Tuesday, September 17, 2013

Far Right Extremist Koch Brothers Are Pouring Hundreds of Millions Into A Silent Coup Against Democracy


North Carolina neo-fascist Art Pope bought his state's Republican Party at bargain basement rates. The Koch brothers, also of a distinctly fascist/John Bircher bent, paid a lot more to buy the national Republican Party. In fact, they're paying a lot more than anyone could have proven until just recently. The most corporately-oriented and extreme right Supreme Court since the Civil War has allowed Big Business and wealthy special interests like the Kochs to coverup the legalistic bribes they give politicians. But the diligence of OpenSecrets keeps foiling much of the skullduggery.
There's a new dark money game in town, one meant to further cover the tracks of tax-exempt groups that have provided major sums to help Republican causes in the 2010 and 2012 elections.

Recent tax filings by the two largest "shadow money mailboxes"-- groups that do virtually nothing but pass grants through to other politically active 501(c)(4) organizations, many of which have been big spenders on election ads benefiting the GOP-- show their financial ties run far deeper than previously known.

The groups, TC4 Trust and the Center to Protect Patient Rights-- both of which have connections to the billionaire industrialist Koch brothers-- have been playing a high-stakes game of hide-the-ball, disguising transfers of millions of dollars from one to the other behind a veil of Delaware limited liability corporations.

  Already, under tax law, 501(c)(4) groups-- like TC4, CPPR and nearly all the groups to which they've given money through the years-- don't have to disclose their donors. By further shrouding the recipient groups behind entities with different names (and, usually, different employer identification numbers), the donors are attempting to make it even more difficult to find out how the money is flowing.

TC4 is now out of business. But in its termination report, signed on May 14, 2013 and sent to the IRS, TC4 reported giving $27.9 million in grants to other groups between July 1, 2011 and June 30, 2012. The report was included in data posted yesterday by Resource.org.

The largest grant by far-- $14.3 million-- was sent to a group called Corner Table LLC. That's a big chunk of change to a folksy-sounding but unknown-- in the political or any other realm-- organization.

But two days after TC4's trustee finalized its termination report, the Center to Protect Patient Rights-- the other big shadow money pass-through-- signed off on amendments to its 2010 and 2011 tax filings that help solve the mystery.

The amendments say that, contrary to CPPR's earlier representations on IRS filings that it had no connected entities operating under a different name, it actually did.

One of them, according to one of the amendments, was called Eleventh Edition, which received $4.3 million from TC4 sometime between July 1, 2010 and June 30, 2011. And not only was Eleventh Edition the same as CPPR, but it had taken on a new name: Corner Table LLC.

And CPPR's other amendment indicates it has another of these units: Meridian Edition LLC-- which, the documents say, was originally called American Commitment LLC. American Committment had received a total of $9.3 million from TC4 in 2010 and 2011 (its earlier grant was unclear at first because the recipient's name was smudged on TC4's 990 return).

American Commitment is a name that has been used for several nonprofits. The incarnation that received the TC4 money (a group that seemed to disappear, along with its millions from TC4)-- is the one that shows up in CPPR's amended filing.

The image below shows TC4's contributions to CPPR:

The upshot: Now we know that CPPR-- through its previously unknown sub-units-- received a total of nearly $28 million from TC4 from August 2009 through June 2012. That's a big chunk of CPPR's overall $95 million revenue. The source of most of the rest of its funds remains publicly unknown.

These wholly-owned sub-units of larger groups have a particular designation under the law: They're known as "disregarded entities"-- meaning their different names and separate identification numbers are disregarded by the IRS for income tax purposes, and they must be reported on the same forms with their parent groups. Officially, they are "disregarded as an entity separate from its owner." They are almost always single-member LLCs.

...The connections between these groups and the Koch brothers, generous funders of conservative causes, are evident in their personnel as well as in grants.

Gretchen Hamel, the executive director of Public Notice, the recipient (through its sub-units) of $9 million from TC4, gave a presentation during at least one of the Kochs' annual conservative strategy sessions. But that's not all: Hamel was also a founding member of TC4, which from its earliest days gave to the Kochs' voter database project Themis.

