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Controversial Dark Money Group Among Five That Told IRS They Would Stay Out of Politics, Then Didn’t

Americans for Responsible Leadership, which California officials have accused of “campaign money laundering,” promised the IRS it would not engage in elections, a confidential filing shows.

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Sun Valley residents vote on election day in Los Angeles, Calif. Americans for Responsible Leadership, which California officials have accused of "campaign money laundering," is among five dark money groups that were active in 2012 elections that previously had told tax regulators they would not engage in politics, filings obtained from the IRS show. (Joe Klamar/AFP/Getty Images)

Jan. 4: This post has been updated.

Five conservative dark money groups active in 2012 elections previously told tax regulators that they would not engage in politics, filings obtained from the IRS show.

The best known and most controversial of the groups is Americans for Responsible Leadership, an Arizona-based organization. Not long after filing an application to the IRS pledging — under penalty of perjury — that it would not attempt to sway elections, the group spent more than $5.2 million, mainly to support Republican presidential candidate Mitt Romney.

The California Fair Political Practices Commission has accused Americans for Responsible Leadership of "campaign money laundering" for failing to disclose the origin of $11 million it funneled to a group trying to influence two state ballot propositions.

The other groups that filed applications for IRS recognition of tax-exempt status saying they wouldn't engage in politics are Freedom Path, Rightchange.com II, America Is Not Stupid and A Better America Now.

Much hangs on these applications, all of which are still pending. The tax code allows social welfare nonprofits to engage in political activities as long as public welfare, not politics, is their primary purpose. If the IRS ultimately decides not to recognize these groups, they could have to disclose their donors.

Such decisions, along with IRS' oversight of social welfare nonprofits overall, have come under increasing scrutiny as these groups have assumed an ever larger role in elections, pouring an unprecedented $322 million into the 2012 cycle.

ProPublica has documented how some social welfare nonprofits underreport their political activities, characterizing them to the IRS as "education" or "issue advocacy." Other groups have popped up, spent money on elections and then folded before tax regulators could catch up with them.

The IRS sent the applications submitted by the five groups to ProPublica in response to a public records request, although the agency is only required to supply these records after groups are recognized as tax-exempt. (ProPublica also obtained the pending application of Crossroads GPS, the dark money group launched by GOP strategist Karl Rove that spent more than $70 million on the 2012 elections, which we wrote about separately.)

The IRS confirmed that none of the groups had been recognized as tax-exempt and referred ProPublica to its earlier response about Crossroads' application. In that email, the IRS cited a law that says publishing unauthorized tax returns or return information is a felony punishable by up to five years in prison or a fine of up to $5,000, or both.

A lawyer for Americans for Responsible Leadership, Jason Torchinsky, cited the same law in an email.

"If you willfully to (sic) print or publish in any manner any information about Americans for Responsible Leadership that you do not lawfully possess — and which may or may not be complete — you will be doing so in violation of (the law) and we will not hesitate to report such unlawful publication to the appropriate law enforcement officials," Torchinsky wrote.

The other groups for which ProPublica obtained IRS applications did not respond to calls or emails for comment.

ProPublica has published the applications of all five groups, but redacted parts to omit financial information.

"As we said when we published our story on the Crossroads application, ProPublica believes that the information we are publishing is not barred by the statute cited by the IRS, and it is clear to us that there is a strong First Amendment interest in its publication," said Richard Tofel, ProPublica's president.

Social welfare nonprofits do not need IRS recognition, though most opt to apply for it. They can operate, and spend money on politics, while their applications are under consideration.

Americans for Responsible Leadership incorporated in Arizona in July 2011 and applied for IRS recognition last September.

By that time, the group had already spent $5,300 on get-out-the-vote efforts for Sen. Orrin Hatch, R-Utah, and given $57,500 to two Republican political committees in Arizona.

Nonetheless, its IRS application said the group hadn't spent any money to influence elections, nor would it. It also said the group planned to split its efforts between influencing policy and educating the public, in part by "promoting a more ethical and transparent government."

According to Federal Election Commission filings, the group spent more than $5.2 million on campaign activities in October and early November, mostly on phone calls urging the defeat of President Barack Obama. In addition to the millions it pumped into California ballot measures, the group also spent $1.5 million on two Arizona propositions.

While the IRS doesn't classify spending on ballot measures as political, California election authorities do.

When ProPublica read the group's description of its activities on its IRS application to Ann Ravel, the chairwoman of the California Fair Political Practices Commission, she laughed.

"Wow," she said, upon hearing that the group said it would not try to influence elections. "That's simply false."

The California commission pressed Americans for Responsible Leadership to identify who contributed the funds it aimed at the California ballot measures, a battle that reached the state Supreme Court. Just before Election Day, the court ordered the group to reveal its donors.

