A bombshell lawsuit has been filed against Tides Foundation, a progressive non-profit that manages donations for various organizations, including Black Lives Matter Global Network Foundation (BLMGNF). The lawsuit alleges that Tides has fraudulently withheld more than $33 million in donations from BLMGNF and has instead directed funds to other groups, including a radical BLM breakaway group led by anti-police activist Melina Abdullah. The lawsuit claims that Tides has engaged in deceptive business practices and operates with minimal regulatory scrutiny that is inconsistent with traditional financial institutions.
Tides Foundation, based in Los Angeles and San Francisco, serves as a fiscal sponsor for organizations that do not have 501(c)(3) tax-exempt status, managing donations for groups such as pro-Palestinian organizations that support anti-Israel protests. The lawsuit alleges that Tides has acted as a quasi-bank without appropriate regulatory oversight or licenses. The lawsuit further claims that Tides has more than $1.4 billion in assets and has been operating without proper banking regulations, resulting in financial discrepancies and lack of transparency in their partnerships with social justice organizations.
BLMGNF sought the assistance of Tides Foundation to manage the influx of donations it received after the death of George Floyd in 2020. Tides agreed to manage BLMGNF’s funds in a collective action fund until BLMGNF received tax-exempt status. However, when BLMGNF terminated its relationship with Tides in 2022, Tides refused to release the $33 million collected for BLMGNF, instead diverting a portion of the funds to other BLM groups without permission. Tides defended its actions by claiming that the funds were intended for local BLM chapters and not large, national organizations like BLMGNF.
The lawsuit also highlights Tides’ distribution of funds to groups such as BLM Grassroots, a breakaway group led by Melina Abdullah. Abdullah previously filed a lawsuit against BLMGNF, seeking $10 million for her organization, but lost the case and was ordered to pay BLMGNF’s legal fees. The lawsuit emphasizes the principle of rightful ownership and transparency in social justice funding partnerships, criticizing Tides for exploiting its role as a fiscal sponsor and failing to distribute donations as intended.
BLMGNF has faced its own financial challenges, with co-founder Patrisse Cullors coming under fire for her multi-million dollar home buying spree following the group’s $90 million in donations in 2020. Cullors purchased multiple high-end properties, leading to accusations that she misused donations, which she denied. Cullors resigned from BLMGNF in May 2021 and also oversaw the acquisition of a $6 million mansion in Los Angeles and an $8 million property in Toronto for the group’s Canadian chapter. The lawsuit against Tides Foundation underscores the importance of upholding transparency and accountability in social justice philanthropy to ensure that funds are used appropriately for the intended purposes.
