by In the last couple of days since the lawsuit against Ackerman McQueen I’ve spoken to a former lobbyist for the NRA and two serving NRA Board Members. The conversations were off the record and not for attribution. Then I read this article in The New Yorker thanks to a link to it posted on Facebook by Prof. David Yamane.
The article is entitled “Secrecy, Self-Dealing, and Greed at the N.R.A.” Mike Spies article has a subhead saying “The organization’s leadership is focussed on external threats, but the real crisis may be internal.” I hate to say this given all the attacks on the NRA from every Democrat running for President, the State of New York, and the media but from what I’ve gathered Spies is correct. Just because we don’t like the source doesn’t mean they are wrong.
Last August, the N.R.A., in desperate need of funds, raised its dues for the second time in two years. To cut costs, it has eliminated free coffee and water coolers at its headquarters and has frozen its employees’ pension plan. Carry Guard, which was meant to save the organization, has proved disastrous. According to the memos, in 2017, the year that Carry Guard was introduced, Ackerman McQueen received some six million dollars for its work on the product, which included the creation of a Web site and media productions featuring celebrity firearms trainers. The lawsuit against New York State has created an additional burden. Sources familiar with the N.R.A.’s financial commitments say that it is paying Brewer’s firm an average of a million and a half dollars a month.
An official assessment performed by Cummins last summer dryly describes the N.R.A.’s decision-making during the previous year as “management’s shift in risk appetite.” The document analyzes the organization’s executive-liability exposures and discusses insurance policies that “protect NRA directors and officers from claims by third parties that they have breached their duties, such as by mismanagement of association assets.” From 2018 to 2019, it says, insurance costs increased by three hundred and forty-one per cent. “To say this is a major increase would be an understatement,” Peter Kochenburger, the deputy director of the Insurance Law Center at the University of Connecticut, told me. “This seems to be pretty direct evidence that the N.R.A.’s problems are not due to New York but rather to how the organization conducts itself.”
The memos urged the audit committee to “step up + fulfill its duties!,” but it’s not clear what the board has done to root out malfeasance. James Fishman, a co-author of “New York Nonprofit Law and Practice: With Tax Analysis,” a leading text on nonprofit law, told me, “There is no such thing as a director who doesn’t direct. You’re responsible to make yourself aware of what’s going on. If the board doesn’t know, they’ve breached their duty of care, which is against the law in New York,” where the N.R.A. is chartered. According to Owens, the former I.R.S. official, New York State “could sanction board members, remove board members, disband the board, or close down the organization entirely.”
Read that last line again. New York State could close down the NRA entirely by moving for dissolution. You have a governor and attorney general in New York that hate the National Rifle Association. You have a Board of Directors which is too large to be effective. You have Ackerman McQueen trying to preserve its position and an outside counsel trying to take their position for himself. And then you have internal civil war going on within the organization between loyalists to one executive and friends of another leader.
The bottom line is that there are tremendous troubles within the NRA just when you need it to be steadfast in the face of outside attacks.
How bad are these troubles? A reliable source told me that Marion Hammer who hasn’t attended a Board of Directors meeting since hell froze over the last time will be in Indianapolis to attend the Board meeting. It’s that bad.
UPDATE: Jeff Knox, son of Neal Knox, and co-head of The Firearm Coalition published an opinion piece of the issue in response to The New Yorker’s article. It is well worth a read. He makes some good points in it and calls for the resignation of Board members on the Audit, Finance, and Executive Committee for not doing their jobs.