CharityWatch Loses Tax-Free Collar?
Laurie Styron’s Smear and Fundraiser Tied Richard Luthmann to a Paid Hit Job Without Proof — Then Passed the Donation Hat
LUTHMANN NOTE: CharityWatch made the oldest mistake in the book. It confused a headline with proof. It alleged payments to Frank Parlato, admitted it lacked direct proof of purpose, then dragged my name into a paid-smear narrative without one check, wire, invoice, contract, or bank record showing I received a dime. I was never paid by Leo Grillo, D.E.L.T.A. Rescue, or anyone connected to them. CharityWatch then used that article to solicit donations. That changes the fight. This is no longer just defamation. This is a 501(c)(3), donor-trust, IRS, and Illinois Attorney General problem. I’m giving Laurie Styron some time before I dismantle her operation for sport. See you next Tuesday, Laurie. This piece is “CharityWatch Loses Tax-Free Collar?”
By Frankie Pressman with Richard Luthmann
(CHICAGO, ILLINOIS) – CharityWatch fired first. Now the charity watchdog and its officers and directors may face big problems, including the taxman, the Illinois Attorney General, and potentially far, far worse.
The Chicago-based CharityWatch presents itself as an independent nonprofit charity watchdog that evaluates charities, analyzes financial filings, and advises donors on whether organizations use contributions responsibly. It claims to provide unbiased charity ratings, governance analysis, and donor guidance so the public can make informed giving decisions before writing checks.
On May 1, 2026, CharityWatch published a flamethrower article titled “Convicted Felon Paid By Animal Charity to Smear Its Critics Amid FBI Investigation And Kidnapping Plot.” The article claimed D.E.L.T.A. Rescue paid renowned investigative reporter Frank Parlato $80,000 for “contract services” and “consulting” between June and August 2025.
CharityWatch then claimed those payments coincided with articles attacking CharityWatch, CEO Laurie Styron, and former D.E.L.T.A. Rescue employee Adriana Duarte, an undocumented illegal alien and documented “lettuce picker.”
Then CharityWatch did something reckless. It dragged journalist Richard Luthmann, a contributor to this outlet, into the same paid-smear narrative without showing that one dollar ever went to him. No check. No wire. No invoice. No contract. No retainer. No reimbursement. No consulting agreement. No bank record.
No evidence.
Richard Luthmann was never paid by Leo Grillo, D.E.L.T.A. Rescue, Living Earth Productions, Animals Are People Too, or anyone connected to them. CharityWatch’s article does not prove otherwise. It does not even try.
The article identifies alleged payments to Parlato. It does not identify payments to Luthmann. It cites a September 9, 2025, email from Luthmann to CharityWatch, saying he copied Parlato and asked questions. That is journalism, not a financial conspiracy.
CharityWatch admitted the weak point in its own story, writing that it did not yet have direct evidence, including invoices, emails, text messages, or other records, proving the precise purpose of the payments to Parlato. Yet it still built a public narrative around paid retaliation and smear campaigns. That is neither watchdog work nor transparency.
Is Laurie Styron running an insinuation machine, or worse? Her apparent “product” is hit pieces with no receipts, so says Luthmann.
“I’m going to give her an out,” Luthmann said. “I actually let up on her last year and didn’t go for the kill shot because she looked like a sweet girl who wasn’t talented enough to do much else. If she takes my kindness for weakness now, I won’t stop until she and her corrupt organization lose everything.”
CharityWatch Loses: Sweet Little Lies?
CharityWatch did not publish the article as a basement blog. It published the attack under the banner of a tax-exempt charity watchdog. Its own website identifies CharityWatch as a 501(c)(3) nonprofit with tax ID number 33-0491030. Its staff page lists Laurie Styron as CEO and executive director, and it lists Daniel Borochoff and others on its board.
Daniel Borochoff once famously said, “The Clinton Foundation is an excellent charity,” giving them an A rating from CharityWatch, while ignoring political conflicts, donor-access concerns, disclosure failures, or reputational corruption. Borochoff laundered a deeply conflicted political operation through nonprofit efficiency metrics.
“This is the same CharityWatch problem showing up again, and what Frank Parlato and I reported on,” Luthmann said. “Borochoff and now Styron use narrow numbers used to bless the powerful, while harsh insinuations are used against critics and those who don’t pay up with ‘donations.’ Where I come from, that’s called racketeering.”
