The White House’s memorandum, known as NSPM-7, directs the Department of Justice (DOJ), the FBI, and the IRS to coordinate investigations into individuals and organizations allegedly “aiding” political violence. While its stated goal is to curb extremism, the language is alarmingly broad—so much so that even vocal criticism of the Administration’s policies could be interpreted as “encouraging domestic terrorism.”
This development comes amid a wave of actions painting nonprofits as enemies of the state:
• The Administration’s designation of Antifa as a “domestic terrorist organization.”
• Reports that the DOJ was ordered to investigate the Open Society Foundations.
• Public statements by White House officials accusing nonprofits of “fueling radicalization.”
Together, these actions point to a dangerous trend: the conflation of political opposition with terrorism.
Mounting Backlash from Civil Society
Since the release of the NSPM-7 memorandum, more than 3,000 organizations have signed a National Solidarity Letter, condemning the measure and reaffirming their support for free expression. The ACLU, National Council of Nonprofits (NCN), and other advocacy groups have called the directive an “egregious abuse of power.”
“This rhetoric and action undermine the lifesaving work of millions of nonprofit staff and volunteers and put them at risk,” said Diane Yentel, NCN President and CEO.
Legal observers and media outlets, including The Guardian, Reuters, and The Washington Post, have reported that the memorandum could usher in a new era of politicized investigations, reminiscent of the McCarthy-era tactics that targeted dissenting voices. (Sources: The Guardian, Washington Post, Reuters)
What the NSPM-7 Memorandum Does
The directive:
• Expands DOJ powers to investigate organizations and funders for “aiding or abetting” political violence, even indirectly.
• Instructs the IRS to review whether tax-exempt entities are “directly or indirectly financing political violence,” and refer cases for prosecution.
• Authorizes designations of nonprofits as “domestic terrorist organizations.”
• Defines domestic terrorism to include actions such as protests, online campaigns, and “organized doxing” — potentially encompassing nonviolent activism.
The concern is that this framework could be used to harass nonprofits, freeze assets, or revoke tax-exempt status—without proof of wrongdoing.
The Broader Pattern
The NSPM-7 memorandum fits into a larger strategy of governmental overreach targeting civil society, such as:
• New proposed executive orders on “political violence” and “hate speech” are under review, raising additional alarm among human rights advocates.
• Cultural figures, including Jane Fonda, have revived free-speech advocacy groups in response to what she called a “coordinated campaign to silence dissent.”
• Major law firms such as Morgan Lewis and Elias Law Group’s Democracy Docket have warned nonprofits to prepare for expanded compliance and audit risks.
These developments signal that nonprofits—especially those working on immigration, racial equity, or LGBTQ+ rights—face heightened vulnerability.
Implications for Nonprofits
The NSPM-7 memorandum carries profound implications for the nonprofit sector, touching every aspect of operations—from public advocacy to funding and legal compliance.
• Speech and Advocacy. Perhaps the most immediate concern is the chilling effect on free expression. Many organizations may hesitate to speak out against government policies, fearing that their advocacy could be misinterpreted as subversive or unlawful. This self-censorship undermines the very purpose of civil society—to hold power accountable and give voice to marginalized communities.
• Funding and Donor Privacy. The directive also threatens to erode donor confidence. Individuals and foundations may hesitate to contribute to organizations perceived as politically sensitive, worried that their names or contributions could draw unwanted scrutiny. This could constrict the flow of charitable giving and weaken the financial stability of advocacy-focused nonprofits.
• Operations. Nonprofits may face higher compliance costs as they strive to ensure that all activities and communications withstand potential government scrutiny. Increased documentation requirements, delayed grant processing, and reluctance among partner organizations to collaborate could further hinder the delivery of the mission and the effectiveness of the program.
• Legal Exposure. Finally, the memorandum’s vague language—particularly its reference to “direct or indirect support” for domestic terrorism—creates significant legal uncertainty. Even well-intentioned advocacy or community engagement could be misconstrued, exposing organizations to audits, investigations, or Department of Justice referrals without clear evidence of wrongdoing.
What Nonprofits Should Do Now
• Reassess Legal and Compliance Practices. Conduct a rapid review of governance policies, documentation, and communications. Consult legal counsel about safeguarding donor privacy and advocacy activities.
• Join Collective Advocacy Efforts. Sign the National Solidarity Letter rejecting political intimidation. Coordinate with umbrella organizations like NCN and Charity & Security Network.
• Train and Inform Your Teams. Hold “Know Your Rights” sessions for staff and volunteers. Ensure everyone understands the boundaries of lawful advocacy and how to respond to government inquiries.
• Engage Lawmakers. Contact your Members of Congress to defend the constitutional rights of nonprofits. Personal stories of community impact can be powerful tools for advocacy.
• Communicate Transparently with Supporters. Reassure donors and partners of your mission’s integrity and compliance. Reinforce your nonprofit’s commitment to peaceful advocacy and lawful action.
The Road Ahead
The NSPM-7 memorandum is not just a legal threat—it’s a moral test of democracy. When government power is used to intimidate those who speak out, silence becomes complicity. Nonprofits have long stood at the forefront of social progress, from civil rights to climate justice. Defending the freedom to advocate is essential to defending democracy itself.
Ellis Carter is a nonprofit lawyer with Caritas Law Group, P.C. who is licensed to practice in Washington and Arizona. Ellis advises nonprofit and socially responsible businesses on federal tax and fundraising regulations nationwide. Ellis also advises donors concerning major gifts. To schedule a consultation with Ellis, call 602-456-0071 or email us through our contact form.