So, who were they? Another Arizona social welfare nonprofit, which got its money from a Virginia trade association, which also didn't have to report its donors. California regulators are still trying to peel back the group's layers, to see who's behind the money.

Update (Jan. 4): In a Jan. 2 email to the editor at the Arizona Capitol Times, Jason Torchinsky, an attorney for Americans for Responsible Leadership, said the group had submitted an amended application for recognition of tax-exempt status to the IRS that "corrected the error that was the central feature" of ProPublica's story.

Contacted by ProPublica, Torchinsky said he could not confirm that this was accurate without his client's authorization. Torchinsky also would not say when the group submitted the amended filing, or what was changed.

ProPublica has requested that Americans for Responsible Leadership provide us with the corrected application or give the IRS permission to do so. So far, we have not received a reply.

Please Follow Gerald Parsky. he is behind so much FRAUD, SCAMS. He began his career according to internet sources as Mafia and CIA - See “OPAL FILE” he is such a LIAR. Secretary of State Bill Simon (Nixon) taught Parsky how to operate. All of the severe world problems can be traced directly to Gerald Parsky and his gang of well paid thugs. I worked on Parsky’s ranch in 1998. When I got injured, I was fired. What they did not know is that I put a vioce activated tape recorder in my pocket when I went to work the day after I was injured. I was “FIRED” when I tried to get work comp I was told - They never heard of me. Well, eventually Channel 10 NEWS did a story about what happenned to me. I have three letters from parskys attorneys threatenning me if I “TELL THE TRUTH” My life since then is a TRUE TESTAMONY OF THE RETALIATORY ABILITIES of this monster. I actually went to Law school because I could not believe the things that happenned to me, my animals and my husband, It is all very well documented. I could really use some HELP. AS you can imagine, no one wants to stand up to the likes of Parsky. He is personally responsible for the NON Profit industry turning into the Malicious self serving Parasites that they have become. just like BANKING and INSURANCE. I have a RICO Lawsuit that is very well documented in Riverside County Ca. One of the vigelante animal rights wackos STOLE OUR THOROUGHBRED RACE HORSE. My Husband is a paralyzed Service Disabled Vietnam Veteran and Our r anch burned> That is How we became Vulnerable to the HSUS animal rights SCAM.

The other lingering question lurking behind the issue of ‘tax-free’ or ‘non-profit’ organizations pretending not to exist merely to support certain political points of view or the candidates that espouse those points of view, is that if the IRS agrees those orgs are in fact ‘non-profit’ or entitled to special tax status, the individuals and corporations who donated (invested?) in those orgs can write off those donations when they file their 2012 tax returns.

What a racket!

Shenanigans such as these are more reasons why we need not just government regulations, but regulators with sufficient budgets, support from their superiors and a willingness to protect the interests of common and ordinary Americans.

Please check out our story as of 2010 on the website “Pro Per Inc - Franklin and Trea Cleaves” There are also rivetting videos of Pro Per Inc’s co-founder Edward Lawson. Ed took a case in pro per ALL THE WAY TO THE US SUPREME COURT. THE LANDMARK CIVIL RIGHTS CASE “KOLENDAR V. LAWSON” WAS WON BY Civil Rights Icon Ed lawson. No one would help Ed until he got all the way to the US Supreme Court. That is one of the biggest problems is that NO ONE will help (me) Everyone is so wrapped up in their own lives that their and our RIGHTS are being TAKEN away by the very well funded RIGHT wing THINK TANKS and SCAM Non profits which are parasitic money laundering scams. Check them out. The MILKEN Institute!!!!!, the Hoover Institute, The Wilson Institute. these think tanks are mostly involved in HOW TO IMPOVERISH the Masses and then make sure to Incarcerate them - because the Poor (mostly minority) cause Tension and Unrest!!! Riverside County California’s “Strategic Plan 1997” states that exactly. So it is VERY Cozy for the KOCH Brothers, Egyptian Muslim Brotherhood and Scientology to have Headquarters right there. the favorite Spot is Riverside Supervisor Jeff Stones (AKA HILLBILLY MAFIA) 3rd District. Jeff Son Jason will even PROSECUTE you sine he passed the ca. State Bar in 2007 and went right to work for the DA who became famous for bragging about “Putting Innocent men behind bars” Jeff Stone wants to seceed from the Union and his imagined plutocracy is called “South California” My ex employer, gerald Parsky appointed Federal Judges for “W” Bush and State Judges for Gov. Schwartzneggar!!!! I am Proof of the extreme OUTRAGEOUS ILLEGAL ACTS THAT GERALD PARSKY USES TO TRY TO DESTROY anyone and everyone who even critices him (Shawn Steele. John Moores, Carol Lam, Cruz Bustamante) How come he is not prosecuted for what he did to UC Retirement? Connect the dots. follow the money. BRIBERY IS A CRIME!!!!!

It’s worth pointing out that there’s a solution other than anger and the law to stop this, but it requires working a longer game than most of us might be willing:  Refuse to vote for any candidate who takes suspect donations.

