NRA chief kept bankruptcy filing a secret
Lapierre admits he did not inform most of the board
Wayne Lapierre, the embattled chief executive of the National Rifle Association, said on Wednesday that he had kept his organization’s recent bankruptcy filing secret from almost all its senior officials, including its general counsel, chief financial officer and top lobbyist. He also did not inform most of the NRA’S board.
Lapierre made the comments after taking the stand, virtually, at a trial in federal bankruptcy court in Dallas. Though the NRA is solvent, it filed for bankruptcy protection in January in an audacious bid to circumvent regulators in New York, where the NRA has been chartered for a century and a half.
New York Attorney General Letitia James had sued the association in August, trying to shut it down amid claims of mismanagement and corruption. She is also seeking tens of millions of dollars in misspent funds from Lapierre and three other current or former NRA leaders.
The nonprofit organization has been enmeshed in scandal for the past two years, with revelations of lavish spending by the NRA and its contractors — on Zegna suits and luxurious trips Lapierre took to places like Lake Como in Italy and the Atlantis Resort in the Bahamas. Other benefits included chartered jets for him and his family and vacations on a contractor’s yachts, which were named Illusions and Grand Illusion.
The bankruptcy proceedings have become the latest referendum on Lapierre’s 30-year tenure at the gun rights group — recently beset by infighting — as it seeks to turn the battle with the New York attorney general into a fight over free speech rather than free perks.
“We filed this bankruptcy to look for a fair legal playing field, where NRA could prosper and grow in a fair environment, as opposed to what we believe had become a toxic, weaponized, politicized government in New York state,” Lapierre said in his testimony.
The association intends to use the bankruptcy to reincorporate in Texas. Lapierre kept the filing shrouded in secrecy, fearing leaks would jeopardize the plan.
But the attorney general’s office and the NRA’S largest creditor, its former advertising firm Ackerman Mcqueen, want the case dismissed — claiming that
the filing, and particularly the lack of notice to the board, was highly improper.
“The process Mr. Lapierre followed to file this bankruptcy case is itself a master class in bad faith and dishonest conduct,” said Monica Connell, an assistant attorney general.
The trial, part of the bankruptcy proceedings,
began on Monday to determine whether the case would proceed.
The bankruptcy, however, is a risky gambit for the NRA and a sign of its desperation. Lapierre and his outside lawyer, William Brewer III, an architect of the filing, could lose control over the organization. In one possible outcome, if the case is not dismissed outright, the judge, Harlin Hale, could displace the current management by appointing a trustee to take over the NRA’S dayto-day operations. The use of a trustee is rare in large-company bankruptcies and usually happens only in cases of fraud, incompetence or gross mismanagement.
Gregory Garman, an NRA lawyer, argued in court against such an outcome this week, saying “a trustee is in fact a death sentence.”
The role of John Frazer, the NRA’S general counsel, also came under scrutiny, when it was disclosed that he had no prior experience in such a role and had only two years of private practice. He was left in the dark on key legal decisions, even though he is the organization’s top lawyer, and was not informed in advance by Lapierre that the NRA was filing for bankruptcy.