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Politics: Turmoil at influential Koch-backed right-wing advocacy group Americans for Prosperity

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One of the United States' most influential right-wing political advocacy groups, Americans for Prosperity, is in turmoil after its soon-to-be departed leader was caught in the middle of an alleged affair at the same time it deals with an exodus of donors and board members, as well as the repercussions from a gender discrimination lawsuit, a new report found.

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Earlier this week, the group's longtime president Tim Phillips announced his resignation due to what he called "challenging personal matters" — though subsequent reporting from several outlets pinned the reason as an extramarital affair with a Republican official that one AFP insider told CNBC "was a matter of integrity that violated our principles."

Phillips said in a statement first reported by the Washington Examiner: "This morning, I announced my resignation as president of Americans for Prosperity in order to focus on some challenging personal matters that require my full attention. It is difficult to leave this organization, but doing so now is in everyone's best interest."

AFP is the powerful Virginia-based libertarian advocacy organization backed by the industrialist Charles Koch and his late brother David, which has more than three million volunteers spread across the country.

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Phillips' departure comes on the heels of three other high-profile resignations late last year from the group's previous six-member board — which leaves just two members left to helm AFP through a crucial midterm election year: Chairman Mark Holden and the group's CEO, Emily Seidel, who also holds a seat on the board, according to the group's required 990 tax disclosures.

A spokesperson for AFP, Bill Riggs, downplayed any lingering turbulence from the leadership exodus.

"AFP has grown into a world-class organization with hundreds of staff across 35 state chapters with more donors and more resources than we've ever had before. In 2020, AFP and AFP Action engaged in – and won – more races than ever before, and we fully expect to exceed those numbers in 2022," he said in a statement to CNBC.

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Indeed, though a number of notable Republican donors have backed away from the group as it attempted to readjust its messaging during the Trump years, it doesn't seem to have affected AFP's bottom line. Tax forms show $64 million in revenue in 2020 — an increase from the $54 million in cash it managed to raise in 2019. Like most similar 501(c)(4) political advocacy groups, AFP does not disclose the names of its donors or the amounts of individual donations.

Despite its ability to stay flush with cash, there have been other challenges for the libertarian group — CNBC also uncovered a recent settlement in a lawsuit filed by a female employee in the group's North Carolina Branch, after she was allegedly passed over for a promotion and fired by a man who she claimed was clearly less qualified for the role. The former AFP official, Anna Beavon Gravely, sued the group last year for gender discrimination, retaliation and wrongful discharge.

A spokesperson for AFP told the network: "We reached an amicable resolution in each matter. AFP is committed to a respectful, rewarding, and inclusive work environment."

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Gravely's lawsuit also mentioned a separate class-action workplace discrimination case against AFP, though details of that suit were not immediately apparent.

More on the Koch brothers' political advocacy:

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  • Conservative groups are writing GOP voter suppression bills — and spending millions to pass them

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