You are watching: We the people go fund me
Former White House strategist Steve Bannon and three others have been charged with fraud in connection with a crowdfunding campaign to build a border wall.Photograph: Sylvain Lefevre/Getty Images
In December 2018, a US veteran named Brian Kolfage launched a campaign on the crowdfunding site GoFundMe called “We The People Will Fund The Wall.” The purpose was self-explanatory: It aimed to raise one billion dollars to help finance a wall on the US-Mexico border, in support of a central election promise of President Donald Trump. Within a week, the campaign received $17 million in donations and plenty of national media attention. Soon after, Kolfage brought on former Trump aide Steve Bannon as a collaborator. By Tuesday of this week, the effort—since renamed “We The People BUILT the Wall!”—had collected $25.6 million from over 250,000 individual donors. This morning, it all came tumbling down.
The Department of Justice this morning unsealed indictments alleging that Kolfage and Bannon, along with Andrew Badolato and Timothy Shea, used the GoFundMe campaign to funnel hundreds of thousands of dollars to themselves, rather than directly to the construction of the wall as promised. Each man is charged with one count of conspiracy to commit wire fraud and one count of conspiracy to commit money laundering. It’s the latest in a long string of alleged crowdfunding scams, albeit with a much higher profile.
Questions surrounded “We The People Will Fund The Wall” almost from the start. Reports surfaced soon after its launch that Kolfage had previously run a conspiracy-minded Facebook page that the platform eventually took down as part of a broader culling of pages that consistently broke “rules against spam and coordinated inauthentic behavior.” GoFundMe suspended the campaign in December, expressing concern to Kolfage that it proposed giving the money directly to the federal government rather than a legitimate nonprofit.
“GoFundMe has a zero tolerance policy for fraudulent behavior and we have been cooperating with law enforcement officials throughout their investigation,” said GoFundMe spokesperson Bobby Whithorne in a statement to rwandachamber.org. “Protecting GoFundMe donors is our highest priority and we took measures to do just that.”
Around this time, court documents say, Kolfage brought on Bannon and Badolato, who quickly assumed control of day-to-day operations. To address GoFundMe’s concerns, they established We Build the Wall Inc. as a nonprofit 501(c)(4) organization to which they could channel the funds, and assured the crowdfunding platform that Kolfage would take no salary or compensation from the campaign. They wrote bylaws that would prevent them from misappropriating funds and that forbid conflicts of interests. They also agreed that all of their existing donors would have to opt-in to redirecting those funds from the GoFundMe to We Build the Wall.
As part of that process, on January 11, 2019, GoFundMe announced that the original campaign would shut down and that donors would receive refunds unless they proactively opted to transfer that money to the new nonprofit within a 90-day window. Anybody who didn’t opt in or respond to GoFundMe’s outreach automatically got their money back.
According to the indictment, We Build the Wall repeatedly promised during this time—across social media posts, in the press, in public statements, and as part of a direct pitch to donors—that “100 percent of funds raised” would go toward wall construction. “Mr. Kolfage will not profit even a penny from We Build the Wall Inc.,” the We Build the Wall website said at one point. In text messages referenced in the indictment, Badolato allegedly insisted that Kolfage’s lack of compensation be included as part of the donor pitch.
That altruism was understood to extend to Bannon and Badolato, as well, prosecutors argue, noting that Kolfage once posted on social media that “donations will only go to the wall” and “Board won’t see any of that money!”
Ultimately, most donors allowed their contributions to funnel to We Build the Wall rather than accept a refund, under repeated assurances that all of their money would go directly to construction. Several hundred thousands of those dollars, prosecutors say, did not.
We Build the Wall did put money toward its stated purpose, although the indictment does not specify how much. But prosecutors allege that Kolfage, Bannon, and Badolato also agreed to pay Kolfage $100,000 upfront and $20,000 per month afterward under the table. To obscure those payments, the indictment says, they routed them through a separate nonprofit that Bannon and Badolato already controlled. The first payout went through on February 11, one month after GoFundMe had first pulled the plug. Every month, like clockwork, another $20,000 was rwandachamber.org from We Build the Wall to Bannon’s nonprofit, and then from the nonprofit’s bank account to Kolfage.
