The phone rings. The caller knows your name, and opens with a dad joke.
“Carla? Finally, it’s good to hear a kind voice. That last call was tougher on me than my mother-in-law’s meatloaf. (chuckles) I’m only kidding.”
He is asking for donations, to help a group that helps the police.
“This is Frank Wallace calling for the American Police Officers Alliance. Very quickly, we’re mailing out the envelopes to help fight for our officers who protect our nation’s citizens, just like yourself. Once you receive your card in the mail, you can send back whatever you think is fair this time. That’s all.”
This is not a policeman. This is not even a human. This is a computer, making thousands of robocalls with the same folksy voice.
And like “Frank Wallace,” the American Police Officers Alliance is not what it seems.
In theory, it is a political nonprofit called a 527, after a section of the tax code, that can raise unlimited donations to help or oppose candidates, promote issues or encourage voting.
In reality, it is part of a group of five linked nonprofits that have exploited thousands of donors in ways that have been hidden until now by a blizzard of filings, lax oversight and a blind spot in the campaign finance system.
Since 2014, the five groups have pulled in $89 million from small-dollar donors who were pitched on building political support for police officers, veterans and firefighters.
But just 1% of the money they raised was used to help candidates via donations, ads or targeted get-out-the-vote messages, according to an analysis by The New York Times of the groups’ public filings.
About 90% of the money the groups raised was simply sent back to their fundraising contractors, to feed a self-consuming loop where donations went to find more donors to give money to find more donors. They had no significant operations other than fundraising, and along the way became one of America’s biggest sources of robocalls.
It is not clear why the groups plowed so much of what they raised back into more fundraising calls.
But one other set of expenditures was especially notable: The groups also paid $2.8 million, or 3% of the money raised, to three Republican political consultants from Wisconsin who were the hidden force behind all five nonprofits, according to people who worked for the groups and who in some cases were kept in the dark by the consultants about the finances of the operations.
Those three consultants helped organize the nonprofits, the people said, then billed them — through shell companies that obscured the connection.
By minimizing their aid to candidates, the consultants who helped set up the five nonprofits avoided scrutiny from the Federal Election Commission and most state watchdogs, and put their groups under the jurisdiction of a distracted and underfunded regulator, the IRS.
Four of the five nonprofits remain active. In statements, they said they had not sought to avoid oversight, enrich insiders or deceive donors.
Instead, the groups said, they simply believed in helping politicians indirectly — not by giving them money or buying them ads or mentioning their names, but by obliquely raising issues that could shift voters their way.
To that end, the groups said, even fundraising calls from “Frank Wallace” were part of their mission. Since they mentioned policing — a topic voters might care about — the calls were not a means to an end in the work of influencing elections. They were the work itself.
“We have met, and in fact exceeded, in our mission to raise awareness of police issues, hold politicians accountable for shameful treatment of police officers, and activate grassroots supporters who demand change,” said Simon Lewis, one of the three Wisconsin consultants who helped establish the groups and who serves as president of one of them, the National Police Support Fund.
Campaign-finance experts said that the groups’ defense of their work — especially their arguments that the fundraising calls were political activism in themselves — seemed to test the limits of what was allowed under law.
“Constructing an elaborate self-licking ice cream cone, or fundraising cycle that feeds itself, that’s not an exempt purpose,” said Matthew Sanderson, a lawyer at the firm Caplin & Drysdale, using the IRS’ term for an allowable use of the groups’ money.
A lawyer for the active groups, Craig Engle, said all four had faced “tax exempt compliance examinations” by the IRS that began in the spring of 2022. Engle said that an IRS representative had told him in a phone conversation Friday that the groups would face no penalties, but that the service had not yet issued a decision in writing. Another lawyer for the nonprofits said the IRS had told the groups they could continue “to operate as-is.”
The IRS declined to comment about the groups, citing taxpayer-privacy rules.
In their calls, the groups identified themselves to potential donors as political organizations. Beyond that, they were often vague about whom they supported and how. The American Police Officers Alliance told donors it was “supporting efforts to elect lawmakers to advocate for those who protect our nation’s citizens.”
Ryan Meyer, who was president of the American Police Officers Alliance from 2017 to 2021, said the three Wisconsin consultants used him as a figurehead and ousted him after he learned that most of the money raised by the group went back into more fundraising and demanded changes in the organization’s direction.
“It made me sick to my stomach,” Meyer said. “We’re misleading people who have given hard-earned money.”
Hidden Connections
On paper, the nonprofits are not connected to one another. In public filings, they list separate boards of directors, and separate offices in Washington’s Virginia suburbs.
The Times found their connections — to each other, and to the three Wisconsin consultants — by following their money through a web of shell companies and corporate aliases.
The Times’ analysis showed that the five nonprofits had paid a combined $985,000 to a company in Baltimore called Voter Mobilization LLC.
