Al's Accounting

It's no secret that Al Sharpton and Jesse Jackson have parlayed careers as "activists" into a pretty good living, for themselves--and others.

In particular, the Reverund Jacksohn (as Rush Limbaugh likes to calls him), perfected the art of the corporate shakedown years ago, threatening corporations with protests or lawsuits, based on specious claims of racial discrimination. Those threats inevitably disappear when the targeted company makes a substantial contribution to one of Jackson's causes, or provides other remuneration to friends and associates. Cases in point: Anheuser-Bush's decision to award a lucrative beer distributorship to Jackson's sons, and Coca-Cola granting a similar franchise to a Jackson family in-law.

Reverend Sharpton isn't as practiced in the art of corporate race hustling as Jesse Jackson, but he also lives quite well. The sweatsuits that defined his early wardrobe have long been replaced by tailored suits, custom-made shirts and expensive shoes. His 2004 presidential campaign lacked organization, staffing, advertising and even cash, but that didn't prevent Reverend Al from stumping in style, staying in expensive hotel suites around the country. At one point, Sharpton's travel expenses represented the campaign's single largest expense. Questions about financial oversights and illegal activities eventually prompted an IRS probe of the campaign. More on that in a moment.

Two months ago, Sharpton's finances became the target of another investigation. New York State Attorney General Andrew Cuomo--a Sharpton political ally--began scrutinizing the records of the Reverend Al's National Action Network. Seems that the Harlem-based "activist" group has declined to file require statements with the attorney general's charity bureau, listing fund-raising income, expenses and executive salaries, as required by law. A Cuomo spokesman described the matter as an "administrative review," and Sharpton claimed that his organization's finances were "fine."

However, the National Action Network was under a 1 November deadline to turn over required documents to the attorney general's office. And, just yesterday, the curious accounting of his presidential run resurfaced. Teams of federal agents served subpoenas on 10 of Al's current and former associates Wednesday morning, looking for his financial records. Some of the subpoenas were delivered at 6:30 a.m., in a synchronized sweep of friends and associates. Sharpton was not served.

According to the New York Daily News, investigators from the FBI and IRS are trying to determine if Sharpton deliberately misstated the amount of money he raised during his 2004 White House run to illegally obtain federal matching funds. The feds are also looking into allegations of tax fraud, including allegations that Sharpton inter-mingled funds from his non-profit and for-profit ventures.

The Sharpton associates targeted by the subpoenas have until December 26th to provide the requested records to a federal grand jury. The Daily News reports that investigators are seeking a wide range of financial documents, ranging from invoices and cash receipts, to bad debt records. The subpoenaed records cover the years 2007-2007.

Sharpton's spokesman and his attorney tried to downplay the probe. But the federal investigation represents the most serious legal challenge faced by Reverend Al. Apparently, the IRS and FBI discovered that Sharpton adopted a new "decentralized" records-keeping system after a mysterious, January 2003 fire that gutted his New York headquarters. The fire occurred one day after Sharpton announced plans to run for president, and (strangely enough) destroyed most of his organization's financial records.

The probe of Reverend Sharpton's finances is certainly welcome--and long overdue. As for Reverend Jackson, the shenanigans detailed in the first eight chapters of Ken Timmerman's Shakedown provided sufficient gist for a couple of grand juries. But for some reason, the feds-- most notably the IRS--have always given Jesse Jackson a wide berth, despite considerable evidence of questionable (if not illegal) activities. In that respect, Reverend Sharpton still has something to learn from the original race hustler and shakedown artist.