Another presenter at that same conference was Sean Noble, a political consultant known for being closely connected to the Kochs' operations. He founded CPPR, and is still its president and executive director. Noble knows his way around the world of politically focused 501(c)(4)s: He also founded all three versions of American Commitment-- the most recent  of which is now run by Phil Kerpen, who's on the board of the Kochs' large (c)(4), Americans for Prosperity.

Americans for Prosperity-- which spent more than $36 million in the 2012 election cycle, almost all of used for ads opposing President Obama's re-election, according to reports filed with the FEC-- has received a total of nearly $1.4 million from TC4, and at least another $4.3 million from Noble's CPPR.

CPPR figured in a scheme last year in which a Americans for Responsible Leadership, a group founded by one of Noble's clients, funneled $11 million to advocates mobilizing against a California ballot initiative (a temporary tax increase for education) and on behalf of another one (to ban unions from using dues for political purposes).

When California's election watchdog won a court order to force ARL to disclose its donors, it revealed little: ARL got its money from CPPR, which had received it from another dark money group called Americans for Job Security. The money, then, had passed through a triple-layered curtain of nondisclosing groups, and its original source was still unknown. The state agency called it a plain case of "money laundering." The Daily Beast has reported that a grand jury has been empaneled to investigate the transactions.
Is it any wonder that Darrell Issa was screaming-- still is, I believe-- like a stuck pig at the thought of the IRA investigating claims that extreme right wing political groups are just innocent little old social clubs? Last week Mike Allen and Jim Vandehei reported in Politico about the Koch's secret bank they use to fund extremist organizations and pet politicians, Freedom Partners. It serves as an outlet for the ideas and funds of the mysterious Koch brothers, cutting checks as large as $63 million to groups promoting conservative causes, according to an IRS document to be filed shortly.
The 38-page IRS filing amounts to the Rosetta Stone of the vast web of conservative groups-- some prominent, some obscure-- that spend time, money and resources to influence public debate, especially over Obamacare.

The group has about 200 donors, each paying at least $100,000 in annual dues. It raised $256 million in the year after its creation in November 2011, the document shows. And it made grants of $236 million-- meaning a totally unknown group was the largest sugar daddy for conservative groups in the last election, second in total spending only to Karl Rove’s American Crossroads and Crossroads GPS, which together spent about $300 million.

...Freedom Partners is organized under the same section of the Tax Code as a trade association, a 501(c)6, which allows the group to conceal its donors from public release, although the amounts and recipients of its major grants are public.

The filing offers a rare tour of the conservative movement and how it gets its funds:
Center to Protect Patient Rights, a group that vehemently opposes Obamacare: a total of $115 million, from three grants.

Americans for Prosperity, an organizing and advocacy group that is courted by Republican presidential candidates: $32.3 million.

The 60 Plus Association, a free-market seniors group that also opposes Obamacare: $15.7 million.

American Future Fund, an Iowa group that spent a lot of money on ads in 2012, many for Mitt Romney: $13.6 million.

Concerned Women for America Legislative Action Committee, which gets involved in a number of social policy debates: $8.2 million.

Themis Trust, a Koch-based voter database that is made available to other conservative organizations: $5.8 million.

Public Notice, a fiscal policy think tank: $5.5 million.

Generation Opportunity, a group for “liberty-loving” young people: $5 million.

The LIBRE Initiative, which targets a free-market message to Hispanic immigrants: $3.1 million.

The National Rifle Association: $3.5 million.

The U.S. Chamber of Commerce: $2 million.

American Energy Alliance: $1.5 million.

And several groups-- including the State Tea Party Express, the Tea Party Patriots and Heritage Action for America-- got less than $1 million each.
Members are drawn from the Koch brothers’ semiannual conferences, a 10-year-old tradition that draws top politicians-- including, last month, House Majority Leader Eric Cantor (R-Va.) and House Budget Committee Chairman Paul Ryan (R-Wis.). Many seminar attendees also give directly to Koch-approved groups, and the Freedom Partners funds do not include the Kochs’ many gifts to university think tanks.

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