Report on Sons of Confederate Veterans raises legal flags

New reporting by The Daily Tar Heel, UNC's student newspaper, raises questions about whether the neo-Confederate group at the center of the "Silent Sam" controversy has broken state and federal tax and campaign finance laws.

Posted 7:08 p.m. Jan 10, 2020 — Updated 11:25 p.m. Jan 10, 2020

Laura Leslie

, WRAL Capitol Bureau chief

CHAPEL HILL, N.C. — New reporting raises questions about whether the neo-Confederate group at the center of the "Silent Sam" controversy has broken state and federal tax and campaign finance laws.

The Sons of Confederate Veterans is the group that entered into a consent agreement with the University of North Carolina in late November. Under the agreement, the SCV would take possession of Silent Sam, the controversial Confederate statue that stood on the UNC-Chapel Hill campus for more than a century before protesters pulled it down in August 2018, and UNC would give the group $2.5 million to house and display the monument in any county that does not have a UNC system campus.

According to a report Friday in The Daily Tar Heel, UNC's student newspaper, documents and emails provided anonymously by members of the SCV seem to show a pattern of tax law and campaign finance violations by SCV leaders, as well as leaders of an affiliated group, the Mechanized Cavalry.

Both groups are registered as 501(c)(3), tax-exempt nonprofits in North Carolina. By law, 501(c)(3)s are barred from making political donations. However, the report says, the groups may have funneled membership money into a political action committee, the NC Heritage PAC, to be donated to lawmakers sympathetic to the groups' positions.

Who is the group getting $2.5M in 'Silent Sam' settlement?

The report cites multiple members who said Bill Starnes, a former leader, accepted membership dues in cash and checks, then handed out the money at meetings to individuals who would donate it to the PAC. If that happened, it would violate the law against political donations "in the name of another."

Neither SCV's current state leader, Kevin Stone, nor UNC spokesman Josh Ellis immediately responded to WRAL News' request for comment.

The State Board of Elections is reviewing the allegations in the article, spokesman Patrick Gannon said in an email, but he couldn't comment on whether any investigation would follow.

The consent agreement is under review by Superior Court Judge Allen Baddour, the same judge who initially signed off on the deal. Baddour reopened the issue in December, after a group of UNC students and faculty unsuccessfully sought standing to intervene in the agreement after the fact.

A hearing is expected in that matter sometime in the next few weeks.

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