The moves came April 29, eight days after a federal grand jury in Alabama indicted the SPLC on 11 counts of wire fraud, false statements to a bank, and conspiracy to commit money laundering. Prosecutors allege that between 2014 and 2023 the group secretly funneled more than $3 million in donor funds to individuals affiliated with extremist organizations, including the Ku Klux Klan, Aryan Nations, and the National Socialist Party of America, while misleading donors about the use of the money.

Fidelity Charitable, which oversees more than 350,000 donor-advised accounts, notified customers that the SPLC is no longer an eligible grant recipient, the NY Times reports. "Fidelity Charitable is aware of an ongoing governmental investigation into Southern Poverty Law Center," the company wrote in an email to a donor. "Consistent with our grant-making standards and practices, the organization is not an eligible grant recipient during the ongoing investigation."

Vanguard Charitable issued a similar denial when a donor requested a grant. "The organization has had allegations and/or charges brought against them for activities that may call into question their ability to carry out their tax-exempt charitable purpose," the company stated.

Both sponsors have long-standing rules that allow them to reject grant recommendations when legal issues arise. Fidelity Charitable's guidelines state that recommendations "might" be declined if an organization "is being investigated for alleged illegal activities or noncharitable activities, such as terrorism, money laundering, hate crimes or fraud," or if other federal or state agencies are investigating the group.

Vanguard Charitable's policy is triggered by any criminal indictment from state or federal authorities. A Vanguard spokeswoman said the sponsor makes grants "only to organizations that meet I.R.S. eligibility requirements" and pauses funding "while the matter is pending" when charges are filed. The company does not evaluate the substance of the allegations, she added.

Fidelity Charitable distributed $18.3 billion in grants last year. The SPLC now joins a list of organizations the sponsor has paused under its due-diligence rules.

Context of the Indictment

The Department of Justice announced the indictment April 21. Acting Attorney General Todd Blanche and other officials described the case as involving deception of donors. The SPLC has denied the allegations, called them politically motivated, and said its payments were part of a legitimate informant program that provided intelligence to law enforcement. The group has filed court motions seeking grand jury transcripts and restrictions on public statements by prosecutors.