An organisation set up by the shadow defence secretary Liam Fox and linked to a string of other Conservative front benchers is under investigation by US tax authorities, Scrapbook can reveal. Atlantic Bridge, whose political activities have been subject to an official probe in the UK since October 2009, has been referred to the Internal Revenue Service (IRS) by the Charity Commission. The investigation comes as an embarrassment to members of its advisory council, which include George Osborne, Michael Gove, William Hague and Chris Grayling.

The sham charity was set up with the ‘simple aim of “Strengthening the Special Relationship” exemplified by the Reagan-Thatcher partnership of the 1980s’ despite regulation clearly prohibiting party political activity. Hosting a book launch for William Hague and providing a $2,500 hotel room for a visiting US senator number amongst controversial activities which have drawn the attention of regulators on both sides of the pond.

The ruse used by Atlantic Bridge to fend off the authorities is to configure itself as two separate charities: one in the US and one in the UK, which was previously registered at Portcullis House. Problems in the UK are referred to the US jurisdiction and vice-versa despite accounts indicating that “the two entities have been set up to mutually support each others aims”. The organisations are referred to by executives as a single entity and have executive and advisory councils and an honorary patron (Margaret Thatcher) in common.

It seems a recent press release and an article by the Atlantic Bridge CEO backing David Cameron was the last straw for the Charity Commission.  Correspondence between blogger Stephen Newton and the UK regulator seen by Scrapbook indicates Atlantic Bridge is now under investigation by the Internal Revenue Service:

As you will appreciate the Atlantic Bridge Inc is registered in the United States as a 501(c)(3) organisation with the IRS and therefore does not fall within the Commission’s jurisdiction. We have therefore notified the IRS of this information* – Charity Commission

As a 501(c)(3) organisation, the US-arm, Atlantic Bridge Inc, is “absolutely prohibited from directly or indirectly participating in, or intervening in, any political campaign on behalf of (or in opposition to) any candidate for elective public office”. One can only look askance at the following statement:

“Americans should look forward to May 6, after which Cameron and his government will likely assume power.   He will be good for America and better for the Special Relationship.” – Atlantic Bridge CEO Amanda Bowman

For Conservative shadow cabinet ministers, sitting on the management structures of an organisation responsible for rubbishing the NHS in US healthcare debates is reckless enough. It is apparently the case, however, that this body is also responsible for flying senior Conservatives and their US friends across the Atlantic at the expense of the British Treasury and UK taxpayers. As Newton (whose excellent articles on Atlantic Bridge are available available on his blog) writes:

As a higher rate taxpayer, a £1,000 trip to see comedian James Hirsen in LA, for example, would be covered by a £600 donation. The remaining £400 would then be claimed from British taxpayers. It sounds like an invitation to take part in well planned, systematic corruption.

The taxes this organisation has avoided paying could have been used to fund schools and hospitals. Perhaps hacks following Messrs Fox, Osborne, Hague and Grayling on the campaign trail should pose the following question:

How much tax has your organisation dodged?

*IRS analysts are currently acting on this communication and a complaint from Stephen Newton.

UPDATE 18:15 So, as Guido observes, the press release is a bit suspect. But the article is genuine and Bowman is clearly a shill for David Cameron during an election.

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  7. That press release would be the one Guido filed as “Dirty Tricks”, no?

    The article doesn’t actually endorse anyone: it analyses the position of the person “…who will likely win the election, even if with a slimmer majority than predicted a few months ago.”

    501(c)(3)’s are allowed to discuss candidates’ positions – what they can’t do is campaign on their behalf (say by distributing their materials or statements).

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  23. Perhaps Matthew has a short attention span. Had he made it to the end of Bowman’s piece he’d have read: ‘He [Cameron] will be good for America and better for the Special Relationship.’

    As his beloved Guido says, ‘How non-partisan is that?’

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  34. Matthew makes a good point, “short attention span” or no. I’m pretty sure that 501(c)3 does not preclude someone from commenting on ANY aspect of politics. Say, for example, a speculative piece looking at what the future might hold for a relationship between two nations.

    I’d also be highly interested in finding out who wrote the original, sham “press release” that is the root of that complaint. It’s clearly a hoax.

