Project Veritas audit accuses 'untouchable' founder of improper spending
In August 2022, James O'Keefe needed to get to Maine for a sailing trip. Rather than take a commercial flight for roughly $200, the conservative undercover-video activist directed his employees to book a $12,000 helicopter flight direct from New York to the seaside town of Southwest Harbor, using funds donated to Project Veritas, the nonprofit he founded, according to a draft of a private internal audit conducted by an independent law firm.
When bad weather forced the helicopter to make an unscheduled landing in Portland, O'Keefe booked a $1,400 black car for the three-hour drive from the helipad to the sailboat. O'Keefe justified the expenses by saying that he had a meeting near the dock, the audit stated. Two Project Veritas staffers described the person he met with to The Washington Post as a low-level donor.
It wasn't the first time O'Keefe had covered personal expenses with funds from the donor-supported nonprofit whose self-described mission is investigative journalism, according to the report compiled by Dorsey & Whitney, a firm hired by the Project Veritas board in the wake of its founder's departure in February. A copy of the report was shared with The Post.
There was $208,980 worth of luxury black-car travel over a two-year period. There was a $600 haul of bottled water during one hotel stay in San Antonio. There was even a $2,500 set of DJ equipment; O'Keefe dreamed of playing a set at Coachella, according to two former employees, and was irritated when his staff couldn't get him booked at the legendary California music festival.
The audit report raises questions about whether O'Keefe complied with laws that prohibit nonprofit leaders from using the organization's funds for their personal benefit. The Westchester County, N.Y., district attorney's office has said it is investigating O'Keefe, as first reported by the Nation.
Before he left Project Veritas in February, under pressure from its board of directors, O'Keefe was surrounded by a "cult of personality" that enabled him to behave as if he were "untouchable," the audit concluded. The report states that it was based on interviews with 35 current and former Project Veritas staffers conducted by Dorsey & Whitney. O'Keefe did not respond to The Post's requests for comment.
Hannah Giles, a onetime O'Keefe ally who is now the CEO of Project Veritas, compared O'Keefe's spending habits to the mega-wealthy financier antihero on the Showtime television series "Billions."
"If you're Bobby Axelrod from 'Billions,' it's fine to live like that," Giles said in an interview with The Post. "When you're paying your bills from a little old lady's Social Security checks, we're going to have problems."
Project Veritas gained the admiration of major conservative donors as well as small-dollar grass-roots contributors with undercover videos exposing supposed bias or wrongdoing by journalists, labor leaders and liberal advocates. In 2021 alone, it raised $21,958,641 in contributions, according to the most recent available tax forms.
But the group laid off 25 of its 40 staff members last month, Project Veritas acknowledges. In an Aug. 18 meeting, board chairman Joe Barton told staffers he was concerned that the audit, if made public, could trigger an IRS investigation or even a forced shutdown, according to a recording of the meeting that was shared with The Post.
Barton told The Post his comments reflected the opinion of the larger board. He declined to comment further on the audit.
Last year, two Florida residents pleaded guilty in connection to an FBI probe into the theft of a diary belonging to Ashley Biden that ended up in the possession of Project Veritas during the 2020 campaign. During that investigation, agents searched O'Keefe's Mamaroneck, N.Y., home and seized electronic equipment, but O'Keefe was not charged with a crime. (Project Veritas never ran a story about the diary, and both O'Keefe and the nonprofit have said they acted legally as journalists.)
O'Keefe, 39, was more than the founder of Project Veritas. He was also the face of the organization, styling himself as a citizen journalist crusading against perceived corruption, hypocrisy or bias in media or liberal politics. Now, though, the nonprofit is suing him over his messy departure, which came amid questions about the group's finances, and the board-commissioned audit includes vivid accounts of profligate spending as well as what it calls his "volatile" workplace behavior, highlighting O'Keefe's role in the downfall of the organization.
O'Keefe declined to speak with the auditors, according to the document.
In September 2021, according to the report, Hurricane Ida floodwaters threatened to destroy the Project Veritas office in Mamaroneck. The staff scrambled to save equipment and their own lives - one elderly employee was briefly pulled underwater and had to be rescued by colleagues. But O'Keefe had already left the scene, asking employees to prioritize his own evacuation so he could make it to Virginia for a performance of the musical "Oklahoma!" in which he had the lead role, according to staffers cited by the audit.
"Don't worry, everything will be okay," O'Keefe told his employees, according to recollection of a staffer cited in the audit, "but help me get out of here." In 2022, Project Veritas admitted in a tax filing to improperly spending $20,500 moving some staff operations to Virginia during O'Keefe's time with the musical production for his convenience.
