Staff Reports
A conservative watchdog group has accused several liberal organizations of misdirecting funds to the for-profit firm of Eric Kessler, who founded Arabella Advisors and is responsible for overseeing the operations of these groups.
The complaint claims that these groups likely misappropriated their tax-exempt status in order to pay more than $200 million in excessive fees to Kessler’s firm.
The complaint highlights the internal handbook of Arabella, which shows the level of control that the consultancy has over the groups it sponsors and the New Venture Fund. It also raises concerns regarding the fund's potential involvement in political activities. Despite the large sums of money that the nonprofits under the company received, they still haven’t been able to keep their operations under wraps. In the past few months, Politico reported that over 30 employees had been laid off from the firm.
The firm responded by calling the complaint meritless and accusing the group of having a political agenda. It maintains that it is focused on improving the efficiency and effectiveness of charitable work. The watchdog also claimed that the payments that the organizations made to the firm were only beneficial for Kessler and his business operation. The complaint urged the IRS to take the necessary steps to revoke the organizations' tax-exempt status.
The complaint was filed after the Campaign for Accountability asked the IRS to look into the activities of groups linked to Leonard Leo, a conservative activist. One of these is Americans for Public Trust, which received funding from a right-wing fund called Donors Trust.
The allegations against these groups have raised concerns about the transparency of the charitable sector. If these entities, which are linked to Democratic groups, have used their tax-exempt statuses to misappropriate public funds, they must be held accountable. Charitable organizations are important and should be trusted. It is also troubling to think that these funds could have been used to fund private individuals.
