The National Rifle Association emerged from its annual convention last week with a veneer of stability.
Its leader Wayne LaPierre managed to quash a takeover attempt by now-ousted President Oliver North, winning reelection as executive vice president in a unanimous vote of top board members.
But beneath the surface, the organization is in turmoil. New York Attorney General Letitia James is conducting a wide-ranging investigation into alleged financial mismanagement at the NRA, while the group is embroiled in a messy lawsuit with its longtime image-maker, Ackerman McQueen. The NRA sued the Oklahoma City-based ad firm last month to get documents as part of an apparent internal investigation into whether the firm has been siphoning money out of the gun lobby, allegations that Ackerman denies.
Then there’s Carry Guard. The program — which offers combat training and liability insurance for shootings carried out in “self-defense” — was founded in 2017 to keep money flowing into the NRA’s dwindling coffers after President Trump’s surprise election left gun owners assured that, for the time being, at least, no “jack-booted” government officials were coming for their firearms.
Instead, Carry Guard has become a financial liability of its own. Multiple states have banned the program and are investigating whether the NRA violated state law regarding the marketing and sale of insurance. In a lawsuit against Lockton, Carry Guard’s administrator, the NRA alleged it lost “tens of millions of dollars” from the program after relying on assurances that Lockton was complying with state law. Numerous NRA members took issue with the program’s “sloppy” rollout.
Gun control advocates even gave Carry Guard a nickname: “murder insurance.”
Rather than help the NRA shore up its finances, Carry Guard has become a symbol of the unprecedented public relations and legal woes plaguing the nation’s largest gun group.
The NRA did not reply to TPM’s repeated requests for comment. In lawsuits against the state of New York and its former insurance broker, the NRA said the accusations that it violated state law in marketing Carry Guard were part of a coordinated, politically motivated assault, and implied that New York Gov. Andrew Cuomo was using the case to intimidate Lockton and other insurers out of doing business with the NRA.
The Trace, an outlet devoted to gun-related issues, first revealed the scandals around Carry Guard.
From the NRA’s perspective, Carry Guard had real potential to be lucrative. Like many affinity groups, the NRA had long offered various forms of insurance to members, former NRA lobbyist Richard Feldman told TPM.
Feldman called insurance sales a tremendous source of revenue for the NRA over the years, but that, under LaPierre’s watch, the drive to earn a profit off them was taken “to the extreme.”
LaPierre had “turned the NRA into a business,” he added.
NRA members — and numerous stories from The Trace — refer to Carry Guard as the “brainchild” of NRA member Josh Powell. Brought on as NRA chief of staff in 2016 from the world of high-end outdoor garments, Powell reportedly “billed” the program “as an integral part of securing the NRA’s finances well into the future,” a source “close to the NRA” told The Trace.
Court filings indicate that Powell began serious preparation on Carry Guard in late 2016. The final version of the product offered four tiers of protection, from a bronze plan providing $250,000 in protection from civil lawsuits and another $50,000 in criminal defense to gold plus, with $1.5 million in civil protection and an extra $250,000 for criminal defense.
The Trace quoted a former Ackerman McQueen employee as saying that “Carry Guard was pushed to the front after the election because they needed money.”
But the project appears to have failed in that task. Between 2016 and December 2018, when Powell was shifted to a new role handling legal strategy for the various lawsuits entangling Carry Guard, the NRA lost some $55 million in income, according to The Trace.
That period saw internal dissent over the program, with some NRA members seeing it as a potential scam, according to interviews with NRA members and publicly available posts.
Carry Guard’s liability insurance component only kicks in for criminal cases after an acquittal. Individual Carry Guard customers would have to cover the hefty costs of criminal defense out of pocket until they were acquitted, leading to accusations within the firearms community that the NRA was luring people into paying for a service unlikely to help them during the most expensive and consequential phase of liability.
NRA allies also raised red flags about Carry Guard’s marketing and training operations.
Beginning with its April 2017 launch, the NRA aggressively marketed Carry Guard as a way for gun-owning civilians to defend themselves at home and on the street, using military tactics.
The marketing campaign itself — an Ackerman McQueen production — used a group of former Navy SEALs and Army Rangers to hawk the program. The same former special forces operatives also worked as instructors for the Carry Guard trainings.
That prompted an outcry within the existing pool of NRA-certified firearms trainers. Most of them are NRA members with day jobs, who earn extra cash by running certification courses for different kinds of firearms, the most popular being a tactical defense course called basic pistol. They worried about the potential loss of income from military-style trainings, and about Carry Guard’s focus on teaching offensive — rather than defensive — tactics.
“How do you take Navy SEALS and Rangers, and apply that kind of training to civilians? The two don’t correlate,” trainer Bob Boilard, who wrote a widely-circulated post about how the program threw instructors “under the bus,” told TPM.
“Their rules of engagement on the battlefield are completely different than your rules of engagement on an American street,” another longtime instructor, who requested anonymity to speak candidly out of fear of retaliation from the NRA, told TPM.
Their concerns dovetail, in part, with the liability insurance element of Carry Guard. The law is relatively black-and-white when it comes to taking up arms to defend one’s home from an intruder, instructors told TPM. People maiming or killing others in the name of self-defense in public settings, however, raises a morass of legal questions.
“You can’t pull a gun and start shooting, there are statutory requirements,” the same longtime instructor said.
Carry Guard’s marketing appears to emphasize these outdoor, public encounters.
Here’s a screencap from a 2017 version of the website:
The website has since been updated to emphasize how the training courses focus on “defensive” tactical skills. But they still highlight apparently public encounters, as in this screenshot from the current version of the site:
A third NRA trainer, who certifies other instructors and also spoke anonymously for fear of retaliation, told TPM that “Carry Guard got more into military-type offensive stuff — it’s not for a civilian to go and learn to kick in a door and clear a room.”
No regulator has gone after Carry Guard for any violation related to its training courses.
Many states, however, have laws forbidding companies from marketing insurance policies without an appropriate license.
By October 2017, New York was investigating the NRA and the firms it hired to operate Carry Guard for breaking state law regarding the marketing and sale of insurance.
Within weeks, Carry Guard’s broker and administrator, Lockton, suspended its participation in the program in New York. Empire State officials banned the sale of Carry Guard insurance to New York consumers, and fined Chubb, the policy’s underwriter, and Lockton, for a total of $8.3 million.
Other states — including New Jersey, California and Washington — soon launched investigations of their own.
But the New York case has progressed the furthest. According to court documents reviewed by TPM, state regulators alleged that Carry Guard violated state law prohibiting insurance that covers holders who inflict bodily harm. An add-on offering a free one-year NRA membership to Carry Guard purchasers was also illegal, they said.
By April 2018, Gov. Andrew Cuomo (D-NY) issued a notification urging businesses to reconsider their ties to the NRA.
The NRA has sued both Cuomo and Lockton, seeking to recoup revenues lost from the Carry Guard insurance program. The NRA accuses Cuomo of selectively pursuing the group as part of a “political vendetta” that discontinued other, non-Carry Guard insurance policies it had offered to New York State members for years.
But in the Cuomo lawsuit, the NRA admitted to hemorrhaging money since the Carry Guard investigations began, claiming that the state’s warning has seriously hindered its ability to do business.
“The NRA has encountered serious difficulties obtaining corporate insurance coverage, media liability coverage, and basic banking services,” the July 2018 document reads, going on to say that though the NRA has tried to find new business partners, “nearly every carrier has indicated that it fears transacting with the NRA.”
The group adds without the coverage, it would be unable “to continue its existence as a not-for-profit organization and fulfill its advocacy objectives.”
