January 28th, 2013 | Nigel Jaquiss News | Posted In: Politics, Cops and Courts

Oregon Department of Justice Closing In On Mannix

Handling of charitable gifts for veterans is under investigation

mannixKevin Mannix

The long-running Oregon Department of Justice investigation into the Oregon War Veterans Association (OWVA) is increasingly focused on Salem lawyer and frequent candidate for higher office, Kevin Mannix.

Mannix, a former lawmaker who has run for U.S. Congress, Oregon attorney general and governor, performed legal work and other services for OWVA, a troubled 501(c)19 charity that purported to provide aide to current and former members of the military.

The DOJ investigation initially focused on OWVA executive director Greg Warnock, whom the DOJ has accused of including diverting $690,000 from the charity to his own pocket.

Mannix is a far higher-profile target.

On Jan. 22, the DOJ filed a motion in Marion County Court seeking to force Mannix to produce documents the agency had previously subpoened.

In that motion, the DOJ alleges that much of the money OWVA collected ended up in Mannix's coffers.

"In fact, between November 2007 and May 2010, the Mannix organization and Mr. Mannix's campaigns for elective office received at least $1.1 million from Defendant OWVA, representing roughly 43 % of Defendants' total revenues," the DOJ motion states.

Perhaps even more revealing, the motion includes a candid email from the source of virtually all OWVA's funding. 

The email reads in part:

"2 million I gave [OWVA's Greg] Warnock because Kevin [Mannix] said he was a legitimate special charity that could take 501(c)3 money. He lied, or was misinformed. I will now have to pay taxes on at least part of that two million. So 3 people have cheated me out of millions. Gregg Warnock, Kevin Mannix, and [redacted]. I'm too gullible."

DOJ spokesman Jeff Manning declined to identify the author of that email, whose name is blacked out in court filings.

But WW has learned from other sources that the mystery donor of $2 million is the reclusive medical products millionaire Loren Parks, who has long bankrolled conservative causes. 

The email refers to the unusual tax status of 501(c)19 organizations: donations to them are both confidential and tax deductible, like those made to 501(c)3 non-profits. But unlike 501(c)3s, 501(c)19 organizations can legally use their money for political purposes.

So a large donor, such as Loren Parks, who wants to make political contributions anyway can do so and enjoy a tax deduction.

For now, the state DOJ is merely seeking the documents Mannix and his lawyer have yet to provide.

"The Mannix organizations have had long, involved and financially lucrative relationships with the Defendants [OWVA], the motion states. "Much of the money donated to Defendants made its way to the Mannix organizations and some of the money Defendants received was from or through the Mannix organizations. Consequently those organizations possess documents that are highly relevant to the allegations of the complaint."

Mannix says he's disappointed that DOJ filed its motion.

"I haven't read the filing yet," Mannix says. "The bottom line is we've been willing to provide financial information but want to protect other material that contains political discussions because much of it contains legislative strategy or other advocacy positions."

With Mannix's help, OWVA got involved in a number of issues that are not necessarily typical concerns of veterans' organizations, including tort reform and criminal justice issues.

Mannix also takes issue with the email from Parks, the donor. He says it's not his fault if Parks got incorrect advice.

"Mr. Parks would have been misinformed," Mannix says. "A 501(c)3 can only give a 501(c)19 money if that money is to be used for charitable purposes." 

Mannix says he hopes to resolve the issue with DOJ soon.

"We'll respond and we think we'll end up with a result that will provide us with a protective order [regarding political activity] without intimidating people from being involved in the political process." 

 
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