Has US Soccer Failed to Comply with State of New York Non-Profit Reporting Requirements?

Has the US Soccer Federation failed to comply with relevant laws required to maintain its non-profit status? This post takes a look at this question and concludes, it looks like it. At a minimum there are yet another set of important questions that a US non-profit sports organization should answer.

The US Soccer Federation is a non-profit organization which serves as the Congressionally-legitimated national governing body (NGB) overseeing the amateur sport of soccer, along with46 other NGBs that comprise the Olympic sports in the United States. The USSF derives its authority from the Amateur Sports Act of 1978 (The Ted Stevens Olympic Act, here in PDF).

USSF is technically a non-profit charitable organization incorporated under New York law. New York law requires that certain financial reports be filed by registered charities (see Section 172-B for details). Let's dig into some details.

The state of New York has a really outstanding website that allows for the public inspection of the financial reports filed by registered charities -- CharitiesNYS.com. For instance, we can look at the US Soccer Foundation (and not to be confused with the US Soccer Federation), an organization founded as part of the legacy of the 1994 US World Cup to "help children embrace an active and healthy lifestyle while nurturing their personal growth beyond sports."

On the NYS Charities page here is what a search results for the US Soccer Foundation:

You can see that the organization was registered in 1997 and has filed required financial reports since 1996, with those filed since 2006 available online.

Now take a look at the search results for the US Soccer Federation:

There was a flurry of filings on February 1, 2018, just a few months ago, and only four years of financial data, despite the fact that the USSF has been a registered NY charity for many decades. There is no evidence of any filings before February 1, 2018.

There are a few curiosities to note and a few questions to raise.

• The USSF filed a registration statement for charitable organizations 1 February 2018 using a form explicitly marked for use by "first time registrants." I have noted this with the red circle in the image below below. Does this imply that the USSF was not properly registered as a NY state charity until February of 2018? What are the implications for its retrospective non-profit status, income earned, taxes?

 

• No financial information is available on the NY Charities website for dates prior to 2013 or after 2015. Is this limited information in compliance with NY law? Relevant NY statutes explain that a charity's "registration to be cancelled for failure to file." What is the NY attorney general's view on the compliance status of USSF? Sure the February 1, 2018 filing flurry was motivated by something, perhaps a notification of being out of compliance. Regardless, it would be important to publicly disclose this information.
• As has been noted elsewhere, the USSF has not filed its 2016 financial information, and notes in a handwritten scribble that it has an IRS extension.

The US Soccer Federation financial page has since posted a FY2017 IRS 990 but not an audited financial statement. The USSF is thus out of compliance with the requirements of NY law. Have they been granted an extension by the NY attorney general?

• Yesterday I noted that the USSF incorporated a subsidiary non-profit organization to oversee the 2016 Copa America Centenario soccer tournament, which resulted in $190 million in revenues. Of this large amount of money, more than $75 million is poorly accounted for (to put things generously), unspecified bonuses were paid to USSF employees and those employed by the subsidiary non-profit and the potential use of funds for luxury travel and personal services went unreported. How does the subsidiary non-profit fit into NY state reporting requirements for charities? What does the NY attorney general think about the degree of disclosure of some $75+ million raised by this "charity" incorporated in his state?

The last question I have is: where is the soccer-savvy media on all this? The CA2016 IRS 990 I reported on yesterday sits in plain view, as do the (non)filings of the USSF in the NY Charities database. Who is going to emerge as the American Andrew Jennings? 

I welcome answers to the various questions posed above. I will update if and when more information comes in.