From Government Accountability and Oversight (GAO):

IRS Complaint Filed Against Bloomberg Philanthropies for Use as Political Campaign

Tool, Inuring to Private Benefit vs Public Interest

“I bought that” candidate’s overlapping charitable, for-profit organizations present tangled web

WASHINGTON, D.C. – On Wednesday, the public interest law firm Government Accountability & Oversight, P.C. (GAO) filed a complaint asking the IRS to investigate the apparent use of Bloomberg Family Foundation Inc., and the entity or entities colloquially known as Bloomberg Philanthropies, for apparent use for Michael Bloomberg’s personal, political benefit.

According to the complaint, while Bloomberg Philanthropies publicly “encompasses all of Michael R. Bloomberg’s giving, including his foundation, corporate, and personal philanthropy,” recent news reports and other public records raise legitimate questions whether it has been used in recent years to illegally benefit Bloomberg’s political ambitions, including his current campaign for the Democratic nomination for President.

In return for its favored tax-status, a charitable nonprofit promises the federal government that it will not engage in “political campaign activity” (defined as “supporting or opposing a candidate for public office”) and, if it does, IRS zero-tolerance regulations mandate that the charitable nonprofit will lose its tax-exempt status. Similarly, the assets of a charitable nonprofit may not be provided as a campaign contribution to a candidate for public office.

The IRS Compliance Guide for 501(c)(3) Public Charities is clear: “[p]ublic charities are prohibited from directly or indirectly participating in, or intervening in, any political campaign on behalf of…any candidate for elective public office…Violation of this prohibition may result in revocation of tax-exempt status and/or imposition of certain excise taxes.”

The New York Attorney General filed charges against the Donald J. Trump Foundation in June 2018 claiming, for example, “The Attorney General’s investigation found that Trump Foundation raised in excess of $2.8 million in a manner designed to influence the 2016 presidential election at the direction and under the control of senior leadership of the Trump presidential campaign.”

More recently, the coincidence between Bloomberg charitable giving to causes run or favored by elected officials and those officials endorsing Mr. Bloomberg’s candidacy for the White House have been reported in the Washington Post, the New York Times, and the New Yorker.

This reporting makes clear the appearance that Bloomberg Philanthropies was used as a means to recruit elected officials for future endorsements. Presidential campaigns do not simply occur to someone, no matter how wealthy they are, but are the products of many months and often years of deliberate organization and preparation. The chronology detailed by media outlets presents a compelling argument that Mr. Bloomberg’s philanthropy was performed with a political purpose.

In addition to noting possible problems with various Bloomberg entities being deployed for impermissible uses, GAO’s letter also cites to emails obtained via public record requests:

Several documents obtained under public records laws reveal coordination between Bloomberg charitable expenditures and the for-profit, Bloomberg L.P. Certain records suggest this overlap between the work of senior “Bloomberg Philanthropies” officials and for-profit Bloomberg advisors (including Mr. Bloomberg’s current presidential campaign chairman) is significant, and understood among political beneficiaries.

For example, one Bloomberg philanthropic project, created to privately hire attorneys for the purpose of “seconding” them to ideologically aligned state Attorneys General to sue the Trump Administration, prepares detailed, bi-weekly reports “for Dan Firger at Bloomberg” Philanthropies. The legal non-profit’s leader expressed uncertainty, however, whether Firger “shares these with Kevin Sheeky [sic]”,who was at the time the Global Head of Communications, Government Relations and Marketing for Bloomberg L.P., and is now Mr. Bloomberg’s presidential campaign manager.

Like Mr. Bloomberg’s inventive campaign to hire and place his own organization’s attorneys in state attorneys general offices to pursue issues of concern to Mr. Bloomberg – described by the Wall Street Editorial Board as “State AGs for Rent” – this scheme is unprecedented.

“The Journal’s editors concluded about Mr. Bloomberg’s “Special Assistant Attorneys General”,

‘The ethical problems here should be obvious’. The same is true here”, said Matthew Hardin, Executive Director of GAO. “The public record contains substantial evidence to question whether Bloomberg’s charitable organization and other outfits have been deployed improperly to obtain personal, political benefit for Bloomberg’s run for the White House.

“This record, independently detailed, at least in part, by major media outlets represents clear grounds for the IRS to investigate implications for various entities’ tax-exempt status. Indeed the record is so robust that it should already trouble all agencies with jurisdiction over such matters, whether they be IRS, the Justice Department, or state and local law enforcement agencies.”

Government Accountability & Oversight is a 501(c)3 non-profit organization dedicated to transparency in public officials’ dealings on matters of energy, environment and law enforcement

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