EXCLUSIVE — A progressive group linked to terrorism may have unlawfully failed to disclose lobbying, tax experts warn.
Alliance for Global Justice, an Arizona-based nonprofit group facing an uncertain future after a Washington Examiner investigation into its Palestinian terrorism ties prompted payment processors and donors to jump ship, claimed in recent years on financial disclosures filed with the IRS that the charity did not engage in lobbying activities. But records show AFGJ has lobbied on the state and federal level — a fact that went undisclosed and, thus, could place the group’s tax-exempt status in jeopardy and open it up to hefty fines.
“The IRS should take this seriously because it’s a violation of their regulations … to not report this information,” said Alan P. Dye, a partner at the law firm Webster, Chamberlain & Bean. He also pointed to IRS rules holding that nonprofit organizations may be hit with a penalty of $105 per day if they submit incomplete tax returns.
The lack of lobbying transparency is the latest hiccup for AFGJ, which houses an Israeli-designated terrorist group called Samidoun that shares employees with the Popular Front for the Liberation of Palestine, a U.S.-designated terrorist group. Samidoun and a French organization called Collectif Palestine Vaincra, which is partnered with the PFLP and received fundraising help recently from AFGJ, are protesting in support of Hamas after its Oct. 7 attack on Israel last year. YouTube kicked Samidoun off its platform this week for violating a company policy related to violent criminal organizations.
AFGJ, which saw a windfall from major corporations and top philanthropies in 2020, fashions itself as an “anti-capitalist” social justice group. One project benefiting from AFGJ’s tax-exempt status is Colorado Freedom Fund, a left-wing criminal justice initiative scrutinized in a June Axios report over an apparent conflict of interest posed by Colorado Freedom Fund Director Elisabeth Epps double-dipping as a Democratic state lawmaker.
That’s because Epps leads the AFGJ-housed project at the same time Colorado Freedom Fund lobbies the state house — including on legislation that Epps sponsored. Colorado Freedom Fund, according to state records reviewed by the Washington Examiner, has lobbied in connection to bills from 2022 to 2024.
But AFGJ, which oversees Colorado Freedom Fund’s finances as its fiscal sponsor, has long checked “no” to a question on IRS tax forms asking if it lobbies.
That could present a legal problem for AFGJ, the same legal entity as Colorado Freedom Fund. Charities such as AFGJ are allowed to lobby as long as the activity constitutes a fraction of their annual expenditures, the IRS said.
“The income, expenditures, and activities of Colorado Freedom Fund should have been reported on AFGJ’s Form 990,” said Patrick Sternal, a nonprofit consultant who previously worked as a tax law specialist for the IRS.
Colorado Freedom Fund’s finances remain murky due to the fiscal sponsorship arrangement with AFGJ, but records show it has received donations in recent years from the left-wing Tides Center, the Denver Broncos football team, the Wolf Family Foundation, and the Marigold Project. AFGJ shuffled $1.4 million to Colorado Freedom Fund between April 2020 and March 2021, tax records show.
AFGJ’s ties to the PFLP resulted in PayPal, Stripe, and other payment processors booting the charity off their platforms. The Ford Foundation, groups managed by the left-wing Arabella Advisors dark money network, Arnold Ventures, and other foundations also vowed they will no longer fund AFGJ amid congressional scrutiny.
Meanwhile, AFGJ has also engaged in activity that Sternal and other tax experts say amounts to grassroots lobbying. The IRS classifies grassroots lobbying as “attempts to influence legislation by attempting to affect the opinion of the public with respect to the legislation and encouraging the audience to take action with respect to the legislation.”
AFGJ manages a webpage that instructs people to contact senators to voice concerns about a proposed bill for sanctions on Nicaragua led by Sens. Marco Rubio (R-FL) and Tim Kaine (D-VA).
“Contact your Senators!” the page says. “Oppose new and old sanctions on Nicaragua!”
It’s not the first time AFGJ has engaged in this type of lobbying. The charity, in 2018, also instructed the public to contact lawmakers to oppose the bipartisan Nicaragua Human Rights and Anticorruption Act.
The bill passed both chambers and was signed into law by then-President Donald Trump. It enacted sanctions on banks in Nicaragua over the government blocking free and fair elections and engaging in other human rights violations.
However, AFGJ did not inform the IRS on financial disclosures that it engaged in any lobbying activities during this period. The IRS also requires nonprofit groups to list how much they spent on lobbying, which AFGJ did not report.
Nonprofit lawyer Paul Kamenar said AFGJ could be subject to criminal penalties over making false statements on federal forms.
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“Not only does AFGJ fiscally sponsor a group that engages in lobbying, but they directly lobby themselves despite telling the IRS they do not,” said Kamenar, counsel to the National Legal and Policy Center. The watchdog group is weighing filing an IRS complaint against AFGJ.
AFGJ and its project, Colorado Freedom Fund, did not reply to requests for comment. The IRS declined to comment.