find former National Rifle Association (NRA) leader Wayne LaPierre liable for the mismanagement of funds and NRA itself liable for violating state nonprofit law.