South Dakota business at center of Senate investigation regarding NRA and Russia Original

WASHINGTON, D.C. (KELO) — The National Rifle Association is in hot water after a newly-released Senate report puts the gun-rights organization’s non-profit status in jeopardy and a South Dakota limited liability company is at the center of it all.

The report released Friday by Sen. Ron Wyden (D-OR) is the culmination of an 18-month investigation by minority party staff on U.S. Senate Committee on Finance.

📃 Read the full minority report at the bottom of this article.

Senate Finance Committee ranking member Sen. Ron Wyden, D-Ore., left, sitting next to committee chairman Sen. Chuck Grassley, R-Iowa, right. (AP Photo/Susan Walsh)

“The totality of evidence uncovered during my investigation, as well as the mounting evidence of rampant self-dealing, indicate the NRA may have violated tax laws. This report lays out in significant detail that the NRA lied about the 2015 delegation trip to Moscow,” Wyden said.

The report also details how money related to that trip funneled through a South Dakota business. KELOLAND Investigates first reported on Bridges, LLC in December 2017.

At the center of organizing this trip are two key figures: Maria Butina and Paul Erickson.

Report: Maria Butina Talking To Investigators About Paul Erickson

31-year-old Russian Maria Butina is in federal prison in Tallahassee, Florida. She is finishing up an 18-month sentence for working as an unregistered agent in the U.S.

In this courtroom sketch, Maria Butina, left, is shown next to her attorney Robert Driscoll, before U.S. District Judge Tanya Chutkan, during a court hearing at the U.S. District Court in Washington, Thursday, Dec. 13, 2018. Maria Butina, a Russian accused of being a secret agent for the Russian government, has pleaded guilty to a conspiracy charge in federal court in Washington. (Dana Verkouteren via AP)

Butina is expected to be released next month. Butina also ran Sioux Falls-based Bridges, LLC.


Also on the articles of incorporation filed with the South Dakota Secretary of State is Paul Erickson. The Vermillion native is a well-known Republican conservative operative in the state.

KELOLAND’s Angela Kennecke spoke to Erickson once in 2017.

Following the money through South Dakota

In the report from the Democrats on the committee, staff found the NRA reimbursed Bridges, LLC thousands of dollars for a 2015 trip to Moscow.

(AP Photo/Alexander Zemlianichenko)

Several NRA representatives, according to the report, traveled to Russia to meet with senior government officials, tour arms manufacturing companies and meet with Butina’s Russian pro-firearms organization “Right to Bear Arms.”

Earlier this year, the NRA distanced itself from the trip.

“In sum, certain NRA board members participated in the trip of their own accord. These individuals are not employees of the Association. As an accommodation to the board members who participated, the NRA assisted with logistical support and some travel-related expenses,” the NRA wrote in a letter to Congress.

However, the Democrats’ report shows how money was moved between different organizations to allegedly get it off the NRA’s financial reports.

“This was an official trip undertaken so NRA insiders could get rich—a clear violation of the principle that tax-exempt resources should not be used for personal benefit,” Wyden said.

The Republican-led Senate issued a counter-report on Friday arguing many of the report’s findings.

📃 Read the majority’s report at the bottom of this article.

“The Minority report reads more like a political document directed at an organization well-known in U.S. politics to be despised by Democrats because of its advocacy for Second Amendment rights,” the Republicans on the Senate Finance Committee wrote.

Jim Liberatore

The Democrats’ report explains that Butina personally paid for $6,000 of travel expenses of Jim Liberatore, an NRA donor and business associate and then-CEO of The Outdoor Channel.

When she asked for reimbursement, Butina requested a bank wire transfer to her American account “to avoid international sanction problems.” The report states, emails went on between NRA officials for a few months to figure out how to pay the expenses.

On Feb. 10, 2016, then-Secretary of State Shantel Krebs’ office filed articles of incorporation for Bridges, LLC.

FILE – In this April 21, 2013 file photo, Maria Butina, leader of a pro-gun organization in Russia, speaks to a crowd during a rally in support of legalizing the possession of handguns in Moscow, Russia. (AP Photo/File)

Two days later, according to the Democrats’ report, Butina emailed an invoice from Bridges, LLC to the NRA for $6,000 to cover Liberatore’s travel.

