National Rifle Association. Photo: Luke Sharrett/Bloomberg

The New York Department of Financial Services on Wednesday accused the National Rifle Association of violating state insurance laws, claiming the gun-rights advocacy group has received more than $1.8 million through its participation in insurance programs since 2000.

The action is the latest event in a long-running dispute between New York State officials and the gun rights advocacy group.

The NRA is accused of misleading marketing practices and acting as an insurance producer without a license, according to the DFS statement of charges. The group may owe civil penalties as high as $14 million, according to DFS.

In return for endorsing and marketing insurance programs to its members, the NRA received "royalties" that sometimes totaled more than 20% of its members' insurance premiums, according to the statement of charges.

Those royalty costs were passed on to NRA members, DFS claimed, so advertising language about the NRA obtaining the "lowest possible cost" was also deceptive.

"DFS alleges that the NRA misrepresented that the insurance offerings to its members was at the lowest cost possible, when in fact the NRA was taking for itself substantial royalties, sometimes more than 20 percent of the premiums paid," DFS said in a press release announcing the charges.

The lead attorney for the NRA said his group was the victim of political targeting.

William Brewer III, counsel to the NRA and managing partner of Brewer, Attorneys & Counselors, said the NRA has done nothing wrong and is, in fact, being targeted for political reasons to "weaken gun-rights advocacy in New York."

According to DFS, the NRA also deceptively offered an insurance program to concealed carry permit holders that claimed to cover criminal defense costs and other expenses associated with intentional use of the firearm. That's not a circumstance that New York insurance products can legally cover, according to DFS.

Brewer defended the group's actions in a statement Thursday.

"The NRA acted appropriately at all times," he said. "The NRA did not underwrite, sell, or administer any insurance programs, period."

The NRA acted like "countless other affinity groups" by relying on insurance experts to market products for its members, Brewer said.

"None of those other groups have been targeted by DFS — because this announcement is about politics, not protecting consumers," Brewer said.

In a statement, a DFS spokeswoman emphasized that the charges will be adjudicated impartially.

"These charges were investigated over the course of two DFS administrations by experienced former federal prosecutors and will be adjudicated on the merits through an impartial and balanced process," the statement said.

DFS scheduled a hearing in Manhattan for April 6. The agency has already reached settlements with several insurance companies named in the statement of charges, which resulted in millions of dollars in civil penalties, according to DFS.

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