Charitable status comes with strings. The IRS says a 501(c)(3) organization must be organized and operated exclusively for exempt purposes. The IRS also says no part of its earnings may inure to a private shareholder or individual, and the organization must not operate for private interests.
The operational test is not window dressing. The IRS says an organization qualifies as operated exclusively for exempt purposes only if it primarily engages in activities that accomplish those purposes. It also says an organization fails that standard if more than an insubstantial part of its activities does not further an exempt purpose.
CharityWatch’s own 2024 Form 990 turns the Luthmann smear into a tax-exempt governance story. The filing shows American Institute of Philanthropy, doing business as CharityWatch, claims § 501(c)(3) status under EIN 33-0491030 and reports $648,528 in total revenue, $613,010 in expenses, and $1,118,474 in year-end net assets.
Laurie Styron is listed as CEO/executive director, paid $159,273 in reportable compensation; the return separately reports $27,693 in other employee benefits and $32,833 in payroll taxes.
The filing also reports $37,108 in “occupancy,” $18,701 in office expenses, and $6,046 in travel. Those numbers invite hard questions because CharityWatch lists its address as 2545 W. Diversey Ave., Suite 203, Chicago, while Mint Studio publishes the same Suite 203 address, and other businesses appear in the same building.
“It’s a virtual office, not the Trump International. Those numbers don’t add up,” Luthmann said. “You’d think a self-proclaimed ‘charitable analyst’ would do a better job covering her tracks. It looks like she works out of her apartment.”
Luthmann appears to be right. The $37,108 “occupancy” line on CharityWatch’s 2024 Form 990 deserves scrutiny because it works out to roughly $3,092 per month for an organization listing 2545 W. Diversey Ave., Suite 203, Chicago as its address.
By comparison, a standard virtual office in Chicago, including neighborhood locations near Logan Square/Avondale, often runs about $50 to $150 per month, with basic mailing-address plans sometimes as low as $10 to $75, and fuller mail, phone, receptionist, and meeting-room packages usually ranging from $100 to $300+. A nearby Davinci Virtual Offices location at 3432 W. Diversey Ave., roughly one mile away, advertises promo pricing around $75 per month before add-ons.
Even actual local coworking spaces appear far cheaper than CharityWatch’s annualized number: dedicated desks near the area can run about $300 per month, small private offices about $500 to $1,500 per month, and neighborhood office leases often fall around $20 to $30 per square foot per year.
So if CharityWatch is using Suite 203 as a true staffed office, the question is what space, square footage, lease terms, and services justify more than $37,000 in occupancy. If it is closer to a shared, virtual, or mail-drop arrangement—especially where other businesses appear to use the same address—then the number raises obvious questions about overhead, allocation, and whether donor funds are being spent on reasonable charitable operations or something requiring a much closer look.
CharityWatch Loses: The Donate Button Makes It Worse
But there are larger issues. If CharityWatch used donor-funded resources, office overhead, payroll, executive time, and nonprofit infrastructure to publish a false attack implying Luthmann was part of a paid smear campaign, then appended a fundraising appeal, regulators may examine whether this was donor education or private reputational warfare.
That is where the private-inurement and private-benefit questions begin: was CharityWatch operating for its exempt mission, or was Styron’s donor-funded machine protecting itself and financing a personal institutional vendetta?
So CharityWatch now has a problem. Was this article legitimate public education? Or was it a donor-funded reputational attack designed to protect Styron and CharityWatch from critics?
“It’s really a one-woman grift, no different than a ‘Quality Learing Center’,” Luthmann said. “She’s robbing charities with what smacks of extortion and holds assets to the tune of almost $1.5 million. I’m not one to kill someone else’s hustle, but she f–ked with the bull and now she gets the horns.”
The article ended with a fundraising appeal. CharityWatch asked readers to help it “continue our important work” and said donations were “noticed, needed, and greatly appreciated.” That appeal came after the attack on Parlato, Luthmann, Grillo, and others.
That matters. If CharityWatch used a false implication to create outrage, then used that outrage to solicit money, regulators may have questions.
The IRS accepts complaints about tax-exempt organizations through Form 13909 or a complaint letter with supporting documents. It also says tax-exempt organizations remain subject to state charity regulators and state tax agencies.
