Wayne LaPierre, the beleaguered chief executive of the National Rifle Association, said on Wednesday he kept his organization’s recent bankruptcy secret from nearly all of its senior officials, including its general counsel, CFO and senior lobbyist . He also failed to brief most of the NRA board members.
Mr. LaPierre made the comments after speaking, virtually, at a trial in federal bankruptcy court in Dallas. Although the NRA is solvent, it filed for bankruptcy protection in January in a bold attempt to bypass regulators in New York City, where the NRA has been licensed for a century and a half.
State Attorney General Letitia James sued the association in August, trying to shut it down amid allegations of mismanagement and corruption. She is also seeking tens of millions of dollars in ill-spent funds from Mr. LaPierre and three other current and former NRA leaders.
The nonprofit has been in the throes of scandal for two years, with revelations of lavish spending by the NRA and its contractors – on Zegna suits and the luxury trips Mr. LaPierre has taken to places like Lake Como in Italy and the Atlantis Resort in the Bahamas. Other perks included chartered jets for him and his family and vacations on a contractor’s yachts, which were named the Illusions and Grand Illusion.
The bankruptcy proceedings became the last referendum on Mr LaPierre’s 30-year tenure in the recently infighted gun rights group as he seeks to turn the battle with the New York attorney general in a fight for free speech rather than free benefits. .
“We have filed for bankruptcy to seek a level legal playing field, where the NRA could thrive and develop in a fair environment, as opposed to what we believe has become a toxic, militarized and politicized government in New State. York, ”Mr. LaPierre said in his testimony.
The association plans to use bankruptcy to reincorporate in Texas. But the attorney general’s office and the NRA’s biggest creditor, its former advertising company Ackerman McQueen, want the case dismissed, arguing it is in bad faith. The trial, which was part of the bankruptcy proceedings, began on Monday to determine whether the case would continue.
“In the NRA’s own words, it’s not just creditworthy, it’s financially strong,” said Deputy Attorney General Monica Connell. “If the NRA faces an existential crisis through bankruptcy, it is a crisis brought on by LaPierre and his facilitators and their choices,” she added.
In the two years of unrest leading up to the trial, the NRA had gone unusually silent, shutting down its fire-breathing media, NRATV, and parting ways with its former spokesperson Dana Loesch. He was also largely silent in the 2020 presidential election, having played a major role in helping elect Donald J. Trump in 2016.
But the organization remains a powerful lobbying force that has reshaped the political landscape around guns. His enduring influence was manifested in the wake of two recent mass shootings, in Atlanta and Boulder, Colo., When calls for gun control met with strong Republican opposition and the realities of the systematic obstruction of the government. Senate.
Bankruptcy, however, is a risky bet for the NRA and a sign of its desperation. Mr. LaPierre and his outside lawyer, William A. Brewer III, an architect of the depot, could lose control of the organization. As a possible outcome, if the case is not dismissed outright, the judge, Harlin D. Hale, could shift the current leadership by appointing a trustee to take over the day-to-day operations of the NRA. The use of a trustee is rare in large corporate bankruptcies and usually only occurs in cases of fraud, incompetence or serious mismanagement.
Gregory E. Garman, an NRA lawyer, argued in court against such a result this week, saying “a trustee is in fact a death sentence.”
“The argument that a trustee secures the future of the NRA appeals to our purpose and role,” said Mr. Garman.
The NRA used the lawsuit to argue that the group reformed after making modest oversight errors. “Compliance has become a way of life at the National Rifle Association,” Garman said, while acknowledging that there would be “moderately dignified” moments in the lawsuit.
But these moments undermined demands for reform. Among the issues raised during the proceedings is the fact that Mr LaPierre’s longtime assistant Millie Hallow was kept even after embezzling $ 40,000 from the NRA for her personal use, including for help pay for her son’s marriage. (Prior to being hired by the NRA, Ms Hallow pleaded guilty to a felony related to the theft of money from an arts agency she ran.)
The role of John Frazer, the NRA’s Advocate General, also came under scrutiny, when it was revealed that he had no previous experience in such a role and only had two years of private practice. He has been left in the dark about key legal decisions, even though he is the organization’s lead lawyer, and was not informed in advance by Mr LaPierre that the NRA was filing for bankruptcy. According to a former aide, Mr. LaPierre once said he would not use Mr. Frazer “for my parking tickets,” a beard that Mr. LaPierre acknowledged in a pre-trial statement that he “could have say “like” a joke at some point. “
Mr. LaPierre himself admitted to making mistakes, including not disclosing his use of luxury yachts.
“I now believe it should have been disclosed,” he said.
His testimony is expected to continue on Thursday.