New York sues to dissolve the National Rifle Association for 'illegal' and 'fraudulent' conduct

New York state Attorney General Letitia James has announced a lawsuit to dissolve the National Rifle Association (NRA) over alleged financial mismanagement that's run rampant in the organization for years.

The state of New York has the power to dissolve the group because it operates as a New York-registered 501(c)(4) not-for-profit, charitable corporation.

State law requires that the group's assets are used in a way that serves the interests of NRA membership and advance the organization's charitable mission.

However, according to the lawsuit, the NRA has been doing the exact opposite.

In the announcement, James said the gun-rights group is "fraught with fraud and abuse" and that its financial mismanagement has resulted in a loss of more than $64 million over a three-year period.

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The lawsuit alleges that charitable donations given to the organization were misused by NRA executives for personal gain and that it awarded valuable contracts to family members, friends, and former employees.

Seeking to dissolve a not-for-profit charity is the most aggressive action the state of New York can take against the organization.

"The NRA's influence has been so powerful that the organization went unchecked for decades while top executives funneled millions into their own pockets," James said in a statement. "The NRA is fraught with fraud and abuse, which is why, today, we seek to dissolve the NRA, because no organization is above the law."

James says that the organization "instituted a culture of self-dealing, mismanagement and negligent oversight" that contributed to "the waste and loss of millions in assets."

The lawsuit calls out four executives that it claims used the organization "like a piggy bank" and takes dead aim at Executive Vice President Wayne LaPierre.

via Gage Skidmore / Flickr

The suit alleges that LaPierre has received more than $1.2 million in expense reimbursements over the past four years, including travel expenses, gifts for friends, and memberships at exclusive golf clubs.

The lawsuit alleges that his post-employment contract with the organization is worth $17 million.

Legal experts say that the lawsuit could lead to the demise of the non-profit group.

"The NY Attorney General has already brought down the Trump Foundation, and now it is targeting the NRA," Adam Winkler, a law professor and Second Amendment expert at UCLA, said according to The Hill. "If the allegations are true, Wayne LaPierre has been using the NRA as his personal piggy bank."

The NRA lashed out against the lawsuit on Twitter in its typical aggressive fashion.

The NRA was already dealing with financial problems due to a multiple lawsuits. In a secret recording obtained by NPR, LaPierre told an audience that the NRA's legal troubles have cost the organization $100 million.

"The cost that we bore was probably about a hundred-million-dollar hit in lost revenue and real cost to this association in 2018 and 2019," LaPierre said, according to a recording by a source in the room. "I mean, that's huge."

The organization has also seen a steep drop in contributions from its members since Donald Trump was elected president. Its membership dues have dropped 21% since 2016, from $163 million to $128 million.

The NRA's financial and legal troubles will definitely have an impact on the 2020 election. The organization gave Donald Trump over $30 million in 2016 and it doesn't appear to have that type of cash to donate to Trump and down-ballot Republicans this year.

The NRA is also facing greater competition after the recent rise in mass shootings.

In the 2018 midterm elections, gun-control groups outspent the NRA for the first election cycle in history.

Studies show that sensible gun control measures are supported by a majority of Americans, so this could be a turning point where the NRA's grip over the political process loosens enough for government to finally implement new gun-safety laws.