Illinois matters too. The Illinois Attorney General says charitable organizations that solicit donations or hold charitable assets in Illinois must register with the Attorney General’s Office. Illinois residents may file complaints with the Charitable Trust Bureau if they believe there have been financial improprieties or misuse of charitable assets.
CharityWatch Loses: Styron’s Receipts Problem
Laurie Styron built her brand on receipts. CharityWatch’s own bio says Styron has logged more than 10,000 hours as a nonprofit financial analyst. It says she has advised journalists, conducted nonprofit research, and worked in charity financial analysis for years.
That makes the Luthmann smear harder to excuse. A first-year blogger might confuse timing with proof. A charity watchdog should know better. And a nonprofit accounting analyst should know the difference between a documented payment and a narrative leap.
CharityWatch had alleged bank records for Parlato. It had no alleged bank records for Luthmann, no alleged payment from Grillo to Luthmann, no alleged payment from D.E.L.T.A. Rescue to Luthmann, and no alleged payment from Living Earth Productions, Animals Are People Too, or any related charity to Luthmann.
“I’ve never met Leo Grillo. I heard the story about the lettuce picker shakedown and crooked L.A. lawyers, and now the L.A. FBI Field Office’s fraud parade, and I started writing,” Luthmann said. “If you don’t see that a Government Rat, crooked cops, and shady foreign lawyers are trying to rob a conservative of $17 million in L.A. real estate, you’re not paying attention.”
Still, the article placed Luthmann under a “Convicted Felon” section and connected him to a broader story about paid attacks, donor money, FBI allegations, and an alleged kidnapping plot.
That is the trick. The article does not need to say, “Richard Luthmann was paid.” It leads readers there. It arranges facts and innuendos to create the impression. Lawyers call that defamation by implication. Reporters call it a smear. Regular people call it dirty pool.
The legal exposure is obvious. CharityWatch may face claims for defamation, defamation by implication, libel per se, false light, tortious interference, and injurious falsehood. Discovery would seek drafts, emails, board communications, donor communications, legal review notes, source communications, and internal messages about the article.
“Laurie Styron is small potatoes. She plays this one wrong, she’ll be gone for good,” Luthmann said. “Her next business address will be the side hallway at 3301 West Arthington Street. She’ll enjoy it. There’s always a lot of activity on the weekends.”
But the larger danger sits outside the courthouse. CharityWatch grades charities on transparency, and now CharityWatch may need to explain why it used its own charitable platform to publish a piece that implied a payment it did not prove.
That is not a minor correction; that is a governance question.
Laurie Styron’s Silence
Richard Luthmann served Laurie Styron and CharityWatch with a blistering notice. Neither has responded as of yet. Here is what he asked:
From: Richard Luthmann <richard.luthmann@protonmail.com>
Date: On Saturday, May 2nd, 2026 at 12:25 AM
Subject: Immediate Retraction Demand
To: Laurie Styron <lauries@charitywatch.org>, membership@charitywatch.org <membership@charitywatch.org>
To Laurie Styron and CharityWatch:
I am writing concerning CharityWatch’s May 1, 2026, article titled “Convicted Felon Paid By Animal Charity to Smear Its Critics Amid FBI Investigation And Kidnapping Plot.”
https://blog.charitywatch.org/convicted-felon-paid-by-animal-charity-to-smear-its-critics-amid-fbi-investigation-and-kidnapping-plot/
Your article is false, defamatory, reckless, and actionable as it concerns me.
You created the false implication that I was paid by Leo Grillo, D.E.L.T.A. Rescue, Living Earth Productions, Animals Are People Too, Frank Parlato, or anyone connected to them to attack CharityWatch or participate in a supposed “smear campaign.”
That is false.
I was never paid by Leo Grillo, D.E.L.T.A. Rescue, Living Earth Productions, Animals Are People Too, Frank Parlato, or anyone acting for or with them. I received no check, wire, invoice payment, consulting fee, retainer, contract payment, reimbursement, gift, benefit, or anything of value from any of them.
Your own article identifies alleged payments to Frank Parlato—not to me. You cite no check, invoice, wire transfer, contract, retainer agreement, email, text message, communication, bank record, tax record, or financial document showing that I received a dime from Grillo, D.E.L.T.A. Rescue, or any related person or entity.
