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Attorney says Washington nonprofit’s complaints are part of ‘smear’ campaign

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Terre Haute conservative attorney James Bopp Jr. says that an IRS whistleblower suit and other complaints alleging Bopp has diverted funds from the nonprofit James Madison Center for Free Speech to his law firm are part of a “smear machine” by Citizens for Responsibility and Ethics in Washington.

The nonprofit Citizens for Responsibility and Ethics in Washington announced Tuesday that its executive director Melanie Sloan has filed a whistleblower suit with the IRS against Bopp Jr., his law firm and the James Madison Center for Free Speech. Sloan alleges that Bopp has misrepresented the activities of the James Madison Center to divert nearly all of its money into the Bopp Law Firm.

The nonprofit JMCFS, based in Terre Haute, supports litigation and public education to defend the rights of political expression and association by citizens guaranteed under the First Amendment, according to the group’s mission statement. Bopp serves as the nonprofit’s general counsel.

The Bopp Law Firm helps clients with PAC law, campaign finance, election law, First Amendment and constitutional law matters.

The complaint filed with the IRS claims that in the last six years, Bopp, as sole manager of JMCFS, has operated unchecked by its board of directors and diverted the nonprofit’s funds to his law firm.  It alleges that Bopp, the law firm, and JMCFS owe more than $6.2 million in back taxes.

In addition to filing a whistleblower complaint with the IRS, Citizens for Responsibility and Ethics in Washington asked the Indiana attorney general to investigate whether the JMCFS has violated Indiana law by diverting more than 99 percent of its revenue to Bopp’s law firm, according to a letter sent to Attorney General Greg Zoeller’s office.

Complaints were also filed with U.S. Attorney Joe Hogsett in the Southern District of Indiana, the Indiana Secretary of State, and the D.C. Department of Consumer and Regulatory Affairs.

“Mr. Bopp is a self-described expert on the laws governing non-profits so he can’t claim to have made innocent mistakes,” Sloan said in a statement. “He knew what he was doing when he funneled all of JMCFS’s assets to his own firm and he had to know it was wrong.  Misusing a non-profit for personal gain is a serious offense and merits a thorough investigation.”

But Bopp said Wednesday he expects nothing to happen from these complaints. He said CREW has filed dozens of complaints against successful conservatives, such as Jim Dobson and Sean Hannity, but have never won on any of them. He referred to CREW as a “smear machine” that goes after people and groups whose views don’t match CREW’s.    

“I’ve represented groups they’ve filed IRS complaints against and nothing happened,” Bopp said.

CREW’s complaint is that Bopp is the only one paid by the JMCFS, he explained, but he’s the only one paid because he’s the only one who does work.

“[JMCFS] can only afford one lawyer. That’s me,” he said. The litigation center contracts with him and pays him to handle legal matters. He also pointed out that he’s donated millions of dollars in pro bono work to the group.

Bopp also said he’s paid taxes on every cent paid by JMCFS.

Bopp has gained national recognition for his work challenging campaign finance laws and regulations. He was one of the lead attorneys on the 2010 Citizens United case before the Supreme Court of the United States that allowed for unlimited contributions by corporations, unions, individuals, and private groups for political campaigns.

He’s also worked on judicial free speech cases and challenged judicial merit-selection systems in several states.
 

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