October 28, 2010

IT'S ALL ABOUT THE PROFIT, NOT THE PROPHET:

Anti-Muslim crusaders make millions spreading fear (Bob Smietana, 10/24/10, THE TENNESSEAN)

Steven Emerson has 3,390,000 reasons to fear Muslims.

That's how many dollars Emerson's for-profit company — Washington-based SAE Productions — collected in 2008 for researching alleged ties between American Muslims and overseas terrorism. The payment came from the Investigative Project on Terrorism Foundation, a nonprofit charity Emerson also founded, which solicits money by telling donors they're in imminent danger from Muslims.

Emerson is a leading member of a multimillion-dollar industry of self-proclaimed experts who spread hate toward Muslims in books and movies, on websites and through speaking appearances. [...]

Emerson incorporated his for-profit company, SAE Productions, in Delaware in 1995. He launched the nonprofit Investigative Project on Terrorism Foundation in Washington, D.C., in 2006.

But he doesn't make that distinction on his website, www.investigativeproject.
org, which describes the Investigative Project on Terrorism as "a non-profit research group founded by Steven Emerson in 1995." And today, the two groups share the same Washington street address, which is published on Emerson's personal website.

In 2002 and 2003, despite lacking nonprofit status, Emerson received a total of $600,000 in grants from the Smith Richardson Foundation, a conservative public-policy shaper based in Connecticut. The foundation declined to comment on the grants but said it gives money only to tax-exempt charitable groups.

Giving money to a for-profit is extremely rare for foundations, said Peter Bird, president of the Nashville-based Frist Foundation. It can happen only when the foundation keeps meticulous records on how the money was spent by the group that received it.
"It almost never happens," he said. [...]

The Investigative Project on Terrorism Foundation's 1023 application for tax-exempt status stated that all of the money raised by the Washington, D.C.-based charity would go to a nonprofit subcontractor with no ties to Emerson or any board members. The application also said the charity would buy no services from board members. Emerson ended up being the only board member.

In a letter dated Dec. 8, 2006, the IRS asked if there would be any ties between the subcontractor and the Investigative Project on Terrorism Foundation. On Dec. 29, 2006, Emerson wrote back: "There are and will be no financial/business transactions between officers, board members or relatives of the aforementioned and applicant organization."
In 2008, however, the charity paid $3,390,000 to SAE Productions for "management services." Emerson is SAE's sole officer.

Because of its unusual arrangement with Emerson's company, the Investigative Project's tax returns show no details, such as salaries of staff.


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Posted by Orrin Judd at October 28, 2010 6:52 AM
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