In reality, the Baltimore address was just a virtual office, where the company received mail but kept no staff. Voter Mobilization LLC was actually owned by an obscure political firm called Campaign Now, which was in turn owned by a 37-year-old Republican consultant from Wisconsin named John W. Connors, a central figure who appears to connect all five nonprofits.
Tax records show that the five groups paid $1.1 million to companies where Connors was either the owner or a partner. The payments were part of a pattern in which the nonprofits paid firms connected to the three consultants for “political support services” and other tasks like bookkeeping and consulting.
“I do this to help people without a voice organize, raise money and design a platform,” Connors said in a statement.
In another instance, the nonprofit groups said they had paid six different vendors spread across Illinois, Pennsylvania, Colorado, Nevada, Texas and Tennessee. But corporate records showed a common thread: All of those companies were actually aliases for — or a subsidiary of — a single Wisconsin firm owned by Kyle Maichle, another of the consultants behind the nonprofits.
Maichle, 40, was a researcher for Connors in 2011 and 2012. In 2017, with Connors’ help, Maichle started his own company, Precision Compliance Consulting. The nonprofits paid Maichle’s companies about $876,000.
‘Boss Man’
Connors, Lewis and Maichle were all active in college conservative politics in Wisconsin about 15 years ago, when Connors was the leader of campus Republicans at Marquette University.
Connors founded Campaign Now before he graduated, and built it into a firm that handled robocalls and voter outreach. He hired Lewis and Maichle, but made clear who was in charge: the firm’s website gave his title as “Boss Man.”
In 2015, Connors’ company appeared to land a new lucrative client: Veterans Action Network. It was a 527 group, which meant it could take donations, but not offer donors a charitable deduction. It paid Connors’ company for strategy consulting.
Veterans Action Network’s disclosures show it raised $6.1 million before shutting down in 2019.
Of that, about $102,000 went to Campaign Now, the firm started by Connors, and another $112,000 to companies where Connors, Maichle or Lewis was either the owner or a partner, tax records show. Maichle left Campaign Now in 2012, and Lewis in 2016, to start their own firms.
Overall, the Times’ analysis found, Veterans Action Network spent about 92% of its donations on more fundraising, a level that made it an outlier among its peers.
Four New Groups
The four new 527 groups started by people connected to Connors mimicked the methods employed by Veterans Action Network — with one improvement. The veterans group had used human callers to raise money. The new nonprofits used robocallers that sounded deceptively human, and could operate on a much wider scale.
The National Police Support Fund, where Lewis was president and Maichle the treasurer, used robocalls that opened with a joke about the caller’s wife.
The American Police Officers Alliance featured both the Midwestern-sounding “Frank Wallace” and “David,” with a thick New York accent. “David” said donors’ money would help elect pro-police legislators, and help the families of slain police officers. Maichle had filed the paperwork to incorporate that group, listing Lewis as an officer.
The American Veterans Honor Fund frequently opened calls with a joke but quickly pivoted to more somber topics, including veteran suicide and homelessness. A longtime friend and adviser to Connors was that group’s president, and Lewis filed its paperwork.
The fourth group, Firefighters and EMS Fund, talked about how deadly firefighters’ work is, and said its mission was to “support legislation that will save lives.” It asked for pledges of $30 or $50. Its president was formerly an intern at Campaign Now.
The organizations’ calls were recorded by Nomorobo, a company that collects robocalls so it can help customers block them. The company’s founder, Aaron Foss, said it had recorded tens of thousands of calls from just these four groups — putting them among the most prolific and longest-running robocallers his network has ever tracked.
The Fate of $89 Million?
In the 2022 election cycle, campaign watchdog OpenSecrets tracked 202 similarly large groups organized as 527s, and found that only 13% of them spent more than one-third of their expenditures on fundraising. Among them, the four connected to Connors and his associates ranked first, second, fourth and sixth in total fundraising expenditures.
While the groups spent heavily on fundraising, they also told the IRS they had spent only small sums — or, sometimes, nothing at all — to help candidates get elected.
The groups avoided helping candidates on purpose, said Engle, a Washington lawyer they recently hired as a legal adviser. He said they made sure not to exceed $1,000 in direct aid to federal candidates — which could trigger a requirement to register with the FEC — or to exceed state-by-state thresholds that would trigger a requirement to register with state agencies. That left them regulated by the IRS, which monitors 527 groups that the others do not.
Tax law says only that the nonprofits must be “operated primarily” to influence the election of candidates, or the selection of unelected officials like Supreme Court justices.
Several campaign-finance experts said that was a loose limit, but that these nonprofits still seemed to stretch it.
“Indirect expenses have to support direct expenses,” said Ellen Aprill, a law professor at Loyola Marymount University who has studied 527 groups. “Why are you spending money fundraising, if you don’t have any candidate you’re going to use it for?”
The groups continue to raise money. Foss, of the firm Nomorobo, said his lines have recorded hundreds of calls this year alone. “Frank Wallace” is back with new dad jokes, and another plea for money.
This article originally appeared in The New York Times.