Mikey Weinstein, the MRFF, and MIBON Consulting

Michael “Mikey” Weinstein sometimes tries to make the MRFF — the group he created and runs — seem bigger than just him, citing the number of people associated with his “charity.” However, he quietly admits to the IRS the MRFF has only a single employee — Mikey Weinstein.  That admission seems to contradict claims by others, like Chris Rodda, who say they work for the MRFF.

Normally, personnel costs are not considered “program expenses” in IRS lingo (program expenses are “those incurred while performing its tax-exempt activities”). However, that seems to be how Weinstein framed payment for Rodda’s services. Rodda once admitted the MRFF “Research” expense line item — about $25,000 — was her annual pay (though she has faded from the MRFF scene in the past year or so).  Presumably, the legal explanation is Weinstein treats her as a kind of independent contractor, rather than technically an employee.  The characterization of the use of that $25K on “research” — or Rodda — is not something a potential donor would know if Chris Rodda hadn’t spoken out of school.

What else don’t you know?

While Weinstein itemized such administrivia as Internet ($143) and Bank Fees ($14), he declined to explain three of his charity’s top 5 expenses totaling more than $100,000.  One of those is Rodda’s “research.”  Weinstein pays two other repetitive and predictable (and strikingly similar) annual expenses:  “support” and “consulting.”

Weinstein’s third largest expense in 2012 ($43,000) was vague “support.”  While it is technically possible the expense is actually hundreds of other minor expenditures, following the Rodda research compensation model, the substantial “support” expense might be paid to only one or two people providing some kind of undefined program services.  Just as “research” is performed by the MRFF’s “Senior Research Director,” support services could feasibly be accomplished by another MRFF “staff” member. There are a host of possibilities, of course, but it’s impossible to know because Weinstein doesn’t publicize where that $43K in charitable donations actually goes.

Weinstein’s second largest expense — second only to his own paycheck — has been over $50,000 each year on an equally undefined “consulting.”  Like “support,” all of it is listed as a “program expense,” and he declines to specify who, exactly, is being consulted.

MRFF “consulting” expenses spiked from $0 in 2006 to $136,000 in 2007 — making “consulting” Weinstein’s costliest expense that year before it settled to $50-60K a year thereafter.  Perhaps coincidentally, 2007 is the only year Weinstein didn’t claim an MRFF paycheck — which was the costliest expense all the rest of the years.

In what may be yet another coincidence, despite claiming he works 80 hours a week for the MRFF, Mikey Weinstein found time to quietly create another company in 2010: MIBON Consulting and Investment (a portmanteau of “Michael” and “Bonnie”).  It seems he’s not only paying for consulting, he’s also doing consulting.

While this all may seem rather nitnoid, consider that the top 5 expenses for Weinstein’s charity in 2012 were:

  1. Weinstein’s pay
  2. Consulting
  3. Support
  4. Accounting
  5. Research

Those 5 lines account for 73% of Weinstein’s “charitable” expenses — or more than $420,000.  Regardless of IRS categorization, if you interpret those costs as “compensation” to individuals rather than “program expenses” and subtract them from Weinstein’s bottom line, the percentage of donations that Weinstein diverts to actual “charitable” work – not just what might otherwise be called “salaries” — is almost nil.

To emphasize the point, an MRFF staffer recently said they couldn’t take action on a potential controversy — technically, perform their supposed tax-exempt activity — because they first had to find a lawyer who would take the case pro bono.  If they can only afford to take action with free lawyers, it begs the question where all the charitable donations go.  It seems most go to the people in those top 5 expenses.  So much for doing anything to support “religious freedom.”

As has been said before, if Weinstein’s donors want to make tax-deductible donations to the MRFF for that purpose, they can have at it.  It appears to be entirely legal, even if questionably wise, for the “charity” to operate in that fashion. The facts are there (or not, in the cases of vague expenses) for people to draw their own conclusions.  In return, it appears the donors get a few blog posts and an occasional billboard for their half-million dollars in donations.

Three of those expense items — the first, fourth, and fifth highest expenses of the MRFF — are individuals: Weinstein, Rodda, and MRFF accountant David Cowan (“and associates”).

Kind of makes you wonder who those last two line items are.