Despite that absence of evidence, you inserted me into a story framed around paid retaliation, donor misuse, an FBI investigation, and an alleged kidnapping plot. You did not merely report facts. You constructed a false implication.
That has legal consequences.
Your publication implicates, among other things:
1. Defamation — because you published false statements and implications damaging to my reputation;
2. Defamation by implication — because you arranged technically separate facts to create the false impression that I was paid or involved in a paid smear campaign;
3. Libel per se — because the article falsely links me to dishonest, unethical, and potentially criminal conduct affecting my profession as a journalist;
4. False light invasion of privacy — because you portrayed me publicly in a materially false and highly offensive manner;
5. Tortious interference — because your article is capable of damaging my professional relationships, publishing platforms, business opportunities, and journalistic reputation;
6. Trade libel / injurious falsehood — because the article attacks my professional work and credibility in a manner that can cause financial and reputational harm;
7. Civil conspiracy, if discovery shows coordination — if CharityWatch coordinated with others to publish or amplify false implications;
8. Aiding and abetting reputational harm, if discovery supports it — if third parties knowingly assisted the publication of false implications;
9. Actual malice — because you published without evidence tying me to any payment and with reckless disregard for the truth;
10. Punitive damages exposure — because this was not a minor factual error, but a calculated reputational attack using a tax-exempt platform;
11. Spoliation exposure — if any drafts, communications, notes, donor communications, legal review materials, or internal records are deleted or altered after this notice;
12. Regulatory exposure — because CharityWatch used a tax-exempt charitable platform to publish a defamatory, retaliatory article and then solicit donations from the controversy;
13. IRS scrutiny — because this conduct raises serious questions about whether CharityWatch is operating for exempt educational purposes or using 501(c)(3) resources for private reputational warfare;
14. State charity regulator scrutiny — because donor-facing defamatory content used in connection with fundraising may implicate state charitable solicitation, charitable trust, and consumer protection laws;
15. Board governance scrutiny — because CharityWatch’s officers and directors may have allowed charitable assets to be used for non-charitable, retaliatory, or misleading purposes.
I am not required to sit quietly while CharityWatch launders a smear through nonprofit branding.
Legal action is one option. I reserve it fully.
But litigation is not the only option, and frankly it may not be the most effective one. I am also prepared to pursue CharityWatch where it is most vulnerable: its claimed public-interest status, its 501(c)(3) posture, its state charitable registrations, its donor-facing credibility, and its reputation as a supposedly neutral watchdog.
CharityWatch’s conduct raises serious tax-exempt and charitable-governance concerns. A § 501(c)(3) organization must be organized and operated exclusively for exempt purposes, and it may not devote more than an insubstantial part of its activities to non-exempt private purposes, private benefit, retaliation, or institutional reputation management masquerading as public education. If CharityWatch used charitable resources to publish a defamatory, retaliatory article that falsely implied I was part of a paid smear campaign, then appended a donor solicitation to that same publication, regulators may examine whether charitable assets were used for a legitimate exempt educational purpose or for a private reputational campaign. The IRS may review such conduct under the operational test, private-benefit doctrine, and excess-benefit rules, including I.R.C. §§ 501(c)(3) and 4958, while state charity regulators may examine whether donor-facing communications were misleading, whether charitable assets were misapplied, and whether officers or directors breached fiduciary duties by approving or allowing tax-exempt resources to be used for false, retaliatory, or donation-driven attacks.
Your demise is but a few good-faith reports away:
eoclass@irs.gov
Attorney_General@ilag.gov
Illinois.icactip@ilag.gov
Organization: CharityWatch
EIN: 33-0491030
Principal Officer: Laurie Styron
Website:
https://www.charitywatch.org
If you refuse to retract, I will be more than willing to take the truth directly to the IRS, state Attorneys General, charity regulators, donors, journalists, watchdog critics, and the public. I will use documents, filings, screenshots, quotes, timelines, public records, and CharityWatch’s own words to expose what happened here.
I will not need to embellish. The truth is enough.
CharityWatch published a piece implying that I was part of a paid smear campaign without evidence that I was ever paid. CharityWatch inserted me into a narrative involving donor misuse, an FBI investigation, and an alleged kidnapping plot without proof that I had anything to do with any of it. CharityWatch then used the same article to solicit donations.