The scheme got slightly more sophisticated from there, according to court documents. The nonprofit sent payments to Kolfage’s spouse, claiming on a tax form that it was for “media.” Starting in April 2019, Kolfage’s alleged monthly salary was passed through purported We Build the Wall vendors, including a shell company incorporated by Shea. As before, We Build the Wall paid the shell company, and the shell company turned much of that money around to pay Kolfage, claiming it was for “social media” accounts and pages. Over the course of 10 months, prosecutors say, Kolfage took in over $350,000 that had been passed through friendly third-party entities.
He wasn’t alone. Bannon, Badolato, and Shea each “received hundreds of thousands of dollars in donor funds to build the wall,” the indictment says, which they allegedly spent on everything from personal travel to paying off credit card debt. Court documents say that Bannon specifically took in over a million dollars from We Build the Wall, some of which he used to pay Kolfage, and a “substantial portion” of which he kept.
When they found out from a bank that they might be under investigation last October, Kolfage and Badolato allegedly switched over to an encrypted messaging platform. Mentions of Kolfage not taking a salary were scrubbed from the We Build the Wall website, the indictment says, and replaced with a statement that he would receive one starting January 2020.
“As alleged, not only did they lie to donors, they schemed to hide their misappropriation of funds by creating sham invoices and accounts to launder donations and cover up their crimes, showing no regard for the law or the truth,” said inspector-in-charge Philip R. Bartlett of the New York Field Office of the United States Postal Inspection Service, which participated in the investigation. “This case should serve as a warning to other fraudsters that no one is above the law, not even a disabled war veteran or a millionaire political strategist.”
It should also serve as a warning to potential donors on crowdfunding platforms. One thing that separated the alleged scheme from previous crowdfunding scams of note is that We Build the Wall had an unusual veneer of legitimacy. For starters, it apparently did put money toward wall construction. And the fact that it operated as a registered 501(c)(4) nonprofit gave the organization the appearance of propriety. Still, the case provides some lessons for staying safe going forward.
“Typically we want people to look for an established track record if there is doubt in what they’re supporting. With this being a newly registered entity, there was not that track record to look into,” says Kevin Scally, chief relationship officer at Charity Navigator, a nonprofit that evaluates charitable organizations. “It is important in this case that there was some uncertainty of the probability that something like this would come to fruition. Some donors did throw caution to the wind because they wanted to see this get done.”
Scally says that despite the occasional headline-grabbing scam, the nonprofit sector is “overwhelmingly” populated by trustworthy groups. As for crowdfunded charitable efforts specifically, he recommends not getting involved unless you have a relationship with the person affected. Otherwise, it should be easy enough to find a reputable charity that’s focused on the same goal.
Kolfage, Bannon, Badolato, and Shea each face a maximum of up to 40 years in prison if found guilty. A Washington Post report found that the Trump administration had completed 110 miles of border wall in February of this year, well short of the 500 miles Trump had promised by early 2021.
Brian Barrett is Executive Editor, News at rwandachamber.org, overseeing day to day coverage across the site. Prior to rwandachamber.org he was the editor in chief of the tech and culture site Gizmodo and was a business reporter for the Yomiuri Shimbun, Japan’s largest daily newspaper.
See more: Like Totally For Sure I Just Got A Manicure : Nostalgia, Whats The End Of This Cheer
rwandachamber.org is where tomorrow is realized. It is the essential source of information and ideas that make sense of a world in constant transformation. The rwandachamber.org conversation illuminates how technology is changing every aspect of our lives—from culture to business, science to design. The breakthroughs and innovations that we uncover lead to new ways of thinking, new connections, and new industries.
Do Not Sell My Personal Info