The Black Lives Matter movement is once again facing legal scrutiny, with California attorney general Rob Bonta threatening to bring the hammer down on Black Lives Matter Grassroots if it doesn’t soon disclose what it did with millions of dollars in unreported charitable donations in 2022.
Bonta, a Democrat, notified Black Lives Matter Grassroots in late August that he would have no choice but to strip the group of its charity status, levy massive taxes upon the organization, and fine its leader, activist and professor Melina Abdullah, if it doesn’t file a copy of its 2022 Form 990 tax return with his office by Oct. 27.
But producing that tax form will likely be easier said than done for Black Lives Matter Grassroots. The group has had the privilege of operating as a tax-exempt charity since May 2022 but falsely claimed 2023 was its first year in business in its IRS tax return for that year. Several experts told the Washington Free Beacon it should have filed its 2022 tax return by last November at the latest. But it’s nowhere to be found. The group’s 2023 tax return, meanwhile, is laden with errors.
The missing 2022 tax return that Bonta now seeks could help resolve an $8.7 million mystery first reported by the Free Beacon in May. From 2020 through 2022, the Tides Foundation transferred $8.7 million in charitable funds for the benefit of Black Lives Matter Grassroots, but those donations seemingly disappeared on paper as movement insiders alleged Abdullah pilfered the organization’s finances to pay for personal expenses, including a vacation to Jamaica. Abdullah denied the allegations in a 2022 interview.
Black Lives Matter Grassroots is an offshoot of Black Lives Matter Global Network Foundation, the charity commonly referred to as the national Black Lives Matter group, which raised $80 million during the George Floyd riots in 2020. Under the leadership of its former director Patrisse Cullors, the Global Network Foundation used its windfall to purchase a $6 million Los Angeles mansion in 2020 and an $8 million Canadian mansion in 2021 and doled out massive contracts to Cullors’s friends and family.
Black Lives Matter Grassroots broke away from the Global Network Foundation in 2022 as the latter faced investigations and legal threats from authorities in California, Washington, and Indiana over the mismanagement of its windfall from the George Floyd riots. Black Lives Matter Grassroots claimed its progenitor was run by “thieves” and that it was the rightful leader of the activist movement and what remained of its war chest. It tried to sue the Global Network Foundation for $10 million in 2022, but a California judge threw out the lawsuit and ordered Black Lives Matter Grassroots to repay its progenitor’s legal fees of over $700,000.
Amid its rhetoric about the “thieves” running the Global Network Foundation, Black Lives Matter Grassroots has ensured its finances remain shrouded in secrecy. Abdullah told Black Lives Matter activists privately that she wanted to keep her group’s financial arrangements “intentionally private” because she “didn’t want folks to know how the money was moving,” the Free Beacon reported.
Indeed, Black Lives Matter Grassroots’s 2023 tax return is riddled with errors and discrepancies. It falsely said 2023 was its first year in business as a stand-alone charity, but the organization also reported it entered the year with $3.95 million in the bank. Both can’t be true at the same time.
“In my 20 years of watchdog work, this is one of the sloppier tax filings I have seen,” CharityWatch executive director Laurie Styron told the Free Beacon of Black Lives Matter Grassroots’s 2023 tax filing. “There aren’t one or two mistakes here. This document is unusable for its intended purpose of providing the public with a means of holding the charity accountable. It’s unethical.”
The source of Black Lives Matter Grassroots’s $3.95 million cash hoard at the start of 2023 is unclear. The money possibly originated from the Tides Foundation funding, but it represents less than half of the $8.7 million the Democratic dark money giant claimed to have provided to Black Lives Matter Grassroots before 2023. Whatever happened to the remaining millions presumably would have been disclosed in the charity’s missing 2022 tax return.
Bonta also barred Black Lives Matter Grassroots from soliciting charitable contributions in California until it produces its missing 2022 tax return. But it doesn’t appear the charity has taken notice of his warning—Black Lives Matter Grassroots continues to solicit online donations nationwide through the Democratic fundraising platform ActBlue as of last Wednesday.
It’s unclear if Black Lives Matter Grassroots will comply with Bonta’s demands before his Oct. 27 deadline. And though California is among the most liberal states in the country and is politically aligned with the Black Lives Matter movement, it’s also one of the few states that doesn’t turn a blind eye to charity malfeasance, former IRS tax law specialist Patrick Sternal told the Free Beacon.
“California is one of the handful of states that has a very aggressive charitable enforcement arm in its Attorney General’s office,” Sternal said. “I imagine Black Lives Matter Grassroots will have to reckon with them.”
Black Lives Matter Grassroots did not return a request for comment.
Several charity experts said Black Lives Matter Grassroots’s 2023 tax filing is laden with other errors and discrepancies. It reported in one section of the return that it has five members on its board of directors but only disclosed the names of two of those members in another section instructing disclosure of the names of all of its board members. Abdullah, who signed the tax filing under penalty of perjury, reported she didn’t allow her fellow board members to review the document before she submitted it to the IRS.
“The multiple reporting errors and omissions in their initial 2023 IRS 990 report, particularly the lack of accounting for the source of approximately four million dollars, raises serious IRS violations subject to civil and even criminal charges against its president and its unnamed Board of Directors,” said Paul Kamenar, counsel to the National Legal and Policy Center, an ethics watchdog group.
Styron, the CharityWatch executive director, noted that oversight of Black Lives Matter Grassroots is practically nonexistent. It has no document retention policy. It has no conflict of interest policy. It won’t provide its founding documents to the public despite IRS regulations requiring it to do so. Its financial statements haven’t been reviewed or audited by an independent accountant. It claimed to grant $22,200 to individuals in 2023, but it didn’t disclose any additional required information about the grants, and it says it doesn’t maintain any records to substantiate the grants.
“A charity of this size should be expected to have a sufficiently large and independent board, and all the basic governance policies in place related to good record keeping, internal controls, conflicts of interest, and whistleblowers,” Styron said. “Right now, it’s a puzzle with most of the pieces missing and no clear picture emerging about what’s happening with millions of dollars of public money. This charity constructively has no oversight.”
Sternal, the former IRS tax law specialist, said federal tax authorities shouldn’t turn a blind eye to Black Lives Matter Grassroots’s shoddy reporting.
“This raises a lot of flags, and there are a lot of indications that they are not operating consistently with the requirements of a 501(c)3 charitable organization,” Sternal said. “It’s generally bad, bad reporting. There are inconsistencies and obvious gaps in the reporting here. It definitely raises questions, and I think it certainly should raise a flag at the IRS.”
Original News Source – Washington Free Beacon
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