White Nationalist Group Failed to File Nonprofit Paperwork Required for Fundraising

Richard Spencer is one of the country's most prominent white nationalists. He's also a terrible bookkeeper.

For the second time this year, the state officials in Virginia who regulate nonprofits have rebuked Spencer's far-right think tank for failing to register to solicit donations.

Fundraising without such registration is illegal in Virginia. As of Thursday, Spencer's National Policy Institute website continued to solicit donations, asking they be sent to a P.O. box in Alexandria, Va., where the tiny organization is based.

Like other white nationalists, Spencer uses the mail because over the last year Silicon Valley tech companies have denied far-right figures access to popular crowdfunding websites.

But many of Spencer's fundraising problems are self-inflicted.

They started in March. After Spencer failed to file federal tax returns for three straight years, the Internal Revenue Service stripped the National Policy Institute of its tax-exempt status.

That meant Spencer's supporters could no longer claim a tax deduction for their contributions.

Later that month -- following an inquiry by the Los Angeles Times -- Virginia state regulators determined that the National Policy Institute had broken state law by fundraising while failing to register in the state and by not telling prospective donors it had lost its tax-exempt status with the IRS.

Spencer worked with state regulators to obtain a six-month extension in May to keep his group in good standing.

Then, on Nov. 15, that extension ran out.

Alerted by The Times that the National Policy Institute was continuing to solicit donations, Elaine Lidholm, a spokeswoman for the Virginia Department of Agriculture and Consumer Services, said the regulatory agency would investigate. Knowingly violating Virginia nonprofit law can result in a misdemeanor.

For his part, Spencer had the same reaction as he did on the previous occasions The Times called him about delinquent filings: befuddlement.

"Is that online?" he asked. (Yes.)

"I just got a letter to pay a fee," he said, promising to do so soon. "Can I just hire you to do this for me?" (No.)

Spencer is unusual compared with most white nationalists in that he uses a nonprofit to support him financially.

Some far-right supporters have created for-profit companies and platforms to provide their own financial infrastructure for neo-Nazis and other fringe figures.

They include the newly created site "GoyFundMe" -- the name appropriates a term used for non-Jews -- which hosted a fundraiser for a Nazi sympathizer who lost his job after being profiled by the New York Times.

Some far-right figures also ask supporters for donations in Bitcoin, the decentralized digital currency.

"With Bitcoin, they don't have to physically expose themselves anywhere" like a P.O. box that can be spied upon, said John Bambenek, a security expert and a manager of threat systems at Fidelis Cybersecurity.

But unlike bank transactions or mail drops, Bitcoin transactions are all trackable online. So on his free time, Bambenek recently set up a Twitter account, @NeonaziWallets, to track which white nationalists are receiving Bitcoin in their digital wallets.

"Part of it is, 'Screw those guys,' you know? You drove a car into a person," said Bambenek, referring to the white nationalist rally in Charlottesville, Va., attended by Spencer this summer where a white nationalist killed a protester by ramming his car into her. "Up yours."

Bambenek's Bitcoin tracker says that the neo-Nazi website Daily Stormer has raised the equivalent of more than $500,000 in Bitcoin, and that the site's reputed webmaster, Andrew "weev" Auernheimer, has nearly $2 million worth of Bitcoin.

"There's real money that these people have," Bambenek said. "Some, not so much."

He said Spencer has collected $1,183 worth of Bitcoin, and the National Policy Institute has about $20.

In 2015, the National Policy Institute raised $145,671 from supporters, mostly from donations, according to the most recently available tax return that Spencer provided The Times after initially failing to file with the IRS. (Spencer said the group, which was registered as an educational nonprofit, has applied to regain its tax-exempt status.)

It's unclear how much cash the group keeps in reserve.

In October, it sponsored Spencer's controversial appearance at the University of Florida in October, where protesters in the audience booed as Spencer recited his ideas about the "ideal" of a white nation. But its check for the rental space fee and security -- $10,564 -- bounced.

Emails released by the university in response to public records requests by The Times and other news outlets show that the cause was insufficient funds, and that the bank charged the university a $40 penalty.

Then, in the scramble to wire the university money from its Bank of America account, the National Policy Institute fell about $100 short when it wired the university $10,500, according to additional records released this week.

The university decided not to bother with the discrepancy.

"The amount was a mistake," university spokeswoman Janine Sikes wrote in an email to The Times on Wednesday. "But we had so much going on to get ready for the event, the $100 or so wasn't something we considered a deal breaker."

Spencer offered his own take on the bounced check: "That was just a management issue," he said.

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