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This Week's Updates:
CfA Urges IRS to Investigate Tax-Exempt Organizations Used to Funnel Millions to Leonard Leo
On Wednesday, CfA urged the IRS to investigate seven tax-exempt organizations which appear to have funneled millions of dollars to judicial powerbroker Leonard Leo – a possible violation of the agency’s rules against private inurement. CfA laid out how these organizations directly or indirectly paid Leo a total of $73 million from 2016 to 2020, despite his full-time employment at the Federalist Society. Furthermore, the payments were made to businesses owned by Leo that did not publicly describe, market, or advertise their services. While it’s impossible to know what percentage of the $73 million made its way to Leo’s pockets, his personal spending has visibly increased; since 2017, he paid off his home mortgage, purchased two multi-million-dollar vacation properties, and pledged to donate $1 million to Vatican initiatives. The complaint was covered by David Smith, with The Guardian.
In January, CfA called on the Senate Homeland Security and Government Affairs committee to investigate whether Kellyanne Conway used her official position as an advisor to President Trump to advance Leo’s Supreme Court picks, and in exchange, Leo’s BH Fund facilitated a multi-million-dollar deal to purchase her consulting firm. The BH Fund, which has since been dissolved, was also one of the businesses used to channel millions of dollars to Leo, and features in CfA’s complaint.
A Bombshell Report on Judicial Ethics
In related news, a ProPublica investigation revealed that Supreme Court Justice Clarence Thomas had been gifted luxury vacations gifted by property developer and GOP donor Harlan Crow – and failed to report them in his financial disclosures. The report comes amidst a renewed push for judicial ethics rules, which were recently clarified by the Judicial Conference. The updated guidelines require federal judges (including Supreme Court justices) to disclose gifts of travel, food, and lodging which were previously exempted by the “personal hospitality” loophole.
Leonard Leo also makes an appearance in the ProPublica story, in a “photorealistic” painting hung at one of Crow’s luxury properties that depicts him enjoying cigars alongside Crow, Justice Thomas, and several other conservative political operatives.
Big Tech Says Goodbye to Customer Service, Content Moderation, Ethics Teams
Layoffs at big tech companies don’t fall evenly across the workforce, which has worrying implications for cost centers like trust, safety, and security. Mark Zuckerberg has said that Meta will aim for a “more optimal” ratio of engineers to other roles, which could include anything from HR to middle-management. In the wake of these cuts, Meta’s customer service has suffered, as the company walked back a plan to expand live help for users. Instead, access to customer support has been placed behind the “Meta Verified” paywall.
Katie Paul, the Director of CfA’s Tech Transparency Project, told CNN that Meta’s lack of transparency surrounding its latest wave of layoffs could suggest cuts to safety and security teams. Platforms may look to content moderation technology as a cost-cutting measure, but it’s not a replacement for dedicated staff. Katie pointed out that Facebook itself was automatically generating pages for terrorist organizations, which doesn’t inspire much confidence in other automatic content moderation systems.