That is the story.
And if you do not correct it, I intend to report it aggressively, repeatedly, and publicly.
Accordingly, I demand that CharityWatch immediately:
1. Retract any statement, headline, subheadline, paragraph, implication, or insinuation suggesting that I was paid by Leo Grillo, D.E.L.T.A. Rescue, Living Earth Productions, Animals Are People Too, Frank Parlato, or anyone connected to them;
2. Retract any statement, implication, or insinuation suggesting that I participated in a paid smear campaign against CharityWatch, Laurie Styron, Adriana Duarte, or anyone else;
3. Publish a clear correction stating that CharityWatch has no evidence that I received any payment from Grillo, D.E.L.T.A. Rescue, Living Earth Productions, Animals Are People Too, Frank Parlato, or any related entity;
4. Remove or revise the article so it no longer falsely links me to alleged donor-funded retaliation, alleged misuse of charitable funds, the FBI investigation, or the alleged kidnapping plot;
5. Preserve all documents and electronically stored information relating to the article, including drafts, edits, notes, emails, text messages, Signal messages, direct messages, source communications, payment records, internal communications, donor communications, legal review materials, board communications, contractor communications, and communications involving Laurie Styron, CharityWatch staff, board members, contractors, attorneys, donors, sources, and third parties.
Treat this letter as a formal litigation-hold notice. Do not delete, destroy, alter, overwrite, conceal, “clean up,” or fail to preserve any relevant evidence. Any spoliation will be treated accordingly and pursued to the fullest extent permitted by law.
You have 72 hours to confirm in writing that CharityWatch will retract and correct the article.
If you refuse, ignore this demand, or attempt to double down, I will consider all legal remedies. I will also consider filing formal complaints with the Internal Revenue Service and state charitable regulators, and I will pursue a public-interest reporting campaign concerning CharityWatch’s conduct, governance, fundraising practices, and use of charitable status to attack critics.
You chose to publish without proof.
You chose to imply facts you could not establish.
You chose to put my name into a narrative involving paid smears, donor misuse, an FBI investigation, and an alleged kidnapping plot.
Now you can choose to correct the record. If you don’t, things will not end well for you.
Nothing in this letter waives any rights, claims, remedies, privileges, or defenses. I expressly reserve all of them.
Govern yourselves accordingly.
Richard Luthmann
Writer, Journalist, and Commentator
Tips or Story Ideas:
(239) 631-5957
richard.luthmann@protonmail.com
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“I’ll give her until Tuesday to respond, and then I’ll unleash unholy hell on her, her sham charity, and her board members,” Luthmann said. “It will be easy because, as we well know: ‘The truth is like a lion. Once released, it will defend itself.’ These lightweights will be dismantled by the truth by Memorial Day.”
Luthmann confirmed that reports on Styron, CharityWatch, and its board members are already being prepared.
“See you next Tuesday, Laurie,” Luthmann said.
CharityWatch Loses: The Watchdog Should Get Watched
The IRS does not need a jury verdict to ask questions. Regulators can examine whether a charity used assets for exempt purposes, private purposes, or something else. They can examine whether donor-facing content misled readers, and whether officers or directors allowed charitable resources to support a reputational campaign.
The IRS also has intermediate sanctions rules. IRC Section 4958 can impose excise taxes on excess benefit transactions involving applicable tax-exempt organizations and disqualified persons. Managers may also face excise tax exposure in certain circumstances, and the organzation may face revocation of tax-exempt status.
That means CharityWatch has automatically opened the door for scrutiny.
The record is simple. CharityWatch published an article that alleged payments to Parlato. It admitted it lacked direct evidence proving the purpose of those payments. It inserted Luthmann into the story without evidence of payment. It linked the whole thing to donor misuse, FBI allegations, and an alleged kidnapping plot. Then it asked readers for money.
That is the file. The remedy (at least until Tuesday) is also simple: retract the false implication, correct the record, and admit CharityWatch has no evidence that Richard Luthmann was paid by Grillo, D.E.L.T.A. Rescue, Living Earth Productions, Animals Are People Too, or anyone connected to them.
If CharityWatch refuses, the next audience may not be its donors. It may be the IRS, the Illinois Attorney General, state charity regulators, and the press.
The watchdog wanted a fight over truth. Now it gets one.