  35. Well, I suppose you could argue that giving credence to a phony “press release” is freedom of speech of sorts, isn’t it? I mean, even malicious fraudsters deserve their say, right? And if their ability to play fast an loose with the facts plays into your partisan agenda, hey, all the better. Who cares if the release is real? Someone wrote a blog post about it! A blog post!

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  39. Wow!
    So the Charity Commission led by arch Labour crony and queen quangocrat “Dame” Suzy Leather (never had a real job in her life) is on the case.
    This is dog bites man stuff.
    Perhaps they’d care to look at some of the Labour dodges too. John Smith Institute? Scott Trust?
    Perhaps they could look at “Lord” Paul. You know, the asset stripping, pension pot pilfering, non-domicile, tax dodging, but I’ll fill my boots with the absolute maximum Lords expenses gravy train cash like Udin, Paul. Now I bet he’s got some dodgy little “charity” somewhere

  40. Yes, the press release is fake. Political Scrapbook, please look at Guido’s two “updates” towards the bottom of his piece. He notes that whereas the op-ed piece is real, the press release labeling it an “endorsement” is not. He also says that he is filing this under dirty tricks until the author of the release, one “Shalia Cooper” comes forward. No need to give Guido a hard time, as he has already corrected the record.

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  42. @Bill fair enough. Have updated the post. Now we’ve cleared that up perhaps we can concentrate on why Conservatives and their US friends are clocking up the airmiles at the expense of the taxpayer?

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  46. The Charities Commission has written to the IRS. And? The IRS may well reply: “It’s not of your business, we have laws against trying to interfere with freedom of speech, here. PS. Dame? Suzi… Leather? Is that a REAL name?”

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  48. I find it slightly bizarre that you evidently didn’t bother to read Guido’s article, given it’s your only source for the existence of the press release – and the press release is the only thing you’ve got to support your claim of an endorsement.

    Was this damp squib really the piece about which you said yesterday “Working on serious story for tomorrow though. Will probably get picked up by print press (fingers crossed).”?

    One really salient question: Did you develop this yourself, or did someone suggest you might like to write it? If the latter, I’d venture to suggest that you might want to ask that person if they happen to know “Shaila Cooper”.

    You may not like the fact that the Atlantic Bridge has been flying shadow cabinet members to the US, but neither you – nor Stephen Newton – have anything to offer but innuendo and ignorance of US tax law.

    Tinfoil hats? I think you might want to check your own headgear.

  49. Peter Grimes says:

    Does the Charity Commission have the authority to ‘refer’ the details of their ‘official probe’ to the IRS in the United States?

  50. “Does the Charity Commission have the authority to ‘refer’ the details of their ‘official probe’ to the IRS in the United States?”

    It probably does. However, the IRS has every right and authority to ignore the UK Charity Commission.

  51. Good to see some people getting hot under collar here and as usual writing in ignorance. The IRS guidance on political campaigning is here:
    http://www.irs.gov/charities/charitable/article/0,,id=163395,00.html
    And you will see it says, ‘all section 501(c)(3) organizations are absolutely prohibited from directly or indirectly participating in, or intervening in, any political campaign on behalf of (or in opposition to) any candidate for elective public office’

    Obviously, I’ve checked my facts and got the advice of a US lawyer who has confirmed that there is no geographic restriction on this guidance. That is, it applies to the UK general election.

    Bowman’s Washinton Examiner article may read like a parody, but she has confirmed that it is not:
    http://www.thirdsector.co.uk/news/Article/996221/Atlantic-Bridge-US-publishes-pro-Cameron-remarks/

    To be fair she does say the words, ‘He will be good for America and better for the Special Relationship’ should not be read an endorsement of Cameron.

  52. Peter Grimes says:

    I thought that the CC problem was that there were 2 entities, and that it could not control the US one. The US entity might well take umbrage at a UK government directed quango snitching it to the IRS.

  53. Peter, I’m sure they would take umbrage. Not that this spurious complaint to the IRS would hold any water. That is, assuming that the IRS is actually “investigating,” a claim which is pretty dubious in and of itself. Maybe their chief “investigator” is one Shaila Cooper? 😉

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