NRA leaders will soon face greater personal risk in overseeing the organization.
Lloyd’s of London will not renew the group’s directors and officers insurance when coverage ends in August, according to multiple sources. The NRA is creating a new $5 million fund to cover potential lawsuits against executives and board members while it searches for a replacement policy. The money will be drawn from current NRA investments.
NRA board member Phillip Journey told The Reload the fund was announced during the closed executive session of the gun group’s Saturday board meeting. He said board members were authorized to talk about it after the session ended, though. He believes the fund was created to alleviate concerns about liability raised by a number of board members.
“It was apparent from the comments that there are several board members that have expressed concerns,” Journey said. “This was their attempt to address the concern, knowing that the policy expires in, golly, less than 40 days.”
Lloyd’s did not respond to a request for comment. The elite business group has a reputation for insuring high-risk clients, and Journey said its decision not to renew the NRA’s policy is bad news.
“I mean, if Lloyd’s won’t insure you, who the hell will?” he said.
A second source with knowledge of the Lloyd’s move called it a “bombshell” likely driven by the risk NRA leaders could face lawsuits related to their management of the organization. This is a major question in light of the suit brought by New York Attorney General Letitia James (D.).
“Underwriters have to assess risk, and when they look at the NRA, they think the risk is too high,” the source, who asked not to be named for fear of reprisals, told The Reload. “They’re still trying to find insurance, but I don’t know that they’re going to be successful.”
The NRA did not dispute claims that Lloyd’s has decided not to renew the group’s directors and officers insurance once its term expires next month, but it said the policy is currently in good standing.
“As a matter of policy, the NRA does not typically discuss the administrative or personal affairs of its board of directors,” Wit Davis, counsel to the NRA Board of Directors, told The Reload. “The NRA can confirm its insurance policies are in good standing. That said, the Association is constantly exploring ways to maximize the value of its insurance needs.”
The NRA was mostly silent about its legal predicaments in the open session of its Saturday board meeting. The failed bankruptcy the group spent tens of millions to pursue was not mentioned, and neither was the New York corruption suit the bankruptcy strategy was meant to counteract.
Letitia James’s suit continues to cast a shadow over the gun group. An outspoken political opponent of the NRA, James is asking a New York judge to dissolve the $400 million organization. She might go after board members and executives, including CEO Wayne LaPierre, for allegedly allowing millions of dollars worth of the organization’s money to be spent on personal expenses such as private flights, luxury suits, and extravagant international trips.
“I think it’s apparent from the New York Attorney General’s pleadings that she is going to try to pursue her statutory duty to recover as much money as she can from those the court finds have breached their fiduciary duty to the members,” Journey said. “The New York court can appoint a receiver who would pursue those types of claims as well. It’s one way or the other, perhaps both.”
8 Responses
This is all over the internet, announced by Lloyds in early May.
Unfortunately, Lloyds will still be theoretically on the hook for claims against the years when it covered the corrupt vampire coven of officers & self-dealing derelict clown-board members. That’s to the extent it’s not fraud, embezzlement or other criminal behavior, which is illegal to insure, so I doubt Lloyds would pay out on it. So maybe there’s a silver lining. They should have to cough up all the self-dealing cash, the “expense accounts”, the sweetheart contracts, money effectively laundered through vendors for $1 million board member and other contracts undisclosed to the membership (e.g. N), even the cost of the rubber-stamp “board meetings” that are nothing but junkets.
You may be thinking of when Lloyds dropped their backing for firearms insurance products the NRA sold back in 2018. This is a different kind of insurance Lloyd’s has with the NRA to protect board members and executives from lawsuits stemming from accusations they failed to carry out their fiduciary responsibilities.
Thanks. No, I know what D&O (and E&O) insurance is. Point is, the distancing appears to have begun several years ago – about or just before the time the War of The Vampires began, containment was lost, and corruption had really begun to publicly stink. Maybe Lloyds knew something.
And the E&O cancellation was announced months ago, but cancelling only protects Lloyds’ going forward. Lloyds is still liable for the periods covered, except for fraud, embezzlement, and other criminality. Obviously none of THAT going on! Not.
The E&O cancellation wasn’t announced anywhere before this report. The board wasn’t told about it until Saturday. There may have been rumors about it but there are rumors out there about all kinds of things that haven’t or can’t be verified.
But, yes, the policy not being renewed is bad news for the board members.
Perhaps not specifically. I found several articles yesterday referring to an early May decision not continue any business whatsoever with NRA. That obviously included D&O. Now I can’t find the articles. Perhaps I misread. However, the writing was clearly on the wall in early May:
Financial Times, May10, 2021.
“Lloyd’s of London bans syndicates from writing business for NRA”
https://www.ft.com/content/b3f8ea5c-538d-11e8-b24e-cad6aa67e23e
“Lloyd’s, the London-based insurance market, has banned its syndicates from writing business for the US National Rifle Association.”
The article then focuses on carry insurance, but you’d have to be an — well, an NRA director — not to take it as the generalized statement of intent that it clearly was.
Also, it’s pretty clear that when or if the corrupt derelict rubber-stamp board of directors is told anything has nothing to do with when or if something actually does or does not happen. e.g. Bankruptcy, LaPew keeping a convicted embezzler as a personal assistant and a known embezzler as his treasurer, etc.
Yes, they dropped all the other NRA insurance and the NRA has also called their executives as witnesses in the suit against New York over its warming against financial entities from working with the NRA. But there wasn’t news about the D&O insurance until now. I think it’s fair to say they should’ve guessed this was coming.
The interesting question now is whether the NRA can find a replacement policy or not. Especially in light of the ongoing New York case where these kinds of claims are likely to be made against directors.
Yep. I had to LoL at how — in my not-so-humble opinion — they now have to misappropriate more member funds to self-insure their misappropriation of member funds, fraud, embezzlement, corrupt self-dealing, dereliction, etc.
Hey, thanks for these articles. Keep ’em coming!
It sure seems like LaPierre is going to ride this thing into the grave. A real shame.