The Marble Freedom Trust is a new conservative group headed up by the former Federalist Society vice president Leonard Leo. Recently, the group received the largest known donation on record to a political advocacy group: a $1.6 billion windfall from conservative donor Barre Seid, an electronics manufacturing mogul.
Leo was a prominent advisor to Donald Trump on judicial appointments, raising hundreds of millions of dollars to remake the federal courts. This $1.6 billion donation may affect some midterm congressional and Senate races, but its primary impact will come after the midterms as conservative groups will continue to shape the legal and cultural landscape.
The amount of the donation was unique. And so was the way the money ended up with the Marble Freedom Trust.
The cash infusion was arranged through an unusual series of transactions that appear to have avoided tax liabilities. It originated with Mr. Seid, a longtime conservative donor who made a fortune as the chairman and chief executive of an electrical device manufacturing company in Chicago now known as Tripp Lite.
Rather than merely giving cash, Mr. Seid donated 100 percent of the shares of Tripp Lite to Mr. Leo’s nonprofit group before the company was sold to an Irish conglomerate for $1.65 billion, according to tax records provided to The New York Times, corporate filings and a person with knowledge of the matter.
The nonprofit, called the Marble Freedom Trust, then received all of the proceeds from the sale, in a transaction that appears to have been structured to allow the nonprofit group and Mr. Seid to avoid paying taxes on the proceeds.
The left is trying to portray this as a shady deal. But it’s nothing of the sort. Magical accounting is simply taking advantage of the tax laws as they were written — mostly by the rich for the rich. Conservatives have been advocating for years for a simplified tax code with few opportunities to game the system. It’s been the left that has resisted these reforms because it likes to use the tax code to change social policy.
And for those on the left screaming about “dark money,” they should remember the massive influence of donors like George Soros and the granddaddy of all dark money organizations, Arabella Advisors.
Arabella Advisors manages four nonprofits that serve as incubators and accelerators for a range of other left-of-center nonprofits: the New Venture Fund, the Sixteen Thirty Fund, the Hopewell Fund, and the Windward Fund. These nonprofits have collectively hosted hundreds of left-wing policy and advocacy organizations since the network’s creation (referred to by critics as “pop-up groups” because they are little more than websites.) A fifth nonprofit, the North Fund, is significantly funded by Arabella’s nonprofits, is housed at the company’s address, and pays Arabella consulting fees.
In 2020, Arabella’s nonprofit network boasted total revenues exceeding $1.67 billion and total expenditures of $1.26 billion, and paid out $896 million in grants largely to other left-leaning and politically active nonprofits. In 2019, Arabella’s four nonprofits reported combined revenues of $731 million.
Arabella has spent billions of dollars over the last decade doing exactly what the Marble Freedom Trust wants to do.
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