NATIONAL NEWS

NRA’s ex-CFO agreed to 10-year not-for-profit ban, still owes $2M for role in lavish spending scheme

Jul 9, 2024, 7:54 AM | Updated: 8:36 am

NEW YORK (AP) — The National Rifle Association’s former finance czar, Wilson “Woody” Phillips, has been banned for a decade from managing money for any nonprofit company in New York, the state’s attorney general said Tuesday.

Phillips agreed to the ban in May, three months after a jury found him liable in a scheme to have the influential gun rights organization bankroll the extravagant lifestyle of the NRA’s longtime chief executive, Wayne LaPierre. Details of the settlement were not made public until Tuesday.

Under the agreement, Phillips is banned for 10 years from serving as a fiduciary of a not-for-profit organization in New York and must receive training before returning to any such position. He is still on the hook for $2 million in damages to the NRA for his role in concealing and enabling LaPierre’s lavish spending on things like exotic getaways and trips on private planes and superyachts.

The settlement means that Phillips, now retired, won’t have to participate in next week’s second phase of a trial in New York Attorney General Letitia James’ civil lawsuit against the NRA and former top executives.

Manhattan Judge Joel Cohen is to decide remaining issues in the case beginning July 15, including whether former LaPierre and ex-general counsel John Frazer should be barred from charitable organizations in the state.

Among other things, Phillips was accused of approving invoices for LaPierre’s private jet flights to the Bahamas; facilitating payments to contractors owned by LaPierre’s friends; and allowing an arrangement through which the NRA paid back its longtime advertising agency, Ackerman McQueen, for travel, makeup and other expenses it covered for LaPierre and his wife.

“For decades, Wilson Phillips oversaw and allowed financial mismanagement and corruption at the NRA, and that is why the jury found him, the NRA, and his co-defendants, senior executives Wayne LaPierre and John Frazer, liable for their misconduct,” James said in a statement. She said Phillips’ 10-year ban “should serve as an example that my office will hold anyone, and everyone, involved in abusing their power or misappropriating funds accountable.”

A message seeking comment was left for Phillips’ lawyer.

The trial’s first phase concluded in February when a jury in state court in Manhattan found that LaPierre had misspent millions of dollars of NRA money. The jury said LaPierre must repay almost $4.4 million to the NRA and that Phillips owed $2 million.

Jurors found Frazer violated his duties, but not that he owed any money or that there was cause to remove him from the organization. They also found that the NRA failed to properly manage its assets, omitted or misrepresented information in its tax filings and violated whistleblower protections under New York law.

A third co-defendant, LaPierre’s ex-chief of staff Joshua Powell, settled with James’ office just before the start of the trial in January. Powell, who wrote of “staggering” waste and corruption in his 2020 book “Inside the NRA,” agreed to testify at the trial, pay the NRA $100,000 and forgo further nonprofit involvement.

LaPierre announced his resignation on the eve of trial. In May, the NRA elected Doug Hamlin, the executive director of its publications wing, as his replacement. At the same time, Frazer was removed as general counsel but he remains as the NRA’s corporate secretary. Phillips retired in 2018.

James sued the NRA and its executives in 2020 under her authority to investigate not-for-profits registered in the state. She originally sought to have the entire organization dissolved, but Cohen ruled in 2022 that the allegations did not warrant a “corporate death penalty.”

The trial cast a spotlight on the leadership, organizational culture and finances of the powerful lobbying group, which was founded more than 150 years ago in New York City to promote rifle skills and grew into a political juggernaut that influenced federal law and presidential elections.

In the trial’s second phase, James is seeking an independent monitor to be appointed to oversee the NRA’s administration of charitable assets.

James is also seeking to ban LaPierre from serving in leadership positions at any charitable organizations that conduct business in New York, and wants the NRA and Frazer barred from collecting funds on behalf of any charitable organization operating in the state.

“New Yorkers deserve to know that when they support a not-for-profit, those donations are being used to advance its mission, not squandered on lavish perks for staff or cronies,” James said.

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Associated Press reporter Anthony Izaguirre in Albany, New York, contributed to this report.

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NRA’s ex-CFO agreed to 10-year not-for-profit ban, still owes $2M for role in lavish spending scheme