The auditors interviewed an employee who described being subjected by O'Keefe to a two-hour polygraph test to prove his loyalty after the two had a falling-out. O'Keefe also allegedly warned one female employee not to get pregnant and pressed another to return to work shortly after a miscarriage, the women told the auditors, according to the report.
Some office drama was propelled by O'Keefe's romantic relationship. Though she was unnamed in the audit, three Project Veritas employees identified her as Alexandra Rose, a California real estate agent who is a star of the Netflix reality series "Selling the OC."
O'Keefe allegedly pressed staffers to set up donor meetings in California so he could justify visits to Rose as work trips, leading him to waste time in meetings with minor donors. In another incident, O'Keefe allegedly demanded employees buy her what Project Veritas executives described to auditors as "many expensive bottles of tequila." Rose did not reply to an email for comment.
O'Keefe did not respond to a list of questions related to the allegations. When initial claims of improper personal spending made by Project Veritas employees in February helped lead to O'Keefe's exit from the organization, O'Keefe labeled the allegations "truly bizarre" and said he was the victim of a conspiracy trying to punish him for exposing the left.
O'Keefe's breakthrough on the national scene came in 2009, when he dressed as a 1970s-style pimp - complete with a chinchilla shoulder throw - for a video where he claimed to have duped employees at ACORN, a liberal housing nonprofit, into advising him to obtain a home by evading taxes and disguising his (fictitious) intent to operate a brothel.
The resulting videos were disparaged as "heavily edited" by the California attorney general's office, which revealed in a report that O'Keefe only dressed as a pimp for the introductions to his videos, wearing business-casual attire for the stings themselves. Still, they went viral, a launchpad for O'Keefe to found Project Veritas a year later. Subsequent "gotcha"-style stings targeted NPR, teachers unions, journalists and Democratic political operations.
In 2016, O'Keefe inadvertently botched an attempted infiltration of Democratic donor George Soros's nonprofit by sending a voice mail explaining the whole scheme to one of his targets. A year later, an O'Keefe operative tried and failed to trick The Washington Post into publishing false allegations against Roy Moore, then a U.S. Senate candidate in Alabama.
Still, at the time, Project Veritas was riding high on the endorsement of a sitting president, Donald Trump, whose foundation once gave the group $10,000 and who invited O'Keefe to the White House. The nonprofit began to aspire to a certain grandeur, hosting employee trainings by a former British MI6 spy and events that featured elaborately staged musical routines by O'Keefe and backup dancers.
Today, Project Veritas is run by a skeleton crew unable to pull off serious undercover work, three current staffers told The Post.
In June, the board hired Giles as CEO. As she was part of the original Project Veritas crew going back to its beginnings, her appointment was meant to appease loyalists upset by O'Keefe's ouster. One of her first moves, though, was to prohibit so-called "honey-pot" stings - in which targets were lured out on dates by undercover operatives who encountered them on dating sites and then recorded their loose-lipped chatter. "That's one of our key tools," Christian Hartsock, a longtime O'Keefe associate who was laid off from Project Veritas last month, told The Post.
Hartsock is one of several Project Veritas alumni who believe that O'Keefe's managerial flaws and spending habits - qualities that the founder himself would want to investigate in a liberal organization, they say - have squandered his legacy within the conservative movement.
"The big winners are Dems," said a Project Veritas veteran who now works with O'Keefe and spoke on the condition of anonymity because he wasn't authorized to speak to the media. "They get to have political conferences now without any threat of 'Who is this person I may be talking to?'"
A handful of loyal staffers left Project Veritas with O'Keefe to launch a for-profit rival organization. O'Keefe Media Group sells $500 subscriptions to video lectures by the founder holding forth on journalism and other topics. Yet its undercover work has so far lacked the kind of big targets that made O'Keefe famous. In May, an executive resigned from the start-up with a fiery email that was shared with The Post, calling O'Keefe a "tyrant" and claiming his new company had blown $300,000 on a simple website design.
In June, O'Keefe filmed a video in the Hamptons to promote an upcoming exposé about a financial-services firm, in which he dressed as a stereotypical Wall Street fat cat puffing on a cigar, spraying champagne and revving a Lamborghini - too high, apparently, because the engine caught fire, according to a Twitter video of the incident and a participant in the shoot.
For all the bad blood, though, Giles has raised the prospect of O'Keefe rejoining the organization. In a call with a Project Veritas employee, a recording of which was obtained by The Post, Giles said O'Keefe "lit the house on fire and shut the doors" by blasting Project Veritas publicly after his exit. But she also entertained the possibility of a return by O'Keefe.
"I don't know that I could work for him, but I could work with him," she told a Project Veritas employee, in a recording shared with The Post. Giles declined to comment on the discussions.
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