Dark Money Group Spent Millions On Election After Telling IRS It Would Stay Out Of Politics

Jason Torchinsky, an attorney for Americans for Responsible Leadership, argues on the group's behalf during a hearing in Sacramento Superior Court, Wednesday, Oct. 31, 2012.
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An Arizona political non-profit that spent millions in 2012 supporting Republicans and opposing President Obama told the IRS in September that it would not spend money to influence elections, according to documents obtained by ProPublica.

The organization, Americans for Responsible Leadership, run by a group of mostly little-known Arizona Republicans, also spent millions of dollars on ballot initiative efforts in Arizona and California. Its $11 million donation to a California group prompted a lawsuit from California’s campaign finance watchdog, which eventually forced it to disclose that it served only as a pass-through for the donation.

ProPublica obtained Americans for Responsible Leadership’s application for federal tax-exempt status, as well as applications submitted by a number of other conservative “dark money” groups active in the 2012 elections, after submitting a public records request to the Internal Revenue Service.

All of the groups (which include: Freedom Path, Rightchange.com II, America Is Not Stupid, and A Better America Now) checked “no” in response to the following question: “Has the organization spent or does it plan to spend any money attempting to influence the selection, nomination, election, or appointment of any person to any Federal, state, or local public office or to an office in a political organization?”

Elsewhere in its IRS filing, which was made in September, Americans for Responsible Leadership said that 50 percent of its resources would go toward to educating the public and “promoting a more ethical and transparent government” through advertisements, “telephone programs,” town hall meetings, speakers, rallies, a website, and a newsletter. The remaining 50 percent of the group’s resources, according to the filing, would go toward influencing policy, in “Washington and elsewhere,” through direct mail and email campaigns, advertising, and phone banking.

In reports filed with another agency, the Federal Election Commission, a few weeks later, Americans for Responsible Leadership disclosed (PDF) spending millions of dollars on phone calls supporting or opposing House and Senate candidates, supporting Mitt Romney, and opposing Obama in the days leading up to the election.

ProPublica obtained Americans for Responsible Leadership and the other groups’ applications despite the fact that the IRS is only required to supply these records after groups are recognized as tax-exempt. None of the above-mentioned groups have been recognized as tax-exempt. Last month, when ProPublica similarly published the application submitted by the Karl Rove-linked Crossroads GPS, an IRS spokesperson told the news outlet that that publishing unauthorized returns or return information was a felony punishable by a fine of up to $5,000 and imprisonment of up to five years, or both. In this case, a lawyer for Americans for Responsible Leadership threatened to report ProPublica to the authorities if it published the IRS application.

“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,” Jason Torchinsky, a partner at the D.C. firm HoltzmanVogelJosefiak, wrote in an email.

ProPublica has redacted financial information from the IRS documents, but believes publishing the applications is lawful.

“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,” Richard Tofel, ProPublica’s president, said in a statement.

Emails to Americans for Responsible Leadership and Torchinsky were not immediately returned.

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