COLUMBUS, Ohio — Ohio Speaker of the House Larry Householder, and four other men, were arrested by federal agents for what investigators call a more-than $60 million bribery and racketeering scheme.
We are now learning more about the corporation investigators say is in question, Generation Now, Inc., and what it's Internal Revenue Service designation as a 501(c)(4) means.
"The conspiracy was to pass and maintain a $1.5 billion bailout in return for $61 million in dark money," U.S. Attorney David DeVillers said.
According to the 82-page complaint from investigators, Generation Now, Inc. was created in February of 2017. Speaker Householder's aide, Jeff Longstreth, and an attorney were the only two names tied to two bank accounts also created in connection to the corporation. In July of 2017, Generation Now, Inc. registered with the Ohio Secretary of State as a foreign non-profit corporation. A document called a "foreign agent resignation" was filed Tuesday.
On their website, Generation Now, Inc. shows it focuses on "promoting energy independence and economic development," while also supporting seniors, healthcare, and financial security. Those issues categorize the corporation as a "social welfare" organization or a 501(c)(4) under IRS rules.
The criminal complaint shows in a 2019 recorded conversation, one of the men charged said "it's a secret. A (c)(4) is a secret. Nobody knows the money goes to the speaker's account."
According to the IRS, a 501(c)(4) is a non-profit organization, like most charities you know of. However, while 501(c)(3)s are usually meant for religious, charitable and educational issues, a 501(c)(4) has more room to lobby and advocate for social welfare issues. They can also spend money on politics as long as it's not their main focus.
For example, volunteer firefighter groups or a cultural festival's board can be 501(c)(4)s, as can several other kinds of groups focusing on the betterment of a community.
Federal laws allow 501(c)(4)s to keep the identities of donors from public inspection, which investigators say is what allowed householder and the other men to funnel the money without setting off alarms.