Angry Former Supporters of Minuteman Civil Defense Corps Question Founder Chris Simcox’s Accounting

Angry former supporters of the Minuteman Civil Defense Corps are questioning group founder Chris Simcox's accounting

Two Simple Questions
Simcox's stonewalling may be his undoing. According to a July 20 article in The Washington Times, a right-wing newspaper with a long track record of strident anti-immigration editorializing and pro-Minuteman reporting, "A growing number of Minuteman Civil Defense Corps leaders and volunteers are questioning the whereabouts of hundreds of thousands, perhaps millions, of dollars in donations collected in the past 15 months, challenging the organization's leadership over accountability."

The article also reported, "[MCDC] members said money promised for food, fuel, radios, computers, tents, night-vision scopes, binoculars, porta-potties, and other necessary equipment and supplies never reached volunteers who have manned observation posts."

The Washington Times piece was based in part on interviews with Cole and with former Minuteman field coordinator Mike Gaddy, who said Simcox rejected Gaddy's offer last year to pay for an auditor with his own money to "answer growing concern among the ranks about the group's finances."

"[Simcox] told me what he did was his business," Gaddy said.

When Simcox wanted to reach potential MCDC donors, he advertised in The Washington Times, because anti-immigration activists -- his core supporters -- hold the newspaper in high regard. For this reason, there was no way Simcox could wave off the revelations in the July 20 article as unfounded accusations from the liberal media, as he has past reports on his organization's fundraising practices.

Still, he attempted to control the damage with this response to The Washington Times article, posted to the MCDC website: "Critics are obtaining false information from disgruntled people who have been terminated from staff or from leadership involvement because they could not meet MCDC standards. Consequently, these dismissed Minutemen have no actual knowledge of MCDC finances."

Washington Times Managing Editor Fran Coombs fired back. "Chris Simcox and company can attack this newspaper all day long, which is ironic given the coverage we have given their issue and their organization over the years," Coombs wrote on the newspaper's website. "But the story isn't about The Washington Times. It's about the money that countless American citizens contributed in good faith to the Minutemen because they believed in the cause of securing our nation's borders. So it's time for [Simcox] to stop the runaround and to start answering two very simple questions: Where's the money, and how's it being spent?"

Simcox still declined to answer. And he isn't required by law to divulge any financial information because the Minuteman Civil Defense Corps is not registered as a nonprofit corporation with the Internal Revenue Service. Last September, Simcox told reporters the application had been submitted. But MCDC spokeswoman Connie Hair told The Arizona Republic in early August -- almost one year later -- the group "plans to meet all the filing requirements later this month," adding "delays with the complex paperwork [have] slowed the process." (The IRS website contains step-by-step instructions on establishing a nonprofit organization and provides a toll-free number for those with questions.)

In his late July statement, released the same week as The Washington Times story, Simcox claimed "all donations which have been received have been recorded, processed, and banked by a highly reputable and responsible caging company which specializes in nonprofit accountability. Funds are safely and appropriately held in a secured bank account, overseen by a certified public accountant and a lawyer, disbursed by an authorized escrow agent only against approved, invoiced expenses."

The "highly reputable and responsible" accounting company hired by MCDC to oversee donations is Houston-based American Caging, Inc. Maureen Otis, president of American Caging, released a statement confirming "since the day MCDC was incorporated, my company has acted as the comptroller and escrow agent for MCDC." But that may do little to alleviate the concerns of MCDC donors, since American Caging apparently has some trouble keeping its own books in order. The Texas Comptroller of Public Accounts office lists the status of American Caging Inc. as "not in good standing" because it "has not satisfied all state tax requirements." (American Caging Inc.'s biggest client is Declaration Alliance, a right-wing consortium established by Alan Keyes in 1996 to oppose legalized abortion and civil rights for gays and lesbians. MCDC is identified on its website as "a project of Declaration Alliance," leading Simcox critics to speculate Declaration Alliance may be taking a large cut of MCDC donations.)

Simcox's assurances of financial regularity did not dissuade the editorial board of The Washington Times from scolding him in a July 25 editorial: "As supporters of the Minuteman Civil Defense Corps, we were disheartened to read ... about questions and criticisms of Chris Simcox's management of the organization," it began. "The truth is that no one except Mr. Simcox knows how much money has been donated and what it has been used for. So far, Mr. Simcox has been unable to come up with a good explanation -- at least one that can be independently verified."

The editorial called for immediate "transparency" in MCDC's finances. But Simcox still did not open his books. Instead, he pledged MCDC would release a detailed financial report no later than Nov. 15, as required by the IRS.