Pete Brownell, the former president of the NRA, confirmed to the Senate Finance Committee through an attorney that he paid $6,000 to Bridges, LLC. A separate email sent on June 15, 2016, confirms the same payment.

Erickson's Neighbors Haven't Seen Him In Weeks
The location of Bridges, LLC in Sioux Falls.

What happened next, according to Brownell’s attorney’s interview with the Democrats, is the NRA reimbursed Brownell $21,545.10 for both the $6,000 payment to Bridges, LLC and other travel-related expenses in June 2016.

However, the Democrats also report that two years later Brownell had to pay back the NRA $17,000 as a way of “getting the trip off the NRA’s books,” according to Brownell’s attorney. This happened one week after the Democrats opened their investigation.

“The report from the Senate Finance Committee shows the NRA has been engaged in business activities and self-dealing that likely violate nonprofit rules under the tax code,” minority leader Sen. Chuck Schumer (D-NY) said.

The Republicans in their own report argue that the NRA may have only paid $4,500 of the $6,000 according to another email provided by the Republicans.

The Democrats argue this web of payments violates the tax code.

“The NRA has abused its tax-exempt status and essentially become a business enterprise that its board members and leadership use for lucrative personal business opportunities, including in Moscow,” Schumer said. “As the disturbing truth continues to surface, the NRA’s status as a tax exempt entity needs to be thoroughly investigated.”

Republicans disagree.

“Whatever the resolution of this $6,000 payment was, even if the NRA improperly paid this amount, it does not come close to jeopardizing the tax-exempt status of an organization with over $412 million in revenue,” the Republicans wrote.

The Republicans argue the Democrats’ report exaggerates several details and omits or downplays facts.

Sen. Chuck Grassley, R-Iowa, chairman of the Senate Finance Committee, center, joined at left by Sen. Ron Wyden, D-Ore., the ranking member. (AP Photo/J. Scott Applewhite)

“This Majority finds no wrongdoing by the NRA or its officials that would reasonably call into question the NRA’s tax-exempt status, based on the documents provided to the Committee,” the Republicans said in a media release.

Wyden is encouraging the Internal Revenue Service to begin its own probe. Several states are also investigating.

“The IRS needs to examine these findings and investigate other publicly reported incidents of potential lawbreaking,” Wyden said.

How Paul Erickson fits in

The Democrats’ report calls the NRA a “foreign asset” for Russia ahead of the 2016 presidential election. They point to Erickson for this part of the story.

President Donald Trump speaks at the National Rifle Association annual convention in Dallas, Friday, May 4, 2018. (AP Photo/Susan Walsh)

Erickson, who was indicted earlier this year on 11 counts of wire fraud and money laundering, was also involved in the planning process for this trip.

Paul Erickson's Connection To Maria Butina

In November 2016, Erickson emailed Brownell requesting he go on the trip to “re-set” Russian relations with Congress with Hillary Clinton as president or a “neutral introduction to the next American president.”

“The Minority report seeks to use this report as justification for a compulsory audit of the NRA, in order to conduct yet another fishing expedition for wrongdoing,” the Republicans said.

The NRA issued the following statements late Friday:

“This report promotes a politically motivated and contrived narrative. An avalanche of proof confirms that the NRA, as an organization, was never involved in the activities about which the Democrats write. This report goes to great lengths to try to involve the NRA in activities of private individuals and create the false impression that the NRA did not act appropriately. Nothing could be further from the truth. As noted by the committee Republicans in their rebuttal, this report is a transparent effort to justify yet another ‘fishing expedition’ into the NRA.”  

William A. Brewer III, counsel to the NRA

“Certain NRA members made the trip of their own accord. The record reflects it was not an official NRA trip. NRA CEO Wayne LaPierre was opposed to it and, at his directive, no NRA staff members or employees attended.” 

Andrew Arulanandam, NRA managing director of Public Affairs

“During the 2016 election, Russian nationals effectively used the promise of lucrative personal business opportunities to capture the NRA and gain access to the American political system,” Wyden said.

Explore the documents

The minority staff (Democrats) provided 115 documents to KELOLAND News, most of which are emails cited in their report between NRA officials, Butina and Erickson. In addition, the minority staff provided 39 documents related to correspondence for the investigation.

The majority staff provided three documents in their report.

Read the minority report

Read the majority report

Explore the document library

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