Richard Spencer's white nationalist think tank broke Virginia nonprofit laws by failing to register in the state and by not telling prospective donors it had lost its tax-exempt status with the Internal Revenue Service, according to an investigation by state regulators.
The violations were revealed in Virginia Department of Agriculture and Consumer Services records obtained by the Los Angeles Times through a public records request.
The agency, which oversees nonprofits in the state, closed its investigation on June 8 after working with Spencer to bring his group back into compliance with Virginia law.
"We take this very seriously," Spencer said in a private message on Twitter, where he shared a June 1 letter from the state confirming that his group has completed the registration to legally operate in Virginia. "We're doing everything we can to get everything in order."
Over the last two years, Spencer has become one of the nation's most prominent white nationalists, popularizing the term "alternative right" or "alt-right" for his views supporting the creation of a separate nation for white people. He has frequently earned media attention for his support of President Trump or for controversial events supported by his nonprofit for white nationalists, called the National Policy Institute.
Virginia's Department of Agriculture and Consumer Services launched its investigation in early March after The Times inquired about administrative irregularities with Spencer's Alexandria-based group.
In a recent filing with Virginia regulators, Spencer wrote that "the purpose of this charitable organization is to secure the existence of our people and a future for white children," a variation of the "14 words" slogan popular with white nationalists.
Since Spencer took over the National Policy Institute in 2011, the group has been plagued by administrative problems. Spencer didn't file federal tax returns for three years, leading the IRS to retroactively strip the National Policy Institute of its 501(c)3 tax-exempt status in mid-March.
In its recent investigation, regulators at the Virginia Department of Agriculture and Consumer Services found that Spencer was fundraising in the state despite failing to register his group as required under Virginia law, according to department records.
The agency also said the National Policy Institute broke state law by not telling prospective donors on its website that the group had lost its tax-exempt status, potentially misinforming donors that they would be able to claim tax deductions with the IRS.
"NPI is aware of their 501c3 status being revoked ... yet continues to claim 501c3 status on their donation pages," an investigator noted in a summary of the review of Spencer's group.
Spencer had publicly acknowledged the loss of the group's tax-exempt status on social media and in an interview with The Times. Spencer said an IRS error led him to believe his group was not required to file federal tax returns. (Experts said that was no excuse.)
Virginia regulators also raised their eyebrows at an interview Spencer gave to The Times in March in which Spencer said his group had completed the necessary paperwork to operate as a nonprofit in Virginia.
That was not true — Spencer didn't file for registration with Virginia charity regulators until April, according to state records reviewed by The Times — which regulators concluded might be a violation of a state law that prohibits misleading the public about the status of a charitable group.
Spencer told The Times on Monday that it was a misunderstanding and that he meant he had registered the National Policy Institute as a nonprofit corporation in Virginia — a separate regulatory requirement with a separate Virginia agency. "At the time, I was unaware that additional charitable registration was needed," Spencer wrote.
In certain circumstances, knowing violations of Virginia charitable law can be punishable as a misdemeanor, but Spencer does not appear to have been accused of any criminal wrongdoing.
Spencer worked quickly to restore his group's legal status in Virginia after state regulators contacted him about the infractions, according to state records. Spencer paid a $300 fee to register in the state and inserted a clause on his group's donation page that clarifies that "donations to the National Policy Institute are not tax deductible."
Spencer has previously said he plans to restore his group's tax-exempt status, though the process, if successful, was expected to take months. An IRS database of nonprofits says that the National Policy Institute does not currently have tax-exempt status.