If that means your only option is to vote for a third party candidate who has no chance of winning and you hate, then so be it.  If it means letting “the enemy” win an election due to split votes, it won’t be so bad, since they all have the same platforms.  But every vote for against one of the big guys is dollars wasted.

The day we can block both major party candidates from getting their 270 delegates, the Dark Money will vanish, because it’s no longer worth spending.  Even if we can pull the popular vote to a third, there’s no reason to spend that kind of money if we refuse to be swayed.

clarence swinney

Jan. 4, 2013, 5:38 p.m.

OBAMA BLAME
Who Dug the Deep Hole?  Who Fumbled the ball?
Numbers rounded

Clinton left Bush an 1800B Budget
Bush Left Obama a 3500 Budget

Clinton left Bush a 240B Surplus as far as the eye can see
Bush left Obama a 1400B Deficit as far as the eye can see

Clinton left Bush 5,700B of Debt
Bush left Obama 11,800B of Debt

Clinton left Bush a 237,000 net new jobs created per month
Bush left Obama a 31,000 lowest number since Hoover.

Clinton left Bush 17 Million Manufacturing Jobs
Bush left Obama 11 Million Manufacturing Jobs

Clinton left Bush a 10,800 Dow
Bush left Obama an 8028 Dow

Clinton left Bush Peace on Earth Good Will From Most Men
Bush left Obama Hell on Earth Two disastrous wars. Enmity of 1500 Million Muslims

Clinton left Bush a President most highly rated of any peacetime President in Asia, Africa, Europe.
Bush left Obama the most hated President in history
Bush left Obama an Housing Tsunami and Financial Volcano
Bush left Obama, in 2008, an 8500B Bail out commitment Yes! 8500 not just 700
Bush left Obama his Takeover of Fannie/Freddie, AIG, and first bailout of Chrysler
Bush increased maximum loan by Fannie/Freddie from $153,000 in 2000 to $300,000 then to $729,000
That is how F&F got stuck with so many toxic mortgages. Bush gift to Big Bank pals.
Bush increased FDIC maximum deposit coverage from $100,000 to $250,000. Help the rich.
 

Thank You for investigating these supposed non-profits.  We all know they are lying.  What can we do about it?  How can we force an IRS investigation?

Don’t hold you breath for any consequence to this perjury. There is no penalty - except nominal, on paper - for big money influencers.

Cecil Johnson

Jan. 6, 2013, 11:29 p.m.

Systemic incorporated lawlessness.

Is it any surprise assault rifles are sold out everywhere?

Every individual for themselves in this wretched excuse for a “nation of laws.”  Pure horse shit from top to bottom.

I have RICO lawsuit in Riverside County, Ca. (RIC10017827) naming Gerald Parsky and Fourth Reich aka New World Order. I have Proof of everything especially including the RETALIATION against me by Gerald Parsky - I have 3 letters from Parsky’s attorneys THREATENNING to USE THE COURTS OF LAW to fraudulantly retaliate against me for TELLING THE TRUTH. Yes, he did USE THE COURTS to Retaliate against me and my friend, Franklin Cleaves. Gerald Parsky and Fireman’s Fund Insurance Co have used lies and Bribery of the District Attorneys - INSURANCE FRAUD divisions!!! Talk about the fox guarding the chicken coop!!!! Insurance investigators are PAID LIARS who make up anything in order to DENY Work Comp to ANYONE the Insurance Co. does not want to pay. WHAT A SCAM. Since when did OUR CONSTITUTION give away the Jusdicial Brance of OUR Government to the greedy scammers who run INSURANCE COMPANIES??? Gerald Parsky and Humane Society of the United States are using this EXACT SAME MAFIA SCAM of monopolization, lying, bribery, railroading, etc. to USE photos and videos of suffering animals to get gullible animal owners to contribute Hundreds of Millions of dollars to their SCAM orgs. to extort money through scam lawsuits and sneeky legislation. Check out Californis’s AB 917!!!! it is NOW ILLEGAL FOR ANYONE EXCEPT animal control to sell any animal in the State of California!!!! Wake Up America. We are now a Plutocracy. Keep fighting these insane malicious psychopaths.

DARK MONEY?

TWO POINT TWO TRILLION DOLLARS UNACCOUNTED FOR AT THE PENTAGON.

Prep schools and colleges for rich kids are also non-profits, and rich people give them a lot of money, especially if they have a child at the school, and then they get a huge tax break for being so charitable. That’s how the system works. Those with the most property (ownership of the means of production, or financial assets, or real estate) are the ones a “liberty” based system is supposed to protect.

This article is part of an ongoing investigation:
Buying Your Vote

Buying Your Vote: Dark Money and Big Data

ProPublica is following the money and exploring campaign issues in the 2012 election you won't read about elsewhere.

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