A new database released by Americans for Public Trust aims to shed light on over $5 billion in foreign spending directed towards politically active nonprofit organizations in the United States. The tool, the first of its kind, catalogs 523 groups and 12,090 records of foreign contributions, seeking to expose what the organization calls loopholes in current disclosure laws.
Under provisions from the Tax Reform Act of 1969, many nonprofit organizations are not required to disclose the names of their donors. This lack of transparency has drawn criticism from lawmakers who argue that foreign money could be unduly influencing American discourse and policy. House Ways and Means Committee Chairman Jason Smith, R-Mo., has been vocal about these concerns.
"It is clear the status quo is unacceptable. Tax-exempt status is a privilege, not a right. It exists to support legitimate charitable and educational work that strengthens our communities, not to serve as cover for foreign propaganda, election interference, or activities that undermine our national interest," Smith stated in a press release.
Caitlin Sutherland, executive director for Americans for Public Trust, believes the current laws should be revised. "That’s exactly the problem. It should be illegal for foreign influence to permeate our political system and right now it’s not. Our database is designed to give them the information they need to address these loopholes and close them once and for all," Sutherland said.
The database allows users to search for specific organizations and their contributions, providing a timeline of when the funds were received, some dating back to 2007. Sutherland noted that the term "nonprofit" often evokes an image of charitable work, but that many such organizations have evolved into large entities engaged in lobbying and public policy.
"The nonprofits of today are not what we have seen in decades past," she added.
Foreign money, according to Sutherland, can be used for various activities, including get-out-the-vote drives, ballot harvesting, and funding protests. Smith echoed these concerns, stating that the database confirms his committee's findings that "foreign money is flowing into America’s tax-exempt sector through shell funds and intermediaries designed to hide where it actually came from to influence American policymaking and our public discourse."
However, some organizations, such as the American Legislative Exchange Council (ALEC), argue that donor privacy is crucial. ALEC contends that mandatory donor disclosure could lead to harassment of individuals contributing to causes they support, infringing on First Amendment rights to freedom of speech and association.
Sutherland countered that voters should not have to sift through disparate reports to understand the flow of foreign funding. She explained that the process of obtaining documentation is complicated by varying legal standards in other countries and the lack of a central registry for foreign charities. Americans for Public Trust compiled its data through a piecemeal collection of information from foreign charities' annual reports and grant databases.
While the database highlights concerns about foreign influence, there is no indication from the provided notes that the Department of Justice is investigating any groups in the database for criminal behavior. The focus of the database and the accompanying advocacy is on the lack of transparency and the potential for abuse of nonprofit status. The Americans for Public Trust database aims to provide the information needed to potentially close these perceived loopholes.