Arizona Legislature Threatens Legal Action Against NAAG Regarding Use of Funds

Arizona state legislators, House Speaker Ben Toma (R-Peoria) and Senate President Warren Petersen (R-Mesa) sent a letter to the National Association of Attorney Generals (NAAG) Wednesday, threatening legal action because of the association’s utilization of public money.

“It is time that Arizona’s laws and regulations start applying to NAAG and that this unaccountable slush fund activity stop now,” the legislators wrote in the joint letter. “At this point, litigation is reasonably likely between us. Consider this letter a litigation hold notice.”

The Arizona Sun Times reached out to NAAG for a response to the letter but did not hear back before publishing time.

The NAAG is a self-proclaimed “nonpartisan national forum” community for state attorney generals and their staff nationwide. The association fosters collaboration between state attorneys general and promotes knowledge exchange amongst members.

However, the legislators wrote concern about money the NAAG has amassed through the public. As reported by The Arizona Sun Times, the NAAG has been taking assets from public settlements, totaling in a reported $280 million slush fund for the association. Toma and Petersen said this includes public Arizona money. Additionally, a report from Fox News shared that the Internal Revenue Service (IRS) considers NAAG an instrumentality of the states.

As an entity in possession of Arizona public money, the lawmakers wrote that NAAG “is subject to the duties and liabilities set forth under Arizona law for custodians of public money[.]” For example, public money cannot be appropriated under Arizona law without legislative authorization.

To that end, Toma and Petersen wrote that they take issue with what the NAAG has been spending the money on. In 2022, the NAAG allegedly lost roughly $37 million of public money in private equity and foreign stock investments. Moreover, The Tennessee Star reported that the NAAG also spent money on sending attorneys general and their families to Europe for two “globalist retreats.”

Furthermore, Breitbart reported that the NAAG had made investments with a left-wing bias. In January, Kansas Attorney General Kris Kobach (R) made a public records request for a list of NAAG’s investments. Two entities on the list, BlackRock and Dimensional Fund Advisors, are oriented around the leftist ideology of environmental, social, and governance (ESG) practices.

“It appears that NAAG has been operating outside the lines, and the result is millions in public money lost on ESG investments, foreign stocks, and trips to Europe, while millions still sit in the hands of an unaccountable bureaucracy in Washington, D.C.,” the lawmakers wrote. “This situation is unacceptable and not consistent with Arizona law.”

Furthermore, Toma and Petersen are not the first Arizona officials to take issue with the NAAG. In 2022, former Arizona Attorney General Mark Brnovich announced he was disassociating from the association. Brnovich claimed the NAAG was beginning to lean too far leftward, and he became the fifth Attorney General to leave after Alabama, Texas, Missouri, and Montana.

Moreover, Arizona is also attempting to disassociate with BlackRock. In December, State Treasurer Kimberly Yee (R) shared that her office had made “significant divestments” from BlackRock due to concerns that CEO Larry Fink was using the company to share his political beliefs. Other states, such as Texas, South Carolina, Louisiana, and Utah, have also attempted to divest from the company.

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Neil Jones is a reporter for The Arizona Sun Times and The Star News Network. Follow Neil on Twitter. Email tips to [email protected].
Photo “Ben Toma” by Ben Toma. 




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