More bumbling incompetence from Atheist Alliance International


by Martin Boers

In my previous article, I presented evidence that the so-called "board" of Atheist Alliance International (AAI) is attempting to hide a very large tax liability from their donors, and from the California Attorney General. Not only does the "board" of AAI have no democratic mandate to act on behalf of that organisation, they are also supremely incompetent at the roles they claim to occupy.

The latest demonstration of incompetence has been the failure of the "board" to submit a Statement of Information to the California Secretary of State, as every Corporation registered in California is required to do every two years. Here is how the California Secretary of State website is reporting the status of AAI at the time of writing:

The "Not Good" standing with California Franchise Tax Board (FTB) since 2016 is the reason for AAI's large (and growing) tax liability. This, along with their failure to fulfil other filing requirements over recent years, has resulted in the "Not Good" standing with the California Secretary of State, and their overall "Suspended" status in California since May 2021 (the "Inactive Date").

Separate to their status with the SOS and the FTB, AAI's charitable status with the California Attorney General (AG) was also revoked in 2022 due to their persistent failure to comply with filing requirements with his office.

Here are some recent attempts by the "board" of AAI to fix these problems:

  • In May 2022, during his brief period as "President" of AAI, David Orenstein wrote to the California Attorney General, asking that AAI's charitable status be restored. In his letter, Orenstein promised that "in the future AAI will NEVER be in such a position."

  • During a purported "Extraordinary General Meeting" in January 2023, the "members" of AAI voted in favour of a motion (recorded as Motion #11 on page 11 of the meeting minutes) which proposed a "Governance Course for AAI Board". This course would, among other things, give "an overview of the California Regulations for Charitable Organizations", and would be mandatory for all new members of the AAI "board".

  • Following further representations in April 2023, the California AG restored AAI's charitable status, but put them on Probation for a period of three years. In his letter to AAI granting their reinstatement, the AG's office said that "the registrant ... has implemented controls to prevent future deficiencies." The AG also said that, as part of their probation conditions, "If the registrant violates its probation in any respect the Registrar may revoke its registration without further notice or proceeding."
As the "Governance Course" would no doubt have explained to the "directors" of AAI, reinstatement by the California AG did not restore AAI's good standing with either the Franchise Tax Board or the Secretary of State - that needs to be applied for separately. In any case, how has the new, legally compliant AAI been performing?

The first test that AAI was required to pass was to submit their 2022 filings to the California Attorney General. As can be seen on the California AG website, this filing was due by by 15 May 2023, less than three weeks after AAI was granted probation. Two and a half months later, that filing is still not recorded on the AG website. Let's hope that there has just been a processing delay in the AG's office, otherwise that would be a breach of AAI's probation conditions, in which case "the Registrar may revoke [AAI's] registration without further notice or proceeding."

Since AAI's financial year ends on December 31, they were also required to submit an annual return to the IRS by 15 May 2023. Two and a half months later, that filing from AAI is still not recorded on the IRS website. Let's hope that there's also a processing delay at the IRS, because if not then AAI's 501(c)(3) tax exempt status is also at risk.

And finally, more than one year after David Orenstein promised that "in the future AAI will NEVER be in such a position", AAI remains suspended by the California Secretary of State and the Franchise Tax Board. Now, AAI's failure to submit a biennial Statement of Information to the Secretary of State risks the very existence of the Corporation. But even that would not get AAI off the hook for their large and ever-increasing tax debt with the California Franchise Tax Board.

Do you still trust AAI with your charitable donations?

Comments

  1. Janice Rael2 August 2023 at 23:15

    Question, just so I understand: is it true that the AAI was allowed to accept untaxed donations during a probationary period in California, but due to negligence, has failed to file necessary paperwork, and thus has violated the probation?

    And they owe a lot of money in back taxes?

    Yikes.

    ReplyDelete
    Replies
    1. Martin3 August 2023 at 13:11

      AAI lost their charitable status last year for failing to meet their filing requirements (e.g. annual financial statements) with the California Attorney General. Their status has recently been restored, but subject to a 3 year probationary period.
      They now appear to have breached their probation conditions.
      And yes, separate to all that, since AAI lost their non-profit status with the California Franchise Tax Board in 2016, they have been liable for an annual state corporation tax of $800. This tax has never appeared in AAI's published accounts, either as an Expense or as a Liability. You can ask them if they've ever paid these taxes (plus penalties and interest), but they won't tell you.

      Delete

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