Using shell company 501c non-profits is common form of corruption

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Trio arrestedMarch 6, 2014- The recent conviction of a New York State Assemblyman, William Boyland, details how elected officials and others in the power grid on New York love to form noble sounding non-profits as tax-exempt 501c’s then funnel money from them into personal pockets.

The NYT reports how Boyland, “Mr. Boyland was also accused of submitting false travel vouchers to the Assembly and conspiring to steer state money into a nonprofit that he ran for his personal use….. Mr. Boyland’s former chief of staff, Ry-Ann Hermon, who pleaded guilty to bribery charges, cooperated with the government. She testified that Mr. Boyland pressured a nonprofit organization that he controlled, Wayside Outreach Development, to spend more than $50,000 in state funding on a boat cruise for his most loyal voters.”

The problem is so bad that Albany passed a new law tightening the restrictions on 501c’s. Governor Cuomo recently signed into law Bill A8072, now known as the “Non-profit revitalization Act”. Among other things, the new law will make it harder for executives of non-profits to send kickbacks and favors to other corporations.

It just became more difficult to use a non-profit for personal gain in New York

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