Justice Department Investigates Alleged Fraud in Black Lives Matter Foundation Following $90 Million in Donations

The foundation reported receiving over $90 million in donations following George Floyd's murder in 2020.

Washington:

The Justice Department has launched an investigation into potential fraud by leaders of the Black Lives Matter movement regarding tens of millions in donor contributions during the 2020 racial justice protests, according to multiple sources familiar with the matter.

Federal law enforcement officials have recently issued subpoenas and executed at least one search warrant as part of their investigation into the Black Lives Matter Global Network Foundation, Inc. and other Black-led organizations that played key roles in the national conversation about systemic racism. These sources spoke to The Associated Press anonymously as they weren't authorized to discuss the ongoing criminal investigation.

Whether this investigation will result in criminal charges remains unclear. However, its existence brings renewed scrutiny to a movement that has faced questions about its financial transparency in recent years. This investigative activity comes at a time when civil rights organizations have expressed concerns about the potential for the Trump administration to target progressive and left-leaning groups critical of his policies, including those associated with BLM, transgender rights advocacy, and anti-ICE protesters.

Justice Department representatives declined to comment when contacted on Thursday.

One source indicated that while the investigation began during the Biden administration, it has gained renewed attention under the Trump administration. A second source confirmed that allegations were previously examined during Biden's presidency.

Following George Floyd's murder in 2020 - when a Black man died under the knee of a white Minneapolis police officer, sparking worldwide protests - the foundation reported receiving over $90 million in donations.

Critics of both the nonprofit foundation and the broader BLM movement have accused organizers of lacking transparency regarding donation expenditures. These criticisms intensified after BLM foundation leaders confirmed in 2022 that they had used donations to purchase a $6 million Los Angeles-area property featuring a six-bedroom, six-bathroom home.

The organization's leaders have consistently denied wrongdoing and publicly released tax documents. Previous investigations into the nonprofit's finances have not produced evidence of impropriety.

Foundation leaders have received subpoenas. In a statement emailed to the AP on Thursday, the foundation stated: "is not a target of any federal criminal investigation."

"We remain committed to full transparency, accountability, and the responsible stewardship of resources dedicated to building a better future for Black communities," the foundation added.

The Black Lives Matter movement emerged in 2013 following George Zimmerman's acquittal in the killing of 17-year-old Trayvon Martin in Florida. However, it was Michael Brown's 2014 death at the hands of police in Ferguson, Missouri, that transformed "Black lives matter" into a progressive rallying cry and a frequent target of conservative criticism.

The movement's founders and organizers pledged to build a decentralized organization governed by consensus among BLM chapters. As the movement gained influence, the number of affiliated organizations grew. The massive influx of public contributions following Floyd's murder in 2020 primarily benefited the BLM foundation, though other organizations also received funding from these sources.

Foundation leaders provided detailed financial information in 2022, including comprehensive expenditure accountings. According to the latest Form 990 filing, the BLM foundation held $28 million in assets for the fiscal year ending June 2024.

The investigation is being conducted by the U.S. Attorney's Office for the Central District of California in Los Angeles. The district's top prosecutor, Bill Essayli, was recently disqualified from several cases after a federal judge determined he had remained in his temporary position longer than legally permitted. It's unclear how Essayli's disqualification might affect the BLM investigation. He effectively continues as the office's leading prosecutor under the different title of First Assistant United States Attorney.

Essayli previously served as a Republican assemblyman in California, where he championed conservative causes and criticized the state's COVID-19 restrictions. He has openly opposed state policies protecting undocumented immigrants and has aggressively prosecuted individuals protesting Trump's intensified immigration enforcement across Southern California.

As a private attorney, Essayli characterized BLM as a "radical organization" while defending a white couple charged with a hate crime in 2020 after being recorded defacing a BLM mural in Martinez, California.

During that period, city-sanctioned BLM murals had been painted on streets throughout the United States as expressions of solidarity with the racial justice movement. Essayli told a San Francisco CBS TV affiliate that his clients were simply expressing their political views and objected to taxpayer funds being used to "sponsor a radical organization, Black Lives Matters."

The couple ultimately accepted plea deals to resolve the case in 2022.

During the height of the racial justice reckoning sparked by Floyd's death, some state officials announced their own investigations into the foundation's finances, citing their duty to protect residents who may have donated to BLM. Most of these investigations concluded without official action.

In 2022, Indiana Attorney General Todd Rokita filed a lawsuit against the BLM foundation for failing to comply with an investigation into its finances. Shortly thereafter, a foundation representative provided the requested information and documentation, according to a spokesperson for the attorney general's office, and the lawsuit was dismissed.